How to Obtain Manufacturing License in UAE

The manufacturing license UAE requires some processes, requirements, and costs to acquire them. Furthermore, with the license, you will receive the benefits that it brings, although you will also have to comply with certain obligations. However, you will get the opportunity to develop your business in the Emirates, which is one of the best places to set up a business.

In this article, we will delve into the reasons why you should apply for this license to operate in the UAE. In addition, you will know what the requirements and processes are to obtain it easily.

Why You Need a UAE Manufacturing License

Obtaining a manufacturing license UAE right now means taking advantage of the boom in this sector in the country. This includes the manufacturing, import, and export sectors, as well as those that contribute to the local economy. Furthermore, the manufacturing sector contributes significantly to the GDP of the UAE through annual exports worth an average of AED 167 million.

Furthermore, there are some notable reasons to establish a manufacturing company in the country. This way, you will get business opportunities like nowhere else in the world. Below, we set out the reasons to consider the UAE as a prime option for doing business:

1. Legal Compliance

A Dubai manufacturing license allows you to run a business legally compliant with the regulations of the country. This safely eliminates the risk of legal problems with your company in the future. Additionally, legal compliance will allow you to enjoy tax benefits such as low corporate taxes and 100% foreign ownership.

Additionally, the license will allow you to access financial institutions and banks in the United Arab Emirates. Similarly, this license will show your partners and clients the legality of your company, which builds more trust in them.

2. Market Access

With a manufacturing license in UAE, you will be able to establish your business in a commercially strategic location. In this case, the country is located in a place that facilitates connectivity with the markets of Africa, Asia, and Europe. This way, you increase your chances of achieving the goals of your company in terms of global reach.

Likewise, the country has a first-class infrastructure in terms of means of transportation. This point includes seaports, airports, and roads that connect with large markets.

3. Government Support

The manufacturing license UAE is one of the government initiatives to attract foreign investment and improve the economy. In this sense, the favorable policies of the authorities allow business growth, which include the following:

• Low registration costs
• Favorable regulations
• Tax exemptions
• Support for startups
• Incubator programs

In this way, the country offers a welcoming environment, financial tranquility, and growth for those who wish to contribute to the economy. Of course, the manufacturing sector has a leading role in the strategic plans of the authorities.

4. Investment Opportunities

The manufacturing license in Dubai contributes significantly to the GDP, in addition to being one of the most competitive regionally. With favorable policies, manufacturing companies have great opportunities to grow and expand. Furthermore, one of the long-term goals of the authorities is to increase manufacturing industries and increase the GDP of the nation.

How to Obtain Manufacturing License in Dubai, UAE?

As we mentioned, the manufacturing license UAE will allow you to operate legally in the country and take advantage of the advantages it offers. You must follow a systematic process that will help in safe processing and compliance with UAE laws. Below, we present the steps that generally lead you to obtain the respective license for your business.

Step 1: Determine Your Business Activity

The business activities you wish to carry out in the UAE will determine the configuration of your manufacturing business. Additionally, you can establish your business on the continent or set it up in one of the Free Zones of the country. In these two different jurisdictions, you will find different benefits, regulations, and operating models.

However, Free Zones are more popular due to their configuration and the profitability of the companies. One of these benefits that investors highlight is 100% foreign ownership. However, Free Zone companies must take additional actions to trade within the UAE. In this case, they must open a branch or use a distributor to trade their products on the mainland.

The free zones established in the country are more than 40 prepared for different commercial activities. On the other hand, the trading company in the Emirates market will allow you to trade without having to take extra steps. However, 51% of the shares of the continental company will belong to the sponsor.

Sometimes choosing which business setup is best for your type of business could be complicated. Thus, to apply for a UAE manufacturing license, you will find business consultants who can help you choose the best configuration for your company. Below you will see the types of manufacturing company setups that can operate in the UAE.

• In UAE, you can set up your manufacturing company as:
• Limited liability company
• Public limited company
• Private limited company
• Branch of a GCC (Gulf Cooperation Council)
• Branch of a local company

Likewise, it will be up to you to decide the structure that you will apply, thinking about the objectives you want to achieve with your business.

Step 2: Select a Business Name

When deciding on the name of your manufacturing company, remember to follow the regulations of UAE law. Also, the company name cannot have an offensive term in its structure. Furthermore, it should not contain abbreviations of your name or references to recognized brands or institutions.

Likewise, the name you choose will have to include a legal entity such as LLC or FZE. Additionally, you will have to go to the Registry Office to register the name of your business.

Step 3: Choose the Right Location

Another important step to applying for the manufacturing license UAE is the correct location that will have to be in order with the commercial activity you will carry out. In the Emirates, you will find two commercial zones, the free trade zones and the continental ones. Likewise, both have certain benefits, operating guidelines, as well as particular regulations.

However, the Free Zone is the most sought-after due to the superior profitability it has concerning the other. It will also offer you the opportunity to have 100% ownership of your industry. Yet, Free Zone companies require other measures such as opening a branch or having a distributor to be able to negotiate legally.

On the other hand, if the manufacturing license in UAE is for a mainland company, it will be able to trade without any additional measures. However, the local sponsor will receive 51% of the total shares of the company.

Step 4: Submit Application to Regulatory Authority

To proceed with obtaining the license, you will need to apply for approval from the local municipality of the Emirate of Dubai. Likewise, this step will include a complete report of the factory, the plan, and financing information, among others, that will be delivered to the authorities. However, if your business is located in the Free Trade Zone, you will not need to comply with this step.

For approval of the manufacturing license UAE of a mainland company, you will have to get accompanying approvals. These will include approvals from the Ministry of Health, Ministries of Environment, and the Dubai Chamber of Commerce and Industry.

Step 5: License Issuance

For the issuance of the Dubai manufacturing license, you will have to rent or purchase some physical location. In addition, you will have to have at least AED 250,000 as initial capital at least and a payroll of at least 10 workers. Finally, when you have all the requirements and the configuration of your company defined, you can send them to the government entities of the Emirates.

This way, you can apply for the UAE manufacturing license. Below are some examples of industries that require a license:

• Bread making
• Textile manufacturing
• Metal casting
• Manufacturing of equipment and engines
• Manufacturing of petroleum products
• Paper manufacturing

Additional requirements for the licensing of a Company with a Local Service Agent (LSA) in Dubai

For a manufacturing license in UAE, your company will have to have an LSA that will function as a representative of your business. Thus, it will represent you before the local authorities of the UAE. Below are the additional requirements:

Request an Environmental Report Comprehensive

To request the environmental report, you will need to prepare a detailed report on your industry. Likewise, in the report, you will have to include the design of the plant, the flow diagram, and the list of machines and equipment you need.

Comply with fire safety regulations

To obtain the manufacturing license UAE, you must comply with fire regulations promulgated by the Civil Defense of the Emirates. Therefore, it will involve obtaining the initial approval certificate. To do this, present the commercial lease document and install fire prevention equipment.

DEWA regulations

You will have to comply with the provisions of DEWA for the Dubai manufacturing license. Likewise, by complying with the guidelines and regulations of this entity, you will be able to enjoy special tax and customs exemptions.

Extra considerations to apply for the manufacturing license UAE

The industrial license is useful if your company wants to engage in the production of packaging for different products. Additionally, to apply, you will need to have an office space, warehouse, and capital of at least AED 250000. Moreover, the following documents are necessary to complete the process:

• Balance of movements
• Plant reports
• Passport and residency copies for non-citizens
• If applicable, partnership contracts
• Aptitude studies
• Photocopies of commercial license

Step 6: Post-Licensing Procedures

One of the procedures to apply for a UAE manufacturing license is permission from the DED. With this municipal permit, you will be able to build your work plant and obtain approval from other important ministries. Likewise, the cost of the license in Dubai will depend on the place where you establish your business but is generally AED 35,000.

Also, if it seems expensive, keep in mind that with this license, you will have many benefits in the emirate. Hence, you will enjoy good rents for your business and reduced costs for land granted by the government. You will also be able to take advantage of rate subsidies for public services.

Likewise, industry support and guidance, low-interest rates for innovative products, and financial assistance during R&D. Additionally, the first place for quality products when making the official purchase.

However, you must remember that acquiring the manufacturing license UAE will bring you some obligations. Therefore, you will have to start building the company 6 months after approval and submit the data to DED. In addition, you must notify this entity of the moment in which you will begin operations and when you will register in the Industrial Registry.

• Any changes or amendments to your factory records.
• That is not selling or leasing designated industry development properties.
• Employee data.
• You are using imported goods and materials for their purpose.
• That your company adheres to land laws and regulations.
• Your company follows hygiene, physical fitness, and industrial safety guidelines.
• Any changes, such as the appointment of a director, must be reported to DED.

How much does a manufacturing license cost in Dubai, UAE?

The initial cost for a manufacturing license UAE specifically is between AED 20,000 and AED 30,000. Commercial licenses, government approvals, visas, and personnel recruitment will also be included. However, as we mentioned above, the cost may depend on factors such as location or type of industrial activity.

Additionally, keep in mind that the government of the United Arab Emirates prioritizes products that are of high quality. Likewise, those who have industrial licenses will have to comply with the construction within the mentioned 6 months. In addition, comply with hygiene, land, and industrial safety laws.

Conclusion

The manufacturing license UAE is a necessary document for industrial production processes in the emirates. However, you will need to meet all requirements including additional ones to successfully process this document. Furthermore, when you comply with everything required, this license will give you multiple benefits in industrial processes.

You have already learned everything related to the license, but if you want more information you can contact us and our team of professionals will advise you.