Starting a business in the United Arab Emirates (UAE) presents numerous opportunities, but understanding the requirements for obtaining a trade licence can be complex. Traditionally, securing a trade licence requires a physical office space, but recent developments have introduced more flexible options that cater to a broader range of businesses.
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 business 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.
A physical office is generally required for most trade licence applications for several key reasons: • Legal compliance: A registered office address is crucial for official correspondence and regulatory adherence • Operational functionality: Having a physical location enhances credibility and provides a space for meetings and business operations For those concerned about costs, many entrepreneurs opt for co-working spaces or shared offices, which can be more budget-friendly.
Some emirates offer virtual trade licences tailored for businesses that primarily operate online. These virtual trade licences allow registration without the need for a physical office set-up, catering to modern entrepreneurs who prefer flexibility in their business operations.
• Eligibility: Typically available for businesses in sectors such as e-commerce, technology and consultancy, virtual licences cater to those operating mainly online • Operational flexibility: These licences enable entrepreneurs to manage their businesses without the constraints of a traditional office, providing operational freedom
You can obtain a licence to conduct business in 13 economic sectors including agriculture, manufacturing, contracting and others.
You can choose to set up either a Limited Liability Company (LLC) or a Sole Proprietorship LLC and own 100% of your business.
Fees for applying is AED 850, in addition to federal fees which are determined according to the activity selected and the legal form.
To apply for your virtual licence, visit the respective emirate’s portal. While virtual trade licences are an option in certain emirates, most businesses still find that having a physical office space is the most reliable solution.
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. 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. However, mainland and most free zones mandate a physical office space for registration. Ras Al Khaimah Economic Zone (RAKEZ) offers the flexibility of obtaining a dual licence. This enables you to operate across the UAE without restrictions. 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) Step 5: Make the payment To obtain a UAE trade licence, one needs to pay various fees, that may include: • Trade licence fees • Commercial permit fees • Inspection fees • Municipality fees While most trade licence applications in the UAE require a physical office space set-up, some emirates provide the option of virtual trade licences for specific business models. Understanding the requirements and processes for obtaining a trade licence is crucial for entrepreneurs looking to establish a presence in the UAE. Contact RAKEZ to get your trade licence now. Phone: +971 7 204 1111 Email: info@rakez.com
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