Easily Apply for a Commercial License in Dubai and Grow Your Business
Commercial License in Dubai enables smooth business ventures.
A Commercial License in Dubai is issued to businesses engaged in trading specific goods or services. Unlike a General Trading License, it is more focused and covers a limited range of products. Certain items, such as automobiles and software, require a Commercial License in Dubai, as they are not permitted under the General Trading License.
If you plan to establish a trading company, obtaining a commercial license in Dubai is the first step, and it can be incorporated as a limited liability company (LLC). An LLC can be formed with as few as one shareholder and up to 50 outside. The company’s liability is limited by its paid-up capital, and each shareholder’s liability is confined to their fiscal donation. Alternately, an attachment company may also be established, which is possessed by another company rather than individual shareholders.
As of June 1st, 2021, businesses applying for a commercial license in Dubai can benefit from 100% foreign ownership in nearly 1,000 designated commercial activities. Previously, companies on the mainland were required to allocate 51% of their shareholding to a local partner, who had to be an Emirati citizen or a UAE-owned entity. This rule, however, still applies to activities not covered under the new regulation. Therefore, consulting an experienced business setup consultant is essential to confirm whether your proposed activity qualifies for a commercial license in Dubai under the updated list.
What Is a Commercial License?
A Commercial License in Dubai is essential for companies involved in buying, selling, or trading activities. To establish a business in Dubai, companies must apply for a valid commercial license. Three jurisdictions in the UAE issue these licenses, and the investor must select the most suitable one based on their business needs.
Dubai's Strategic Location
Dubai’s prime geographic position makes it a key trading hub, connecting Asia, Africa, and the rest of the world. With excellent infrastructure such as Dubai International Airport—the third busiest globally—and world-class seaports like Port Rashid and Jebel Ali, the city offers unmatched connectivity. These advantages, combined with a business-friendly environment, make obtaining a commercial license in Dubai highly attractive for entrepreneurs looking to establish and expand their trading activities.
Business Activities under a Commercial License
Before applying for a Commercial License in Dubai, it’s crucial to identify the type of business activities that will be carried out. Common activities covered under a commercial license include:
- Logistics
- Import and export
- Tourism and travel
- Brokerage
- Product-oriented sales (e.g., electronics, construction)
- Real estate and rental businesses
Once you’ve decided on your business activities, the next step in obtaining a Commercial License in Dubai is to register your trade name and submit the required documents to the Department of Economic Development (DED) and the UAE Federal Ministry of Economy for approval.
Required Documents for a Commercial License
To apply for a commercial license, the following documents are needed:
- Company name (in both English and Arabic)
- Lease contract for the registered business address
- Memorandum of Association (MOA)
- Dubai Municipality Department permit for the business address
- License fee payment proof
A commercial license in Dubai is initially valid for one year and must be renewed annually. The renewal process requires submitting additional documents such as a lease contract copy, approvals from relevant authorities (if applicable), and details of staff accommodation for foreign-owned companies. Once renewed, the commercial license in Dubai remains valid for five years.
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Commercial License in Dubai – Renewal Documents Needed
The validity of a Commercial License in Dubai is 1 year, making it mandatory to renew once it expires. The documents required to obtain the initial license and those for renewal are not identical. For renewal, a different set of documents is needed, which includes: a copy/original of the license, a registered address lease contract (copy), approvals from concerned authorities (if required), and information regarding staff accommodation (for foreign shareholder companies). Once the renewal process is completed, the commercial license in Dubai is granted an extended validity of 5 years.
Advantages of Commercial License in Dubai
Acquiring a commercial license in Dubai comes with many benefits, such as:
- Ability to trade multiple products
- Freedom to operate across the UAE
- No mandatory auditing for license renewal
- Ability to sponsor employment visas for foreign workers
- Permission to engage in foreign trade
- Easier financial reporting
- Simple process for opening corporate bank accounts
- 100% profit repatriation and tax exemptions for free zone companies
Steps to Obtain a Commercial License in Dubai
The process of obtaining a commercial license in Dubai involves several steps:
- Confirm Business Activity: Determine your business type and products.
- Initial Approval: Apply to the DED for initial approval.
- Local Sponsor: For mainland companies, secure a local Emirati sponsor
- Legal Structure: Draft the Articles of Association (AOA) and MOA.
- Trade Name Approval: Select a unique, compliant trade name.
- Office Space: Rent an office or commercial space and complete Ejari registration.
- Ministry Approvals: Obtain additional ministry approvals as required.
Dubai offers immense advantages for businesses, thanks to its strategic position, world-class structure, and probative business terrain. By following the needed procedures and submitting the necessary documents, you can fluently establish your business with a Commercial license in Dubai.
THE STRATEGIC LOCATION OF DUBAI ?
Prior to the application for a commercial license in Dubai, one
needs to decide on the trading activities that are going to be
conducted under the same. Have a clear understanding of the
type or category of your business activity before you set up a
business in Dubai. Business activities related to buying and
selling, and certain service-oriented endeavors, come under the Commercial License. Key activities included in the commercial license in Dubai, UAE are listed below.
- Logistics
- Import and export
- Tourism and Travel
- Import and Export
- Brokerage
- Product-oriented sales (electronics, construction, shops, stores etc)
- Real Estate
- Rental business
After deciding on the business trading activities, the next step is to choose and register your trade name. Once done, submit all the required documents to the Department of Economic Development (DED) and the UAE Federal Ministry of Economy to obtain your Commercial License in Dubai.
