What Are The Various License Options To Set Up A Business In The UAE?

The UAE is widely regarded as the Middle East’s commercial capital. The economic, industry, trade, and logistics sectors have seen substantial growth over the last two decades. They have a massive impact on the global economy. The course of registering an entity in Sharjah or Dubai is legitimate and procuring a business license is the most important part of the process. There are several deliberations, extending from understanding the different types of business and trade licenses to selecting the suitable license type. As a businessman or woman, it’s important that you reflect on both of these factors.

In UAE, securing a trade or company license is not only a formality but also a requirement. This approval establishes the nature of your company and confirms your company’s legitimacy. Although this license is costly, it comes with its own package of perks and incentives.

Why do you require a business license to do business in the UAE?

Firstly, we must understand the UAE business license setup scenario. Each business in the UAE must be licensed, whether it is in a Free Zone or part of the mainland in any Emirate.

A corporate license is a document that verifies a company’s legal status. Companies are issued business licenses in order to offer responsibility for their operations in the region. It also organizes, safeguards, and classifies the firm’s legal cases.

Procuring a trade license is needed if you wish to trade lawfully as a company. Trade licenses would guarantee that the company is in line with the UAE’s Commercial Firms Act. Additionally, obtaining a trade license supports you to do business lawfully and in line with the regulatory authorities’ laws, as well as gives you a lot of advantages.

Major licenses that you can apply for

A company has to be assigned to one of many licenses by a licensing authority that’s part of each city. In the UAE, commercial operations are divided into five categories.

The following are the most common forms of business licenses available in the UAE.

Commercial License

Businesses that deal with purchase and sale of goods are given a commercial license in the UAE. Businesses may function within UAE or outside with a Commercial License. You can opt for a general trading license in the UAE if you just pick to trade locally. Also, you must file an import/export permission with the licensing authority for some kind of import/export. For exchange in goods, the UAE has different types of business licenses and business operation lists. When beginning a company, whether on the mainland or offshore, the applicant must select a particular Business License. An expat or international owner may legally own 49 percent of the total shares of a commercial license, with the remaining 51 percent belonging to a UAE national or local service agent.

Advantages of Acquiring a Commercial License

A commercial trade license aids as both the regulation and protection for trading companies. The advantages of a commercial license are as follows:

• To perform unlimited activities in one commercial trade license;
• Several options for the type of company to register;
• Several similar business activities can be undertaken under one license;
• Secure business engagement with DED and Registrar of Companies;
• Residence visas for employees and company management
• Assistance with opening of corporate bank accounts
• Cost-effective ways for the renewal of a commercial trade license in the UAE

Professional License

Any person or company involved in the use of people’s intellectual abilities would be necessary to acquire a Professional License. The company will be classified as a Civil Works Corporation if the owner is more than one person. Professional licenses are available for consultants, auditors, and lawyers. A UAE Technical License may be requested by IT service suppliers, mechanics, craftsmen, among others. An expat with a professional degree would have 100 percent ownership and would be able to become the ultimate owner.

Advantages of Acquiring a Professional License

A service-oriented company relies on professional skills. Therefore, specialists and professionals each need to acquire a UAE professional trade license in order to set up a business in the country.

Benefits of having a professional license are:

• Fixed annual fee for professional license holders;
• Appropriate for skilled professionals;
• Transparency in dealing with clients;
• Business can apply visas for employees

Industrial License

An Industrial License is issued to those organizations that want to convert/alter natural resources in order to manufacture new products to sell within the country. Therefore, specialists and professionals each need to obtain a UAE professional trade license in order to set up such a business in the country.

Tourism License

UAE has done an outstanding job of depicting the tourism industry as a world-wide pioneer and as a center of attraction for luring corporate owners and tourists. A travel and tourism license from the Department of Tourism and Commerce Marketing (DTCM) is compulsory to start a travel and tourism company in Dubai, while other Emirates have their own respective authority. There are three major categories of tourism licenses required, based on the operation of the tourism industry.

• Outbound tour operator
• Inbound tour operator
• Travel agent

Related Article: How to Start a Tourism Company in the UAE? (Guide 2023)

Freelance Permit

The freelance permit is a recent authorization in UAE these days. In the UAE, freelancing is increasingly becoming popular. Individuals may apply for Freelance Permits in the free zones of Sharjah, Dubai, Abu Dhabi, Ras Al Khaimah, and Fujairah.

These permits allow skilled people in the media, telecommunications, art, and entertainment sectors to offer consulting services in addition to their full-time work. Individuals may get a Freelance Permit from places like SPC Free Zone.

Our business setup experts have years of practical experience in this domain and we can make the whole process relaxed and completely hassle-free for you. Contact us for any kind of assistance at 800 SPCFZ.