- December 21, 2024
- Posted by: axiom_admin
- Category: Company formation in Dubai / UAE
Dubai has emerged as a hub for global entrepreneurs, offering unmatched opportunities for businesses of all sizes. A key step in starting your journey in Dubai’s business ecosystem is obtaining a trade license. This guide will walk you through the types of trade licenses, benefits, and the step-by-step process to secure one while highlighting resources to make your setup seamless.
What is a Trade License in Dubai?
A trade license is a mandatory document that permits you to conduct business in Dubai legally. Issued by the Dubai Department of Economy and Tourism (DET) or relevant free zone and offshore authorities, it defines your business’s legal activities and operational jurisdiction.
Types of Trade Licenses in Dubai
Dubai’s mainland company formation offers numerous advantages, making it a prime destination for entrepreneurs and investors. Here’s a comprehensive look at the top benefits:
- Commercial License
- For companies engaging in buying, selling, or trading goods.
- Explore Mainland Activities for insights into eligible business operations.
- Professional License
- Suitable for service-oriented businesses like consultancies and freelance professionals.
- Industrial License
- For businesses involved in manufacturing or production activities.
- Tourism License
- Aimed at travel agencies, hotels, and tourism services.
Learn more about the various Mainland Licenses available in Dubai.
Benefits of Getting a Trade License in Dubai
- Tax Advantages: Dubai offers a zero-corporate tax environment for most businesses.
- Access to Global Markets: With its strategic location, Dubai acts as a gateway to Asia, Europe, and Africa.
- Residency Visas: A trade license allows business owners and employees to apply for Residence Visas.
- Diverse Setup Options: Choose from mainland, free zone, or offshore licenses to suit your business needs.
Thank you for sharing the detailed steps! I’ll incorporate this content into the How Do I Get a Dubai Trade License? section of the blog while maintaining a professional and approachable tone. Here’s the updated section:
How Do I Get a Dubai Trade License?
The following detailed guide will help you navigate the requirements and steps to obtain a Dubai trade license:
- Select a Business Name
- Choose a name that aligns with UAE guidelines, ensuring it’s unique and not already in use by another entity.
- Define Your Legal Structure
- Decide on the legal structure of your business, such as Sole Proprietorship, Limited Liability Company (LLC), Partnership, Branch of a Foreign Company, or Free Zone Company. Each structure has specific implications for ownership and liability.
- Define Your Business Activities
- List all planned activities on your license, noting that each license can include up to ten activities.
- Complete the Application Form
- Fill out the application form and submit it to the Dubai Department of Economy and Tourism (DET) for initial approval.
- Get Additional Approvals
- Certain activities may require external approvals. Research these requirements to avoid delays in the licensing process.
- Gather Required Documents
- Collect documents such as Emirates ID, passport, or unified numbers, ensuring all signatures are included.
- Choose Your Business Location
- Mainland licenses require a physical location with a tenancy contract attested by Ejari.
- Select the Main Business Activity
- Add the primary and additional activities you plan to conduct to your application.
- Select the License Type
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Choose from:
- Normal License: Requires drafting a Memorandum of Association and a lease agreement.
- Instant License: A streamlined process suitable for certain activities. Includes initial year benefits like virtual office setups and establishment cards.
- DET Trader License: Specifically for home-based businesses, issued through the “Invest in Dubai” platform.
- Add License Parties and Their Details
- Include details of all license parties, such as addresses, contact information, job titles, and ownership shares.
- Add Ultimate Beneficiary Owners
- Provide information about ultimate beneficiary owners if applicable.
- Submit Your Application
- Once all documents and approvals are in order, submit your application to the DET.
- Pay Your Licensing Fees
- Complete payments for issuance and license fees using an accepted payment method.
- Send Legal Documents
- Share legal documents, like the Memorandum of Association, for electronic signatures. All partners must be registered for e-signing.
- Obtain the Final License
- After completing payments and document submission, you will receive your trade license and other related documents.
Cost of a Trade License in Dubai
The cost of obtaining a trade license in Dubai varies based on several factors, including the type of license, the business location (mainland, free zone, or offshore), and the business activities involved. On average, the cost starting from AED 4,999 , but it can differ depending on additional services or approvals required.
Here’s a general breakdown of the costs you may encounter:
- License Issuance Fee:
This is the primary fee for obtaining the trade license and typically starts at around AED 4,999, depending on the license type. - Business Name Registration Fee:
Registering a unique and compliant trade name can cost between AED 500 and AED 2,000. - Office Space and Ejari Fee:
Businesses opting for a mainland license need to lease office space, with costs varying by location. Ejari registration for tenancy contracts adds another AED 2,000 to AED 4,000 on average. - Local Sponsorship or Service Agent Fee:
For mainland businesses, appointing a local sponsor (for commercial or industrial licenses) or service agent (for professional licenses) may involve additional costs. - Activity-Specific Approvals:
Some business activities require external approvals from government bodies, which may incur extra charges. - Additional Government Fees:
These include administrative costs such as knowledge and innovation fees, which typically range from AED 300 to AED 600.
Why Costs May Vary
- License Type: A free zone license may cost less overall since office space is optional, whereas mainland businesses must lease premises.
- Activity Scope: Certain business activities require specialized permits or inspections, adding to the total expense.
For entrepreneurs looking to streamline costs, Dubai offers options like instant licenses, which are issued in minutes and waive some requirements, such as Ejari registration, for the first year.
Whether you’re a startup or an established enterprise, understanding these costs is crucial for effective budgeting. To explore affordable business setup options and get expert guidance, reach out to Axiom Mark.
