Establishing a business in Dubai has always been one of the most important goals that every company owner or potential young businessman has ever set for themselves. Consequently, the process of forming a company in Dubai begins when you apply for a business license and begin conducting business operations with the Free Zone Authority or Department of Economic Development (DED) of your choosing. Therefore, to do so, one must know about the DED activity list.
In this article, we will be talking about the DED activity list, available business licenses, and the difference between these trade licenses. With over 2,000 activities to pick from, it should not be difficult to discover one or more that match the character of your firm. Let us see about this topic:
1. What is a Commercial License?
A UAE commercial license is one of the trade licenses necessary to have your business setup in Dubai mainland. Thus, in Dubai, United Arab Emirates, professional and industrial licenses are the other two frequently used company licenses. Consequently, you must become familiar with the application process because it is a prerequisite that must be met.
Given by the Department of Economic Development (DED), the commercial license enables foreign organizations to lawfully establish and run their businesses on Dubai’s mainland, a non-free zone area. The license entitles the holder to carry out specified commercial operations; such as services or products trading, within or outside of the jurisdiction.
In Dubai and the UAE, the commercial license is the most popular license. And it is clear why. One is that most business owners in the United Arab Emirates, prefer the mainland to the free trade zone. Two, trading items (whether they are raw materials or finished goods) and services are much less complicated, easier to carry out, and less expensive than creating them from nothing and supplying them to wholesalers for later sale. Three, one of the friendliest places in the world to conduct business is Dubai.
Benefits of a Commercial License
For businesspeople, opening a company in Dubai with a commercial license is usually favorable. As a result, let us look at some of the significant ones:
- In Dubai, a commercial license serves as both a regulation and a form of protection for trading firms.
- The bearer can engage in a minimum of 10 business activities only with one commercial trade license.
- enough options to let the applicant choose the kind of business they want to register.
- A single commercial license can be helpful to perform a number of business operations.
- When utilized in a free trade zone, you can benefit from tax exemption and free restoration of capital gains.
- You have the choice to take part in international trading operations thanks to it.
- With the license, it is simpler for companies to hire many international workers and obtain employment permits for foreign workers.
- Trading businesses operating under a commercial license are exempt from audit requirements for license renewal.
- In Dubai, the process to obtain a commercial trade license is the simplest of all. The commercial license must be obtained in addition to any additional permissions and authorizations if the business involves particularly specific activities.
How to get Commercial License?
Under the direction of a knowledgeable Dubai business counselor or experienced business formation specialist, obtaining a commercial license in the UAE is a very simple process. Choosing an appropriate site and business activity is the first step since until you are certain of the nature of your company you cannot determine the optimal location for you or the type of license you will require to carry out the desired commercial activity. Consequently, let us examine the four main steps in the procedure for getting a commercial license for your Dubai business.
One: firstly, you must identify the type of business. To do so, you can check the DED activity list and select the one that fits you most.
Two: then, you need to look for the right place to establish your business.
Three: subsequently, you should select your company name, one that does not go against the local guidelines.
Four: lastly, you must file and send your commercial license application to the corresponding authorities.
What is an Industrial license?
The UAE industrial license is a permit that allows eligible businesses or factories to conduct DED-approved activities while taking advantage of various programs and benefits. Including duty exemption solutions on equipment, machinery, spare parts, organic raw materials, semi-manufacturers, and packaging materials.
If certain requirements are met, the license also permits the export of items to GCC and Arab nations. For instance, the Department of Economic Development – RAK would be the issuing authority for a unit that was to be established in Ras Al Khaimah. Rules could slightly change depending on the emirate. Lastly, both a permanent headquarters and a warehouse for storing are required for plant establishment in Dubai.
Advantages of the Industrial License
To begin with, having a current industrial license is a need in order to lawfully engage in industry or manufacturing activities in Dubai, United Arab Emirates. In addition, the license holder benefits from a number of privileges offered by the UAE government to support sectors and draw in more investment.
- If your product is expected to contribute value to the economy of the UAE, the government will offer land at no cost or at a reduced cost, as well as support for research and development.
- Terms for leasing industrial premises were specifically established with the investor in mind.
- Discounted prices for water, power, and other necessities.
- Advice based on business practices of related businesses, to advance your industry
- A loan with lower interest rates is available for innovative items.
- The government would provide you with financial assistance during the R&D process if your item is anticipated to boost the UAE economy.
- The UAE Government will give priority to high-quality products when making official purchases.
- If you install your plant outside of the free zone with the local municipality’s agreement, power and water will be granted at discounted rates as needed for your plant.
- If your item is new to the market, there is a chance that a UAE Government bank will finance it.
How to Get Industrial License?
Similar to the licensing process for businesses and professionals in the UAE, getting an industrial license in Dubai is not difficult at all if you have the appropriate information and adhere to the rules. The final approval shouldn’t take longer than two weeks if all the procedures and paperwork are in order.
- Firstly, a factory or industrial company should first obtain the Initial Authorization from pertinent authorities before establishing itself in Dubai. Even if you are changing the current factory specs or settings, you still need to obtain the Initial Approval.
- Then, gather all the necessary paperwork and contact DED e services to submit your industrial license application. It could take the government up to three months to examine the license application and reach a decision. You will know the DED’s ultimate determination regarding application approval, which could take a further 15 days.
- Subsequently, if you intend to construct a factory or manufacturing facility outside of a free zone, you must first acquire approval from the local municipality. It is also necessary for this situation to obtain extra permits from organizations and Authorities like the Chamber of Commerce and Industry, the Ministry of Health, and others. An expert in free zone business setup may obtain all of these permits on your behalf.
- Accordingly, in order to maintain your Industrial Manufacturing License, you must properly abide by labor laws regarding your employees as well as industrial safety rules.
Your industrial license could be given in as little as 3–4 weeks if all is in order. Therefore, make sure you have all extra approvals from pertinent agencies; such as the Ministry of Environment and Water, the Ministry of the Interior, and the Ministry of Health and Prevention, before applying to the DED for the license to prevent delays in the process.
What is the DED Activity Under Each Type of License
Activities under commercial license
The Department of Economic Development (DED) has granted commercial licenses to thousands of business activities. Subsequently, you can obtain a complete list of allowed commercial business operations from the DED or from a company setup professional. Therefore, for your convenience, here is a DED activity list of just a few legal commercial actions in Dubai, UAE:
- Import/export
- The general store
- Trading in aircraft and train replacement parts
- Refueling stations
- Trading in bags and packaging materials
- Trading necessities for cosmetics and baby care
- Food supplies
- Trading of animal skins
- Trading in amusement supplies and equipment
- Financial and exchange services
- Trading in flowers and plants
- Trading in household goods
- Building upkeep services
- Services of surveillance
- Services for cleaning
- Sanitary and plumbing contracting
- Services for advertising
- Installation and maintenance of radio, television, and movie theater equipment
- Trading in automobiles
- Trading shoes
- Refrigerated storage
- Trading of tanks and silos
- Warehousing in general
- Self-storage facilities
- Services for renting
- Restaurant administration
- Ready-made clothing, among other things
Activities Under Industrial License
Industrial activity is the process of converting natural resources or raw materials from an unprocessed state to a finished or refined state. Here, the basic materials are transformed structurally or cosmetically, and the finished product can either be semi-made or fully manufactured. Either human or mechanical intervention can be used to carry out the changeover.
According to a general rule, you will probably need an industrial license in the UAE if your firm involves the fabrication, preparation, production, or manufacturing of items. Under the UAE industrial license, a long variety of activities have been designated as manufacturing and industrial activities. As a result, among the activities in the DED activity list are:
- Processing of raw materials
- Extraction of metals and petroleum
- Alloy casting
- The recycling materials’ reprocessing
- Manufacturing of any product, including magnetic technology equipment, petroleum products, appliances, machinery, food, beverages, textiles, paper, and paper-based goods.
- Slitting of paper and adhesive
- Books are bound
- Envelope and card printing
- Helicopter repair and upkeep
- Turning workshop
- Paper pulp manufacturing
- Waste management and disposal
- Processing of meat
- Processing of items by filling, separating, and packing
- Putting air conditioners together
- Metal coating products
- Production of three-dimensional images (hologram)
- Packaging for pharmaceuticals
- Making requirements for animal, bird, and saddle training
- Making safety harnesses
Difference Between an Industrial and a Commercial License
What is the difference between the two licenses? This is a common question people make after seeing the DED activity list of both. Despite the fact that they are all for commercial activity and the same department provides them, they have certain differences.
Each license is distinct and given to a company that fits into its category. A person or group of individuals seeking to offer their service in Dubai, whether they are producing goods or engaging in any other commercial activity, are given a professional license.
Depending on the type of Dubai business license you are looking for, there may be differences in the process and the documentation you may need. Similarly, the length of registration and the time people need to finish the process can also vary.
Likewise, the cost of both licenses can be another differential point. The commercial license usually costs around AED 30,000, while the industrial license may go up from AED 30,000 and reach AED 50,000.
5. How can Connect FZ help you?
Connect FZ is your best ally to help you start a company in the United Arab Emirates. Consequently, we have been supporting companies for years and assisting investors and entrepreneurs located in the UAE Free Zones, such as:
We provide professional business services that can be of help to establish your business and develop it with no problem. Our company counts on a professional team that has the necessary knowledge and edge to make any business succeed.
Do you want to check the DED activity list with the help of a professional team? Contact us! You can call us at +971 43 316 688 or send us an email at contact@connectfz.com.
Sanjyam DhingraShe is an esteemed Compliance Officer with extensive experience in ensuring corporate adherence to regulatory standards. Her expertise spans a wide range of compliance functions, including regulatory analysis, risk management, and the implementation of compliance programs. She excels in identifying potential compliance issues and developing strategic solutions to mitigate risks.
