Dubai International Academic City in 2026: Universities, Education Operators and the New Federal Higher Education Law

Dubai International Academic City (DIAC) is the business park of the education cluster inside the Dubai Development Authority free zone, licensing universities, branch campuses of foreign universities, schools, nurseries and education service companies. From 1 January 2026 the regime for free zone universities has been rebuilt: Federal Decree-Law No. 31 of 2025 on Higher Education and Scientific Research applies expressly to “universities, institutes, and colleges established in the free zones”, requires federal Institutional Licensure and subjects every programme to federal Program Accreditation. A DIAC licence costs AED 15,000 a year for any of the five segments, and the minimum paid-up capital across all five is AED 50,000 — five times the zone’s standard AED 10,000.

Important. Article 14(2) of Federal Decree-Law No. 31 of 2025 reverses the order of operations: a free zone higher education institution must first obtain a Local Permit from the Competent Local Authority (in Dubai, KHDA) and only then apply for federal Institutional Licensure. KHDA’s published Local Quality Assurance route describes the opposite sequence — MOHESR licensure and a CAA letter first, the KHDA permit afterwards. The published texts do not reconcile this, and until they do, article 14(2) prevails as the provision of a federal decree-law.

Key parameters of DIAC in 2026

The table below collects the figures needed to plan an education project in DIAC. Each value is cited to the specific provision or official source that sets it.

Parameter	Value	Source
Zone regulator	Dubai Development Authority (DDA)	DIAC FAQ; Dubai Law No. 15 of 2014
Number of DIAC licence segments	5 (22.1–22.5)	Part Seven, DDA Decision No. 1 of 2021
Number of activities across all DIAC segments	19	Part Seven, DDA Decision No. 1 of 2021
Annual licence fee, any DIAC segment	AED 15,000	Art. 14, DDA Decision No. 1 of 2021
Activities included in the licence	1 for segments 22.1, 22.2, 22.4 and 22.5; 2 for segment 22.3	Art. 14, DDA Decision No. 1 of 2021
Minimum paid-up capital, all five segments	AED 50,000	Art. 15, DDA Decision No. 1 of 2021
Default minimum paid-up capital in the zone	AED 10,000	Art. 15.1, DDA Decision No. 1 of 2021
Additional segment on the licence	+AED 10,000 a year	Art. 10.1, DDA Decision No. 1 of 2021
Deposit or bank guarantee for DIAC	None required	Art. 3.7, DDA Decision No. 1 of 2021 (segment 21.12 only)
Freelancer permit in DIAC	None exists	Art. 9.1, DDA Decision No. 1 of 2021
Company registration time	7 working days (4 + 3)	DIAC FAQ
Licence validity	1 year, renewed annually	DIAC FAQ
Visa quota	1 employee per 80 sq ft of leased space	DIAC FAQ
Federal Institutional Licensure for a university	Mandatory	Arts. 6(1) and 14(1), FDL No. 31 of 2025
Regu­lari­sation deadline for existing institutions	by 1 January 2027	Art. 25, FDL No. 31 of 2025
Criminal penalty for operating without Institutional Licensure	AED 100,000 to AED 10,000,000 and/or up to 1 year’s imprisonment	Art. 22(1), FDL No. 31 of 2025
VAT on tuition at a private free zone university	5% (zero-rating unavailable)	Art. 40(1)(c), VAT Executive Regulation
Corporate tax	9% above AED 375,000; QFZP status effectively unattainable	FDL No. 47 of 2022; Cabinet Decision No. 100 of 2023
Students in DIAC	28,000+	DIAC website, About Us
Programmes in DIAC	500+	DIAC website, About Us
Established	2007	DIAC website, About Us

What DIAC is in legal terms: zone, cluster and business park

Dubai International Academic City is not a free zone in its own right. It is one business park inside the single zone created by Dubai emirate legislation and administered by the Dubai Development Authority. The distinction is not cosmetic: it determines which instrument sets the fees, which body issues the licence and which company law rules apply.

Article 1.1 of DDA Decision No. 1 of 2021 defines “BU” as “the business parks located within the Zone which includes DMC, DIC, DKP, DOC, DSC, DSP, DPC, DIAC, ET and D3”, and “Cluster” as “the different sectors within the Zone in which businesses share the same or a related product or service which includes Science, Media, ICT, Design and Education”. DIAC is the business park of the education cluster.

The zone’s legislative chain

Instrument	Date of issue	What it did
Dubai Law No. 1 of 2000	31 January 2000	Created the zone; repealed by article 31(a) of Law No. 15 of 2014, though decisions made under it survive by virtue of article 31(b)
Dubai Law No. 15 of 2014	27 October 2014	The operative law of the zone and its authority
Dubai Law No. 10 of 2018	19 September 2018	Blanket substitution of names: DCCA → DDA, “Creative Clusters” → “Clusters”, “Creative Products” → “Products”; renamed the statute itself the Law of the Dubai Development Authority No. 15 of 2014
Dubai Law No. 8 of 2023	6 February 2023	Replaced article 3 of Law No. 15 of 2014 in full; Official Gazette No. 603; status “In Force”
Dubai Law No. 15 of 2016	1 November 2016	The promulgation rule: free zone authority legislation is published free of charge on the authority’s own website and becomes binding 30 days after publication unless it provides otherwise

Dubai Law No. 8 of 2023 is the missing link in most published chains. The DDA’s own legislation index omits it; the chain should be checked against the Dubai Supreme Legislation Committee portal instead.

The zone’s subordinate instruments that apply to DIAC

•          DDA Decision No. 1 of 2021 (Licensing Categories 2021) — 136 pages, setting the segments, activities, annual fees, minimum capital and special restrictions. The document carries no date on its face, so its binding force is fixed by article 5 of Dubai Law No. 15 of 2016 — 30 days after publication on the authority’s website.

•          Dubai Creative Clusters Private Companies Regulations 2016 (PCR) — the zone’s corporate law: FZ-LLC, branch, continuation of incorporation.

•          DTMFZ Licensing Regulations 2003 — the licensing procedure; regulation 3.2 delegates publication of licence categories to the Director General, regulation 31 confers the general power to make implementing regulations — the power under which Schedule 4’s fines are issued — and regulation 10 is the power to suspend, cancel or revoke a licence.

•          DDA Decision No. 3 of 2017 — the registrar’s corporate services tariff.

Note. Decision No. 1 of 2021 still calls the regulator the “Dubai Creative Clusters Authority”, a name substituted by Law No. 10 of 2018. That does not deprive the document of force, but any citation should use the current name, the Dubai Development Authority.

Who issues the licence, and what it does not replace

Article 2.1 of Decision No. 1 of 2021: “Licences are issued by the Authority for each of DIC, DMC, DKP, DIAC, DPC, DOC, DSC, DSP and D3 for their respective licence segments.” Article 2.15 adds the decisive limitation: the issuance of a licence by the Authority does not exempt the licensee from having to obtain any other permit, licence or approval from such other regulators as required by Dubai or UAE law.

For an education project that provision is the whole point. A DIAC licence is permission to carry on business in the zone. The right to teach, to recruit students and to award qualifications comes from other bodies: KHDA at emirate level and the Ministry of Higher Education and Scientific Research at federal level.

If you are comparing DIAC with the other districts of the same zone, the analysis of Dubai Knowledge Park, the district for HR, training and professional development is a useful counterpoint: identical corporate machinery, a different segment list and a different regulatory gateway.

Three regulatory layers in DIAC: who is responsible for what

An education project in DIAC is governed by three independent layers, and clearance at one layer does not substitute for the other two. Conflating them is the single biggest source of error in timeline and budget planning.

Layer	Authority	What it issues	Legal basis
Zone	Dubai Development Authority	The commercial licence for a 22.x segment, company registration, visa quota, premises	Dubai Law No. 15 of 2014; DDA Decision No. 1 of 2021; PCR 2016
Emirate	Knowledge and Human Development Authority (KHDA)	Academic Autho­risa­tion, Local Permit, registration of each programme, advertising approval, attestation of qua­lifica­tions	Dubai Law No. 2 of 2021; Executive Council Resolution No. 21 of 2011; art. 5 of DDA Decision No. 1 of 2021
Federal	Ministry of Higher Education and Scientific Research (MOHESR) and the Commission for Academic Accreditation	Institutional Licensure and Program Accreditation	FDL No. 31 of 2025, articles 6, 10 and 14

The zone layer: a licence is not a right to teach

A DDA licence fixes what a company may do inside the zone, what its minimum capital is and how many visas it may hold. It confers no right to recruit students or award degrees. Article 5 of Decision No. 1 of 2021 makes the issue of a licence in the teaching segments — 22.1, 22.3, 22.4 and 22.5 — conditional on KHDA approval, leaving only 22.2 outside the gate — the zone layer itself defers to the emirate layer.

The emirate layer: KHDA as the Competent Local Authority

Dubai Law No. 2 of 2021 on KHDA repealed Dubai Law No. 30 of 2006, and its article 3(a)(2) extends KHDA’s remit to institutions licensed “including in Special Development Zones and free zones”. That is why KHDA regulates DIAC even though DIAC sits inside a free zone.

Federal Decree-Law No. 31 of 2025 never names KHDA. It uses the term “Competent Local Authority” — “the local government authority concerned with higher education and scientific research affairs, and with technical and vocational education and training affairs, in any Emirate of the State”. In Dubai that authority is KHDA.

The federal layer: MOHESR and the CAA

Until 2026 the federal layer was largely optional for universities in Dubai’s free zones: an institution could take KHDA’s quality assurance through UQAIB, or be licensed and accredited by the CAA. From 1 January 2026 that alternative is closed — the section on Federal Decree-Law No. 31 of 2025 sets out why.

What this means for planning

None of the three layers can be cleared in parallel and in isolation. A zone licence in segment 22.1 is not issued without initial KHDA Academic Authorisation approval (article 5.3 of Decision No. 1 of 2021). Federal Institutional Licensure is not granted without a Local Permit (article 14(2) of FDL No. 31 of 2025). And the Local Permit, on KHDA’s published route, requires a copy of the free zone commercial licence and the premises lease at phase 3 — that is, zone registration.

The result is a circular dependency, resolved in practice in stages: preliminary KHDA approval → company registration and lease in DIAC → issue of the commercial licence → completion of the KHDA phases → federal Institutional Licensure → Program Accreditation. The step-by-step sequence appears later in this article.

By contrast, private schools sit almost entirely within emirate regulation, and the chain is shorter. That regime is analysed in the companion piece on private school licensing in the UAE: KHDA in Dubai and ADEK in Abu Dhabi.

Federal Decree-Law No. 31 of 2025: what changed on 1 January 2026

Federal Decree-Law No. 31 of 2025 on Higher Education and Scientific Research was issued on 1 October 2025, published in Official Gazette No. 809 of 14 October 2025, and entered into force on 1 January 2026. Its article 29(1) repealed Federal Decree-Law No. 48 of 2021 on Higher Education together with any conflicting provision. The federal legislation portal records its status as “Active”.

The date of issue and the date of entry into force are three months apart, and official publication falls two weeks after issue. For compliance planning the operative date is 1 January 2026.

Free zones written into the definition

Article 1 defines Higher Education Institutions as “public and private educational institutions that provide Higher Education programs in the State, including universities, colleges, higher education institutes, specialized universities such as police, military, and maritime universities, as well as branches of international universities, and universities, institutes, and colleges established in the free zones”.

Article 3(1) fixes the scope: the Decree-Law applies to all higher education institutions and technical and vocational education and training (TVET) institutions in the State, “including all types of free zones”. Article 3(2) reserves to the Cabinet a power to exempt a particular institution from some or all provisions — there is no blanket free zone exemption in the text.

Five national frameworks

Article 5(1) requires the Cabinet to issue five regulatory frameworks: the National Framework for the Licensure of Higher Education Institutions; the National Qualifications Framework; the National Framework for Classification, Performance Quality and Oversight; the National Framework for Scientific Research; and the National Framework for Technical and Vocational Education and Training. Article 5(2) allows Competent Local Authorities to issue their own local frameworks provided they do not conflict with the national ones and include the standards, conditions, indicators and procedures required federally.

Two prohibitions to read before signing a lease

Article 6(1): it is prohibited to establish or operate any higher education institution, to offer higher education programs or services in the State, or to promote or advertise its programs and services, unless Institutional Licensure has been obtained.

Article 10(1): a higher education institution is prohibited from offering any academic program, or promoting or advertising it, or admitting students to it, or commencing study in it, before obtaining Program Accreditation.Article 10(2) makes Institutional Licensure a prerequisite for even beginning the Program Accreditation procedures.

Note the reach of both prohibitions: they bite not only on teaching but on advertising and marketing. Launching an admissions landing page before accreditation is, on the face of the text, an offence.

Sanctions: criminal and administrative

Article 22(1) imposes imprisonment for a term not exceeding one year and a fine of not less than AED 100,000 and not exceeding AED 10,000,000, or by either of these two penalties, for: establishing or operating a higher education institution, or providing higher education programs and services for the purpose of awarding a qualification, or promoting or advertising its services, before obtaining Institutional Licensure; providing, promoting, advertising, admitting students to or commencing any academic or professional program without Program Accreditation; and advertising the granting of certificates before the requirements are met and the necessary licences obtained.

The administrative layer is kept separate. Article 20(1) requires the Cabinet to issue the Regulation of Violations, Penalties and Administrative Measures applied by the Ministry. Article 20(2) states expressly that higher education institutions in free zones, TVET institutions and training centres are subject to the penalties and administrative measures under the applicable local legislation of the Emirate.

The practical consequence is that a DIAC university faces criminal liability under the federal provision and administrative liability under Dubai legislation applied by KHDA. Article 14(7) confirms the same split.

Challenging a decision

Article 21(1): a written grievance against decisions, procedures, penalties or measures of the Ministry must be filed within 60 days of the applicant becoming aware of them. Article 21(2): a Grievance Committee within the Ministry decides within 60 days, and its decision is final. Article 21(3): no action is admissible before the courts until the grievance has been submitted and decided, or the prescribed period for deciding it has elapsed. Article 21(4) refers challenges to decisions of the Competent Local Authority to the Emirate’s local legislation.

Article 14: how a free zone university is admitted now

Article 14 of Federal Decree-Law No. 31 of 2025 is the central provision for DIAC. Its eight clauses redefine the relationship between the federal ministry and KHDA.

Art. 14	Content	Practical effect
14(1)	Higher education institutions established in the free zones must obtain Institutional Licensure to carry out their activities	Federal licensure is no longer optional
14(2)	Such institutions must obtain a Local Permit from the Competent Local Authority before applying for Institutional Licensure	KHDA becomes the mandatory first step, not an alternative
14(3)	The Ministry grants Institutional Licensure to an institution holding a Local Permit without repeating procedures and without additional fees	The key concession: the federal stage does not duplicate the emirate stage
14(4)	The institution supplies the Ministry with information and data under a mechanism set by Minister’s resolution after coordination with the local authorities	Federal reporting is introduced
14(5)	All academic programs of free zone institutions are subject to the Program Accreditation standards and mechanisms approved by the Ministry	Programmes are no longer accredited solely on the home-campus validation model
14(6)	The Ministry and the local authorities may coordinate oversight and inspection	Joint inspections become possible
14(7)	Penalties and admi­nistra­tive measures on free zone institutions are imposed by the Competent Local Authority under the Emirate’s local legi­slatio­n; the Ministry may notify it of violations	Admi­nistra­tive enforcement stays with KHDA
14(8)	Local authorities may issue local frameworks on Local Permits, evaluation, oversight, quality and research, provided they do not conflict with the national frameworks	KHDA keeps a rule-making role inside federal standards

What actually changed against the old model

Before 2026, KHDA’s published position described two alternative routes. The “Responsibilities of higher-education institutions” page (last updated 18 October 2022) says in terms: “Branch campuses of international universities may choose to come under the University Quality Assurance International Board (UQAIB) quality assurance scheme or they may choose to be licensed and accredited by the Commission for Academic Accreditation (CAA). All other private higher-education institutions in a Free Zone must be licensed and accredited by the CAA.”

Article 14 converts the alternative into a sequence. A Local Permit (clause 2), Institutional Licensure (clause 1) and federal Program Accreditation (clause 5) are now all required. Nothing in the text supports remaining under UQAIB alone.

Note the compensating provision. Clause 14(3) expressly rules out repeating the procedures and paying additional fees for Institutional Licensure where a Local Permit has already been obtained. The law adds a mandatory federal stage while stipulating that the stage is not to become a second full review and a second bill.

The regularisation deadline

Article 25: higher education institutions and TVET institutions in existence before the Decree-Law entered into force must regularise their status within one year of entry into force — that is, by 1 January 2027. That period may be extended for similar periods by decision of the Minister in coordination with the Competent Local Authorities.

For an operating DIAC campus this is the only hard calendar date in the statute. A new project gets no runway at all: the prohibitions in articles 6(1) and 10(1) have applied since 1 January 2026 with no transitional relief.

What happens on revocation

Article 7(3) gives an institution a further 90 days after Institutional Licensure expires to supply the data needed for the renewal evaluation, on acceptable justification. Article 7(4): if the data is not supplied within that period the Institutional Licensure is revoked, and “any permit issued by the Competent Local Authority shall be deemed cancelled upon the revocation of the Institutional Licensure.”

The linkage runs one way: revoking the federal licence extinguishes the Local Permit automatically. The statute creates no automatic reverse effect — article 9(2) merely requires the Ministry to coordinate with the local authority before revoking.

Article 9(1) lists the revocation grounds: carrying out an activity for which the institution is not licensed; obtaining licensure through forged documents or incorrect data; remaining closed for more than three consecutive months without an excuse acceptable to the Ministry; failing to commence operations within one year of issuance without an acceptable excuse; and any other case specified in the National Framework for Licensure.

Article 8: Institutional Licensure may not be transferred or assigned without the Ministry’s approval, and where a Local Permit exists the local authority’s prior approval must be obtained before the Ministry’s approval is sought.

KHDA and UQAIB: the emirate layer, and the contradiction inside it

The University Quality Assurance International Board (UQAIB) is the body established by KHDA to assure the quality of higher education in Dubai’s free zones. UQAIB applies a validation model: it verifies that the academic programme delivered in Dubai is the same accredited programme taught at the institution’s home campus.

On KHDA’s account, UQAIB is a full member of the International Network for Quality Assurance Agencies in Higher Education (INQAAHE) and abides by the INQAAHE Guidelines for Good Practice and the 2005 OECD/UNESCO Guidelines for Quality Provision in Cross-border Higher Education.

The contradiction inside KHDA’s own site

Two KHDA pages describe the mandatory reach of UQAIB differently, and the difference is substantive rather than editorial.

KHDA page	Last updated	What it says
“Quality assurance in the free zones of Dubai”	6 September 2024	“All higher education institutions located in Dubai’s Free zones must undergo the UQAIB quality assurance process”
“Respo­nsibi­lities of highe­r-edu­cation institutions”	18 October 2022	“Branch campuses of international universities may choose UQAIB or may choose to be licensed and accredited by the CAA. All other private highe­r-edu­cation institutions in a Free Zone must be licensed and accredited by the CAA”

Resolving the conflict. The later page (2024) makes UQAIB mandatory for all. The earlier page (2022) describes a choice available to branch campuses. Both predate Federal Decree-Law No. 31 of 2025 and are overtaken from 1 January 2026 by article 14, which makes the routes cumulative rather than alternative. For 2026 planning, assume that a KHDA Local Permit, federal Institutional Licensure and federal Program Accreditation are all required.

One further point: the link to the UQAIB Manual on KHDA’s “Quality assurance in the free zones of Dubai” page does not work — the address returns an error page rather than a PDF. The current edition of the UQAIB manual could not be confirmed from a primary source, so no specific UQAIB standard is quoted in this article.

What KHDA requires beyond the permit

The “Responsibilities of higher-education institutions” page sets out four free-standing duties:

1.        Registration of every programme. “All programmes offered by academic institutions in the Free Zones of Dubai require approval and registration by KHDA. Programmes and institutions are listed on the KHDA website and made available to the general public.”

2.        A prohibition on advertising and recruiting before approval. “An academic institution may not advertise or recruit students into an academic programme without obtaining KHDA approval and registration.” The same prohibition is duplicated federally by article 10(1) of FDL No. 31 of 2025 and at zone level by article 5.6 of DDA Decision No. 1 of 2021.

3.        Attestation of qualifications. Executive Council Resolution No. 21 of 2011 allows KHDA to attest academic qualifications. Since April 2007 this has applied to all academic programmes registered with KHDA and appearing on the institution’s Academic Authorisation. The attestation fee is AED 200.

4.        Prior approval of marketing material. A higher education provider in the free zones must hold written KHDA approval before using any advertising or marketing material.

KHDA’s two permit routes

KHDA’s published “Permits for Higher Education Institutions” guidance describes two separate routes, each of three phases.

International Quality Assurance — the branch campus route. Phase 1 requires, among other things: a description of the home Higher Education Provider and of the branch; their legal status and legal relationship; confirmation from the home institution that the branch programmes are identical and that students have access to similar learning resources; a letter from the home institution confirming that its own external quality assurance agency will quality assure all academic programmes at the branch; a letter from that agency confirming the same; a responsibility matrix for the investor; all agreements between the investor and the home institution; five-year financial projections with profit and loss and cash flow statements; a letter confirming adequate funds for capital and operating expenditure; evidence of financial capacity to teach out students if a programme closes; a student grievance policy; and the home institution’s accreditation status. Phase 2 adds partner agreements, the home institution’s most recent independent quality assurance report, a letter from its quality assurance agency confirming it has been formally advised of the full extent of the branch’s activities, and the home institution’s Guarantee under Appendix E. Phase 3 is corporate and property documentation: a board resolution, a copy of the commercial licence from the free zone licensing body, the licence of the Academic Infrastructure Provider or investor, a copy of the premises lease from the free zone, a signed Certificate of Authorisation from the Academic Head, a certificate of fitness for any in-house medical clinic, a completion certificate from Dubai Municipality or the free zone, and KHDA Undertakings for the Academic Head and the investors.

Local Quality Assurance — the route for an institution with no home campus. Phase 1 repeats the financial requirements and adds “submission documents to the Commission for Academic Accreditation under the Ministry of Higher Education and Scientific Research”. Phase 2 requires a copy of MOHESR licensure. Phase 3 requires, alongside the commercial licence and the lease, “for all offered programmes a copy of the Initial accreditation approval letter from CAA”.

This is where the second contradiction sits. The published Local Quality Assurance route places federal MOHESR licensure and the CAA letter before the KHDA permit is issued. Article 14(2) of FDL No. 31 of 2025 requires the opposite — the Local Permit before the application for Institutional Licensure. KHDA’s pages date from before the Decree-Law and have not been re-sequenced. The federal decree-law prevails; until updated KHDA guidance appears, the practical order should be agreed in writing with both regulators.

The five DIAC segments and what each one permits

Part Seven of DDA Decision No. 1 of 2021 gives DIAC five licence segments covering nineteen activities. The segment fixes the annual fee and how many activities the licence covers; the activity fixes what the company may actually do.

Segment	Name	Activities in the segment	Included in the licence	Annual fee
22.1	Higher Education Provider	4	1	AED 15,000
22.2	Non-Academic Services Provider	3	1	AED 15,000
22.3	Educational Support Services	7	2	AED 15,000
22.4	School	4	1	AED 15,000
22.5	Early Learning Centre (Nursery)	1	1	AED 15,000

Segment 22.1 — Higher Education Provider

Four activities, and the licence covers only one of them:

•          22.1.1 University (MOHE Licensed and Accredited) — “a university licensed and accredited by the UAE Ministry of Higher Education and Scientific Research and authorised by the Knowledge and Human Development Authority in the UAE”.

•          22.1.2 Branch University — “a branch of a university accredited and licensed as a university in its home jurisdiction and authorised by the KHDA”.

•          22.1.3 Junior College — “Junior Colleges or Community Colleges are institutions providing higher education and lower-level tertiary education, granting certificates, diplomas, and associate’s degrees”.

•          22.1.4 Career Technical Educational Provider — “a Technical Educational Provider providing post-secondary credit bearing courses in a specialized field or technical area and authorised by the KHDA”.

A consequence that is routinely missed: a university that wants to run bachelor’s degrees as a University and also award associate’s degrees as a Junior College cannot do both on one segment 22.1 licence. Article 10.4 allows further activities within a paid segment at no extra fee, but only up to the article 14 limit — and for 22.1 that limit is one. Article 10.5 offers the way out: the Authority may, at its discretion and on the licensee’s application, increase the number of activities permitted under a segment. The text guarantees nothing.

Note too how activities 22.1.1 and 22.1.2 are drafted: both already build in the requirement of KHDA authorisation, and 22.1.1 adds federal licensing and accreditation. A 2021 zone instrument thus writes the federal and emirate gateways into the definition of the activity itself.

Segment 22.2 — Non-Academic Services Provider

•          22.2.1 Education Technology Implementation Services — organisations enhancing the delivery of learning capabilities and the administration of schools and other educational organisations through technological learning solutions.

•          22.2.2 Sports – Shared Facilities Management — management and coaching services for sporting activities inside the Zone; management covers renting facilities and organising sports activities, coaching covers coaching sports trainers and coaches. Express carve-out: “does not include Gymnasiums, Health Clubs and Yoga”.

•          22.2.3 University Dormitory – Student Accommodation — investment and management services to accommodation facilities inside the DIAC community.

Segment 22.2 is the only DIAC segment for which article 5 of Decision No. 1 of 2021 imposes no KHDA gateway.The general duty in article 2.12 to obtain the necessary approvals still applies, but there is no specific pre-condition to the issue of the licence.

Segment 22.3 — Educational Support Services

Seven activities, and the licence covers two — the only DIAC segment with a limit above one:

•          22.3.1 Educational Consultancies — advice to education providers. Scope: curriculum development; professional development workshops for teachers and administrators; assessment systems; performance management and leadership development; management information systems for education providers; establishing and expanding education providers; strategic planning; financial management in education.

•          22.3.2 University Placement Services — student recruitment for universities outside and inside the UAE. Scope: student counselling; admission paperwork; travel, visa and accommodation paperwork.

•          22.3.3 Academic Representative Services — “a representative office established in Dubai by any academic institution to facilitate academic exchange programs with its local counterparts, or market programs of the parent university”.

•          22.3.4 Educational Management Services — administering the affairs of educational institutions under their governance, or providing infrastructural support to early learning centres, schools, training institutions and higher education providers.

•          22.3.5 Examination Preparation — preparing candidates for standardised and entrance examinations and conducting tests in association with a global or regional testing body. Express carve-out: “does not include GED, NIOS and curricula offered at schools approved in the UAE”. Examples given: SAT, TIMMS, TOEFL, ICDL, IELTS, GRE, GMAT.

•          22.3.6 Students Support Services — support for elementary, middle, secondary, post-secondary and university-level students.

•          22.3.7 Testing Centre — standardised tests and entrance examinations in association with a global or regional testing body.

Segments 22.4 and 22.5 — schools and nurseries

22.4 School is described as “a school operation of an existing accredited school from an approved country or one following the IB System of Education”, and covers four activities: 22.4.1 KG; 22.4.2 Primary (grades 1–6); 22.4.3 Preparatory (grades 7–9); 22.4.4 Secondary (grades 9–12 or 13, where such schools “must be accredited by or have authorisation from a recognised international accreditation organisation for Grade 9 and above”).

22.5 Early Learning Centre (Nursery) — care and welfare of the child including language development and creative skills. A single activity.

Note how segment 22.4 is framed: DIAC does not license the creation of a school from scratch but the operation of an existing accredited school from an approved country, or an IB school. That narrows the field of applicants before KHDA is even approached.

What a DIAC licence costs and what capital is required

The annual licence fee in DIAC is AED 15,000 for any of the five segments. What differs between segments is not price but how many activities the licence covers: two for Educational Support Services and one for the other four.

The minimum paid-up capital for all five DIAC segments is AED 50,000. That is set by article 15 of DDA Decision No. 1 of 2021 and is five times the zone-wide standard in article 15.1.

Article 15.1 puts it this way: “Subject to certain minimum paid up capital amounts set out below for specific segments and activities, for all other activities and for the purposes of Regulation 25.1 of the PCR, the minimum paid up capital of an FZ-LLC shall be AED 10,000.” A table of uplifted requirements by business park follows — and all five DIAC rows read AED 50,000.

What that means in practice

Item	DIAC	Zone standard
Minimum paid-up capital	AED 50,000	AED 10,000
Annual segment fee	AED 15,000	AED 15,000 for standard segments
Additional segment	+AED 10,000 a year	+AED 10,000 a year
Additional activity inside a paid segment	Free, within the article 14 limit	Free, within the article 14 limit
Deposit or bank guarantee	Not required	AED 100,000 for Executive Search (segment 21.12) only
Freelancer permit	None exists	AED 7,500 a year in segments 16.5, 18.9, 21.13 and 25.10

The rules on adding segments and activities

Article 10.1: with the Authority’s prior approval a licensee may add an additional segment to its current licence for an additional annual licence fee of AED 10,000 over and above the standard fee for the current segment, provided the added segment is a standard segment charged at AED 15,000. Where the added segment carries a fee higher than AED 15,000, no discount applies and the full fee is payable. There is no pro-rating irrespective of when the licence falls due for renewal.

Article 10.4: a licensee may add further activities from the same segment at no additional licence fee — but only within the article 14 limits. For DIAC this means: inside segment 22.3 the second activity is free and a third requires a decision under article 10.5; inside segments 22.1, 22.2, 22.4 and 22.5 there is no free activity beyond the first.

Article 10.5: the Authority may, at its discretion and on the licensee’s application, increase the number of activities permitted under a given segment.

Article 11.1: a licensee in one cluster may add a segment or activity from another cluster at the sole discretion of the Authority. This is the route for, say, a DIAC university wanting to add a DKP training segment or a DMC media segment.

What DIAC does not publish

DIAC publishes no prices at all. Asked what it costs to set up a company in DIAC, the official FAQ answers: “Our pricing structure is designed to be competitive and in alignment with prevailing market rates.” Rent per square foot, registration cost, per-visa cost, medical and Emirates ID cost and the establishment card fee appear nowhere on the site.

The only source of DIAC figures with normative force is DDA Decision No. 1 of 2021. Everything else is a commercial quotation, and should be obtained in writing and dated.

Registrar corporate services are priced separately by DDA Decision No. 3 of 2017: incorporation AED 3,500 plus activity fees; name change AED 2,000; share transfer AED 3,000; voluntary winding up AED 1,500; Good Standing certificate AED 1,000; extract AED 500 for a consolidated list or AED 200 per individual list. AED 20 Knowledge & Innovation Dirhams is added per service type.

If you are modelling the cost of holding a licence year on year, the analysis of UAE company and trade licence renewalcovers the renewal procedure and late-renewal fines separately from first registration.

Article 5 of Decision No. 1 of 2021: six restrictions on education licensees

Article 5 of DDA Decision No. 1 of 2021 is headed “Limitations on Licence for the Education Provider” and runs to six clauses, and all six bear on DIAC segments — five exclusively, and clause 5.5 jointly with Dubai Knowledge Park’s training segments. It is the only article of the Decision devoted entirely to education.

Clause	Who it binds	Requirement
5.1	Activity 22.1.2 Branch University	A licence is granted only to bona fide branches of an approved foreign university, college or school, and only where that institution exercises full control over the operation and management of the branch
5.2	Segment 22.1	The licensee must ensure that all enrolled students are provided with a valid student identity card
5.3	Segment 22.1	The licensee must obtain initial approval of Academic Authorisation from KHDA prior to issuance of the licence
5.4	Segment 22.5 Early Learning Centre	Approval of KHDA and/or the Ministry of Social Affairs (whichever applies) is required before the licence is issued
5.5	Segments 21.1–21.7 (DKP), 22.3and 22.4	A No Objection Certificate from KHDA is required prior to issuance of the licence
5.6	The whole of segment 22 (DIAC)	Any advertising, public relations or similar publicity or aware­ness-rai­sing action must comply with KHDA requi­reme­nts

Three conclusions that follow

First: control over the branch is a licence condition, not a question of corporate structure. Clause 5.1 requires “full control over the operation and management” by the home institution. An arrangement in which a local investor owns the operating company and the foreign university supplies only a brand and a curriculum under a licence agreement sits awkwardly against the express words of clause 5.1. KHDA’s documentation reflects the same requirement: a responsibility matrix for the investor, a letter from the home institution confirming its academic responsibilities towards the branch, and the Appendix E Guarantee.

Second: segment 22.2 is the only one with no KHDA gateway in article 5. A company implementing education technology, managing sports facilities inside the zone or investing in student accommodation does not pass a KHDA pre-approval under article 5. That makes segment 22.2 the fastest entry into DIAC’s education ecosystem for a business that does not teach. The general duty in article 2.12 to obtain the necessary approvals still applies.

Third: segments 22.3 and 22.4 need an NOC, not an Academic Authorisation. The difference matters. Segment 22.1 requires initial Academic Authorisation approval — entry into KHDA’s academic system. Educational support services and schools need only a no-objection certificate. Segment 22.5 uses a third construction: approval of KHDA and/or the relevant social ministry.

Note the stale department name. Clause 5.4 refers to the “Ministry of Social Affairs”. No federal ministry of that name exists in the current structure of the UAE government; its social development functions passed to successor bodies. That does not deprive the clause of force, but the relevant authority should be confirmed with DDA and KHDA on application rather than reproduced from the 2021 wording.

How this sits with the general licensee duties

Article 2 of the Decision imposes duties that apply to DIAC as to every other business park:

•          2.5 — every licensee must appoint a General Manager (regulation 8.1 of the Licensing Regulations and regulation 74 of the PCR); the role and conditions are in Schedule 3. This is the only mandatory office: there is no minimum number of directors and a secretary is optional.

•          2.6 — every licensee must maintain a Registered Office stated on the licence; compliance with PCR regulation 51.2 for an FZ-LLC or 96.1.3 for a branch satisfies the requirement.

•          2.8 — every licensee must prepare and retain Audited Accounts and supply them to the Authority on demand; failure triggers the procedures in regulation 10 of the Licensing Regulations.

•          2.11 — every licensee must keep full ultimate beneficial ownership (UBO) details at its Registered Office and supply them on demand.

•          2.12 — licensees must obtain and maintain the appropriate approvals or NOCs from the relevant UAE authorities.

•          2.15 — the issue of a licence by the Authority does not exempt the licensee from obtaining any other permit required by Dubai or UAE law.

Entity forms in DIAC: FZ-LLC, branch and continuation

DIAC offers three forms of presence, but the legal basis for them comes from the Dubai Creative Clusters Private Companies Regulations 2016 rather than from the zone’s website. DIAC’s official FAQ lists three options: new incorporation of a Free Zone Limited Liability Company (FZ-LLC); a branch of an existing foreign or UAE company; and a freelancer permit — with an asterisk.

There is no freelancer permit in DIAC. Article 9.1 of DDA Decision No. 1 of 2021 lists four and only four freelancer segments: 16.5 (Dubai Internet City), 18.9 (Dubai Media City), 21.13 (Dubai Knowledge Park) and 25.10 (Dubai Design District). No 22.x segment appears. DIAC’s GoFreelance marketing page offers an “education” category, but the legal basis for such a permit is Dubai Knowledge Park segment 21.13, not DIAC. The fee is AED 7,500 a year, and under article 9.3 a freelancer is not an employee for the purposes of the Employment Regulations.

The three corporate routes under PCR 2016

Route	PCR regulation	Key features
FZ-LLC	Private companies part	One to 75 members with a Registrar discretion to set a lower number (reg. 8.1); shares fully paid on issue (reg. 26.4); bearer shares prohibited (reg. 26.5); name ending “FZ-LLC” (reg. 12.3.1); secretary “if applicable” (reg. 12.3.22); registered office in the zone (reg. 51.2)
Branch	Regs. 91.1, 93.1, 95.1, 96.1	Duties: a person authorised to accept service; a place of business in the zone; annual filing of the home­-jurisdi­ction annual return; records kept in the zone; particulars on letterhead
Continuation of incorporation	Section 10, regs. 97.1, 97.3, 98	Provisional certificate → Certificate of Cessation within three months → final certificate; regulation 98 governs continuation out of the zone

An unsettled point worth knowing. PCR regulation 90.1 speaks of “an overseas company or a company incorporated outside of the zone”, whereas regulations 91.1 (branch) and 97.1 (continuation) are addressed to “an overseas company” alone, and that term is nowhere defined in the PCR. It follows that the claim “a branch of a UAE mainland company cannot exist in the zone” is not supported by the text — and neither is the opposite. The question is for the Registrar in the individual case, and the position should be obtained in writing before a lease is signed.

What a branch gives, and what it does not

For a university the branch form looks natural: activity 22.1.2 Branch University describes exactly that. But two different “branches” must be kept apart:

•          the corporate branch under PCR 2016 — a form of presence without separate legal personality;

•          the academic branch campus in KHDA’s terminology and in article 5.1 of Decision No. 1 of 2021 — a model in which the home university exercises full control over operation and management.

The two are not the same thing. In practice an academic branch campus is often set up as an FZ-LLC owned by the home university or by an investor vehicle, with academic responsibility resting on the home institution. The requirement in clause 5.1 is directed at actual control, not at corporate form.

Mandatory corporate elements

Whichever route is used:

•          General Manager — the only mandatory office (art. 2.5 of the Decision; reg. 8.1 of the Licensing Regulations; reg. 74 of the PCR; Schedule 3).

•          Registered Office in the zone (art. 2.6 of the Decision; PCR reg. 51.2 or 96.1.3).

•          Audited Accounts — a duty to prepare, retain and produce on demand (art. 2.8 of the Decision).

•          UBO — full details at the Registered Office, produced on demand (art. 2.11 of the Decision).

Note separately that DDA free zones are not carved out of federal employment law: DDA’s own standard employment terms define “Labour Law” as Federal Decree-Law No. 33 of 2021 and give the Dubai Courts jurisdiction. DIFC and ADGM have autonomous employment codes; DDA does not. The practical side of hiring is covered in the analysis of hiring your first employee in the UAE.

Customs code

Article 3.6 of the Decision gives a licensee three mutually exclusive options: obtain a free zone customs code from Dubai Customs (import and re-export permitted, goods stored within the bounded area of the zone); request a local customs code (duty payable on arrival of the goods); or take no code at all (no imports permitted). For a university this matters when importing laboratory equipment, teaching materials and library collections.

Program Accreditation: what the federal layer now requires

Program Accreditation is a free-standing federal approval, separate from Institutional Licensure, and without it a programme may not be offered, advertised or opened for admissions. That follows from article 10(1) of Federal Decree-Law No. 31 of 2025.

Article 10(2): the issue of Institutional Licensure is a prerequisite to beginning the Program Accreditation procedures. The order is rigid: the institution first, the programmes after.

Article 10(3): to obtain Program Accreditation the institution applies to the Ministry and undergoes a comprehensive evaluation against the accreditation standards and conditions.

Recognition of international accreditation

Article 10(4) is the provision that materially reduces the load on branch campuses. The Ministry may accredit academic programmes that already hold international accreditations without repeating the Program Accreditation procedures and without additional fees, provided three conditions are met together:

1.        the institution has obtained Institutional Licensure;

2.        the international accreditation body is reliable and approved by the Ministry;

3.        the standards of the international accreditation body are not lower than the national accreditation standards.

Note the structure: this is not automatic recognition but a discretionary power (“may accredit”) subject to three cumulative conditions. The Ministry’s list of approved international accreditation bodies does not appear in the statute and must be confirmed separately.

What changes for branch campuses

Before 2026 the UQAIB model rested on validation: KHDA verified that the Dubai programme was the same as the home-campus programme, and quality was assured by the external quality assurance agency of the home jurisdiction. KHDA’s documentation expressly requires a letter from the home institution confirming that its own agency will quality assure all branch programmes, and a letter from that agency confirming the same.

Article 14(5) adds a federal layer on top: all academic programmes of free zone institutions are subject to the Program Accreditation standards and mechanisms approved by the Ministry. Home-agency validation is not abolished, but it ceases to be sufficient on its own. The practical route for a branch is article 10(4): to seek recognition of an existing international accreditation rather than run the full national procedure.

Changes to programmes and structure

Article 16 lists twelve obligations of higher education institutions. Four bear directly on managing a programme portfolio:

•          16(1) — obtain prior approval of the Ministry and, where a Local Permit exists, of the Competent Local Authority before implementing any substantial change contemplated by the National Framework for Licensure;

•          16(2) — obtain prior approval of both bodies when adding new academic units (colleges, institutes, centres) or closing existing ones;

•          16(3) — ensure that all academic programmes are subject to the Program Accreditation standards and mechanisms approved by the Ministry;

•          16(4) — obtain prior Ministry approval before implementing any substantial amendment to academic programmes.

The remaining obligations under article 16 include producing information and documents on request; supplying data on applicants, enrolled students, new students, continuing students, graduates and academic and administrative staff; admitting authorised employees of the Ministry or the Competent Local Authority for audit, evaluation and oversight; complying with the controls on advertising, publication and the use of higher education designations; and applying principles of institutional governance, transparency and disclosure, including risk management, safeguarding academic integrity and operational continuity.

Electronic and blended learning

Article 15 regulates electronic, digital and blended programmes separately. Such programmes must: adopt innovative and flexible methods with data protection and intellectual property safeguards; apply the quality assurance standards of the national frameworks; be subject to independent academic or professional accreditation; and undergo periodic review to maintain quality and update curricula.

The requirement of independent accreditation for online programmes stands on its own and is not absorbed into general Program Accreditation under article 10.

Technical and vocational education

Activity 22.1.4 Career Technical Educational Provider leads into a distinct federal regime. Article 18 sets its own sequence for TVET institutions: approval of the Competent Local Authority before applying for Institutional Accreditation (18(1)); the Ministry grants Institutional Accreditation to those who have that approval (18(2)); Program Accreditation before providing any professional or technical programme leading to a qualification classified within the National Qualifications Framework (18(3)); and Program Accreditation before providing international professional qualifications (18(4)).

Article 18(5) introduces a third type of approval — the Training License, granted by the Ministry or the Competent Local Authority to training centres and institutes for programmes that do not culminate in NQF-classified qualifications. That is the approval type matching Dubai Knowledge Park’s training segments and KHDA’s Dubai authorisation regime for training programmes.

Schools and nurseries in DIAC: a separate regulatory track

Schools and nurseries in DIAC are regulated differently from universities: the federal higher education law does not reach them, and the whole regulatory load falls on KHDA. That changes the procedure, the calendar and the risk profile.

Federal Decree-Law No. 31 of 2025 applies to higher education institutions and TVET institutions. General secondary education falls outside its scope: article 1 defines higher education as “education that follows the general education stage”. Segments 22.4 School and 22.5 Early Learning Centre therefore remain within the Dubai track.

KHDA’s 2026 regulatory wave

During 2026 the KHDA Director General issued a series of administrative resolutions published in the Dubai Official Gazette. All carry the status “In Force”, and all concern schools and early childhood centres.

Instrument	Date of issue	Official Gazette	Subject
Admi­nistra­tive Resolution No. 15 of 2026	—	—	Approving the Dubai Inclusive Education Policy Framework and directives on inclusive education for private schools
Admi­nistra­tive Resolution No. 23 of 2026	—	—	Determining admi­nistra­tive violations by private schools requiring a written warning before fines
Admi­nistra­tive Resolution No. 30 of 2026	7 May 2026	No. 770	Requirements and procedures for approving the enrolment of children in early childhood centres
Admi­nistra­tive Resolution No. 31 of 2026	7 May 2026	No. 770	Requirements and controls for curricula in early childhood centres
Admi­nistra­tive Resolution No. 35 of 2026	13 May 2026	No. 778	Violations by early childhood centres requiring a written warning before fines
Admi­nistra­tive Resolution No. 39 of 2026	18 June 2026	No. 781	Requirements and procedures for approving or changing the names of early childhood centres
Admi­ni­strative Resolution No. 41 of 2026	3 July 2026	No. 784	Re­quire­ments, rules and procedures for issuing and assigning educational permits for private schools
Admi­nistra­tive Resolution No. 43 of 2026	29 July 2026	No. 786	Approving the Guide to Premises Requirements for early childhood centres and private schools in Dubai

The conclusion the table supports is that Dubai’s 2026 regulatory activity is concentrated on schools and early childhood, not on higher education. Higher education in the free zones is being rebuilt federally by Decree-Law No. 31 of 2025, while the school segment is being rebuilt at emirate level by KHDA administrative resolutions.

Administrative Resolution No. 41 of 2026 matters most for segment 22.4: it sets the requirements, rules and procedures for issuing and assigning educational permits for private schools. Two 2026 instruments — Nos. 23 and 35 — introduce a written-warning stage before a fine, softening the sanctions regime for schools and early childhood centres.

The 2026 economic measures

On 22 May 2026 KHDA confirmed that there would be no increase in private school fees in Dubai for the 2026-27 academic year. The decision follows the directives of the Crown Prince of Dubai and forms part of a second economic incentives package worth AED 1.5 billion, bringing recently introduced incentives to AED 2.5 billion in total and comprising 33 initiatives to be implemented over three to twelve months.

For education operators the package contains specific measures:

•          private educational institutions holding a KHDA permit benefit from deferrals or instalments of licence renewal fees, as well as deferral of fines;

•          early childhood centres holding a KHDA permit are exempt from licence renewal fees, fines and Dubai Municipality market fees;

•          the Knowledge Fund Establishment offers affiliated institutions partial rent exemptions, extended rent-free periods for centres under construction, partial or full exemptions from guarantee insurance requirements for cancelled contracts, temporary suspension of contractual penalty clauses, a freeze on scheduled rent increases at renewal, and deferred rental payments.

These measures attach to institutions holding a KHDA permit, not to the DDA licence. The AED 15,000 DIAC licence fee is set by Decision No. 1 of 2021 and is untouched by the announced package; the deferral concerns the KHDA permit renewal fee.

Inspections resume

On 3 June 2026 KHDA announced the resumption of quality assurance visits to Dubai private schools from the 2026-27 academic year. Monitoring of private education quality is being strengthened by the Education Quality Assurance and Compliance Agency. Annual school inspections have run in Dubai since the 2007-08 academic year. The measures are tied to the Education 33 (E33) Strategy, Dubai Plan 2033, the Dubai Economic Agenda (D33) and the Dubai Social Agenda, with the goal of ranking among the world’s top ten cities for education quality.

The school regime, including the differences between KHDA in Dubai and ADEK in Abu Dhabi, is analysed in the companion piece on private school licensing in the UAE.

Corporate tax: why QFZP status is effectively unattainable for a DIAC university

A DIAC company is a Free Zone Person, but Qualifying Free Zone Person (QFZP) status at 0% is, in the great majority of cases, unattainable for a university or a school — because education is not on the list of Qualifying Activities.

Two instruments do the work. Cabinet Decision No. 100 of 2023 defines what counts as Qualifying Income. Ministerial Decision No. 229 of 2025 sets the closed list of Qualifying Activities, the de minimis threshold and the consequences of breaching it.

Article 3 of Cabinet Decision No. 100 of 2023

Qualifying Income comprises four categories, provided the income is not attributable to a domestic or foreign permanent establishment, does not arise from the ownership or exploitation of immovable property, and is not treated as taxable under article 7(2):

•          3(1)(a) — income from transactions concluded with a Free Zone Person, except income from Excluded Activities. No activity filter applies here at all.

•          3(1)(b) — income from transactions with a Non-Free Zone Person only in relation to Qualifying Activitieswhich are not Excluded Activities.

•          3(1)(c) — income from the ownership or exploitation of qualifying intellectual property.

•          3(1)(d) — any other income, provided the de minimis requirements are met.

Article 3(2) adds that income counts as arising from a transaction with a Free Zone Person only where that person is the beneficiary of the service or commodity. Article 3(3) defines the beneficiary as a person with the right to use and enjoy the service and with no contractual or legal obligation to supply it onward to another person.

Why that closes the 0% route for a university

Tuition is paid by students. Students are natural persons and are not Free Zone Persons. Article 3(1)(b) therefore governs, and it allows Qualifying Income only in relation to Qualifying Activities.

Education, teaching and academic services do not appear in the closed list of fourteen Qualifying Activities in article 2(1) of Ministerial Decision No. 229 of 2025. The list covers manufacturing; processing; trading in Qualifying Commodities; holding shares and securities for investment purposes; ownership, management and operation of ships; reinsurance; fund management; wealth and investment management; headquarter services to Related Parties; treasury and financing services to Related Parties; financing and leasing of aircraft; distribution of goods in or from a Designated Zone; logistics services; and ancillary activities.

Tuition fees are therefore non-qualifying Revenue. The de minimis threshold in article 3 of Ministerial Decision No. 229 of 2025 — 5% of total Revenue or AED 5,000,000, whichever is lower — is bound to be exceeded, since tuition is the bulk of revenue.

The consequence of breach under article 5(2) of Ministerial Decision No. 229 of 2025 is that QFZP status is lost from the beginning of the tax period concerned and for the following four periods — five periods in all.

What applies instead of QFZP

Instrument	Condition	Effect
General rate	Taxable Income above AED 375,000	9% on the excess
Small Business Relief	Revenue not exceeding AED 3,000,000 in the period and in all previous periods; QFZPs excluded by article 3(2)	No taxable income for the period
QFZP	Requires a Qualifying Activity for transactions with mainland customers	Effectively unattainable for education

Ministerial Decision No. 131 of 2026 of 29 July 2026 extended Small Business Relief from tax periods ending 31 December 2026 to tax periods ending on or before 31 December 2029. The AED 3,000,000 threshold and the exclusion of QFZPs in article 3(2) are unchanged.

For a small segment 22.3 company — an education consultancy, a representative office or an examination preparation centre — Small Business Relief is usually the practical answer. For a university with revenue in the hundreds of millions of dirhams, the general 9% rate applies.

The mandatory audit threshold

Ministerial Decision No. 82 of 2023 on audited financial statements was repealed by Ministerial Decision No. 84 of 2025 (issued 25 March 2025). Article 3 of the new decision repeals the old one but keeps it alive for tax periods that commenced before 1 January 2025; article 4 applies the new decision to periods commencing on or after 1 January 2025. The AED 50,000,000 threshold in article 2(1)(a) is unchanged, and article 2(1)(b) still requires audited financial statements of a Qualifying Free Zone Person whatever its revenue — a condition that article 5(1)(b) of Ministerial Decision No. 229 of 2025 imports into the QFZP test itself. What changed is the governing instrument, not the threshold. Commentary from 2023 still citing the repealed Decision No. 82 is reproducing a superseded rule.

Note separately the duty in article 2.8 of DDA Decision No. 1 of 2021 to prepare and retain Audited Accounts and produce them to the Authority on demand — it applies irrespective of any tax threshold.

The mechanics of the QFZP regime and the common ways of losing it are analysed separately in the conditions for applying Qualifying Free Zone Person status and how free zone companies lose 0% corporate tax in the UAE. The limits of Small Business Relief are covered in the last chance for a 0% rate.

VAT: why tuition at a private DIAC university is 5% while a school is zero-rated

Tuition at a private higher education institution in a Dubai free zone is subject to VAT at the standard rate of 5%, because condition (c) of article 40(1) of the VAT Executive Regulation is not met. This is the most frequent error in financial models for UAE education projects, because the belief that “education in the UAE is zero-rated” is widespread.

The three cumulative conditions of article 40(1)

Article 40(1) of Cabinet Decision No. 52 of 2017 applies the zero rate to educational services only if three conditions are met together:

•          (a) the services are provided in accordance with the curriculum recognised by the federal or local competent government agency regulating the education sector where the course is delivered;

•          (b) the supplier is an educational institution recognised by that agency;

•          (c) “If the supplier of educational services is a higher education institution, the institution shall be either owned by the federal or local government or receive more than 50% of its annual funding directly from the federal or local government.”

A private international branch campus in DIAC is not government-owned and does not receive more than half its annual funding directly from government. Condition (c) fails, and tuition is standard-rated at 5%.

Why the answer flips for a school

Condition (c) is addressed exclusively to higher education institutions. It does not reach a segment 22.4 school or a segment 22.5 early learning centre. Such an institution that satisfies conditions (a) and (b) — a recognised curriculum and recognition by KHDA — applies the zero rate.

The dividing line runs through DIAC’s own segment list: segment 22.1 at 5%, segments 22.4 and 22.5 at 0% where (a) and (b) are met.

What the zero rate covers, and what it does not

Article 40(2): goods or services supplied by those institutions are zero-rated where the supply is directly related to the provision of a zero-rated educational service. Article 40(3): printed and digital reading material related to the curriculum is zero-rated.

Article 40(4) removes eight categories from the zero rate, notwithstanding clause 2:

Category	Provision
Goods and services supplied to, or made available to, persons not enrolled at the institution	40(4)(a)
Goods other than educational materials consumed or transformed by students for the purposes of education	40(4)(b)
Uniforms and other required clothing, whether or not supplied by the institution as part of the educational service	40(4)(c)
Electronic devices related to the educational services, whether or not supplied as part of the service	40(4)(d)
Food and beverages supplied at the institution, including vending machines and food vouchers	40(4)(e)
Field trips, unless directly related to the curriculum and not predominantly recreational	40(4)(f)
E­xtracurri­cular activities provided by or through the institution against fees additional to the education fee	40(4)(g)
Membership of a student orga­nisa­tion	40(4)(h)

Education is not VAT-exempt

Education does not appear among the exemptions in article 46 of the VAT Decree-Law. An educational service is therefore either zero-rated or standard-rated, but never exempt. The practical consequence is decisive: the right to recover input VAT survives in both cases.

A DIAC university charging 5% on tuition recovers input VAT on rent, campus construction, equipment and services in full. A zero-rated school does the same. Exemption would deny both that right — but there is no exemption here.

Designated Zone status changes nothing

DIAC does not appear on the Federal Tax Authority’s Designated Zones list. A full-text check of the current list finds no TECOM district at all; the Dubai entries are Jebel Ali, Dubai Cars and Automotive Zone, Dubai Textile City (ceased 4 April 2021), Al Quoz (ceased 1 July 2021), Dubai Aviation City, Dubai Airport Free Zone and Dubai CommerCity.

Even if the status existed it would change nothing for education: article 51(6) of the Executive Regulation provides expressly that the place of supply of any services is inside the State if the place of supply is in a Designated Zone.The Designated Zone regime works for goods, not services.

The general mechanics of UAE VAT are covered separately in UAE VAT: the complete business guide.

Can you operate outside DIAC, and how is it authorised?

A DIAC licence confers no right to carry on business outside the free zone. DIAC’s official FAQ answers the question directly: “No, you can only operate within the free zone.” The same principle appears in regulation 12.1 of the DTMFZ Licensing Regulations 2003 and in regulation 90.2 of the PCR 2016, which catches carrying on business outside the zone from a place of business inside it.

Since March 2025 there has been a formal mechanism for stepping outside the perimeter — Dubai Executive Council Resolution No. 11 of 2025, issued on 3 March 2025 and published in Official Gazette No. 707.

Three options under Resolution No. 11 of 2025

All three authorisations are issued by the Dubai Department of Economy and Tourism (DET), not by the free zone.

Option	Provision	Term	Fee
Licence for a branch within the emirate	Art. 4(a)(1), art. 5	1 year, renewable	No fee set by the Resolution; the general DET tariff applies under art. 5(a)(6)
Licence for a branch operating out of the free zone	Art. 4(a)(2), art. 6	1 year, renewable	AED 10,000 a year (art. 12)
Temporary permit	Art. 4(a)(3), art. 7	maximum 6 months	AED 5,000 (art. 12)

All three require the prior approval of the free zone’s licensing authority and, where relevant, of the supervising government entities.

Article 3(b) requires compliance with applicable federal and local law and the maintenance of separate financial records for out-of-zone activity. Article 3(c): activity outside the emirate requires that jurisdiction’s licences. Article 8 allows a workforce already registered on the free zone portal to be deployed with its privileges preserved. Article 10 applies emirate legislation, including administrative penalties, to such activity. Article 11 governs audit and inspection under DET and licensing-authority procedures. Article 13 gives a one-year compliance grace period, extendable once by the Director General.

An open point. Article 9 required DET, together with the licensing authority, to publish within six months a list of economic activities identifying which model each requires, and article 7(6) makes the temporary permit conditional on that list. Publication of the list is not confirmed from a primary source. Until it appears, the availability of a temporary permit for a specific education activity should be confirmed with DET.

What this means for an education operator

Three scenarios recur.

First: corporate training and seminars off campus. Delivering paid training at a client’s premises on the Dubai mainland falls outside the perimeter of the zone licence. One of the three constructions in Resolution No. 11 of 2025 is required — and, in parallel, a check on whether KHDA authorisation is needed for the training itself.

Second: student recruitment through mainland offices and agents. Activity 22.3.2 University Placement Services is permitted inside the zone. A recruitment team physically based in a mainland office is activity outside the zone.

Third: servicing mainland clients informally, with no authorisation. Here a counter-intuitive tax trap appears. Article 5(1) of Cabinet Decision No. 100 of 2023 taxes the income of a domestic permanent establishment at 9%. But article 4 of the same Cabinet Decision removes the revenue of a domestic or foreign permanent establishment from the de minimis calculation entirely. In other words, taking a DET branch or permit protects QFZP status, while servicing mainland clients without that authorisation destroys it.

For an education company that conclusion is largely theoretical, since QFZP status is already unattainable because education is absent from the Qualifying Activities list. But for adjacent group entities — a campus management company or a logistics arm — it matters in practice.

The comparison between the mainland and free zone regimes after the 2025 reforms is analysed separately in mainland versus free zone in 2026.

Staff, visas and space: how the quota is calculated

A DIAC company may sponsor one employee for every 80 square feet of leased space. The rule appears in DIAC’s official FAQ and works out at roughly 7.43 square metres per visa.

For an education operator the visa quota is not a secondary question: teaching staff, administrators, laboratory technicians and library staff fall under the same formula as anyone else. A university of 3,000 students with 200 academic and administrative staff needs at least 16,000 square feet of leased space for the visa quota alone, regardless of what its teaching space actually requires.

What is published and what is not

Item	Published by DIAC	Comment
Visa quota	Yes: 1 per 80 sq ft	FAQ
Company registration time	Yes: 7 working days (4 + 3)	FAQ; DDA service pages elsewhere state 10 + 2 = 12 working days — the divergence is unreconciled
Licence validity	Yes: 1 year	FAQ
Rent per square foot	No	Published neither by DIAC nor by TECOM Group
Cost of a visa, medical test and Emirates ID	No	Not published
Establishment card fee	No	Not published
Late renewal fines	Not on the DIAC site	Set by Schedule 4 to DDA Decision No. 1 of 2021

Space formats

DIAC offers commercial offices, built-to-suit campus space, D/Quarters coworking and in5 centres. The official FAQ confirms that a tenant may design and construct an office to its own requirements and that fitted and non-fitted units of various sizes are available.

For an education project it matters that DIAC’s FAQ describes an incubation route: an institution may “begin with a small space to gauge the market and grow from the ground-up”. That route is recommended to new partners unsure of the Dubai market.

Bear in mind, though, that phase 3 of both KHDA routes requires a copy of the premises lease from the free zone and a completion certificate from Dubai Municipality or the free zone, and that KHDA Administrative Resolution No. 43 of 2026 approves the Guide to Premises Requirements for early childhood centres and private schools. Space and its specification are therefore subject to separate regulatory control, not just to a commercial lease.

Employment law and hiring

DDA free zones have no autonomous employment code. DDA’s own standard employment terms define “Labour Law” as Federal Decree-Law No. 33 of 2021 on the Regulation of Employment Relations, apply UAE law and give the Dubai Courts exclusive jurisdiction. The UAE free zones with autonomous employment codes are DIFC and ADGM; DDA is not among them.

Note that the Employment Regulations 2004 still hosted on DDA’s site cite the repealed Federal Law No. 8 of 1980. That does not invalidate the document so far as it does not conflict with the law in force, but employment contracts should be drafted against Federal Decree-Law No. 33 of 2021.

Emiratisation targets do not reach a free zone company: they bite on employers registered with MOHRE above a headcount threshold. The exclusion is structural rather than express.

Visas for founders and investors

Separate from the visa quota is the question of long-term residence visas for the investors and leaders of an education project. The routes and thresholds are analysed in the UAE Golden Visa through a company: three routes.

The service layer

Applications and corporate actions in DIAC run through axs, the servicing arm of TECOM Group. On DIAC’s own description, axs provides “more than 200 government and corporate solutions including visas, licensing, registration”. In practice the filing interface is a group platform rather than the regulator’s own portal.

Deadlines, renewal and sanctions: three layers of liability

Sanctions in a DIAC education project sit at three levels, and they do not absorb one another. DDA imposes zone fines, KHDA imposes administrative measures on a free zone university, and the federal statute creates criminal liability.

The zone layer: Schedule 4 to Decision No. 1 of 2021

Schedule 4 is issued under regulation 31 of the DTMFZ Licensing Regulations and applies to every licensee in the zone, DIAC included.

Breach	Fine
Late renewal more than 30 but not more than 60 days	AED 2,500
Late renewal more than 60 but not more than 90 days	AED 5,000
Late renewal more than 90 days	AED 10,000
Carrying on business without a licence	AED 10,000; AED 25,000 for a repeat breach
Carrying on business of a segment or activity other than that licensed	AED 10,000
Providing misleading or inaccurate information	AED 5,000
Hindering inspectors	AED 5,000
Failure to provide UBO information on demand	AED 5,000 plus and/or the regulation 10 sanctions

Renewal within the first 30 days of lateness is unpriced in Schedule 4. The fine is payable at or before the fee, and monies received are applied first to the fine and then to the fee. The Authority may refuse renewal and refuse governmental services, including sponsorship under article 4 of the Employment Regulations.

The line “business of a segment or activity other than that licensed” carries particular weight in DIAC because of the hard limit of one activity per segment. A university that begins awarding associate’s degrees without adding activity 22.1.3 falls squarely within it.

The emirate layer: KHDA

Article 14(7) of Federal Decree-Law No. 31 of 2025 assigns penalties and administrative measures against free zone universities to the Competent Local Authority under the Emirate’s local legislation. Article 20(2) repeats the rule for free zone universities, TVET institutions and training centres.

For schools and early childhood centres a mitigating construction appeared in 2026: KHDA Administrative Resolutions Nos. 23 and 35 of 2026 identify the violations that require a written warning before a fine.

The federal layer: article 22

Article 22(1) of Federal Decree-Law No. 31 of 2025: imprisonment for a term not exceeding one year and a fine of not less than AED 100,000 and not exceeding AED 10,000,000, or by either of these two penalties. The offences are:

•          establishing or operating a higher education institution, providing higher education programs and services for the purpose of awarding a qualification, or promoting or advertising its services — before obtaining Institutional Licensure;

•          providing any academic or professional programme, promoting or advertising it, admitting students to it or commencing study in it — without Program Accreditation;

•          advertising the granting of certificates before the requirements are met and the necessary licences obtained.

The provision opens with the words “without prejudice to any more severe penalty provided for in any other law”.

The calendar to keep in view

Event	Deadline	Provision
Regularising the status of an existing institution	by 1 January 2027, extendable by Minister’s decision	Art. 25, FDL No. 31 of 2025
Supplying data for the licence renewal evaluation	90 days after expiry, on acceptable justification	Art. 7(3), FDL No. 31 of 2025
Revocation for failure to commence operations	1 year from issuance	Art. 9(1)(d), FDL No. 31 of 2025
Revocation for closure	more than 3 consecutive months	Art. 9(1)(c), FDL No. 31 of 2025
Filing a grievance with the Ministry	60 days from becoming aware	Art. 21(1), FDL No. 31 of 2025
Decision on the grievance by the Committee	60 days from filing	Art. 21(2), FDL No. 31 of 2025
Zone licence renewal	annually; a fine from the 31st day of lateness	DIAC FAQ; Schedule 4 to Decision No. 1 of 2021
Transitional period under Resolution No. 11 of 2025	1 year, extendable once	Art. 13, ECR No. 11 of 2025

The market: students, institutions and programmes in Dubai and in DIAC

On KHDA’s figures, 42,026 students were enrolled at 41 private higher education institutions in Dubai in the 2024-25 academic year, of which 37 are international campuses. The data comes from KHDA’s release of 19 May 2025 and the accompanying infographic, and covers providers licensed by KHDA.

Dubai higher education sector, academic year 2024-25

Indicator	Value
Private higher education providers licensed by KHDA	41
Of which international campuses	37
New providers opened in 2024-25	4
Students	42,026
Growth in total enrolment against 2023-24	20.4%
Growth in international student enrolment	29.4%
Share of international students	35.2%
Emirati students	3,832
Growth in Emirati enrolment	22%
Programmes	706, of which 91 new
Faculty	2,123
Graduates	7,679 (7,629 in 2023-24; 6,992 in 2022-23)
Students of determination	637 (488 in 2023-24; 382 in 2022-23)
Research publications	1,484

The top five specialisations by enrolment are Business 44%, Information Technology 15%, Engineering 13%, Media and Design 6% and Humanities 5%. The largest student nationality is India at 42%, followed by the UAE at 9%, Pakistan 7%, Egypt 4% and Russia 3%. Among faculty, 61% hold a doctorate and 34% a master’s degree.

DIAC’s own figures

DIAC’s website states: established in 2007, more than 28,000 students and more than 500 programmes.

Note an internal inconsistency on DIAC’s own site: the retail-space card on the homepage refers to “over 27,000 students and academics”, while the About Us section says “over 28,000” in an equivalent paragraph. Neither figure is dated. The 28,000+ figure in the About Us counters should be treated as the official number, with the caveat that no date of currency is published.

Among its institutions DIAC names the University of Birmingham, Middlesex University, Amity University Dubai Campus, Heriot-Watt University Dubai Campus and Hult International Business School.

Movement during 2026

On 15 January 2026 DIAC and Dubai Knowledge Park reported a 15% increase in their student body.

On 22 January 2026 TECOM Group announced the acquisition of an integrated university campus in Dubai International Academic City as part of strengthening its premium education cluster portfolio.

On 25 August 2026 KHDA reported that 26 new private education institutions would open in Dubai in the 2026-27 academic year: 17 early childhood centres, seven schools and two international higher education institutions. The new schools add nearly 17,000 seats and the early childhood centres more than 1,700. On KHDA’s figures the sector has grown 4.6% a year over the past three academic years across early childhood, schools and higher education, and the number of teachers in the emirate’s private education sector has risen 17.5% over three academic years.

On 30 October 2025 Dubai’s leading education hubs published a study projecting a 40% increase in higher education enrolments in Dubai by 2030. That is a sector study’s forecast rather than an official statistic, and should be used with that qualification.

How to read these numbers when planning

Three observations matter in practice.

First: 37 of 41 providers are international campuses. Dubai’s higher education market is built predominantly on the branch model rather than on locally founded universities. That is why article 5.1 of DDA Decision No. 1 of 2021 and the whole of KHDA’s International Quality Assurance route are worked out in such detail for branches.

Second: 706 programmes across 41 institutions is an average of 17 programmes per institution. Given that each programme needs separate KHDA registration and, from 2026, federal accreditation under article 14(5), the administrative load on a programme portfolio is substantial and grows with it.

Third: the concentration in business education. Business accounts for 44% of enrolment. For a new entrant that is at once evidence of demand and a warning about competitive density in the most obvious niche.

Step by step: from concept to the first intake

Step 1. Establish which regulatory track the project belongs to

A university, branch campus, junior college or technical education provider is segment 22.1 and the federal track of FDL No. 31 of 2025. A school is segment 22.4 and KHDA’s Dubai track. A nursery is segment 22.5. Consultancy, representation, recruitment and examination preparation are segment 22.3. Technology, sports facilities and dormitories are segment 22.2.

An error at this step is the costliest of all: it determines whether federal Institutional Licensure is required and whether article 22, with its fine of up to AED 10,000,000, applies.

Step 2. Check the activity limit in the chosen segment

The licence covers one activity in segments 22.1, 22.2, 22.4 and 22.5, and two in segment 22.3. If the project involves two modalities at once — bachelor’s degrees and associate’s degrees, say — plan for an article 10.5 application or a second segment at an extra AED 10,000 a year.

Step 3. For segment 22.1, obtain initial KHDA Academic Authorisation approval

Article 5.3 of DDA Decision No. 1 of 2021: the approval must be obtained before the licence is issued. Segments 22.3 and 22.4 need a KHDA NOC (art. 5.5); segment 22.5 needs KHDA and/or the relevant social authority’s approval (art. 5.4).

Step 4. Assemble the phase 1 pack for the applicable KHDA route

For a branch campus, the International Quality Assurance route: confirmations from the home institution and its quality assurance agency, the investor responsibility matrix, five-year financial projections, and evidence of the capacity to teach out students if a programme closes. For an institution with no home campus, the Local Quality Assurance route with the CAA documentation.

Step 5. Register the company in DIAC and secure premises

The form is an FZ-LLC, a branch or a continuation of incorporation under PCR 2016. Minimum paid-up capital is AED 50,000. Appoint a General Manager. DIAC’s FAQ gives 7 working days: 4 for initial approval and 3 to issue the licence. Size the space against the visa quota of one employee per 80 square feet.

Step 6. Close KHDA phases 2 and 3

Phase 3 of both routes requires a copy of the free zone commercial licence, a copy of the lease, a signed Certificate of Authorisation from the Academic Head, a completion certificate from Dubai Municipality or the free zone, and the KHDA Undertakings. This is where the circular dependency between steps 3 and 5 closes.

Step 7. Obtain the Local Permit

This is the document that article 14(2) of FDL No. 31 of 2025 requires before an application for federal Institutional Licensure.

Step 8. Apply to the Ministry for Institutional Licensure

Article 14(3) guarantees that where a Local Permit exists the procedures are not repeated and no additional fees are charged. Article 6(2) lists the requirements: compliance with the National Framework for Licensure, including a distinctive name, an application by the owner containing basic information on management, location, colleges and programmes, and financial guarantees of the ability to meet obligations; obtaining any permits required by the Competent Local Authorities; and premises suitable for the educational process and compliant with health, security and safety standards.

Step 9. Accredit every programme

Article 10(1) prohibits offering, promoting or advertising a programme, admitting students to it or commencing study before accreditation. Article 10(4) allows recognition of an existing international accreditation on three conditions. Electronic and blended programmes additionally require independent academic or professional accreditation under article 15(3).

Step 10. Register the programmes with KHDA and clear the marketing material

All programmes offered in Dubai’s free zones require KHDA approval and registration. Advertising and recruiting before approval is prohibited at all three levels: by KHDA, by article 5.6 of DDA Decision No. 1 of 2021, and by article 10(1) of the federal statute.

Step 11. Set up the tax and accounting perimeter

Register for corporate tax. Assess Small Business Relief where Revenue does not exceed AED 3,000,000. For segment 22.1, budget 5% VAT on tuition with full input recovery; for segments 22.4 and 22.5, the zero rate where conditions (a) and (b) of article 40(1) are met, with separate treatment of the article 40(4) exclusions. Put in place the preparation and retention of Audited Accounts under article 2.8 of Decision No. 1 of 2021 and the UBO records under article 2.11.

Step 12. If activity outside the zone is planned, authorise it under Resolution No. 11 of 2025

A branch within the emirate, a branch operating out of the free zone at AED 10,000 a year, or a temporary permit for up to six months at AED 5,000. All three require the zone licensing authority’s prior approval and separate financial records.

Step 13. For an existing institution, meet the regularisation deadline

Article 25 of FDL No. 31 of 2025: by 1 January 2027. The period is extendable by decision of the Minister in coordination with the Competent Local Authorities, but an extension should not be planned for as a given.

If you are also weighing zone against mainland for adjacent group entities, the overview of company registration and business support in the UAE is a useful starting point.

Common mistakes and what they cost

Mistake 1. Treating a DIAC licence as a right to teach

Article 2.15 of DDA Decision No. 1 of 2021: the issue of a licence by the Authority does not exempt the licensee from obtaining any other permit, licence or approval required by Dubai or UAE law.

What it costs: opening admissions on a zone licence alone makes out the offences in article 22(1)(a) and (b) of Federal Decree-Law No. 31 of 2025 — imprisonment of up to one year and a fine of AED 100,000 to AED 10,000,000, or either. In parallel, Schedule 4 imposes AED 10,000 for carrying on business of an activity other than that licensed.

Mistake 2. Assuming UQAIB alone is enough after 1 January 2026

Before 2026 a KHDA page described a choice between the UQAIB scheme and licensing by the CAA. Article 14 of Federal Decree-Law No. 31 of 2025 made the routes cumulative: a Local Permit, Institutional Licensure and federal Program Accreditation are all required.

What it costs: for an existing institution, missing the regularisation deadline in article 25 (1 January 2027). For a new one, operating without Institutional Licensure from opening day — the offence in article 22(1)(a).

Mistake 3. Budgeting on AED 10,000 of capital

Article 15.1 of Decision No. 1 of 2021 sets a standard minimum of AED 10,000, but all five DIAC rows in the article 15 table read AED 50,000.

What it costs: not a fine but a broken timetable. The application goes back for correction, and the KHDA and Ministry timelines, which depend on the commercial licence existing, slip by a full cycle.

Mistake 4. Planning two activities on one segment 22.1 licence

Article 14 of Decision No. 1 of 2021 allows one activity in segment 22.1. Article 10.4 permits free additional activities only within that limit; article 10.5 gives the Authority a discretion to raise it.

What it costs: AED 10,000 under Schedule 4 for carrying on an activity not stated on the licence, plus the risk that qualifications awarded under the uncovered activity fall outside the Academic Authorisation and therefore outside KHDA attestation under Executive Council Resolution No. 21 of 2011.

Mistake 5. Counting on zero-rated VAT for a university

Article 40(1)(c) of the VAT Executive Regulation requires a higher education institution to be government-owned or to receive more than 50% of its annual funding directly from government.

What it costs: under-charged VAT at 5% on the whole of tuition for every period, plus administrative penalties under the tax legislation. In the model of a university with AED 100,000,000 of annual revenue that is AED 5,000,000 a year.

Mistake 6. Assuming Designated Zone status solves the VAT question

DIAC does not appear on the Federal Tax Authority’s Designated Zones list. And even if it did, article 51(6) of the Executive Regulation places the supply of any service in a Designated Zone inside the State.

What it costs: a model built on a zero rate that does not exist, with the same consequences as mistake 5.

Mistake 7. Counting on QFZP status

Education is absent from the closed list of fourteen Qualifying Activities in article 2(1) of Ministerial Decision No. 229 of 2025, and tuition comes from students who are not Free Zone Persons, so article 3(1)(b) of Cabinet Decision No. 100 of 2023 applies.

What it costs: corporate tax assessed at 9% above AED 375,000 for every period in which 0% was applied. Under article 5(2) of Ministerial Decision No. 229 of 2025, a breach costs the status for the current tax period and the following four.

Mistake 8. Launching a landing page and advertising before accreditation

The prohibition operates at three levels: article 10(1) of the federal statute brings “promoting or advertising” a programme within the offence; KHDA’s page expressly forbids advertising or recruiting without approval and registration; and article 5.6 of DDA Decision No. 1 of 2021 requires all advertising to comply with KHDA requirements.

What it costs: the offence in article 22(1)(b) with a minimum fine of AED 100,000, KHDA administrative measures under article 14(7), and the reputational damage of pulling a campaign.

Mistake 9. Structuring a branch campus without real control by the home university

Article 5.1 of Decision No. 1 of 2021 requires a 22.1.2 licence to be granted only to bona fide branches and only where the home institution exercises full control over the operation and management of the branch. KHDA’s documentation requires a responsibility matrix, a letter on the home institution’s academic responsibilities and the Appendix E Guarantee.

What it costs: refusal of the licence at a stage when the lease is already signed, or — if the mismatch surfaces later — a ground for revocation under article 9(1)(b) of the federal statute (licensure obtained on incorrect data).

Mistake 10. Planning on a freelancer permit in DIAC

Article 9.1 of Decision No. 1 of 2021 lists exactly four freelancer segments: 16.5, 18.9, 21.13 and 25.10. No DIAC segment appears, even though the GoFreelance marketing page offers an “education” category.

What it costs: restructuring the project late. An individual lecturer or education consultant is licensed through Dubai Knowledge Park segment 21.13, not through DIAC, which changes both the registered address and the applicable restrictions.

Mistake 11. Ignoring the zone perimeter for off-site teaching

DIAC’s official FAQ: “No, you can only operate within the free zone.” Executive Council Resolution No. 11 of 2025 provides three constructions for stepping outside, and DET issues all three, not the zone.

What it costs: emirate administrative penalties under article 10 of Resolution No. 11 of 2025, plus a tax effect that runs against intuition: revenue from mainland customers earned without any mainland presence is ordinary non-qualifying Revenue and counts against the de minimis threshold, whereas a DET branch or permit creates a domestic permanent establishment whose revenue is excluded from the de minimis calculation altogether under article 4 of Cabinet Decision No. 100 of 2023. Formalising the activity protects QFZP status; leaving it unformalised puts that status at risk.

Mistake 12. Citing repealed instruments

Three repeals recur especially often in commentary: Federal Decree-Law No. 48 of 2021 was repealed by article 29(1) of FDL No. 31 of 2025; Dubai Law No. 30 of 2006 on KHDA was repealed by Dubai Law No. 2 of 2021; and Ministerial Decision No. 82 of 2023 on audited financial statements was repealed by Ministerial Decision No. 84 of 2025. DDA Decision No. 1 of 2021, for its part, still calls the regulator the “Dubai Creative Clusters Authority” and refers to the “Ministry of Social Affairs”.

What it costs: a legal position built on a repealed instrument affords no protection either in correspondence with a regulator or in answer to an administrative measure.

Whom DIAC suits, whom it does not, and when to take professional advice

Whom DIAC suits

•          An established foreign university opening a branch campus with full academic control. Activity 22.1.2 and KHDA’s International Quality Assurance route are designed for exactly that model, and 37 of Dubai’s 41 private higher education providers are international campuses. Article 10(4) of the federal statute allows recognition of an existing international accreditation without repeating procedures or paying additional fees.

•          An education consultancy, a representative office or an examination preparation centre. Segment 22.3 is the only DIAC segment carrying two activities on the licence, needs only a KHDA NOC rather than an Academic Authorisation, and is covered by Small Business Relief where Revenue does not exceed AED 3,000,000.

•          An education technology provider, a sports facilities operator or an investor in student accommodation.Segment 22.2 is the only DIAC segment with no KHDA gateway in article 5 of Decision No. 1 of 2021.

•          An existing accredited school from an approved country, or an IB school. Segment 22.4 plus the KHDA Dubai track, with no federal Institutional Licensure, and zero-rated VAT where conditions (a) and (b) of article 40(1) are met.

•          An operator that wants an incubation footprint. DIAC’s FAQ describes the route of beginning “with a small space to gauge the market”.

Whom DIAC does not suit

•          A project counting on 0% corporate tax. Education is absent from the Qualifying Activities list; QFZP status on tuition is unattainable.

•          A project built on zero-rated VAT for higher education. Condition (c) of article 40(1) cannot be satisfied by a private institution.

•          A brand-licensing model with no academic control. Article 5.1 of Decision No. 1 of 2021 requires full control by the home institution over the operation and management of the branch.

•          An individual lecturer or coach. DIAC has no freelancer segment; the route is Dubai Knowledge Park segment 21.13.

•          An operator whose core revenue is corporate training at clients’ mainland premises. The zone perimeter and the constructions in Resolution No. 11 of 2025 make that model administratively heavy; the natural zone for training is Dubai Knowledge Park.

•          A project with two academic modalities from day one. The one-activity limit in segment 22.1 requires either a discretionary decision under article 10.5 or a second segment.

When professional review is needed

•          when regularizing an existing institution’s status under Federal Decree-Law No. 31 of 2025 before 1 January 2027 — the sequence has to be agreed with KHDA and the Ministry in writing, because the published routes conflict with article 14(2);

•          when structuring the relationship between the home university, the investor and the operating company, because of the full-control requirement in article 5.1 and the Appendix E Guarantee;

•          when choosing between recognition of an international accreditation under article 10(4) and the full national procedure;

•          when building a tax model that mixes streams at different VAT rates: tuition at 5%, school education at 0%, and the article 40(4) exclusions for food, uniforms, devices, trips, extracurricular activities and student organisation membership;

•          when planning activity outside the zone, because the list of activities required by article 9 of Resolution No. 11 of 2025 is not confirmed as published;

•          when adding a segment from another cluster, since article 11.1 leaves that to the Authority’s sole discretion;

•          when choosing the branch form under PCR 2016, because “overseas company” is undefined in the regulations and the Registrar’s position must be obtained in writing.

DIAC compared: Dubai Knowledge Park, the mainland and other emirates

The choice of location for a UAE education project turns not on the licence fee but on which regulatory gateway applies to the specific activity. The AED 15,000 annual fee is the same in DIAC as in most standard segments of the DDA zone; what differs is the capital requirement, the segment list and which authority permits the educational activity itself.

Comparison on key parameters

Parameter	DIAC (segment 22.x)	Dubai Knowledge Park (segments 21.x)	Dubai mainland (DET)
Profile	Higher education, schools, nurseries, education services	Training, HR, professional development	Any activity within the emirate
Annual segment fee	AED 15,000	AED 15,000	DET tariff
Minimum paid-up capital	AED 50,000 across all five segments	AED 10,000 — no DKP segment is uplifted	Under UAE companies legislation
Activities on the licence	1, except segment 22.3 (2)	3 for segments 21.1, 21.7 and 21.8; 1 for the rest	Per DET tariff
Freelancer permit	None	Yes: segment 21.13, AED 7,500 a year	Not in this form
KHDA gateway	Academic Authorisation for 22.1; NOC for 22.3 and 22.4; approval for 22.5; none for 22.2	NOC for segments 21.1–21.7; none for 21.8–21.14	Applies by activity
Federal Institutional Licensure	Required for segment 22.1	Not required for training segments; art. 18 applies to NQF-level programmes	Required for higher education
Operating outside the zone	Prohibited without an ECR No. 11 of 2025 construction	Prohibited without an ECR No. 11 of 2025 construction	Permitted within the emirate
Deposit or guarantee	Not required	AED 100,000 for Executive Search (21.12)	By activity

The decisive difference between DIAC and Dubai Knowledge Park is not price or service mix but the level of regulation. DIAC leads to academic qualifications and therefore into the federal track of FDL No. 31 of 2025. DKP leads to training that does not culminate in an NQF-classified qualification and remains largely within KHDA’s Dubai track — which corresponds to the Training License in article 18(5) of the federal statute.

Dubai and Abu Dhabi: two different local authorities

Federal Decree-Law No. 31 of 2025 uses the single concept of a Competent Local Authority and names no specific body. In Dubai that is KHDA; in Abu Dhabi it is that emirate’s education authority. Article 26(2) refers the fees for Competent Local Authority services to each emirate’s legislation, and article 14(8) allows each emirate to issue its own local frameworks for Local Permits, evaluation, oversight and quality.

The practical consequence is that from 2026 the federal layer is common while the emirate layer stays different.Premises requirements, penalty scales, fees and permit procedures do not match between Dubai and Abu Dhabi. The differences in school regulation between KHDA and ADEK are analysed in the companion piece on private school licensing in the UAE.

Article 28(2) adds a residual rule: in emirates where no Competent Local Authority exists, the Ministry exercises its powers.

Tax treatment by type of education activity

Activity	Segment	Corporate tax	VAT
Private university or branch campus	22.1	9% above AED 375,000; QFZP unattainable	5% — art. 40(1)(c) is not satisfied
Private school	22.4	9% above AED 375,000, or Small Business Relief	0% where art. 40(1)(a) and (b) are met
Early childhood centre	22.5	9% above AED 375,000, or Small Business Relief	0% where art. 40(1)(a) and (b) are met
Education consultancy, repre­senta­tion, examination preparation	22.3	Usually Small Business Relief where Revenue does not exceed AED 3,000,000	5% — not an educational service under art. 40
Education technology, dormitories, sports facilities	22.2	9% above AED 375,000, or Small Business Relief	5%

Note the penultimate row: the services of a consultancy or an examination preparation centre are not “educational services” within article 40 of the Executive Regulation, because they are not supplied by a recognised educational institution under a recognised curriculum. The zero rate is unavailable to them whatever the licence segment.

A general overview of corporate tax and its rates appears in UAE corporate tax 2026: rates, QFZP, Small Business Relief. Where a project is structured through an individual, the analysis of corporate tax for natural persons and the AED 1,000,000 threshold is relevant.

Frequently asked questions

What is Dubai International Academic City?

Dubai International Academic City is an education-focused business park inside the free zone administered by the Dubai Development Authority. It licenses universities, branch campuses of foreign universities, junior colleges, career technical education providers, schools, early learning centres and educational service companies across five segments numbered 22.1 to 22.5. DIAC is not a standalone free zone: article 1.1 of DDA Decision No. 1 of 2021 defines it as one of the zone’s business parks.

How much does a DIAC licence cost?

The annual licence fee is AED 15,000 for any of the five DIAC segments under article 14 of DDA Decision No. 1 of 2021. An additional segment costs a further AED 10,000 per year. DIAC does not publish rental rates, visa costs or registration charges.

What is the minimum capital for a DIAC company?

AED 50,000 of paid-up capital across all five DIAC segments under article 15 of DDA Decision No. 1 of 2021. That is five times the standard AED 10,000 minimum that article 15.1 sets for the zone’s other segments.

Does a university in a Dubai free zone need a federal licence?

Yes. Article 14(1) of Federal Decree-Law No. 31 of 2025 requires Institutional Licensure for higher education institutions established in free zones. Article 14(2) requires a Local Permit from the Competent Local Authority before the application for Institutional Licensure is filed.

Is passing UQAIB enough instead of CAA accreditation?

Since 1 January 2026, no. The earlier model of choosing between the UQAIB route and CAA licensure is described on a KHDA page last updated in 2022 and has been overtaken by article 14 of Federal Decree-Law No. 31 of 2025, which makes the Local Permit, Institutional Licensure and federal Program Accreditation cumulative requirements.

By what date must an existing institution regularise its status?

By 1 January 2027. Article 25 of Federal Decree-Law No. 31 of 2025 allows one year from the date the law entered into force; the period may be extended for similar terms by a resolution of the Minister in coordination with the Competent Local Authorities.

Is tuition at a DIAC university subject to value added tax?

Yes, at the standard rate of 5%. Clause 1(c) of article 40 of the VAT Executive Regulation grants the zero rate to a higher education institution only where it is owned by the federal or local government or receives more than 50% of its annual funding directly from government. A private campus does not meet that condition.

Does the zero VAT rate apply to a private school in DIAC?

Yes, where conditions (a) and (b) of clause 1 of article 40 of the Executive Regulation are met: a recognised curriculum and a recognised educational institution. Condition (c) is addressed only to higher education institutions and does not apply to a school.

Can a DIAC university obtain the 0% corporate tax rate?

In practice, no. Education is absent from the closed list of fourteen Qualifying Activities in article 2(1) of Ministerial Decision No. 229 of 2025, and tuition is paid by students who are not Free Zone Persons, so sub-clause 3(1)(b) of Cabinet Decision No. 100 of 2023 applies and the revenue is non-qualifying Revenue.

How many activities does one DIAC licence cover?

One activity for segments 22.1 Higher Education Provider, 22.2 Non-Academic Services Provider, 22.4 School and 22.5 Early Learning Centre, and two activities for segment 22.3 Educational Support Services. The basis is the table in article 14 of DDA Decision No. 1 of 2021.

Is there a freelancer permit in DIAC?

No. Article 9.1 of DDA Decision No. 1 of 2021 lists four freelancer segments: 16.5 in Dubai Internet City, 18.9 in Dubai Media City, 21.13 in Dubai Knowledge Park and 25.10 in Dubai Design District. No DIAC segment appears among them, even though the GoFreelance marketing page offers an “education” category.

How long does company registration in DIAC take?

Seven working days according to DIAC’s official FAQ: four working days for initial approval of the application and three working days for issuance of the licence. DDA service pages elsewhere state 10 + 2 = 12 working days; that discrepancy is unresolved.

How many visas can a DIAC company obtain?

One employee visa for every 80 square feet of leased space — roughly 7.43 square metres per visa. The rule is stated in DIAC’s official FAQ.

Can a DIAC licence be used to operate outside the free zone?

Not without separate authorisation. DIAC’s official FAQ answers directly: “No, you can only operate within the free zone.” Dubai Executive Council Resolution No. 11 of 2025 provides three constructions: a licence for a branch inside the emirate, a licence for a branch operating out of the free zone at AED 10,000 per year, and a temporary permit for up to six months at AED 5,000. All three are issued by the Dubai Department of Economy and Tourism (DET).

Key takeaways

1.        DIAC is a business park, not a separate free zone. The regulator is the Dubai Development Authority; the operative zone legislation is Dubai Law No. 15 of 2014 as amended by Laws No. 10 of 2018 and No. 8 of 2023.

2.        Five segments, nineteen activities, a single fee of AED 15,000 per year and a minimum paid-up capital of AED 50,000 across all five segments — five times the zone standard.

3.        A licence covers one activity, except segment 22.3, which covers two. Expansion runs either through the discretionary power in article 10.5 or through a second segment at AED 10,000 per year.

4.        Federal Decree-Law No. 31 of 2025 has applied since 1 January 2026 and expressly brings free zone universities, institutes and colleges within its scope.

5.        Article 14(2) requires the Local Permit before the Institutional Licensure application, while article 14(3) guarantees no repeated procedures and no additional fees once it is held.

6.        Article 14(5) subjects every free zone programme to federal accreditation, and article 10(4) allows an institution to ask for recognition of existing international accreditation on three conditions.

7.        The regularisation deadline is 1 January 2027 under article 25.

8.        Sanctions are spread across three layers: Schedule 4 to DDA Decision No. 1 of 2021, KHDA administrative measures under article 14(7), and criminal liability under article 22(1) with a fine from AED 100,000 to AED 10,000,000.

9.        Article 5 of DDA Decision No. 1 of 2021 is the zone act’s only education-specific article: Academic Authorisation for 22.1, an NOC for 22.3 and 22.4, approval for 22.5, and no gate at all for 22.2.

10.    VAT: 5% for a university, 0% for a school and a nursery where conditions (a) and (b) are met; education is never exempt, so input tax recovery survives.

11.    QFZP status for tuition fees is unattainable, because education is absent from the Qualifying Activities list; the practical instrument for small operators is Small Business Relief, extended to tax periods ending on or before 31 December 2029.

12.    Schools and nurseries remain within the Dubai track: during 2026 KHDA issued a series of administrative resolutions on schools and early childhood centres, while higher education is being restructured federally.

Summary

Dubai International Academic City (DIAC) is an education-focused business park inside the Dubai Development Authority free zone, defined in article 1.1 of DDA Decision No. 1 of 2021 alongside DMC, DIC, DKP, DOC, DSC, DSP, DPC, ET and D3. Part Seven of that Decision establishes five DIAC licensing segments — 22.1 Higher Education Provider, 22.2 Non-Academic Services Provider, 22.3 Educational Support Services, 22.4 School and 22.5 Early Learning Centre — covering nineteen activities. The annual licence fee is AED 15,000 for each segment, a licence covers one activity except segment 22.3 which covers two, and the minimum paid-up capital across all five segments is AED 50,000 against the zone standard of AED 10,000. Article 5 of the Decision requires initial Academic Authorisation approval from KHDA before a licence is issued under segment 22.1, a No Objection Certificate from KHDA for segments 22.3 and 22.4, and KHDA approval for segment 22.5; segment 22.2 has no KHDA gate. No freelancer permit exists in DIAC: article 9.1 lists only segments 16.5, 18.9, 21.13 and 25.10. Federal Decree-Law No. 31 of 2025 on Higher Education and Scientific Research has applied since 1 January 2026; it was issued on 1 October 2025, published in Official Gazette No. 809 of 14 October 2025, and repealed Federal Decree-Law No. 48 of 2021. Its article 3(1) extends the law to all types of free zones, article 14(1) requires Institutional Licensure, article 14(2) requires a Local Permit from the Competent Local Authority before the application is filed, article 14(3) excludes repeated procedures and additional fees, article 14(5) subjects all programmes to federal accreditation, and article 25 obliges existing institutions to regularise their status by 1 January 2027. Article 22(1) imposes imprisonment of up to one year and a fine from AED 100,000 to AED 10,000,000 for operating without Institutional Licensure or Program Accreditation. For VAT purposes, tuition at a private free zone university is taxed at 5%, because clause 1(c) of article 40 of the Executive Regulation requires government ownership or more than 50% government funding; a school and an early learning centre apply the zero rate where conditions (a) and (b) are met. Qualifying Free Zone Person status for tuition fees is unattainable, since education is absent from the list of fourteen Qualifying Activities in Ministerial Decision No. 229 of 2025. According to KHDA data for the 2024-25 academic year, 42,026 students studied in Dubai across 41 private higher education institutions, 37 of them international campuses, with 706 programmes and 2,123 faculty members; DIAC itself reports more than 28,000 students and more than 500 programmes and was founded in 2007.

Sources

1.        Federal Decree-Law No. 31 of 2025 on Higher Education and Scientific Research — UAE legislation portal

2.        Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses

3.        Cabinet Decision No. 100 of 2023 on Qualifying Income of a Qualifying Free Zone Person

4.        Cabinet Decision No. 52 of 2017 — VAT Executive Regulation

5.        Federal Decree-Law No. 8 of 2017 on Value Added Tax

6.        Cabinet Decision No. 116 of 2022 on the Taxable Income Threshold

7.        Ministerial Decision No. 229 of 2025 on Qualifying Activities and Excluded Activities — UAE Ministry of Finance

8.        Ministerial Decision No. 73 of 2023 on Small Business Relief

9.        Ministerial Decision No. 131 of 2026 amending Ministerial Decision No. 73 of 2023

10.    Ministerial Decision No. 84 of 2025 on Audited Financial Statements

11.    Federal Tax Authority list of Designated Zones

12.    Dubai Law No. 8 of 2023 amending Law No. 15 of 2014 on the Dubai Development Authority — Dubai Supreme Legislation Committee portal

13.    Dubai Executive Council Resolution No. 11 of 2025 on activities outside the free zones

14.    Administrative Resolution No. 41 of 2026 on issuing and assigning educational permits for private schools

15.    Administrative Resolution No. 43 of 2026 on the Guide to Premises Requirements

16.    Administrative Resolution No. 39 of 2026 on the names of early childhood centres

17.    Administrative Resolution No. 35 of 2026 on violations by early childhood centres

18.    Administrative Resolution No. 31 of 2026 on early childhood centre curricula

19.    Administrative Resolution No. 30 of 2026 on enrolment approvals for early childhood centres

20.    Administrative Resolution No. 23 of 2026 on administrative violations by private schools

21.    Administrative Resolution No. 15 of 2026 on the Dubai Inclusive Education Policy Framework

22.    DDA Decision No. 1 of 2021 — Licensing Categories 2021

23.    DDA Decision No. 3 of 2017 — corporate services tariff

24.    Dubai Creative Clusters Private Companies Regulations 2016

25.    Dubai Law No. 15 of 2014 on the Dubai Development Authority

26.    Dubai Development Authority legal database

27.    KHDA — quality assurance in the free zones of Dubai

28.    KHDA — responsibilities of higher education institutions

29.    KHDA — permits for higher education institutions

30.    KHDA — responsibilities of training institutes (TVET)

31.    KHDA — record growth in Dubai’s private higher education sector, 19 May 2025

32.    KHDA — resumption of quality assurance visits, 3 June 2026

33.    Dubai International Academic City — About Us

34.    Dubai International Academic City — frequently asked questions

35.    Dubai International Academic City — homepage and news

All links were checked as at the date of publication. Federal acts are cited from the official UAE legislation portal, and Dubai acts from the portal of the Supreme Legislation Committee of Dubai and the Dubai Development Authority legal database.

Disclaimer

This material is provided for information purposes only and does not constitute legal, tax, financial, investment or consulting advice. Before taking any decision, obtain individual professional advice tailored to the specific situation, jurisdiction, company status and the regulators’ current requirements.

Date of publication: September 2026.