Before beginning the process of starting a business in Dubai – or anywhere else in the UAE – you’ll first need to decide on the type of license you wish to obtain.
This will be entirely dictated by the nature of your business activities. There are several common license types to choose from: commercial, industrial, professional.
It is the latter, commercial, that we are going to focus on here. Under a commercial license, you are permitted to engage in the trading, import, and export of goods, in, out and within the UAE, along with the selling of certain services.
The commercial license is very popular in Dubai and the UAE for a number of reasons. For one, Dubai is known the world over for its incredible, strategic trading location – surrounded by vast markets including Africa, Asia, Europe and the Middle East.
A number of international airports coupled with the UAE’s direct access to the Persian Gulf also makes it incredibly popular with cargo businesses.
Finally, there is the emirate’s simplified company incorporation process which makes it easy to get trading with the help of a company setup agent.
So if you’re thinking of spreading your wings in the commercial sector of the UAE, here are some key factors for your consideration.
What is a commercial license in Dubai, UAE?
In the simplest terms, a commercial license is one that allows you to trade in goods and sell certain services.
These goods can be imported and sold in the UAE, exported for sale outside of the UAE, or traded solely within the UAE.
The commercial license permits you to trade in almost any type of goods you can think of, from jewellery and toys to packaging, food and electronics. You may also sell services under a commercial license, including brokerage and real-estate services.
Commercial license activities
Below are just some of the activities permitted under a commercial license:
- General store
- Plumbing and sanitary contracting
- Radio, T.V. station, cinema theatre equipment installation and maintenance
- Automobile trading
- Shoe trading
- Tanks and silos trading
- Cold storage
- General warehousing
- Self-storage services
- Rental services
- Restaurant management
A full list of permitted commercial business activities can be obtained from the Department of Economic Development (DED) or from a company setup specialist.
Steps to get your commercial license in Dubai
Providing you seek the help and guidance of an experienced company formation specialist, obtaining a commercial license in the UAE is very straightforward.
There are just three simple steps involved, culminating in your license application.
Step 1: Free zone or mainland setup?
One of the most important considerations when establishing your UAE business is whether to set up in a free zone or in the mainland.
There are many advantages to both. Free zones such as Fujairah Creative City offer benefits such as a quick and easy incorporation process, ongoing business support and financial incentives such as tax exemptions and zero currency restrictions.
There are several types of free zone licences available. Many free zones offer a range of license types including industrial, commercial and e-commerce and professional services.
You’ll also find a range of licenses available on the mainland. Mainland businesses can trade directly with the UAE market and take on potentially lucrative government contracts.
The setup that’s right for you will depend on the nature of your business. An expert in company formation can help you make this decision, advising on the best option for your specific requirements.
Step 2: Your company name
Choosing a company name is a hugely important step in establishing a UAE business. There are a few things to keep in mind when making this decision. You must abide by a strict, yet easy to follow, set of naming conventions. Once again, a company setup expert can help you with this step.
In short, you should avoid any offensive or blasphemous language. Avoid names of well-known organisations and avoid abbreviations if naming your company after yourself – i.e. Dave Mann Consulting, rather than D Mann Consulting. You must also check that your chosen name is available to register.
Step 3: Your license application
The final step in the process is making your commercial license application. If you are setting up in the mainland, you can apply directly to the DED. If you have chosen a free zone setup then you can apply directly to the free zone.
In any case, it is a good idea to instruct the services of a company formation specialist at this stage to ensure a fast and smooth process.
Documents required for a commercial license in Dubai
Whether making your application yourself, or through a company formation agent, you are usually only required to provide a few details and some basic documentation, including:
- Completed application form
- Passport copy of the proposed owner or owners
- Two colour passport size photos.
Cost of commercial license in Dubai
The cost of the commercial license in Dubai is just one of many to consider. The approximate fee to obtain a license is AED 10,000.
On top of this, you may also need to consider the cost of additional registrations, visas, premises and more – which can soon add up to AED 30,000+.
If you are looking for the most cost-effective way to start a commercial business in the UAE, it is advisable to set up in a free zone – and be open to looking at other emirates outside of Dubai.
Free zones such as Fujairah Creative City offer many affordable license packages with no paid-up share capital requirement, no annual audit and an easy incorporation process. There is also no need to be present in the UAE to establish your new company.
A commercial license package in Fujairah Creative City, inclusive of one visa application and use of the free zone’s co-working facility costs just AED 24,775.
Getting your Dubai commercial license
If you’re armed with the right knowledge, getting a commercial license in Dubai doesn’t have to be overly complex.
That being said, it does require a level of prior knowledge of the process. What’s more, it is important to note that the application process is only straightforward if your license application is complete at the time of submission and free from errors.
To help you to ensure that this is the case, it’s a good idea to work with a company formation specialist such as Business Incorporation Zone (BIZ) when establishing a new company in the UAE.
We are a team of company registration professionals who are passionate about bringing the dreams of aspiring entrepreneurs and SMEs to life.
As well as handling your license application, BIZ can also assist with the opening of corporate bank accounts and advise on the most appropriate financial institution to suit your specific needs.
We also offer visa and immigration services and can handle all government formalities, permissions, work permits and visas applications that are required to trade in the UAE.
In short, our experts can establish your company on your behalf, make your license and visa applications, and take care of all the necessary admin – leaving you free to get on with running your business.