Guide to Business License Requirements in Dubai UAE

Are you considering starting a business in Dubai, UAE? Understanding the business license requirements is essential for a successful venture. DBS Business Setup, based in Dubai, offers business setup and support services across UAE and GCC. They specialize in business registration in mainland, free zones, and offshore areas, as well as pro services, bank account opening, VAT registration and filing, and corporate tax registration and filing. In this guide, we will delve into the key requirements for obtaining a business license in Dubai, UAE, providing you with the necessary information to navigate the process efficiently and effectively.

Types of Business Licenses in Dubai

Dubai offers three main types of business licenses that entrepreneurs can apply for, depending on the nature of their business. These licenses include the commercial license, professional license, and industrial license. Each license has specific requirements and is suitable for different types of businesses.

Commercial License

The commercial license is the most common type of license used by businesses in Dubai. It is suitable for companies engaged in trading and retail activities. To obtain a commercial license, several requirements must be fulfilled.

Professional License

The professional license is designed for individuals or companies that provide professional services, such as consultancy, legal, or accounting services. This license requires specific qualifications and certifications, depending on the profession.

Industrial License

The industrial license is for businesses involved in manufacturing or industrial activities. This includes companies that produce goods or use raw materials to create products. Obtaining an industrial license requires adhering to additional regulations and obtaining approvals from the relevant authorities.

Requirements for Commercial License

To Apply for a commercial license in Dubai, the following requirements must be met:

Business Activities Approval

Before applying for a commercial license, it is essential to obtain approval for the business activities you plan to engage in. The Department of Economic Development (DED) is responsible for approving business activities in Dubai.

Trade Name Reservation

Selecting a trade name for your business is an important step in the licensing process. The trade name must be unique and adheres to the guidelines set by the DED. Once the trade name is chosen, it must be reserved with the DED.

Approval from Relevant Authorities

Depending on the nature of your business, you may require approvals from specific authorities. For example, food establishments need approval from the Dubai Municipality, while healthcare providers require approval from the Dubai Health Authority.

Lease Agreement

A lease agreement for a physical office space in Dubai is a mandatory requirement for obtaining a commercial license. The agreement must be attested by the Real Estate Regulatory Authority (RERA) or Ejari.

Memorandum of Association

If you are setting up a limited liability company (LLC), you must draft a Memorandum of Association (MOA). The MOA outlines the company’s structure, objectives, and rules of operation. It must be notarized and submitted with the license application.

Passport Copies of Shareholders

Passport copies of all shareholders or partners in the business must be provided as part of the license application process.

NOC from Local Sponsor

For certain business activities, a No Objection Certificate (NOC) from a local sponsor is required. The local sponsor is typically a UAE national who acts as a partner or sponsor for the business.

Requirements for Professional License

If you plan to provide professional services in Dubai, you will need to obtain a professional license. The requirements for a professional license include:

Educational Certificates

Depending on the profession, educational certificates may be required. These certificates must be attested by the Ministry of Foreign Affairs and the embassy of the home country.

Membership Certificates

For certain professions, such as lawyers or engineers, membership certificates from the relevant professional bodies or associations are necessary.

Passport Copy

A copy of the passport of the individual or partners involved in the business must be provided.

NOC from Current Employer

If you are currently employed and wish to set up your own business, you will need a No Objection Certificate (NOC) from your current employer.

Requirements for Industrial License

The industrial license is specific to businesses engaged in manufacturing or industrial activities. The requirements for obtaining an industrial license include:

Environmental Approval

Businesses involved in industrial activities must obtain approval from the Dubai Municipality’s Environmental Department. This approval ensures compliance with environmental regulations.

Health and Safety Requirements

Certain industries and manufacturing activities require adherence to specific health and safety regulations. These requirements must be met and approved by the respective authorities.

Location Approval

The location of the industrial business must conform to the regulations set by the Dubai Municipality in terms of zoning and suitability for industrial activities.

Technical Evaluation

Some industrial activities require a technical evaluation to ensure compliance with standards and regulations. This evaluation is conducted by authorized technical entities.

Business License Application Process

applying for a business license in Dubai involves several steps. The process includes:

Choose a Company Name

Select a unique and suitable trade name for your business.

Determine the Type of License

Decide on the type of license that best suits your business activities.

Submit Required Documents

Prepare and submit all the necessary documents, including the application form, passport copies, lease agreement, and other supporting documents.

Pay License Fee

Pay the required fees for the business license based on the type of license and activities.

Obtain Initial Approval

Once the documents and fees are submitted, the authorities will conduct a review and provide initial approval for the license.

Lease Office Space

Secure a physical office space and have the lease agreement attested.

Get Final Approval

After fulfilling all the requirements and obtaining the necessary approvals, the final approval for the business license will be granted.

Collect License

Once the final approval is obtained, the business license can be collected from the relevant authorities.

Business License Renewal

Business licenses in Dubai are generally valid for one year. To renew a business license, the following steps must be followed:

Submit Renewal Application

Submit a renewal application along with the necessary documents, such as the current license, lease agreement, and updated company information.

Pay Renewal Fee

Pay the renewal fee for the business license, which may vary depending on the type of license and business activities.

Obtain Renewal Approval

Upon review of the renewal application, the authorities will grant approval for the license renewal.

Collect Renewed License

Once the renewal is approved, the renewed business license can be collected from the relevant authorities.

Business License Amendments

If any changes need to be made to the business license, such as changes in business activities, trade name, shareholders, or legal structure, the following amendments must be made:

Change of Business Activities

Submit a request to amend the business activities and provide the necessary documents to support the changes.

Change of Trade Name

To change the trade name of the business, submit a request along with the required documents, such as the initial trade name reservation certificate.

Change of Shareholders

In case of changes in shareholders or partners, provide the relevant documents, such as updated passport copies and submission forms.

Change of Legal Structure

If there is a change in the legal structure of the business, such as converting from a sole proprietorship to an LLC, the necessary documents and approvals must be obtained.

Free Zone Business License Requirements

In addition to mainland licenses, entrepreneurs also have the option to set up their businesses in one of Dubai’s many free zones. The requirements for obtaining a free zone business license include:

Choose a Free Zone

Select a free zone that aligns with your business activities and objectives.

Select Company Type

Choose the appropriate company type, such as a free zone establishment, free zone company, or branch office.

Submit Business Plan

Prepare a comprehensive business plan outlining the nature of your business, financial projections, and market analysis.

Lease Office Space

Lease office space within the selected free zone to serve as your company’s registered address.

Obtain Necessary Approvals

Obtain approvals from the free zone authority, including the initial approval and NOC from the relevant authorities.

Pay Registration and License Fees

Pay the required registration and license fees based on the selected free zone and business activities.

Get License

Upon fulfilling all the requirements and paying the fees, the free zone authority will issue the business license.

Offshore Business License Requirements

Setting up an offshore business in Dubai provides certain advantages, such as tax benefits. The requirements for obtaining an offshore business license include:

Select Offshore Jurisdiction

Choose the offshore jurisdiction that best suits your business needs, such as Jebel Ali Free Zone Offshore or Ras Al Khaimah International Corporate Center (RAK ICC).

Choose a Registered Agent

Engage the services of a registered agent who will facilitate the offshore business setup and license application process.

Submit Required Documents

Provide the necessary documents, such as company incorporation documents, passport copies, and legal agreements.

Pay Registration and License Fees

Pay the registration and license fees for the offshore business setup, which vary depending on the selected jurisdiction.

Obtain License

Upon completion of the required procedures and payment of fees, the offshore business license will be issued.

Government Departments and Authorities Involved

Various government departments and authorities are involved in the business license application process in Dubai. These entities include:

Department of Economic Development (DED)

The DED is responsible for the approval of business activities, registration, and licensing of businesses.

Dubai Chamber

The Dubai Chamber of Commerce and Industry provides support services for businesses and facilitates trade activities.

Dubai Municipality

The Dubai Municipality approves business locations and ensures compliance with environmental and zoning regulations.

Dubai Health Authority

The Dubai Health Authority approves and regulates healthcare providers and related businesses.

Dubai Police

The Dubai Police may be involved in the security clearance process for certain business activities.

Dubai Customs

Dubai Customs is responsible for regulating and facilitating import and export activities.

Federal Tax Authority (FTA)

The FTA is involved in the registration and administration of value-added tax (VAT) for eligible businesses.

In conclusion, starting a business in Dubai requires obtaining the appropriate business license based on the nature of the business. Whether it is a commercial, professional, or industrial license, entrepreneurs must meet the specific requirements set by the authorities. Additionally, free zone and offshore business licenses provide alternative options for those seeking specific advantages. By understanding the requirements and following the necessary procedures, entrepreneurs can successfully obtain and renew their business licenses in Dubai, enabling them to operate legally and thrive in the dynamic business landscape of the UAE.