What is a Trading License in Dubai?
Thinking of forming a company in the UAE? Well then obtaining a Trade or Business license will be your first and foremost step. It is a well-known fact that Dubai provides a booming business environment with extraordinary trading opportunities, which welcomes entrepreneurs from all over the world. Getting a Trade license may seem like a complex procedure, but nothing should come in the way of turning your dream ventures into reality.
Let us guide you through it.
Trade license (What & Why) ?
A legal authorization is necessary to run any company. And each country has its own laws regarding trading and its own jurisdiction to further avoid any issues.
Hence, a trade license in the UAE is a must to start any commercial activity for an individual or entity. With this the company ensures to hold complete accountability to all its actions as per the terms of the trade licence and gives them a legitimate identity.
Who issues it?
The Department of Economic Development (DED) and Free Trade Zones in the UAE are the licensing authorities that issue the trade license.
Trade License Validity
Businesses hold a 1 year licence and keep renewing it. In Free Zones, there are Multi-Year Trade Licenses available. And yes, any delays in renewing the trade license, there will be notification from the trade license authority to complete the process on time.
Anyhow, there is a 30 days grace period for renewing the Trade License. Don’t worry we are here to assist you for the renewal too!
Time taken to receive the trade license
It basically depends upon your business plan and the clarity of your documentation. For an estimate it takes around three days to four weeks to get your Trade License.
Types of Trade Licenses in Dubai.
➔ Professional License
This allows you to get a license for professional services such as law firms, consultancy, finance and accounting.
➔ Commercial License
Companies can engage in buying or selling goods, for example, different forms of trading, it can be either retail or wholesale.
➔ Industrial License
It involves providing licenses to companies that do industrial activities, like producing, fabricating and segregation of products.
➔ General Trading License
It is slightly different from the normal trading licenses as a General trading license allows the company in a vast trade activity and gives the privilege to trade virtually any goods. But it does come with a slight limitation as it does not guarantee the right to trade goods like cars, alcohol, medical products, and weaponry.
➔ E-Commerce License
This license is very important for companies who sell goods or provide online services via the internet.
- Hence, each license is only limited to ten business activities except a General Trading license that allows the businesses to trade in different varieties of commercial activities.
Trade Licenses in UAE Jurisdiction
1. Mainland Trade License
The Mainland Trade License is issued by the Department of Economic Development (DED). This license entitles a company or an individual to start their business in the local markets of any Emirate in the UAE. The license also guarantees your company a smooth flow of goods in and out of UAE by setting up large warehouses in the industrial areas. It also ensures the Expatriate investors to have a 100% share of the Mainland company. If you are thinking of expanding your venture in Dubai then do grab this opportunity.
2. Free Zone Trade License
Freezone Trade License is only provided to begin business activities in specific demographic locations that perform preset business activities in UAE. So if you’re wishing to start up your business in these specific locations then you require a UAE Freezone Trade License. And you have to keep in mind these licenses are limited to specific kinds of businesses.
3. Offshore Trade License
Offshore Trade License are issued from approved license authorities like JAFZA, RAKEZ, and AFZA. When Corporate firms want to extend their business, outside their registered jurisdiction for operational needs they could apply for an Offshore Trade License.
In a country like UAE, if you are planning to expand then you could enjoy the benefits of saving up tax, investing in the vast real estate field and also enjoy the ownership rights of an Offshore company. Benefits come with regulations, thus your company will be considered as a non-resident company without office space in the UAE.
How to apply for a Trade License
- Pick A Business Activity: The nature of your business allows you to opt for the right trade license.
- Select Jurisdiction: Select the demographic location or an Emirate which you are willing to set up a firm.
- Documentation: Passport copies, Business plans, Visa copy of the investor and manager, Tenancy Agreement, Three Name choices for the company name reservation, Educational certificates ( some cases).
- Fee Amount: Amount of the fee depends upon the Jurisdiction and the type of license you are applying for.
- MOA or LSA: Prepare a Memorandum of Association or MOA or LSA with the local sponsor if it’s a professional type of license
- Approval and Issuance: On the approval of your submitted application ,you will be given the applied Trade license. It will permit you to legally begin your business operations.
Payment Estimate For Trade License
To provide an estimate excluding the visa expenditure and other expenses of your business activity, a Trade license in Dubai costs between AED 12,750 to AED 30,000. Additionally, to be specific the cost of a Trade License in Dubai mainland is around AED 18, 000 to AED 27, 000. Furthermore, the cost of the Trade license in Dubai Freezone ranges from AED 5,750 to AED 30,000. Also, to get a more accurate cost of your Trade License, please feel free to contact our team.
Benefits of Acquiring A Trade License
- Tax Benefits: Dubai is all about creating more revenue from your business, there isn’t personal or corporate taxes. You can file your tax returns separately after acquiring your Trade license; it ensures you the maximum benefit.
- Business Credibility: Acquiring a Trade license increases your chances of getting more customers, stakeholder and also investors as the license escalates the credibility of your business.
- Access to Government support: The UAE government promotes entrepreneurs to invest as they provide a hassle free and supportive business environment, which is very evident as you see brisk growth of the UAE economy.
How will AURION pitch in with getting you a Trade License ?
Our consultants will give you a thorough briefing into the terms and regulation regarding Trade licenses in the area in which you would like to begin your dream project. We are here to assist you in whichever Jurisdiction you may prefer.
Our team will be assisting you with each and every stage of your documentation process, may it be for a new license or renewal. We are here for you.
AURION will try its best to provide you the Trade license by approaching a cost effective process and always give you and your company the needed follow up and support.
Feel free to connect with our team, always here for your service.
