How to Set up a General Trading Business in the UAE

General trading, a broad category encompassing the buying and selling of various goods and commodities, is a key player in the UAE’s economic success. In 2022, this versatile sector was valued at an impressive USD 230 billion, with projections anticipating a substantial annual growth rate of 4.5%, culminating in an estimated USD 300 billion industry by 2027.

While both general trading and e-commerce involve the fundamental concept of buying and selling products, it’s essential to recognize the nuanced differences between the two. General trading, with its focus on the physical movement of goods, encompasses a wide range of activities, including importing, exporting, and re-exporting. This sector often involves direct engagement in logistics, managing transportation, warehousing, and customs clearance. On the other hand, e-commerce primarily centres around online sales, relying on digital platforms for transactions and often outsourcing logistics to third-party providers.

Note: With SPC Free Zone, entrepreneurs can choose up to five business activities under one license, streamlining operations. Deciding when to combine a general trading activity with an e-commerce venture is crucial. If your online business involves products with physical movement, especially imported goods, a wholesale license may be necessary, facilitating bulk purchasing. An e-commerce license allows direct sales to end customers. However, if your strategy includes selling in large quantities to other businesses, a general trading license is essential, facilitating trade on a broader scale.

The integral role of general trading in facilitating global commerce becomes evident when considering the UAE’s top trading partners—China, India, the United States, Saudi Arabia, and Switzerland. These robust international connections offer a gateway to diverse trade opportunities, allowing businesses to tap into a vast and varied market.

This is the business activity that you can select under your license when establishing your general trading business:

4690.00 Non-Specialized Wholesale Trade (General Trading)

Non-Specialized Wholesale Trade (General Trading) encompasses the wholesale distribution of a wide array of products across diverse industries. These wholesalers engage in buying goods in bulk quantities from manufacturers or distributors and subsequently selling them to retailers, businesses, and other wholesalers. Unlike specialized wholesalers that focus on specific product categories, general trading wholesalers offer a comprehensive range of merchandise, including consumer goods, industrial supplies, machinery, and raw materials. With extensive distribution networks and flexible market strategies, these wholesalers cater to the needs of a diverse customer base, supplying essential products essential for various purposes.

Examples of businesses involved in non-specialized wholesale trade include distributors supplying consumer products to retail stores, wholesalers offering industrial supplies to manufacturing companies, and merchandise brokers facilitating transactions across different product categories

Third-party Approval: No third-party approvals are required for this business activity
Filing of Economic Substance Return: Business activity 4690.00 is exempt from this requirement.
Anti-Money Laundering Compliance: Business activity 4690.00 is exempt from this requirement.

4690.01 – Wholesale of a Variety of Goods Without Any Particular Specialization

Wholesale of a Variety of Goods Without Any Particular Specialization refers to wholesale trade activities where businesses engage in the distribution of diverse goods across different categories without specializing in any particular product niche. Unlike non-specialized wholesale trade, which may still involve a broad range of products but does not necessarily exclude specialization, this category specifically denotes wholesalers that operate without focusing on specific product types or industries. These wholesalers procure goods from manufacturers or suppliers and distribute them to retailers, businesses, and other customers, offering a wide variety of merchandise without emphasizing any particular specialization.

Third-party Approval: No third-party approvals are required for this business activity
Filing of Economic Substance Return: Business activity 4690.01 is exempt from this requirement.
Anti-Money Laundering Compliance: Business activity 4690.01 is exempt from this requirement.

4690.02 General Trading Wholesalers

General Trading Wholesalers typically refers to wholesalers that conduct trading activities across multiple product categories but may still maintain a degree of specialization or expertise in certain areas. While similar to “Non-Specialized Wholesale Trade” in terms of offering a broad assortment of goods, general trading wholesalers may have a more defined focus or expertise within the scope of their operations. This could include wholesalers who primarily deal with specific industries or product types while still maintaining a diverse portfolio of merchandise.

Third-party Approval: No third-party approvals are required for this business activity
Filing of Economic Substance Return: Business activity 4690.02 is exempt from this requirement.
Anti-Money Laundering Compliance: Business activity 4690.02 is exempt from this requirement.

Note: For your general trading business involving the import or export of goods, SPC Free Zone offers a streamlined process for obtaining a customs code. If you are operating within the ports of Sharjah, we issue a customs code in-house, simplifying the procedure for your business. Additionally, if your operations extend to a seaport in Dubai, we are affiliated with the Ports Authority of Dubai, enabling you to leverage our license to acquire a customs code directly from the Dubai port authority. In addition, SPC Free Zone offers the advantage of a dual license, allowing your business to operate in both the free zone and the mainland.

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