How to Start a Trading Company in UAE?

How to start a trading company in UAE?

The United Arab Emirates is a commercial hub for businessmen around the world. Distinguished to have one of the largest growing economy and known for its natural resources, the magnetism towards the region has been forever. The dynamic economy of the country offers lucrative markets for several industries including the trading sector.

So, if you are planning to start trading company in UAE then you have made the right decision! However, before we explore how to start a trading company in UAE, lets understand a little more about trading businesses particularly in the UAE

Trading Business in the UAE –

Trading business in UAE was initiated over 4000 years ago after the country established trade links with Egypt and Indian subcontinent. Dubai in the UAE became the epicentre of trade after the extensive vision of non-oil developments. This made trading startups in the UAE enjoy a safer market space and steady trade relationships. Moreover, with open trade policies and global trade relations starting a trading firm proved to be a great option for businessmen across the globe.

The two ways to start a trading company in UAE –

The UAE has been continuously ranking top as one of the best trading locations in the world. From international trading companies to SME’s – the UAE is preferred by a wide variety of business entities. Nevertheless, every trading businesses need to consider these two-ways of setting up a trading company in Dubai or anywhere across the UAE.

General Trading Companies

General trading companies opt for a general trading license in UAE, which allows the company to trade on every generic product. This literally means companies can trade everything except those products that need an additional approval from the legislative authorities. Most companies prefer getting a general trading license in UAE as it offers flexibility and expands the scope of the company.

Specific Trading Companies

Specific trading companies also referred as normal trading companies opt for a normal trading license in UAE. This type of trading company in the UAE permits to trade only the specific product as mentioned in the trade license. This license limits the scope of the company, in terms, if the company decides to trade other products in the future.

Now that we have understood about trading business, let’s analyse how to start a trading company in UAE.

Steps on how to start a trading company in UAE –

Decide Your Trade

Understand the practicability of what you are going to trade in the UAE. Conduct a feasibility study for the product or service you plan on trading in the UAE, do a thorough research on the feasibility before to take the plunge of starting a trade firm.

Pick the Jurisdiction

The UAE is divided into various commercial zones – such as Mainland and Free zones that allows trading companies to be more competent and enjoy added benefits. Picking the jurisdiction completely depends on your business activity, your requirements, and the commodity you are planning to trade.

Name and Activity Approval

The Economic Department approves the trade name for you before you move ahead and start the process of setting up a trading company. The business activity is also approved at this stage and required approval are processed for licensing the business.

Decide the Legal Type

Setup a general trading company or a normal trading company. But, decide the legal type beforehand to provide a proper layout for your company. For some trading activities, you may or may not have the option of choosing and will be bound to take a general trading license.

License your Company

You may go for a normal or general trading license in Dubai, while some Economic Departments in different Emirates only provide general trading licenses. These licenses mainly regulate under UAE mainland. On the other hand, free zone licensing structure have their own distinctive norms.

Find a UAE Local Sponsor

Finding a UAE local sponsor is one of the compulsory steps of starting a trading firm in UAE. Obtaining a trustworthy sponsor who is a UAE national can be tedious, especially for foreign entrepreneurs. But you can opt for a reliable business setup company in the UAE, who can partner with your company as a UAE local sponsor. These business setup companies offer you documented authorisation and 100% control over your business with zero interference.

Get External Approvals

The Department of Economic Development mandates external approval from several governmental and non-governmental entities. For instance, to setup a trading firm you may have to get approvals not just from the DED but also from the municipality, banks, embassies, etc.

Draft your Memorandum of Association

Did you know that the lowest capital requirement for establishing up a Limited Liability Company (LLC) for a General Trading License in Dubai is AED 300,000/-. It is not mandatory to show a bank guarantee but require mentioning the same in the Memorandum of Association (MOA). Before drafting the MOA ensure to take expert advice from a business setup consultant. This helps to draft the MOA in accordance to the governmental standards and your interests.

Rent an Office

The DED conditions on having a rented office for trading companies. It is imperative to get the tenancy agreement and Ejari for the rented office space or warehouse. You must properly draft your agreement and makes a tenancy contract. It is also required to be notarised as per the governmental standards.

Get an Initial Approval & Start Trading

Before getting your trade license the DED provides an initial approval. The initial approval is granted after the name reservation certificate and partner’s passport copies are submitted. Also, the approvals from the external departments are submitted to the DED. It allows companies to start trading activities even before receiving the trade license.

Contact a business setup consultant –

Still have doubts on how to start a trading firm in the UAE? Speak to a business setup consultant to know in detail about staring a trading firm. Understand the various costs of setting up a trading business in UAE? See what makes UAE the best place to start a trading business and so much more!

How to start a trading company in UAE?Book a FREE consultation today with a company formation consultant. Clear all your doubts related to setting up a trading company in UAE. Call us on +97145667485, WhatsApp +971551129344 or simply visit to chat with us.

Share via

Powered by WhatsApp Chat

× How can I help you?
Send this to a friend