Obtaining a trade license in Dubai is an essential step to starting any business legally.
Since Dubai is one of the most important commercial centers in the world, the process of obtaining a trade license is easy, but it requires following some necessary steps.
In this article, we will explain in detail the steps required to obtain a commercial license in Dubai.
Steps to obtain a commercial license in Dubai
1. Determine the type of business activity
The first step to obtaining a trade license in Dubai is to determine the type of business you want to practice. The type of trade license you will obtain depends on the type of activity.
Business activities in Dubai are classified into four main categories:
- Commercial license: for activities related to trade.
- Industrial license: for activities that include manufacturing and production.
- Professional license: for activities that rely on professional skills, such as consulting or accounting.
- Tourism license: for companies operating in the tourism sector.
2. Choose the legal form of the company.
The legal form of the company determines its general structure and is an essential factor when applying for a trade license.
There are several legal forms available in Dubai, such as:
- Limited Liability Company (LLC)
- Public or Private Joint Stock Company
- Sole Proprietorship
- Representative Office
- Branch of a Foreign Company
You must choose the legal form that suits the type of your business and its requirements.
3. Choose the trade name.
The trade name is an important part of the company formation process. The trade name must be distinctive and not similar to the names of other companies.
In addition, it must comply with the laws of the Department of Economic Development in Dubai.
Some rules to consider when choosing a trade name:
- It should reflect the type of business activity.
- It should not contain inappropriate or prohibited words.
- It should not include any abbreviations of the owner’s name (if individual).
You can check the availability of the trade name and register it through the DED.
4. Submit an application for initial approval.
After deciding on a trade name, you need to apply for initial approval from the Department of Economic Development (DED).
This approval allows you to proceed with the next steps but does not give you the right to start your business until the final license is issued.
5. Prepare the Articles of Association
If you are establishing a Limited Liability Company (LLC) or a Joint Stock Company, you will need to prepare an Articles of Association.
This agreement includes details of the rights and obligations of the partners, as well as the distribution of shares and profits. A notary public in Dubai is required to notarize this contract.
6. Choose a Business Location and Obtain a Lease Contract
Every business in Dubai must have a physical business location. Whether it is an office or a warehouse, a notarized lease contract must be submitted.
Make sure that the lease contract is registered with Ejari, the electronic system for registering contracts in Dubai.
7. Obtain additional approvals (if applicable).
Some business activities require additional approvals from specific authorities. For example:
- Health activities require approval from the Dubai Health Authority.
- Financial activities require approval from the Securities and Commodities Authority.
Check the requirements for your type of activity to ensure that you have all the necessary approvals.
8. Submit the required documents.
After completing all the previous steps, you need to submit the required documents to the Department of Economic Development. The basic documents usually include:
- A copy of the owner’s or partners’ passport.
- A copy of the articles of association (if applicable).
- Initial approval.
- The registered lease contract.
- Any additional approvals (if applicable).
9. Pay the fees
Once you have submitted all the required documents, you will need to pay the fees related to issuing the trade license. These fees range from AED 10,000 to AED 25,000 depending on the type of activity and location of the company.
10. Receive the trade license.
After paying the fees and approving the documents, you can receive your trade license from the Department of Economic Development. This license allows you to officially start your business in Dubai.
11. Register with the Chamber of Commerce
After obtaining the trade license, you need to register your company with the Dubai Chamber of Commerce and Industry. This registration is necessary to be able to legally conduct business activities.
12. Post-license procedures
Once you have obtained the license, there are some procedures that you must undertake to ensure that the business runs smoothly, such as:
- Opening a business bank account: You will need a bank account in the name of the company to manage financial operations.
- Obtaining employee visas: If you plan to hire employees, you need to apply for work visas for them.
- Tax registration: If your business requires registration for Value Added Tax (VAT), you should do so as soon as possible.
13. Cost of a Trade License
The cost of obtaining a trade license in Dubai depends on several factors, such as the type of business, the location of the company, and the number of employees. Basic costs may include:
- Trade name registration fees.
- Initial approval fees.
- Lease contract fees.
- License issuance fees.
In conclusion, obtaining a trade license in Dubai is an organized and easy process if the right steps are followed. By ensuring that all legal and administrative requirements are met, you can start your business with confidence in one of the best business destinations in the world.
