What is a Dubai Trade License?

For every businessman who wants to establish his business in the UAE is important to know everything about the Dubai trade license. Simply put, this is an official document providing the legal authority to conduct business in the emirate. It is considered a permit that the pertinent government authorities grant, to indicate that the company complies with all the requirements and regulations necessary to carry out commercial operations.

In this article, we will explain all the information you need to know about the Dubai trade license. Knowing about this is of the utmost importance for the process of forming a company in UAE. This is the most important step. In principle, you will see the types of licenses that exist and when to use each one depending on the type of commercial activity to be carried out. In addition, we will give you a guide with all the steps you must follow to obtain the Dubai trade license. Thus, you can start your business in this emirate so striking for companies.

What Are the Types of Trade Licenses in Dubai?

There are many elements to forming a company in Dubai, but a trade license is one of the most important. This way, with professional assistance and expert guidance, getting your business license is not a difficult task. For this reason, if you want to start your business in Dubai, you should be aware of the following business licenses that you can obtain.

• Professional license: This license is for those people who meet the academic standards and the necessary requirements of technical and intellectual competence. An example of this is people who offer professional services, IT, craftsmen, etc. In addition, the company can also be registered as a civil works company if it has different owners.
• Industrial license: This license is necessary so that companies and individuals whose mission is the production of goods for the industrial sector can start and operate without any inconvenience. In addition, in order for a company to obtain an industrial license, it must have a physical location in the United Arab Emirates.
• Commercial license: Those people and companies whose function is the purchase and sale of goods, need these licenses. In this way, companies can carry out their commercial operations inside and outside the UAE thanks to this license. In addition, there are several categories of business licenses according to the type of activity.
• Tourism license: Those people and companies that offer travel and tourism services receive this license. It is the license most used by companies, as Dubai is one of the most famous tourist centers in the UAE. Entrepreneurs who are in charge of managing establishments with rental services, hotels, cruise rentals, travel agencies, etc., need this license.

How to Get Trade License in Dubai

Obtaining a trade license in Dubai is a crucial step for entrepreneurs looking to set up a business. A trade license Dubai is a legal document that permits individuals or companies to conduct various types of commercial activities within the emirate. To secure a Dubai trade license, you’ll need to follow a specific process outlined by the government authorities. It typically involves selecting a business activity, determining your legal structure, and adhering to the requirements and regulations. The specific requirements can vary based on the type of trade license you’re seeking. It’s essential to research and seek guidance to ensure you meet all the necessary criteria for your specific business endeavor.

What is the cost of a Dubai Trade License?

This license is a document that is responsible for determining what activities a UAE company can carry out. The Department of Economic Development is responsible for issuing business licenses. For this reason, if you want to know how to start a business in Dubai, it is important that you are aware of all the costs associated with the various business licenses available.

Before you rush to get a UAE trade license, you should know what the cost will be. In this way, you can make the budget for the process of obtaining licenses and thus avoid any setbacks. The cost of a business license can vary according to the type of product you wish to sell and the approvals required for this.

Apart from this, other factors directly affect the cost of your business license and these are:

• The number of business partners you have.
• The region in which you are establishing.
• Structure of your company.
• If you have partnerships with local sponsors
• The type of business activity that you are going to develop.

However, the cost of a business license in Dubai is normally between AED 15,000 and AED 50,000. Also, you should be aware that if you obtain a business license in a free zone, the cost of this will be different from obtaining it in mainland Dubai. On the other hand, the time for your business license to be granted is from three days to four weeks and this will depend on the activities you carry out and your approvals.

What is the process to apply for a Trade License in Dubai?

Dubai is one of the most important economic centers worldwide. Therefore, many companies and people want to start their own business in the country and enjoy the benefits it offers. In addition, Dubai offers many facilities to those interested in investing in the country, and in this case, it is no different. For this reason, it is important to know about this entire process.

In this way, getting your business license in Dubai will become quite easy if you follow the steps properly. Later in the article, the steps for you to obtain your business license will be explained in more detail. On the other hand, it is important to know that commercial licenses have a limited duration, that is, they are not valid forever.

The Dubai business license must be renewed every year in order for your company to continue to operate legally in the country. In order to carry out the renewal, you will need certain approvals. These approvals will depend on the type of business you own. For example, if you have a transportation company, you need approval from the Highway and Transportation Authority.

You will need to have the necessary documentation to go ahead with the renewal. In addition, these documents must be filed with the Department of Economic Development. Lastly, before you apply for your renewal you should verify your lease. This is because it must have a minimum validity of three months from the date you request the renewal of your license.

Determine the Business Activity and Legal Structure

Before starting the process to obtain a Dubai trade license you must select an ideal business name. It is important to note that the company name has to comply with the regulations in the UAE.

The first thing to start the application for the Dubai trade license will be to select the legal structure of your business. In short, the legal structure will be the one that defines how your business will be managed and who is responsible for the company. Three main types of legal structure are often of interest to entrepreneurs.

Sole Proprietorship: This legal structure is the simplest form and does not impose any special requirements. They only request a residence permit for foreigners. The most important feature is that it is a single person who has control over business operations. That is, the owner has 100% of the shares of any profits and debts.

Partnership Company: This type of legal structure is the complete opposite of the previous one. That is, the property is shared between two or more partners or shareholders, among whom profits and losses are shared. Of course, everything will be divided according to the proportion established in the initial agreement.

Limited Liability Company (LLC) in Dubai: Most of the entrepreneurs choose this legal structure. The Limited Liability Company (LLC) is characterized by limiting the scope of your investment in the company. Most importantly, LLCs can carry out any type of industrial or commercial activity in the jurisdiction.

Once you have the legal structure, the next step is to choose the commercial activities that you plan to carry out. It is important to ensure that you write down all license activities. In addition, you must take into account that each commercial license allows a maximum of ten commercial activities.

Gathering Essential Documents for Trade License Application

The next step to take is to gather all the documents to obtain the license. It is important to note that you must ensure that all the necessary signatures are present on all documents. That is, depending on the type of legal structure of the company, you must have the signatures of the shareholders and the relevant government entities.

Once you are at this step, it is important to make sure all the documentation is well organized. In addition, you have to send it along with the application to avoid delays that can have negative consequences for you. For instance, delay in obtaining the Dubai trade license.

In principle, all partners must complete the application. They will request different personal data from the shareholders and the company in general. At the end of filling out the application, all company managers must sign the document.

On the other hand, they must create or apply for a Partnership Memorandum. It is important to note that to obtain this document you must hire a legal representative. That is a lawyer or a company that specializes in these matters.

When you have all the above documents, you will have to attach the approval of the company name to the application. This approval will be sent to you by the Dubai Department of Economics (DED) after accepting the business name of your choice. That is, the DED takes care of all aspects regarding the name of the companies in Dubai.

Finally, all partners or shareholders belonging to the manager must present photocopies of their passports. It is important to note that this document must be valid for at least 6 months.

Choose Your Business Location

There are several options regarding the Dubai trade license that you want to apply for. If applying for a continental business license, you must have a physical business location. In Dubai, there are two types of interesting locations: the free zone and the mainland zone. Below, you will see a summary of these types of locations in Dubai, so you can make the best decision.

Freezone: One of the most important and interesting advantages that companies in a freezone have is that they do not require a local sponsor. That is, they do not have to have a shareholder who is a citizen of the UAE. Also, you can have complete ownership of the company.

It is important to mention that free zones have their requirements and costs for doing business. On the other hand, free zones have limitations such as minimum share capital or other additional costs.

Mainland zone: Unlike free zones, a mainland company requires 51% local ownership. That is, you need a UAE citizen shareholder and they will have 51% ownership of the company. However, you can have full control over the company and decisions.

On the other hand, establishing a continental company in the UAE will depend on the type of company and the service it offers. However, all the costs and the process to follow to obtain a Dubai trade license are the same as stated above.

Once you decide on one of the existing zones in Dubai, either in a free zone or a mainland zone, you must look for a physical office. After you choose an office you will have access to a lease. For it to be valid, Ejari must attest to the contract. It is important to note that this must be submitted with the rest of the application documents.

Submit Your Application

Entrepreneurs who own a general business license have a great opportunity to manufacture or import goods. That is, they can send their products abroad or to the local market of Dubai. Thus, they can earn profits from other countries.

Furthermore, owners with a Dubai trade license can re-export their products. Which allows you to increase your company’s ability to market services and goods around the world. Therefore, you can have access to better and higher profits.

That is why you must have access to a Dubai trade license and continue with the application process. The next step in the process is to complete the application form or form. You must complete each of the boxes that are requested with information about the company and the shareholders. Once you finish filling in all the information, proceed to send the form to the DED for initial approval.

After gathering all the materials and having the business location, you are ready to submit your Dubai trade license application. Send all the documents to the DED and in a matter of days, you will have access to your business license.

Pay Your Licensing Fees

This type of procedure is not free, it is important to make the payment for the cost of the Dubai trade license. This payment is divided into two parts, the first is the payment for the issuance fee. The second part is the fee, for the license itself. Once you make the payment of the two amounts, you can receive the license.

One of the main reasons why entrepreneurs want to establish in Dubai is because they decide to take advantage of tax incentives. Most countries require investors or entrepreneurs to pay significant amounts for taxes. Among the most important, on manufacturing and sales. This emirate does not do that; Dubai is almost completely duty-free.

In summary, businessmen prefer this city to open their businesses for numerous reasons. Among them are the low costs of Company formation. Almost the only thing you have to pay is the cost of the infrastructure and the Dubai trade license, which is not very expensive.

The cost of your trade license includes

Some of the commercial or industrial activities that exist may require you to obtain external or additional approvals. It is important to do thorough research on additional requirements before completing the company formation process. For instance, additional records of some products or goods. If you do not do this, you run the risk of having a negative response in obtaining your Dubai trade license.

On the plus side, there are very few trade restrictions or additional requirements in Dubai. Thanks to this, this nation is the ideal destination to do business or open companies.

Conclusion

Thanks to this article, it was possible to better understand what a business license is in Dubai and its importance. In this way, several factors of this license are explained, such as the different types of commercial licenses that you can obtain. In addition, you explain the process that must be followed in order for you to obtain your business license or that you can simply renew it.

There was talk about applying for a DED Trader’s license, which allows you to run a business from the comfort of your home. In addition, it sells all kinds of products and services through social networks. In this way, you will be able to take advantage of the benefits of a business license in Dubai, one of the most important economic centers around the world.

Dubai has a great modern infrastructure and a prime location that is highly conducive to new businesses. In this way, it has established itself as one of the most important emirates for doing business in the UAE. For this reason, if you want to take advantage of all the benefits of starting your company in Dubai and want to get your business license, we are the ones for you.

In Connect Business Center, you will find all the information and guides that you need so much to start in the economy of Dubai. For that reason, we invite you to contact us to learn more about Dubai business licenses. You do not know how to do it? It is easy, you just have to communicate through the following number +971 43 316 688. Also, by sending us an email to our email info@connectbusinesscenter.com.