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 Importance of Having a Trade License in UAE for Starting a New Company


Trade license is mandatory in UAE for commencing business operations of export, re-export, manufacture, and distribution. The laws of the land in the UAE have been formulated carefully to support business ventures. Those are conducive to the growth and development of the firms. Business license in Dubai establishes the authenticity of a firm and confirms that it is authorized by the federal authority to conduct trade operations. In this blog post, we are looking into the topic importance of having a trade license in the UAE for starting a new company.

The type of trade license you require will depend upon different factors, including the field of business. The license could be professional, commercial, or industrial. The company will be differentiated in respect of the area of jurisdiction, i.e. Mainland, Free Zone, and Offshore companies. A business consultancy service will be able to give you a better idea about the license to obtain and type of company set up after evaluating your business targets. 

The federal authority in the UAE has been welcoming entrepreneurs to the country. Therefore, the regulations made are investor-friendly and progressive. You can make the optimum use of the liberties to obtain maximum profit from your business. Nonetheless, the authority will not pardon defaulters. Heavy fine, cancellation of license, and embarrassment await those who do not follow the directives. Else, that can be troublesome for both you and your organization. 

Why Business License is Important In Dubai?

The Department of Economic Development (DED) in Dubai is the authorized governmental department to monitor, regulate, and issue business licenses. Therefore the officials will examine the relevant documents and certificates for issuing the license. However, every document you submit for a license must accompany a copy translated in Arabic too. Therefore it is a mandatory requirement for processing most of the requests in the UAE.

Issuance of business/ trade license necessitates your business to have a proper legal structure and a constitution. The business license will be advantageous in receiving several benefits from the government. The exclusive incentives will help progress your business further. 

There are three types of business licenses.

  1. Commercial License – It is required for establishing a commercial activity based business. The companies specializing in trade, including general trading, must possess commercial licenses. 
  2. Industrial License – An industry-based business organization should get an industrial license prior to establishment. Both manufacturing and commercial firms need to have this license. 
  3. Professional License – Obtain a professional license if you are considering a profession-based business in Dubai or any part of the UAE. It includes service-centric business viz. architects, doctors, tutors, artiste etcetera. 

Decide the type of license to process according to your profession or business. The procedure will depend on the type of license you require. It will be advantageous if you outsource the business license activities to business setup services in Dubai. A business setup in Dubai can elevate the possibilities of growth to your firm optimally. That is the reason for citizens around the world planning the commencement of their business-journey in Dubai. With ample understanding of the prerequisites, they will conclude it in quick time, without causing any complications to you. 

Business License Issuing Authorities in Dubai

Every business must have a trade license to begin a business in the UAE. Therefore the Department of Economic Development (DED), Dubai is the principal organization for issue, cancellation, renewal, and examination of licenses. However, there will be involvement of other ministries, organizations, and departments depending on the type of business activity.

  • Ministry of Finance and Industry – All companies in the manufacturing industry must obtain approval from the ministry while submitting for a business license. 
  • Ministry of Health – The firms operating in health products, medicines. And pharma products will need authorization from the ministry of health for processing the business license. 
  • Road and Transport Authority/ Commercial Activities Department – Business activities in road and transportation will necessitate approval from the said departments. 
  • Ministry of Economy and Commerce – Insurance-related business firms will require approval from the ministry for commencing operations.
  • UAE Central Bank – Banks, financial institutions, and other finance-based entities will need approval from the UAE central bank.
  • Dubai Municipality – Architectural, construction, and engineering businesses will be approved by the Dubai municipality. 
  • Department of Legal Affairs – The department will authorize legal firms. 

There are several more departments and offices engaged during the process of business licenses. You have to read the procedure and submit the required documents to the subject departments accordingly. 

 The data about your entity will be included in the system when you submit the documents to the authority. This will be beneficial for you in the future to gain additional advantages from the government. 





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