From the extensive government support to the favourable business environment and proximity to various emerging markets worldwide, there are many reasons business owners choose to set up their company in Dubai. The ease of doing business alone is more than enough cause to bring your firm to the most populous city of the United Arab Emirates (UAE).
But before you can enjoy all the perks of starting a Dubai company, you must first acquire a trade licence.
Continue reading for the frequently asked questions about general trade licences and get the answers you need for hassle-free business setup in the UAE.
What are the different trade licences in Dubai?
A trade licence is a document that serves as proof that a company operates according to the UAE’s Commercial Companies Law. It lets entrepreneurs manage their businesses freely in line with regulations levied by the government.
There are different trade licences you can apply for in Dubai, depending on your chosen business structure, activities, and jurisdiction. The four main ones include:
- Commercial Licence: This covers all types of general trading and specialised trading activities conducted in Dubai.
- Professional License: This type of licence lets businesses engage in service-oriented activities. It also allows professionals like doctors, teachers, craftsmen, and artisans to do business in the country.
- Industrial License: This trade licence covers all establishments engaged in industrial and manufacturing activities in Dubai.
- Tourism License: This trade licence is required for all firms and businesses involved in the hospitality, travel and tourism sector.
What are the activities under a general trade license in Dubai?
Entrepreneurs who wish to start a company need to have a general trading licence to operate legally in Dubai.
This trade licence is ideal for most companies, especially those that perform multiple trading activities in the same or different industries. Among the activities covered in a general trade licence are import, export, and trading of products like:
- Clothes
- Accessories
- Furniture
- Electronics
A general trade licence also covers wholesalers and other businesses that participate in bulk product trading.
Note that some goods are regulated and require special approval on top of the general trade licence of the respective authority they fall under. These goods include:
- Pharmaceuticals
- Frozen goods
- Alcoholic beverages
How much does a general trade licence cost in Dubai?
Acquiring a general trade licence can cost anywhere between AED 30,000 and AED 40,000, depending on various factors.
Though the initial cost may be relatively high, this trade licence offers a broader range of business activities that opens more opportunities for your company. This is the reason many business consultancy experts recommend this option, especially for firms planning to engage in trading, export, and import of over one type of product.
While general trade licences apply to all types of jurisdictions and legal entities, the regulations – including the cost and processes – usually vary for each case.
How long do I have to wait to get my trade licence in Dubai?
The UAE government has made starting and running a business very easy. In fact, this is one of the primary factors that draw entrepreneurs and investors to the country.
The licencing process is quite straightforward and would only require anywhere between seven to ten days to complete if all requirements are met.
That’s not all. You also have the choice to operate your business immediately whilst running on an instant trade licence from the Department of Economic Development (DED).
The agency responsible for licencing and other company formation processing in Dubai lets entrepreneurs start their companies immediately with an instant licence. This can be applied for directly to the DED (both on-site and online) or with the help of a service provider or reading a Guide on Business Setup in Dubai which helps you out with all the necessary steps.
Instant licences grant entrepreneurs a one-year grace period to finalise their trade name. Within those 12 months, they must accomplish other important business formation requirements, including:
- A fully notarised Memorandum of Association (MOA).
- A commercial space agreement or tenancy contract or registration from the EJARI – the real estate online registration system started by the Real Estate Regulatory Agency (RERA).
How can I get a general trade licence in Dubai?
To get your general trade licence, you must:
- Choose a corporate entity and trade name.
Picking out a legal structure and trade name for your company is the first step to getting your trade licence. Choose a unique name that abides by all the conditions set by the DED, and there shouldn’t be any delays in its processing.
You also need to apply for a corporate entity to proceed further.
- Select a business activity.
Finalise all the business activities you wish to include in your trade licence. You can list no more than ten activities per licence.
- Pick a business location.
Business location is crucial in acquiring your trade licence as well. Unless you’re applying for an instant licence, you need to get a tenancy contract attested in the EJARI to get a trade licence.
- Complete the application form and other documents required.
Any legal representative of your company must fill out the application form and gather all the necessary documents for your company setup. This can include:
- The Memorandum of Association (MOA)
- The tenancy agreement attested on the EJARI
- The company name approval from the DED
- The company setup approval from the DED
- Shareholders’ details, including copies of their passports along with other important details
- Submit the application and pay the required fees.
Once you have all the requirements ready, you can already submit your trade licence application and pay the necessary fees to get the license.
Do I need to renew my general trade licence?
Yes.
DED-issued trade licences must be renewed annually. The process is simple:
- Get authorisations and approvals.
First, get the authorisations and approvals from all governmental bodies concerned. Below are some examples:
- Taxi service companies need to get authorisation from the Roads and Transport Authority (RTA).
- Restaurants and food establishments must have an approval letter from the Food Safety Department.
- Renew your tenancy contract.
Check if your tenancy contract is still valid for at least three months from the date of your renewal application. Don’t forget to submit an attested EJARI with your renewal.
- Gather documentation.
Prepare the documents needed for the renewal. This includes:
- An accomplished renewal form
- The valid tenancy contract with an attested EJARI
- Approvals and authorisation documents
- Photographs of all stakeholders and business partners
- DED transaction number or payment voucher
Go Global in Dubai
Deciding to move your business somewhere better doesn’t need to be overwhelming.
Getting a business licence in Dubai is easier with the right knowledge and help. Use this as a quick guide when forming your Dubai company and get a head-start in this global business hub.
