General Trading License In UAE

Dubai is the most populated city in the United Arab Emirates (UAE) and the country’s business and trade hub. It has an excellent strategic location, exceptionally friendly economic policies, and generous taxes. These factors make the UAE one of the best places to start a business or establish a company. Today, we will explain everything you need to know regarding obtaining a general trading license in the UAE, including an overview of different types of trade licenses, the steps involved in applying for a general trading license in the UAE, and the costs associated.

What is a General Trade License in Dubai?

A General Trading License in Dubai allows businesses to import, export, and distribute products. The Department of Economics and Tourism in Dubai, also referred to as the Department of Dubai Economy and Development (DED) is the approval and regulatory authority for issuing and renewing General Trade Licenses. A physical office location is one of the requirements for obtaining a General Trade License in the UAE. You may also require a solid Business Plan and appropriate permissions from other related authorities.

How does a General Trading License differ from a Regular Trade License?

A general trading license is similar to a regular trading license, including the requirement, cost, application, and renewal processes. However, general licensing covers a broader range of activities than a regular trade license. For example, you can typically buy, sell and trade specific products in UAE with a trade license or eCommerce license. In contrast, a General trading license authorizes you to import, export, and buy/sell any type of product that is not prohibited for trading. Because of this broad applicability and functions, documentation requirements and costs to get a license for general trading are somewhat more stringent than other license categories.

Types of General Trading Licenses in Dubai

Depending on where you wish to set up your business or company, there are generally two types of general trading licenses in Dubai: one for mainland trading, and another for free zone trading. Free zone trading licenses are considerably cheaper and easier to obtain than mainland licenses. In addition, mainland licenses often require you to pay extra fees and find a local sponsor.

Why Get a General Business License in Dubai

A general business license in Dubai has many benefits and may open up new possibilities for you as an entrepreneur. Some of these benefits include:

Unlimited business activities: You can carry out any type of business activity with a general business license in Dubai, including import/export, manufacturing, retailing, wholesaling, and distribution. This license gives you the freedom to operate any legal business activity in the UAE.
Simplified application process: The application procedure for a general business license in the UAE is very easy. All you need to complete is fill in the relevant forms and pay the appropriate fees.
Online services: You can access the online services portal for the application. You can also get help through the phone number provided.
Multiple ownership structures: You can choose between 100 percent foreign ownership and joint venture ownership. You can also open sole proprietorships and partnerships.
Free zones: The general business license lets you establish your company in either a free zone or the mainland. Both options have their pros and cons, so you should weigh them carefully before deciding.
Long-term visa: You can obtain a long-term and permanent business visa with a general business license. You can also get a work permit.
Flexibility with partner involvement: You can decide whether to involve a partner in your business. You can also allow a foreigner to become a shareholder.
No minimum capital requirement: There is no minimum paid-up capital requirement for a general business license. However, you must prove that you have enough money to run your business.
Offices and warehouses: You can avail of offices and warehouses with a general business license. These are essential for the successful operation of your business.

In addition to these advantages, investors also consider Dubai to be one of the most attractive locations to establish their business due to:

Its excellent strategic location and global connectivity via major shipping lines and air transport routes;
Business-friendly government policies;
The willingness of policymakers to emphasize more trade shifting from an oil-dependent economy;
Complete exemption from personal income tax;
Streamlined import and export regulations and tariffs;
World-class infrastructure;
Ease of doing business;
100% profit and principal return, and much more.

Required Documents for a Trading License

Before exploring the step-wise process of applying for a Trading license, we will review the document requirements.

A business plan for your planned trading activity

Your business plan should provide a comprehensive overview of your trading activities including products and services, targeted markets, and projected growth rates. The authorities use your plan to assess your proposed business's viability and determine the type of licensing you require. Make sure that you invest enough time and effort into creating a detailed and rational business plan. Our team of professionals at LEO Invest can assist you in developing the most optimal business plan based on your previous professional experience and investment plans. 

A NOC from relevant authorities

Depending on what type of business you want to be set up, you may require a NOC from the Department of Economic Development (DED) or another relevant authority. For example, if your business is related to healthcare, you would need to get a NOC from the Ministry Of Health And Prevention or the Dubai Health authority. For certain product categories, you may require approval from Dubai Municipality.  

A Parent Company’s Trade License

If you want to set up a branch of an existing business in Dubai, you will need to submit a copy of your parent company's trade license as part of the application.  

A Trade Name Reservation Certificate  

One of the first steps towards setting up any business in the UAE is reserving a trading name. The trading name is the name under which you will conduct your business.  

A Photographic Identity Document

You will need to submit a passport-sized photograph of all company shareholders, managers, and authorized signatories, along with copies of their passports or ID cards. - A valid residency permit If you are not an Emirati citizen, you will need a valid residency visa to apply for a trading license in Dubai. The kind of residency visa you need depends on the country you come from.

A Tenancy Contract

The application requires you to supply a copy of the tenancy agreement for the commercial space where you intend to operate your business. You should also attest to the tenancy contract from the DLD.

A valid work visa

If you are not a resident, you will need a work visa to apply for a business license in Dubai. The work visa you need depends on whether you are national or expatriate.

Memorandum of Association

Memorandum of Association (MoA) is a legal document that defines the relationship between a company and its shareholders. The endorsement must be verified by a notary public in Dubai. You will usually need to submit these documents with your business license application. It is time to familiarize yourself with the application process and the competent authorities in charge of it.

How to get your business license in Dubai: Step by step

Dubai’s Department of Economy and Tourism (DED) oversees the licensing process through its self-service online portal, Invest in Dubai. Here is a brief overview of the application process for your general business license in Dubai.

Step 1: Determine the business activity and prepare documents

Your first task is to determine the operational specifications of your business and prepare its business plan. In particular, you should decide on these questions early on, because your application process may differ depending on the nature of your business.

Free zone vs mainland

The UAE government has set up 60 free zones to facilitate foreign investment in Dubai and the UAE. Free zones offer many benefits, including zero taxes, 100% ownership, and 100% return on capital gains. Although the free zone offers many companies related to the ease of doing business, they also have a specific type of income. Different free zones are suitable for different businesses. Therefore, you should check carefully whether you want to do your work from a free zone. The cost of setting up a business in the free zone starts from AED 10,000 and can reach AED 50,000 or more. On the other hand, if you choose to do your business from the land of Dubai through a Mainland business license. In this case, you can find a local sponsor who should be an Emirati citizen. Continental license fees are also different from free zones.

Nature of Ownership

You can run your business as a sole proprietor, general partnership, or limited liability company. In any case, you will need the identification and consent of all shareholders.

Step 2: Request initial approval

Once you have your identity documents and business plan in hand, you can visit the Invest in Dubai website to open an online account to start the application. You can also visit any DED office in Dubai during office hours.

After opening and showing your account and phone number, the system will ask you to register a business name. To secure a trade name, you must submit a request to the DED and the required fee. DED will conduct a name search to ensure that the requested name has not been used and does not infringe on any existing trademarks. Here, you must register a business name, provide contact details and initial contact details, and indicate the type of business you operate before paying online for initial approval.

The program code for the general business program is 4690018 or for the business license type.

Step 3: lease space

Once you pay the fee, the system will immediately prepare the first approval document for your business, which you can use to rent or lease land or an office. If you work in one of the free zones, you can use a shared or virtual office space or workspace. The free zone and ground floor also offer a variety of offices, warehouses, and ground lease options at various price ranges. Be sure to rent a house and get a rental agreement. Step 4: Get other NOCs and confirm MoA

When renting office space, you should check whether you need additional permission or NOC from other authorities. In general, a general trade license covers legal trade activities, including import and export. In a few cases, you can look for NOCs from Dubai Municipality or similar authorities. They usually require your business plan and photos of the rented property before issuing the NOC. Next, you’ll need to write an MoA letter, which outlines the basic terms of your business. Make sure you witness the MoA of DED by visiting one of their offices.

Step 4: Get other NOCs and confirm MoA

Step 5: Claim the amount and submit the warrant

Finally, submit the license or business license at any DED location or by bank transfer. Then you can submit your application and upload all the necessary documents on the portal. It usually takes less than 10 minutes to get your business license application approved.

Your business license will be valid for one year. DED will notify you via SMS before the expiry date so that you can pay the renewal fee immediately and complete the online renewal process.

Cost of getting your business license in Dubai

The cost of setting up your business and applying for a general business license in Dubai will depend on many factors, including the type of business you want to engage in, the size of your business, and the number of shareholders. Here are some specific fees you can consider:

General business services: AED 15,000
Business center: AED 25,000
Free space: from AED 10,000
MoA Agreement: AED 300 (for each team)
License application and renewal: AED 600
Business name reservation or change: AED 600
Initial deposit: AED 100

Generally speaking, the costs associated with starting a business in Dubai and applying for a general business license can range from AED 15,000 to AED 50,000.

Conclusion: General Trade License in Dubai

A general business license in Dubai is a great way to start your business in one of the world’s most powerful economies and businesses. The costs associated with setting up your business and applying for a general business license are reasonable, and the process is easy to understand.

At LEO Invest, we specialize in helping individuals, entrepreneurs and businesses relocate to Dubai and set up new businesses. If you have any other questions or need help setting up your business or applying for your general business license, drop us a note right away.

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