Are you an aspiring entrepreneur looking to start a business in the United Arab Emirates (UAE)? The first crucial step in your entrepreneurial journey is obtaining a UAE trade licence from the relevant authorities. In this blog post, let us explore the step-by-step guide on the trade licence in the UAE, the application process, types of licences and other important details.
A trade licence is an essential legal document issued by the Department of Economic Development (DED) or relevant Free Zone authorities. It outlines the specific business activities that a company or individual is permitted to conduct within the UAE. Once a company is registered, obtaining a trade licence is crucial for facilitating the import and export of goods and materials to and from the UAE, whether operating in the UAE’s mainland or free zone areas. Understanding the process from the beginning to the renewal stage, including all related costs, ensures a smoother experience when establishing your business in the UAE.
Step 1: Define the type of business activity Before starting the process of obtaining a UAE trade licence, it is essential to identify the specific type of business activity you plan to undertake. The UAE offers a wide range of business activities, including trading, manufacturing and services. When selecting your business activity, it is also important to consider the associated licence cost. The comprehensive list of businesses in the UAE exceeds 2,000 economic activities, presenting a broad spectrum of options for individuals and companies looking to establish their presence in the country. Types of trade licences in the UAE: According to the UAE Ministry of Economy, there are six distinct types of licences: industrial, commercial, crafts, tourism, agricultural and professional licences. Each licence has the potential to encompass multiple business activities, offering entrepreneurs a degree of flexibility. Each type of business activity requires a distinct trade licence. Therefore, it is important to clarify the type of business activity before applying. Step 2: Choose the location In the UAE, there are two main types of trade licences: mainland trade licence and free zone trade licence. Mainland trade licence allows business owners to operate from anywhere in the UAE, while free zone trade licence restricts business operations to specific free zones. Mainland trade licences are issued by the Department of Economic Development (DED), while free zone trade licences are granted by the respective free zone authorities. Ras Al Khaimah Economic Zone (RAKEZ) offers the flexibility of obtaining a dual licence. This enables you to operate across the UAE without restrictions. If you are looking for the most cost-effective trade licence in the UAE, a free zone trade licence may be of interest. RAKEZ, for example, offers a business set-up package starting at AED 5,499. This economic zone provides numerous benefits, including 100% foreign ownership and no restrictions on the repatriation of capital and profits. Step 3: Select a business name and activity After determining the business activity and location, select a unique and trademark-free business name that aligns with the chosen business activity and the type of UAE trade licence being applied for. Step 4: Gather and submit the required documents To start the application process for a UAE trade licence, one needs to gather and submit several essential documents, including: ● A fully completed trade licence application form ● Copies of their passport and visa ● A no-objection letter from their sponsor (if applicable) ● A tenancy contract or lease agreement ● A comprehensive business plan ● Memorandum of Association (MOA) (for Limited Liability Company structures) The specific documents required may vary depending on the type of UAE trade licence being sought and the location of the business. Step 5: Make the payment To obtain a UAE trade licence, one needs to pay various fees, including: ● Trade licence fees ● Commercial permit fees ● Inspection fees ● Municipality fees The exact fee structure depends on the type of UAE trade licence being pursued and the location of the business.
A trade licence in the UAE typically remains valid for one year from the date of issuance. It is crucial to manage the cost by renewing the business licence before it expires to avoid unnecessary expenses and interruptions to business activities. Failure to renew within the valid period results in immediate licence expiration and suspension of business activities. Staying informed about renewal deadlines is essential to ensure the smooth operations of your business in the UAE.
Following this comprehensive step-by-step guide can make the process of securing a UAE trade licence straightforward. For the most cost-effective free zone licence in the UAE, consider obtaining a free zone trade licence from RAKEZ. The expert business set-up team at RAKEZ will guide you through every step of the process. So, why wait any longer? Contact us now: Phone: +971 7 204 1111 Email: info@rakez.com
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