Trade License in dubai

A Trade License/Business License is a permit from the government that allows a business to operate legally in the UAE. It contains details such as the company name, legal status, Trade License Number, validity of the license, and the number of permitted activities for the business.

All businesses require a business license to operate legally. The specific license depends on the industry and location. It is issued by the Department of Economic Development (DED).

There are different types of trade licenses depending on the nature of activities and two types depending on processing time.

Learn more about Types of trade licenses and their activities.

Table of Contents

Two types of trading licenses by processing time

Normal Trading License

The processing time for a normal trade license is longer than that for an instant trade license. It typically takes from a few days to one week if all documents are correct.

You might need to submit many documents to acquire a normal trading license, which we will discuss later in this guide.

The benefits of choosing a normal trading license include its ability to cover various activities and business structures. Additionally, you will have many locations to choose from for your business and various legal structures.

Instant Trading License

It usually takes a few hours to one day to obtain an instant trading license. The application process requires only a few documents compared to a normal trading license.

However, the main drawbacks of an instant trading license are that it allows only a limited number of activities, limitations on company structure, and restricts the selection of locations for our business.

How to get a trade license in Dubai,UAE?

Select your business activities for your Business

Each trade license/Business License offers a variety of activities to choose from. You must select the right activities for your business, keeping in mind that the number of activities you can choose is limited according to the license type.

Choose a trade name

When starting a business, one of the first steps is selecting the right name. We must choose the trade name carefully, following several rules and regulations.

Select Business Location

It’s important to choose the location to start our business, which can be either mainland or free zone. The choice of location is influenced by the type of license and may require a tenancy contract. Some free zones even allow virtual offices, eliminating the need for a physical office space.

Fill out the application form

You may need to complete the application form provided by the Department of Economic Development (DED) and submit relevant documents. Finally, you’ll need to pay the relevant fees.

Receive your trade license and Open a bank account

Upon approval from the DED, you will receive your trading license, allowing you to open a business bank account and start operations.

Although these are the common steps for most businesses, some may require additional approvals from other government authorities. Therefore, it’s advisable to engage Business Setup Consultants like us before starting your business in Dubai.

Additionally, the validity of the trade license depends on whether it’s issued in a free zone or on the mainland. A trade license in the mainland is valid for up to 1 year but can be extended up to three years with approval from the DED.

The validity of a trade license in a free zone ranges from 1 to 10 years, varying based on different free zones, types of business licenses, and free zone regulations and policies.

Documents Required for Trade License

Completed application form from Ded

This form details your business activities and the goods and services you plan to trade.

Passports and photos

Copies of passports and passport-sized photos for all company managers and partners.

Additional documents you might need include:

Residence visa

A copy of your residence visa and a No Objection Certificate (NOC) from your current employer (if required).

Emirates ID

A copy of your Emirates ID.

Company formation documents:

This can include the Memorandum of Association (MOA) for your company, which should be drafted with the help of a legal professional.

Business location details

Depending on the Emirate, you might need a tenancy contract or proof of your office space. Types and size of differs according to our company and sometimes office space also affects number of visas

How much does a trade license cost in Dubai?

When considering the cost of a trade license in Dubai, it depends on several factors such as the types of licenses, business activities, legal structures of your company , location of your business, medical test fees, visa fees, and many others.

You might be wondering, what is the cheapest trade license in the UAE?

The answer is simple: The cheapest trade license in the UAE is AED 5900.

JP International Management Consultancy offers a package that includes 5 free business activities, a trade license, 1 year of pro services, co-working space, and assistance with opening a business bank account.

However, the price of a trade license varies from AED 5900 to AED 50000 considering many other factors.

Since we’ve discussed the cost of a trade license, what’s the next expense? Yes, it’s the renewal cost of a trade license.

How to renew your trade license?

Usually, the validity of a trade license is for 1 year, but you can purchase packages for more than 1 year. However, validity packages differ in mainland and free zone. With a 1-year package, you’ll need to renew the trade license yearly.

What are the documents required to renew a trade license in Dubai?

  • Current trade license photocopy
  • Business partners’ passport photocopies
  • A filled BR/1 form (application form)
  • Ejari Registration Certificate (tenancy approval) with a copy of the tenancy contract (to be submitted 30 days before expiry)

Steps to renew a trade license in the UAE:

  • Check whether the tenancy contract is valid for at least 30 days.
  • Submit all the required documents.
  • Submit your application to DED.
  • Make payments.
  • Collect your renewed trade license.

Even though the steps seem simple, complications can arise if some documents are missing or not valid. However, we can help you sort out these issues and assist you. So, it’s better to either consult with us so that we can guide you or handle the process for you.

How much does it cost to renew a trade License in Uae?

The renewal cost of a trade license for both Mainland and Freezone is generally the same as the initial trade license cost. There might be a slight difference if additional services were used.

There’s often a question about whether a Mainland or Freezone trade license is cheaper.

When comparing the renewal cost of Freezone and Mainland licenses, several factors must be considered. Free zones typically allow upfront payment of renewal fees for up to 10 years, while Mainland licenses provide for a lesser number of years.

Paying for multiple years upfront usually results in reduced renewal fees. Therefore, it can be said that Free zones generally have lower renewal fees compared to Mainland.

Additionally, some Free zones offer lower base fees for their licenses compared to the Mainland.

What will happen if trade license is not renewed in UAE?

When a license is not renewed, it expires, and conducting business after the license expiry is considered illegal. The government can take actions against individuals or businesses for operating without a valid license.

The first consequence that may occur is a fine for not renewing the license. The fine can vary from AED 250 to AED 50,000. To avoid such hefty fines, it’s advisable to renew the license on time.

We recommend utilizing our trade license renewal service, where we will remind you before the expiry date and handle the renewal process, including payment of renewal fees, on your behalf.

How can I Transfer trade License in Uae?

Transferring of ownership must be done with the help of a Business setup consultants like us because we are familiar with the regulations and help you complete the process fast and efficiently.

But before understanding about how can you transfer your trade license you must know whom you can transfer your trade license in uae?

  • Owner must have a eligible to own a trade license
  • owner should have the necessary qualifications, experience, and expertise to manage the business.

More importantly, Clear all  outstanding liabilities with ded  and check for any violations. Without clearing it, You will be facing difficulty in changing ownership.

Documents for transfer of trade license

  • A filled application form. 
  • A copy of the existing trade license. 
  • Copies of the new owner’s identification documents. 
  • Memorandum of Association and Articles of Association.
  • Financial statements.
  • Tax clearance certificate .
  • NOC from existing partners/sponsors .
  • Lease agreement and utility bills.

According to business activities some additional documents might be required. So, Its better to get free Consultation from Our Business Experts.

The process of transfering trade license involves several steps:

Notify DED About Ownership Transfer

Write a letter informing DED about the reason for the transfer, along with the new owner’s Emirates ID, passport, and contact details.

Obtain NOC From Owners/Shareholders

You need to obtain consent from owners, shareholders, or sponsors before changing ownership.

Obtain Necessary Approvals and Clearances

After obtaining approval from DED, some business activities require additional approvals and clearances from certain authorities. Therefore, according to the business activities, necessary approvals and clearances must be obtained before the transfer.

Submit Documents

Submit all the required documents for the transfer.Pay the Fees: Pay the fees for the trade license transfer.

Get the Updated Trade License

You will receive the updated trade license with the new owner details.

Can you freeze trade licenses in Uae?

Yes, you can freeze your trade license in the UAE.

To freeze your trade license, you need to pay a freezing fee to DED for a period ranging from 1 to 3 years, depending on your license and approval from the authority.

Sometimes, due to emergencies, you might need to temporarily pause or freeze your license instead of canceling it entirely.

In such a scenario, you can write a letter on your business letterhead to DED, requesting to freeze the license temporarily. Provide the reason for freezing your company in the letter.

Before freezing the license, you should cancel the employees, obtain a confirmation letter from MOHRE, and pay a fee of AED 2000 for each year.

This action suspends the license and reduces fees, but trade activities cannot be conducted during the freeze period.

How to add activities in trade License?

Adding activities in a free zone or mainland follows similar steps, but there are some differences.

Submit Application to DED: 

Whether it’s a free zone or mainland, you’ll need to submit an application to the Department of Economic Development (DED) requesting permission to add the new activities to your license. The application format might be slightly different between free zones and the mainland DED.

Required Documents for Adding Activities:

Documents like your current trade license, details of the new activities, and potentially feasibility studies or NOCs (depending on the activity) are required for adding activities. There will be slight differences in the required documents for mainland and free zones.

Fee Payment for adding activties:

You need to pay processing fees for adding activities, depending on the number of activities and the specific free zone or DED authority.

License Amendment for trade license :

When DED approves your request and payment is collected, you’ll receive a new amended trade license with the newly added activities.

When it comes to adding an activity, some free zones might require additional internal approval processes beyond the DED. So it’s better to seek help from us, then we can do it for you.

How many visas comes with dubai trade license?

There is no exact answer for the number of visas you will get with a trade license, as it depends on several factors such as:

  • Type of license
  • Company size and location
  • Office space
  • Business activity
  • DED approval

However, we can say that free zones offer more visas compared to the mainland.

In Dubai mainland, the number of visas is often linked to the size of your rented office space. It is calculated by allocating a specific amount of square footage per visa, typically around 100 sq ft per person.

There are still exceptions in some businesses. For example, technical service companies can have more visas because they have more people working outside as laborers rather than in office desks.

Labor companies like construction could have less office space but more visas, but they would need to rent suitable living spaces in labor camps.

Will visa be cancelled if trade license expired?

When a trade license expires, you might have a short grace period after the expiry date (usually 30 days) to renew the license and avoid visa complications. If the license isn’t renewed within the grace period, the immigration authorities can initiate visa cancellation procedures for employees sponsored under that license.

There can be fines and penalties associated with operating with an expired trade license and potentially for overstaying visas.

Is certificate of Incorporation and trade license the same thing?

No, a Certificate of Incorporation and a trade license are not the same thing.

A Certificate of Incorporation acknowledges the formation of your company, whereas a trade license is a permit issued to a company indicating the activities it performs and the jurisdiction under which it operates.

Additionally, the Certificate of Incorporation also demonstrates that your business exists as a separate legal entity from its owners.

When you want to enter into a contract or own assets, you need to have a Certificate of Incorporation. On the other hand, a trade license or business license is necessary for all businesses to operate legally in the UAE.

why you needchoose us for getting your trading license in uae?

A trade license/Business License is the primary foundation of a business, and we want to help you achieve your business dreams quickly and efficiently.

With business setup regulations changing regularly, it’s challenging for an entrepreneur to stay updated before starting a business. But here, we can be your guide to your business setup. So contact us today to obtain your new trade license for your business.

Trade license FAQ

How to update trade license In rta?

It’s generally not necessary to directly update your trade license with the Roads and Transport Authority (RTA) in Dubai. Updates to your trade license information, such as company name, address, or activities, are typically handled through the Department of Economic Development (DED).

How to update trade license In labour / Immigration?

Updating your trade license with the labor department and immigration authorities in the UAE typically happens indirectly when you renew or modify your trade license through the Department of Economic Development (DED)

Sahayaraj Siluvai Pillai
Sahayaraj Siluvai Pillai

Sahayaraj Silluvai Pillai is a highly experienced business setup consultant in Dubai with over 10 years in the industry. Leveraging his in-depth knowledge of the local business landscape, he has guided more than 100 entrepreneurs through the process of establishing their businesses in free zones, the mainland, and offshore locations across Dubai, Sharjah, Ajman, and other UAE emirates. His strong background in banking proves to be a valuable asset, as he can assist clients in securing business bank accounts with ease, saving them time and ensuring a smooth transition. Additionally, he is also the manager at JP International Management Consultancy, bringing a well-rounded perspective to his business management services.

Articles: 18