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Complete Guide to Trade License Renewal in Dubai, UAE

It is mandatory for every business to not only obtain a trade license in Dubai to run a business but also keep it active and therefore, get it renewed every year to avoid any kind of penalty or obstruction in the operations.  In the UAE, the Department of Economic Development (DED) takes care of the issuance of licenses in Dubai. License renewal is a complicated process and needs a lot of documentation; hence it is better to seek professional help.  In the UAE, the Department of Economic Development (DED) takes care of the issuance of licenses in Dubai. Therefore, it is advisable before you get into the license renewal process, you must be aware of everything related to licensing. Let us start with the types of trader licenses issued by DED in Dubai.

What are the Types of Trade Licenses in UAE?

 Commercial license

Any business activity that sells tangible products must obtain a commercial license to start its operations.

Industrial license

Every manufacturing and factories should obtain an industrial license to operate.

Professional license

Providing services is for professionals with special skills. They can offer their service for an exchange of a fee. It is mandatory to possess a professional license to apply your skills for income.

Renewal of Trade Licenses in Dubai Mainland and Free Trade Zone

Enterprises must have their tenancy contract valid for at least one month, and Ejari must attest it, in order to renew a trade license in Dubai. It is an online registration system by the Real Estate Regulatory Agency. If the tenancy contract has expired then renewal of licenses cannot be done.

Here are the documents that need to be submitted, at DED along with the application for the license renewal:

  • Typed BR/1 form
  • Current license copy
  • Ejari Registration Certificate and a photocopy of the tenancy agreement
  • Photocopy of the current trade license
  • Passport photocopies of all the business partners

Once you have submitted all the documents, you will be provided, with a DED payment voucher. After the payment process is over, you will be provided with your renewed license from the DED.

Documents required for license renewal in the free zones:

  • Trade license copy or original document (depends upon the free zone)
  • Audit reports (depends upon the free zone)
  • O box confirmation renewal
  • Passport photocopies of the shareholders
  • All other documents as support for your business activity and free zone.

The Department of Economic Development (DED) is strict when it is about licensing and its renewal. Failing to renew the license on time can lead to severe penalties. Huge fines and penalties are levied on enterprises. Many times it may lead to cancellation of licenses and can even be barred from further business activities. The fine is levied every single day by DED from the date of license expiry.

NOTE: The authority reserves the right to call for any additional documents. 

What is the Grace Period for Dubai Trade License Renewal?

A 30-day grace period is thereafter the expiry of the trade license. During this time, the company has the option to either renew the trade license or cancel it.

What are the Types of Penalties?

Monetary

A penalty of AED 5000 charged to entities found working without a license. If there is delay or failure in renewing the license within the given time, then the penalty is about AED 250 per month. If any company is running an additional office with an active license without permission will invite a fine of AED 2000. 

Blacklisting

If an entity fails to renew its trade license within the given time, it can result in blacklisting its business. This could be the complete shut down of its business too.

Restriction on Expansion

The DED can even restrict you from expanding your business further if you fail to renew your license and maintain your records.

Why is it Necessary to Renew Your Trade License?

It is very important for the companies to renew their licenses, as the expiration can even ruin your entire company. The companies will be banned by cutting the license and even your transactions can be seized and visas and sponsors listed by the company will no longer be valid.

Trade licenses are mandatory for the existence of any business, which is why organizations appoint someone specifically for these purposes. Outsourcing of these activities is one of the most common trends followed by business organizations as it will all be done with the utmost care and will be renewed in time without staking the organization’s future.

The outsourcing company will help you renew your licenses on time every year which will help you to focus more on your core projects. They will keep you updated regularly and will also file the documents when necessary. In case any documents are incorrect, they will make sure to update it as well.

Hire a professionals business consultant offering high-quality services. They ensure you complete assistance in trade license renewal and all other services related to setting up your business.

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