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How to get a trade license in Dubai?

 

UAE is popularly known as the business hub of the Middle East. There has been an immense growth in the financial, business, trade and logistics sectors over the last two decades. Their contribution to the world economy is substantial. There are many business setups in UAE, interested in trading goods with neighboring countries; such people should have a valid general trading license to do the same. A Trade License is not just a formality in Dubai; it is more of a necessity. It dictates the scope of your business activity along with legitimizing your Business. Although costlier, having this license has its own perks and advantages. When applying for it, one has to take great care of it.

The Statutory body, The Department of Economic Development (DED), with the institutional support from the Dubai Chamber of Commerce & Industry regulates and controls the licensing procedures for an entity in Dubai. Certain Ministries’ and other authorities’ approval is necessary for some categories of business. Such instances include pharmaceutical and medical products from the Ministry of Health, banks and financial institutions from the Central Bank of the UAE, manufacturing from the Ministry of Finance and Industry, insurance companies and related agencies from the Ministry of Economy and Commerce. Businesses engaged in oil or gas production and related industries require more detailed procedures. Businesses like printing and publishing, food trading require more clearances than say a general trading business. In short, all commercial and industrial businesses in UAE should be registered with the Chamber of Commerce and Industry in the respective Emirate.

A general trading license in UAE costs approximately from AED30,000 to AED40,000, depending upon several factors. The type of services and activities performed by a business is the factor that indicates which type of license you should apply for. There are mainly three types of general trading licenses. They are Commercial License, Industrial License and Professional License. You should apply for the commercial license if you intend to engage with your company in trading. Industrial License is to be issued to a company that will engage in manufacturing or any industrial activity. The Professional trade license is a special business permit and is usually issued in industries such as accounting and finances, management, IT, healthcare, education, advertising, marketing, etc. The professional trade license comes with many advantages. It can be obtained by sole proprietors in Dubai. If you are a foreign citizen applying for a trade license and if you want full foreign ownership over the sole proprietorship you must first become a resident of Dubai.

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To obtain the general trade license one has to follow a few steps. First of all, categorize your Business. The Free Zone or the Department of Economic Development (DED) provides a category list. So you must identify the appropriate category for your Business. Worldwide Formations can assist you in selecting the relevant one for you if you are unable to pinpoint the suitable category. Choosing a suitable legal structure is the next step. Your company’s legal structure is just as important as the trade name of your company. Several free zones in Dubai allow you to operate it. The legal structure mainly depends on the number of shareholders you have in your business, and the jurisdiction you choose to operate your business in. Choosing a trading name is the next step. While choosing a trading name whether it defines your business activity and also make sure it adheres to the government guidelines. You must inquire with the respective free zone authority or DED before finalizing your choice of name. It is to cross-check whether the proposed trade name has already been registered by any other business or not. The next thought you need to have is on how much you need to invest. Depending on your business you must have an idea of your investment. The next is an action that you have to make is to lease or purchase office space. Choose an office space that suits your budget and business requirements and also make sure, you can conveniently accommodate your employees. The next step is to get initial approval from the authority. It is a fundamental step for obtaining a trade license. Make sure you have the documents such as Duly-filled application form, The master plan of your business activity, Copy of present trade license, in case you run a local company (optional), Copy of passport (of every shareholder/partner associated with your business legally), Copy of signature (of every shareholder/partner associated with your business legally), Certificate of reference from the bank or 2 years financial statement, NOC from your sponsor, Unit title deed, Letter of Intent and Original and notarized copy of Registry Identification Form (for the Director) before presenting to the authority for the initial approval. The initial approval is followed by the payment of fees for registration and license. Make sure you have submitted documents such as Application form for registration duly filled, Notarized and attested Board Resolution for the appointment of Director or Manager, Notarized and attested Power of Attorney endowed to the Director or Manager, Notarized and attested Memorandum and Articles of Association, Notarized and attested proof of the signature of the Director or manager, Passport-size photograph of the Director or the Manager and Details of Share Capital.

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