In the UAE, private transportation is exceedingly popular, with car ownership being very common. This is likely due to a few factors, from the extensive road networks to limited public transportation options in some areas and the hot climate, making walking less appealing.
In fact, the UAE has a thriving automotive industry, ranking second in the Gulf Cooperation Council (GCC). Luxury cars are also particularly popular, making up nearly 15% of sales. But, of course, not everyone wants to buy. Right now, the vehicle rental market in the UAE is expected to reach a whopping USD 1.7 billion by 2027. With a diversified economy, tourism growth, and the convenience of online services, vehicle rental is booming.
These are just a few reasons, amongst many, why an entrepreneur in UAE’s car sales or car rental industry is in the perfect position to thrive. With numerous types of vehicles in the markets and consumers with varied needs, it’s also important to understand which niche business area you want to specialize in.
If you want to set up a car sale or car rental business in the UAE, you’ll need to know exactly which business activities you can choose from.
4510 – Sale of motor vehicles
Under this category is a range of specific business activitiesfor the sale of motor vehicles. Remember, you don’t have to limit yourself to trading new vehicles—with this license, you can also match the right used vehicle to its new owner.
Here are the specific categories of vehicles you might be interested in specializing in:
- Passenger motor vehicles (cars, minivans, SUVs, etc.)
- Specialized passenger motor vehicles (ambulances, mini buses, etc.)
- Lorries, trailers, and semi-trailers
- Camping vehicles (caravans and motorhomes)
- Off-road motor vehicles (jeeps, etc.)
There are two routes you can take as a car trader: wholesale or retail. Car wholesalers purchase wholesale cars and resell them to dealerships for a profit. These can be from auctions or direct purchases from individuals or other dealerships.
A wholesale trader should have a good understanding of market trends—they keep the market fluid, after all. They also help dealerships find the right vehicles for their inventory while providing sellers with a quicker and easier way to offload their cars.
A retail car seller, meanwhile, is the person you typically interact with when buying a car from a dealership. Their product knowledge, sales experience, and customer service skills are essential in building trust with clients and completing successful sales.
Under this activity, entrepreneurs can conduct both wholesale and retail trade of the above vehicles, conduct car auctions, and work as commission-based agents too.
| It’s important to note that this does not enable renting of vehicles, whether this includes a driver or not. Additionally, entrepreneurs with this business activity can only sell whole cars, and cannot separately sell car parts or accessories. This applies to all the business activities under the group 4510. |
4510.04 – Cars Trading for Specialized Purposes
From regular passenger motor vehicles to specialized passenger motor vehicles, this activity is a useful one to have in tow. It applies to standard cars (or vehicles) that have been modified to suit a specific purpose, such as taxis or ride-sharing vehicles, regular cars outfitted for police use, regular minivans modified for delivery, and cars modified for racing. SPC Free Zone recommends this for any wholesale or retail trader within the motor vehicles industry.
- Third-party Approval: No third-party approvals are required for this business activity
- Filing of Economic Substance Return: Business activity 4510.04 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.04 is exempt from this requirement
4510.05 – Buses and Trucks Trading
Typically, entrepreneurs with this activity are involved in the buying and selling of commercial vehicles meant for transporting passengers (through buses) or cargo (through trucks).
With the UAE’s thriving logistics sector, there is always a demand for sturdy, reliable trucks to transport goods. Meanwhile, in the cities, where the public transport systems are more popular, a wide network of buses keep things flowing smoothly. The country’s tourist influx and booming event landscape have also propelled the need for private buses.
- Third-party Approval: No third-party approvals are required for this business activity
- Filing of Economic Substance Return: Business activity 4510.05 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.05 is exempt from this requirement
4510.06 – Classic Cars Trading
No region appreciates classic cars like the UAE does. For a large population of high-net-worth individuals in the UAE, collecting and maintaining classic cars is more than a hobby – it’s a lifestyle.
Classic cars are seen as valuable investments in the UAE, with their prices often appreciating over time. The UAE also allows for import of classic and vintage cars, making a wider variety available to collectors. To break into this market, you’ll need a strong knowledge about classic cars and their inner workings, along with networking skills to help set you apart from the crowd.
- Third-party Approval: No third-party approvals are required for this business activity
- Filing of Economic Substance Return: Business activity 4510.06 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.06 is exempt from this requirement
4510.07 – Used Automobile Trading For Export
While the market for the newest, most exciting vehicles is always booming, don’t make the mistake of ignoring the thriving secondhand market in the UAE. For a plethora of reasons, many people opt for used vehicles and this activity gives you the ticket to trade in this booming industry.
- Third-party Approval: No third-party approvals are required for this business activity
- Filing of Economic Substance Return: Business activity 4510.07 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.07 is exempt from this requirement
4510.08 – Specialized Vehicles Trading
This encompasses a category of vehicles designed and equipped for specific functions beyond everyday passenger transport. For example, emergency vehicles such as ambulances and fire trucks are specialized vehicles. So are construction vehicles like bulldozers and cranes and industrial vehicles.
Delivery trucks and refrigerated vans—vehicles for commercial purposes—that require features such as large cargo spaces, towing capacities, and passenger seating arrangements are specialized as well. Other specialized vehicles include limousines and taxes; specialized cars that cater to passenger transportation needs in a luxurious or service-oriented way.
Third-party Approval: Third-party approval from the Ministry of Economy is only required for this business activity the first time you apply for a new license
- Filing of Economic Substance Return: Business activity 4510.08 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.08 is exempt from this requirement
4510.09 Electric Cars Trading
The electric car (EV) market in the UAE is still in its early stages but is poised for significant growth. The UAE government is actively promoting EV adoption, and rising fuel prices coupled with growing environmental awareness and increased production of electric vehicles are making them more popular.
Third-party Approval: Third-party approval from the Ministry of Economy is only required for this business activity the first time you apply for a new license
Filing of Economic Substance Return: Business activity 4510.09 is exempt from this requirement
Anti-Money Laundering Compliance: Business activity 4510.09 is exempt from this requirement
4510.10 Specialized Vehicles For Safe Transport Trading
From vehicles specialized to carry perishable goods to armored vehicles, fire engines, hazmat vehicles, and specific security vehicles, this activity is reserved for entrepreneurs trading vehicles that are meant to keep either goods or living things safe. The focus is on vehicles that ensure the security and well-being of cargo or passengers during transportation.
- Third-party Approval: No third-party approvals are required for this business activity
- Filing of Economic Substance Return: Business activity 4510.10 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.10 is exempt from this requirement
4510.11 – Racing Cars Trading
The UAE’s thriving motorsport scene is fueled by a passion for fast cars and cutting-edge technology. From single-seater Formula 4 cars to GT3 endurance racers, the variety of competitor vehicles you can spot on the tracks is astounding. There are also several indoor and outdoor karting facilities throughout the UAE, offering a fun and affordable way to experience the excitement of racing.
It goes without saying that this is an exciting segment of the industry to step into, provided you’ve equipped yourself with the right knowledge, of course.
- Third-party Approval: Third-party approval from the Ministry of Economy is only required for this business activity the first time you apply for a new license
- Filing of Economic Substance Return: Business activity 4510.11 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.11 is exempt from this requirement
4510.12 – New Automobile Trading For Export
If your business’s focus is on buying and selling brand-new, never-before-used cars specifically for export to other countries, this activity is a must. A trader engaged in export acts as an intermediary between car manufacturers or authorized dealers and international buyers.
Your role would be to anticipate demand, keep up with the newest releases, and provide vehicles to foreign markets. From logistics and shipping to compliance with export regulations, the duties are diverse.
- Third-party Approval: No third-party approvals are required for this business activity
- Filing of Economic Substance Return: Business activity 4510.12 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 4510.12 is exempt from this requirement
7710.01 – Renting and operational leasing of the following types of vehicles: • Passenger cars (without drivers) • Trucks, utility trailers and recreational vehicles
As we’ve already discussed, renting of vehicles is a booming industry in the UAE and this license is the ticket you need to enter the trade. From passenger cars like SUVs and minivans to trucks, utility trailers, and recreational vehicles such as caravans, the scope here is immense. It’s important to note, however, that those operating with this business activity cannot provide drivers alongside the vehicles. In short, they cannot function like a delivery service, or a taxi service by themselves. Financial leasing of the vehicle is not allowed as well.
- Third-party Approval: Third-party approval from Traffic Committee (Sharjah) is required for this business activity, prior to obtaining your business license
- Filing of Economic Substance Return: Business activity 7710.01 is exempt from this requirement
- Anti-Money Laundering Compliance: Business activity 7710.01 is exempt from this requirement
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