What is Business Trade License in Dubai, UAE?

The business license is an essential part of any business in Dubai, UAE. According to Dubai law, a business cannot use its land to operate if it does not hold a valid business license issued by the authorised departments in Dubai. In Dubai, the Department of Economic Development (DED) has the jurisdiction to issue licenses. DED has categorised every business under a different license category, providing them distinction as per their business activity.

What are the Advantages of a Business License?

A business license in Dubai enables you to start a business in Dubai with an adequately regulated, legally authorised structure. Additionally, you are also entitled to several benefits.

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Types of Business Licenses in Dubai

• Commercial License
• Professional License
• Industrial License

The three most preferred licenses are - Commercial, Industrial and Professional. There are many other business licenses in Dubai like - Tourism License, Agriculture License, Craftsmanship License, Freelancer License and more.

Commercial Trade License

The most selected of all business permits is the trade license, also mentioned as the commercial license. Under this license, maximum business activities can be carried out across the United Arab Emirates. Commercial licenses cover all kinds of general trading activities and also specialised trading ventures. Business categories in commercial license include - real estate, import and export goods, retail stores, etc.

Industrial License

The industrial license in UAE is essential for all business establishments that engage in industry-related initiatives here. Some of the known business activities that use Industrial licenses are all kinds of manufacturing sectors (a garment, carpet, etc.), oil and petroleum industry, businesses that into dairy products production, animal and birds feed production, and meat production. The industrial license is issued by the Department of Economic Development, which is the only authorised department with license issuance charges. The manufacturing and industrial sectors open massive opportunities for the economy's growth and serve as a major employment generator. Therefore, UAE has been very welcoming to even global entrepreneurs who are willing to establish industries in the UAE. As a result, in recent times, UAE has seen a gradual rise in the industrial sector.

Professional License

Professional license is the third type of business license among many increasingly on-demand licenses in Dubai and UAE. This license is issued to skilled individuals in a particular profession who practise it for a living or career. Moreover, companies that are into service-sector also require a professional license. A professional license is mandatory for all firms that are into services like - consultancy, finance & accounting, healthcare, teaching, doctors, legal practices and trade-oriented professions like carpentry, masonry, designing, craftsmen, artisans, etc. A professional license is issued by the Department of Economic Development in Dubai.

Where to Apply for a Business License in Dubai?

Business licenses in Dubai for mainland companies are issued by the Department of Economic Development (DED Dubai). DED is responsible for regulating the economic agenda of the emirate. Additionally, it also proposes strategic economic policies and plans to encourage sustainable growth in Dubai. However, if you seek to open a company in a free zone, the respective free zone authority is responsible for issuing the business license.

What Do You Need to Obtain a Business Licence?

Before planning to start any business, determine the following legal requirements to obtain a business license in Dubai:-

• Business category – whether it is professional, commercial, or industrial;
• The type of business activity
• The legal structure of the business entity
• The trade name of your business

How to Obtain a Business License in Dubai?

To obtain the business license, one must follow the below-mentioned steps:-

• Identify Your Business Category

  The free zone or the Department of Economic Development (DED) provides a category list of business activities. To begin your licensing process, you will first need to identify the appropriate category for your business.

• Choose the Right Legal Structure

  Your company's legal structure is no less important than your company's trade name. The legal structure is determined by the number of shareholders your business has and the jurisdiction you choose for your business operations.

• Choose a Trade Name

  Ensure your trading name defines your business activity(ies) and complies with the government guidelines.

• Fix an Amount for Investment

  Depending on your business, you must have an idea of your investment.

• Lease or Purchase Office Space

  Choose an office space that suits your budget and business requirements and make sure you can conveniently accommodate your employees.

• Get Initial Approval from Authorised Departments

  It is a fundamental step for obtaining a business license.

What are the Necessary Documents for Trade License?

Below are the necessary documents which you must keep handy while applying for a business license in Dubai:-

• Duly filled application form
• The master plan of your business activity or project
• Copy of passport (of every shareholder/partner associated with your business legally)
• Certificate of reference from the bank along with 2 years financial statement
• No Objection Certificate (NOC) from your sponsor
• Letter of Intent
• Notarised copy of Registry Identification Form (for the Director)
• Passport-size photograph of the Director or the Manager
• Details of Share Capital

What are the Documents Required for the Issuance of a Trade License in Dubai?

To apply for a business licence, the following documents are necessary. However, these can vary depending on the jurisdiction that governs the licensing process.-

• Trade name certificate
• Initial approval certificate
• Dubai Municipality and RERA attested Tenancy Agreement using the Ejari online feature.
• Memorandum of Association (Applicable for LLCs, One Person Company, Private and Public Shareholding Companies, Simple Limited Partnership, Partnership or Civil Company)
• Local Service Agent Agreement (Applicable when a UAE national represents your business concerning licensing and compliance.)
• Approval of Government bodies (Applicable on certain business types).

What are the Requirements for Business Licensing?

To apply for a business licence, the following documents are necessary. However, these can vary depending on the jurisdiction that governs the licensing process.-

• For the issuance of licenses for banks and other financial institutions, the consent of the UAE Central Bank is a must.
• For the issuance of licenses for manufacturing companies, you must have the permission of the Finance and Industry Ministry.
• For the issuance of licenses for companies engaged in insurance and other relevant firms, you must take the approval of the Economy and Commerce Ministry.
• For the issuance of licenses for medical and pharmaceutical products, the approval of the Health Ministry is a must.

Instant License

An instant license is for those who seek to avail of a business license on an urgent basis. If you are in a hurry and need to obtain a business license immediately, you can opt for instant license services in Dubai. With the instant license initiative, you can get a commercial or professional license in Dubai in just 5 minutes. The idea of instant license was introduced to boost the economy of the United Arab Emirates. It is simpler and quicker for investors entrepreneurs who seek to acquire a business license to establish their business in the UAE mainland. It is a quick-service process in which you do not need to submit either the Memorandum of Association (MOA) or the rent contract for the first year. However, you will have to submit these documents when you renew your business license after a year.

What are the Benefits of an Instant Business License?

In a usual scenario, obtaining a commercial or professional license can take approximately two to three days or sometimes even more. But, with the instant business license initiative in Dubai, you can acquire your license within a few minutes and with fewer documents.

• Same day issuance within 5-10 minutes
• Start your business operations immediately
• Trade name registration is optional for the first year
• MOA is not necessary for the first year
• Rent contract not required for the first year
• You can apply online or in-person

How to Get an Instant Business License in Dubai?

General Trading License

An entrepreneur looking to establish a business in Dubai should possess a general trading license. It covers multiple trading activities either in the same or different industries. The activities covered by the general trading license in Dubai are - export and import or trading of goods like garments, accessories, electronics, furniture, etc. Investors keen on wholesale business should also obtain a general trade license. The regulated products trading such as alcoholic beverages, frozen items, and pharmaceuticals require approval from the concerned authorities.

What Activities the General Trade License in Dubai Cover?

• Permitted to engage in import and export of goods. This is usually requested by trading companies registered in Dubai.
• Eligible to carry out various commercial activities, such as the sale of goods and services in Dubai.
• Companies registered in Dubai free zones can also obtain a general trading license.
• Professionals offering services in a specific industry can also obtain a general trading license.

What are the Benefits of a General Trade License in Dubai?

Here are some of the benefits of having a general trading license in Dubai:-

• Companies with a general trading license can trade within Dubai and other Emirates.
• Massive opportunities in local as well as national and international markets.
• Traders have the advantage of utilising all the trading possibilities.

How Much Does a Trade License Cost in Dubai?

The cost of a business trade license in Dubai usually depends on the type of business activities, jurisdiction, business location, office space, number of partners/shareholders, legal structure, trade name and many other factors. So, you should hire a professional business setup or company formation consultant or a trade licensing agent who can provide you with proper guidance and make the entire process easy and hassle-free.

Trade License Renewal

To operate your business seamlessly in Dubai or any emirate of the United Arab Emirates, you must first register your business and possess a valid license to conduct smooth trade operations. This license must be renewed every year to ensure you can trade across the UAE and the world without violating any trading rules.
The trade license renewal is managed by the Department of Economic Development (DED) in Dubai (UAE). However, if you find the license renewal process complicated, you must approach a professional trade licensing consultation agency for hassle-free assistance.

How to Cancel Your Trade/Business License in UAE?

If you have decided to close your business in the UAE, you must cancel your trade license to avoid penalties or fines. The process is simple and requires paperwork, approvals and clearances from the government bodies and jurisdiction authorities.
First, you will have to fill out the business closure documents available at your relevant jurisdiction. You will also need to submit your trade license copy with the closure document. Then cancel the resident visas under the license and cancel the Establishment Card at the Ministry of Human Resources and Emiratisation or via the concerned jurisdiction. To understand the detailed process of trade license cancellation.