Dubai is a hub of businessmen and entrepreneurs, along with the most growing economies in the world. People from different parts of the world come to Dubai to set up their ventures and start a luxurious life. Besides, Dubai is the best place for new-age investors and budding industrialists to kickstart their professional careers. However, before you step into the process of operating your business, you must first mandatorily acquire a commercial license in Dubai.
There are multiple types of business licenses available in the UAE, such as manufacturing, trading, service, and many others, including the UAE commercial license. Besides, the nature of your business operations determines the type of license you should choose for your company.
The below article gives an overview of the commercial license available in the UAE and also discusses the key specifics and points revolving around this license.
Commercial License in Dubai
A commercial license is a type of license that allows trading in goods and services in Dubai. That means, a company can trade, import, and export products within as well as outside the UAE. in addition to that, it can also sell certain services under a commercial license. Hence, commercial license in Dubai is common in Dubai as well as other parts of UAE.
The commercial license permits to trade in almost any type of goods, such as jewelry, toys, food, automobiles, software, electronics, etc. Services covered under a commercial license, include brokerage, real estate services, etc.
Here is the list of some of the activities that require a commercial license in Dubai:
- Import and export
- Automobiles
- Computer hardware
- Communication Equipment
- Food items
- Furniture
- Medical and Surgical tools
- Readymade Clothes and Apparels
- Software
- Brokerage
- Real estate
- Logistics
- Tourism and travel
- Electronics
- Construction goods
- General stores and shops
- Cold storage and warehousing
- Rental services
Advantages of obtaining a UAE commercial license
- A single commercial license covers up to ten business activities.
- Allows full repatriation of UAE-earned income and profits for freezone companies
- Permits recruitments of foreign employees
- Overseas trade of goods and services
- Enhances trade relations with neighboring countries
- Renewal of license without the need for auditing
- Easy to open an account in any of the UAE banks
- Freezone companies enjoy complete exemption from taxes and tariffs
- Better networking and connectivity because of foreign commercial activities and trading
Steps for obtaining a UAE commercial license
Companies can choose between Dubai mainland and Dubai freezone as their business location. Businesses in the Mainland can get their licenses from the Dubai Department of Economic Development (DED), whereas freezone companies get their licenses from the respective freezone authorities.
The basic steps involved in acquiring a commercial license for business include
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Determine the business activity
While planning to start a business, the owners must decide the business operations they are intending to conduct. The business activity of the company determines the license they can opt for. A commercial license permits up to 10 activities to its holder. Therefore, the owner must ensure choosing the suitable business activity as per the legal structure of the company.
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Choose a location
Dubai provides strategic locations for the companies to operate. It is the center of trade connecting several countries to its market. Moreover, the companies can choose whether they want to set up their enterprise in the mainland or freezone.
Company formation in both these locations has its own advantages. You can contact the experts of Shuraa to get more clear information on the business locations suitable for your business idea.
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Decide a trading name
A trading name is the most important trait of a business as it identifies the company from its competitors. While choosing a trading name, the owner must remember to keep certain things in mind. For example, the name of the business must be unique as well as appealing. Also, they must avoid using any offensive or blasphemous language. Apart from that, they must assure that the selected name does not resemble any existing businesses.
While applying for a commercial license in Dubai, the applicant must obtain initial approval from the DED after submitting the requisite documents.
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Draft an MOA and AOA
Memorandum of Association (MOA) and Article of Association (AOA) lay out the rules, regulations, and policies that the company, the management board, and employees must follow. Therefore, they are called the constitution of a business entity. The business owner must prepare these documents in both English and Arabic.
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Rent an office space
The next step involves renting or leasing an office space for your business purposes. The rented space depends on the nature of the business activity and the count of employees. However, some business activities do not require a physical office, and can rather work on virtual office or Flexi-desks. To get information on such business activities, you can get in touch with the business consultants of Shuraa. They can also provide you with information on the business centers and office spaces available in and nearby Dubai.
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Get final approvals
The additional approvals may include agreement from the relevant ministries and departments to sanction the commercial license application.
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Obtain the license
Once all the above steps are accomplished, you can obtain the license from the DED or the freezone authorities, whichever is your area of business.
Read also: Benefits of Dubai South Free Zone Business Setup
Documents required for registration of commercial license in Dubai
For obtaining a commercial license, submission of all the required documents is mandatory, which include –
- Duly filled application form
- Lease contract form of the company’s registered address
- Memorandum of Association with the sponsor/partner
- Business address sanctioned by the Dubai Municipality Department
- Proof of license fee
After verifying and cross-examining all the documents, DED issues the commercial license to the respective business. The validity of the commercial license is 1 year, which the owner can renew accordingly.
Renewal of Commercial License
Once the license reaches the expiry, the applicant must submit the following documents for renewal of the commercial license –
- Copy of the trade license
- Office space lease contact copy
- Approvals from the concerned authority
- Details of staff accommodation (for foreign shareholder firms)
The renewed commercial license has a validity of five years.
Conclusion
When you start a business in Dubai, you need to get a license to operate your company legally. Getting a commercial license in Dubai isn’t a complex procedure, only if you have the right knowledge and information about it. Moreover, the application process is easy only if the application and documents are genuine and error-free. In addition, it should be submitted on time without any delay.
Shuraa Business Setup is here to ensure that your license application is successful in all stages. From handling your application to opening your bank account in UAE bank, Shuraa is committed to assisting you with your business needs. Furthermore, we will handle all the government formalities including permissions, work permits as well as visas applications that are required for company formation in the UAE. In short, we will establish your company on your behalf and bring your aspiring dreams to life.
So, get in touch with us now and book a free consultation with Shuraa’s business advisors.
Call on +971 44081900 to talk to our experts. You can also send your queries via WhatsApp (+971 50 777 5554) or email ([email protected]).
