What is a Trade License?

Obtaining a business license in Dubai is perhaps the most vital step towards starting up your own business in the emirate. The most commonly used form of business license is the normal commercial license, which refers to all the legal activities which are conducted over the UAE and is issued by the Dubai government. This license allows businesses to trade freely within the country and has to be obtained before doing so.

However, there is another option available for companies wishing to start trading in the United Arab Emirates - they may choose to apply for a Trade License, which is a separate application from the normal one. A Trade License is different from a normal license because it does not need to be renewed on an annual basis. It is solely for a limited period of time and can be revoked at any time by the local sponsor, if required. As a general rule, the processing time for applications for Trade Licenses is usually longer than that of other licenses, due to the extra requirements that have to be fulfilled by the applicant.

When planning on doing business in Dubai, the first thing you have to decide is whether to obtain a normal or a Trade License. Both have their own advantages and disadvantages, and you should only really make a decision based on your goals, your business experience and what the local laws allow for. A normal business can bring in more profit and revenue than a Trade License, but the process of obtaining such a license takes longer and requires more documentation, not to mention an initial deposit which is nonrefundable. Trade licenses are easier to get, requiring just a valid passport, payment and the completion of several documents, unlike Trade Licenses which require the submission of numerous documents, the signing of several documents and the payment of an administrative fee.

A Trade License in Dubai may be renewed after three years by applying to the Dubai Trade License Office. Once you have obtained a Trade License in Dubai, you will need to provide proof of financial status and three years of residence. These documents include a monthly paycheck stub, copies of repossessed bank accounts, a detailed account of your business assets and liabilities, a list of your company's personnel and their details including their national ID number and passport copies. You will also need to submit a detailed plan of your company's structure, its shares and share prices in legal documents, business permits from the local government and the results of previous commercial activities carried out in Dubai. This document checklist can take a long time to prepare and you will need to submit all these documents to the office at least two months before you apply for a new license.

Once you have all the necessary documents ready, you can begin the application procedure and wait for your results. In general, the procedure involves submitting the application to the concerned authority and waiting for a response. If your documents are found to be complete and appropriate, you will receive a positive response within three months from the date of application. If your submission is incomplete or unreliable, you might be required to submit additional supporting documents that will further delay your application. Your commercial operation may still not be approved if there are issues with your personal details and your identity is unknown to the concerned authorities or Trade License authority. For this reason, it is advisable to carry a copy of your employment contract with you whenever you visit Dubai so that you can provide evidence that you have an ongoing job and that you are able to pay your taxes.

Once you receive approval for obtaining a commercial license in Dubai, you will need to register all your commercial properties. The Dubai Trade License Office will issue you a business permit and you will find it compulsory for all businesses wishing to open a branch in Dubai to apply for a business visa. For many people, obtaining a business visa is the most difficult step in obtaining a trade license. For businesses that cannot verify their legal status in the UAE or those that wish to employ employees from abroad, visa sponsorship may be the easiest way to obtain a business visa. Sponsorship can usually be arranged through the concerned visa office in just a few hours.

If you wish to apply for a commercial visa, you must comply with all the legal requirements in addition to filling out the application form. It is best to apply early so that you can have plenty of time to research and compare the different commercial licenses available in Dubai before submitting your application. The process of obtaining a commercial visa in Dubai is much simpler than acquiring a non-immigrant visa, especially for those who are self-employed. However, non-immigrants must still follow certain legal requirements including the payment of applicable fees and performing criminal record checks.

Dubai commercial licensing is administered by the government authorities. An annual fee is required in order to maintain your commercial license and registration. Your license may be suspended or discontinued for failure to pay the necessary fees, or for exceeding the time period allowed for your registration. Failure to comply with the legal requirements may result in penalties and seizure of your property and business activity. For more detailed information on obtaining a commercial license or for additional options for business activity, please contact a UAE licensed agent.