Steps to open a commercial license in Dubai

Steps to open a commercial license in Dubai. The United Arab Emirates is making every effort to facilitate investment methods within the Emirati market, and provide all the necessary services to Arab and foreign investors, so it has adopted the simplest methods to open a commercial license in Dubai and encourageEstablishing companiesin their various legal forms, and below we will discuss everything related to commercial licenses in Dubai.

 

Steps to open a commercial license in Dubai

 

Commercial license in Dubai

A license in general means a license to practice a specific activity or profession within a specific and clear legal framework. The word license in its general sense carries many terms. There are free commercial licenses that allow the product to be modified and resold, and there are professional licenses that are limited to practicing a specific profession and other different categories of licenses. We will learn about it in some detail after listing the importance of opening a commercial license in Dubai.

 

The importance of a commercial license?

The commercial license is considered a basic building block in the process of establishing a business within the Dubai International Market. According to it, the nature of the commercial activity is determined, and accordingly the legal form of the company is chosen. In general, the importance of opening a commercial license in Dubai is summarized in the following points:

  1. Determine the nature of the commercial activity, in terms of it being an industrial activity that specializes in manufacturing the product only, or a commercial activity that is limited to import, export and trade movement only, or a professional activity or other activities available within the United Arab Emirates.
  2. After defining the commercial activity, it is easy to choose the legal form of the company and draft the articles of incorporation in light of the powers of the commercial licenses obtained to employ the company’s activities, as the legal form must match the economic activity of the company.
  3. The importance of the commercial license in the long term is also evident in the possibility of developing and modifying the company’s activity pattern. Based on the license’s powers, you can add more activities to support and develop the service provided by your organization in a way that suits the evolving market requirements.

 

To date, there are more than 2,000 economic activities that can be practiced within the UAE markets. These activities have been classified into several basic categories to facilitate investors, and these categories are limited to the following types of economic licenses:

 

Types of commercial licenses in the UAE:

Establishing a company in the Emirates is linked to obtaining commercial licenses that are compatible with your activity. By opening a license in the Emirates, we find that the type of commercial or economic license is related to the type of activity that will be practiced. Below are the 11 most important and most widely used categories of commercial licenses among entrepreneurs, whether in the local market or free zones.

  • Commercial license:

Commercial license activities are limited to buying and selling activities only, including all types of import and export, whether internally or internationally. However, holders of commercial licenses are not entitled to engage in any other activities related to the product.

That is, under the commercial license, you can import products and distribute them within local markets or export them to other markets, and its validity may include retail or packaging work, provided that the identity of the product is not changed, unlike the general trade license.

 

  • General Trade License:

The general trade license includes more trade-related activities as well, under which you can purchase products and perform all packaging requirements in accordance with the agreements made between the company and the product owner.

The free trade license is considered more flexible than economic trade licenses, so it is the most popular among investors, as it allows them to conclude more partnerships with different specifications and agreements depending on the existing commercial activity.

 

  • Dealer License:

A merchant license is a smaller version of a trade licence, but it is issued to UAE residents only to conduct business activities from home only through e-commerce websites.

This has been activated to open a business license in Dubai for home trade to provide the necessary facilities to encourage small investors to continue their promising business work.

Note that the merchant license requires the merchant to obtain membership in the Dubai Chamber to help them get to know the commercial market closely, interact with investors, and obtain guidance recommendations to develop their business.

 

  • Industry Pioneers License:

The industrial license powers center around establishing an industrial company or establishment to practice one or several industrial activities in one field. Industrial licenses include all industries available for practice within the United Arab Emirates.

Taking into account that the powers of industrial licenses vary depending on the identity of the founder or owner of the company, as there are some industries that are prohibited for non-citizens to practice, such as mining and oil manufacturing industries.

 

  • Professional licenses:

Professional licenses relate to professional activity only. For example, an educational professional license is granted to teachers, or a professional license is granted for financial, engineering, or investment consulting to companies specialized in the fields of accounting, engineering design, or business establishment.

Professional licenses also include some craft work that requires high skill, such as health or agricultural licenses, and other work that is based on extensive skill and experience possessed by an individual who wishes to exploit it to help others and provide advice through a consulting office or practicing his own business.

 

  • Free professions license:

The liberal professions license targets experts and specialists in specific technical fields, whether citizens or expatriates, and allows them to provide their services remotely without any fees or taxes due. The primary goal of issuing this type of license revolves around reducing the unemployment rate and improving income brackets.

Issuing it only requires proof of specialization in a specific technical field, whether through authenticated academic degrees or approved experience certificates, noting that opening a commercial license in Dubai for liberal professions allows non-citizens to obtain family residency within the Emirates without restrictions.

 

  • Event organizing license:

Event licenses include all categories of events, whether political, sporting or entertainment such as festivals, parties and exhibitions, as well as scientific and educational events such as seminars, conferences, workshops and others. This license is limited to organizational activities such as planning, organization and control only.

 

  • Business operating license:

Business operating licenses enable their owners to provide all the services necessary for investors to establish their businesses in the Emirates. For example, under this license, you can provide entrepreneurs with rental contracts for their company sites, help them own a suitable location for the company, or prepare the company to obtain some of the necessary licenses to operate.

 

  • Tourist licence:

Tourism licenses are concerned with companies and institutions operating in the fields of tourism and hospitality, whether domestic or foreign tourism, and aim to monitor these institutions to ensure the provision of service at the best possible level, and on the other hand to provide the necessary facilities to support this important sector.

 

  • Virtual license:

Non-resident foreign investors in the UAE need to obtain virtual licenses, which are obtained electronically to allow the investor to establish a limited liability company or a one-person company, noting that they are limited to only 13 sectors, including:

(Agriculture – Industry – Contracting Works – Maintenance Works – Retail Sale – Transportation Activities – Services Field – Real Estate Investment – Business Operation Sector – Organizing Events – Free Trade – Import and Export)

 

  • Dubai instant license:

The instant license came as one of the fruits of the Dubai Economy initiative to support the business community and simplify the procedures for opening a commercial license in Dubai. Until now, instant licenses are considered the first choice for entrepreneurs, whether citizens or visitors to the UAE markets.

 

Instant license in Dubai

The Dubai instant license is a permit to practice the activity without the need to have a company headquarters in the Emirates or a company incorporation contract, and it is obtained electronically in less than an hour through the official website of the Department of Economic Development in Dubai.

 

Steps to open a commercial license in Dubai

The trade license represents an important step in the process of establishing a company. Here are the most important steps Open a trade license in Dubai:

  • Initial approval receipt, which is extracted from the Department of Economic Development, and indicates that the state does not object to establishing this activity.
  • A lease contract for the company’s site certified by the Real Estate Regulatory Agency, or a scanned copy of an office ownership contract that conforms to the specifications.
  • The company’s incorporation contract is certified by a notary in accordance with the procedures stipulated in the company incorporation law in the Emirates.
  • A contract appointing the local services agent or the company’s agent responsible for its management, and a copy of the approval of all partners to authorize him.
  • Approval from other government agencies, such as the approval of the Ministry of Industry or Agriculture in the case of industrial or professional licenses.
  • A copy of the commercial register in the case of establishing companies in free zones, whether for citizens or foreigners.
  • In the event of obtaining a commercial license in Dubai for a company operating in another emirate, it is necessary to submit the parent company’s articles of incorporation, commercial license information, and commercial register.

Note that the merchant license and the instant license do not require submitting the articles of incorporation, commercial register, or declaration of the company’s headquarters, so the cost of opening a commercial license in Dubai varies depending on the type of license and the nature of its activity.

 

Cost of a business license in Dubai

The cost of a commercial license in Dubai varies depending on the list of fees payable for each activity, and there are some fixed fees in all commercial licenses, which are:

  • Application fees for opening a business license in Dubai.
  • Trade name registration fee.
  • Trade name advertising fees.
  • Incorporation contract fees.

In addition to commercial activity fees, they vary depending on the type of activity. For example, fees for general trade activities are 15 thousand dirhams, while contracting activity fees are 10 thousand dirhams, while fees for business operating activities rise to 25 thousand dirhams, so many investors are looking The lowest cost for opening a business license in Dubai.

 

Commercial license in the UAE

As long as it concerns joint stock companies and institutions, the minimum cost of a commercial license is not less than 12 thousand dirhams, but there are some new alternatives to commercial licenses that you can obtain at the lowest possible cost and start your business, for example:

  • A merchant license, which allows you to practice all commercial activities from home. The total cost of obtaining the license is 1,370 UAE dirhams. It also provides you with membership in the Dubai Chamber of Commerce through which you obtain the title of merchant and enjoy all the privileges of chamber members.
  • An intilak license is granted to citizens of the United Arab Emirates to establish small projects at home. The total cost of obtaining it is 1,070 dirhams, and it is renewed annually for a small amount in exchange for sponsoring these projects and adopting their development process.
  • The instant license is considered one of the least expensive commercial licenses, but it has a different legal status in the UAE companies incorporation law.

 

Cost of instant license in Dubai

The legal position of instant licenses differs from the previously mentioned licenses and does not follow the policy of opening a commercial license in Dubai, for several reasons:

  • The instant license is valid for one year only, and upon renewal, common commercial license fees apply depending on the type of activity.
  • The total cost of the instant license is only 3,000 dirhams, and it is extracted electronically within several minutes, and can be obtained for citizens or expatriate investors.
  • The instant license allows you to obtain immediate residency once the license is issued, as well as a permit from the Ministry of Human Resources and Emiratisation to employ up to three employees only.

 

Renewal of trade license in Dubai

Before the commercial license expires, the owner receives a text message stating the license expiration date, and the renewal fees depending on the type and specifications of the license. The investor can renew the license through four approved service outlets:

  1. Send a text message to 6969 to activate automatic renewal.
  2. Renewal electronically through the Invest in Dubai platform.
  3. Renewal through an economic department Dubai.
  4. Contact one of the authorized service centers.

Note that the validity of renewing commercial licenses extends for one year only, and automatic renewal can be activated when opening a commercial license in Dubai for a period of five years if the lease contract for the company’s headquarters is valid for this period.

 

Obtaining a commercial license without a sponsor

Dubai trade license without a sponsor, provided that all internal and external approvals are met.

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