All investors and entrepreneurs who are operating their companies in the Dubai emirate must know about the business licenses. And besides having a license for running a business, they need to complete the trade license renewal in Dubai annually. Therefore, it is essential to be aware of the requirements and cost of this kind of process.
In this article, you will learn everything that you should know about the trade license in this emirate. For instance, here you can find information about how to apply for this type of license in Dubai. Besides, you will also learn about the different types of trade licenses, their functions, benefits, costs, and renewal process. Let’s observe:
- What is a trade license in Dubai and how does it work?
- How many types of trade licenses can you find available in Dubai?
- What do you need to do to obtain a trade license in this emirate?
- What would happen if you let your Dubai trade license expires?
- How should you carry out the trade license renewal process in Dubai?
- What are the required documents for completing the renewal process of your trade license?
- How much can it cost to renew a trade license in this UAE emirate?
- How can Connectfz help you obtain more information about the trade license renewal process?
1. What is a trade license in Dubai and how does it work?
A trade license is a legal document that allows investors and entrepreneurs to build up and operate their businesses. And applying for this type of license is an essential step of the company formation process in Dubai and the UAE. Depending on the jurisdiction you choose, you can either apply for it through the DED or the free zone authorities.
And this document also determines and legitimizes the business activities that your company will carry out in your chosen location. Nonetheless, make sure to choose a location that suits your business, which can be a free zone or the mainland. If you choose Dubai Mainland, you will need to get your license through the Department of Economic Development (DED).
Also, it is important to select a proper trade license that covers all of your business activities. And this is due to the great variety of trade licenses that you can find in this popular UAE emirate. For example, you can find and apply for a commercial license, an industrial license, a service license, and many others.
Nonetheless, there is something that you should always keep in mind when operating a company in Dubai. Take into consideration that you have to renew your trade license every year in order to keep running your company. Otherwise, your business will face some penalties and other legal issues if it keeps operating without a valid license.
Here you can learn about the available business licenses that investors can obtain in the Abu Dhabi emirate, UAE.
2. How many types of trade licenses can you find available in Dubai?
You can find plenty of licenses available in any of the jurisdictions in Dubai or other emirates in the country. And each of them requires the documents required for trade license renewal in Dubai every year after one year of their issuance. Nonetheless, you have to always keep in mind that you must wisely select a license that fulfills all your needs.
Therefore, we should take a look at some of the most popular trade licenses first, which are the following ones:
- A commercial license: this type of license can cover any business activities that involve selling tangible products and goods. All traders in this emirate must apply for this license in order to carry out these activities. And in most cases, this license can also cover other related activities, such as importing and exporting products.
- An industrial license: this one is vital for those companies and factories that need to carry out industrial activities. For instance, some of the most common industrial activities that this license covers are importing raw materials for making other processes. Manufacturing, processing, assembling, and exporting finished products are some other activities that you can carry out with this license.
- A professional license: and this other license is special for those who desire to carry out their activities individually. And foreign professionals with this license can offer their many different services legally and efficiently. For example, they can offer services related to several industries, like education, healthcare, marketing, advertising, management, accounting, and many others.
Discover the variety of Mainland Trade Licenses that you’ll be able to find in Dubai and also in the UAE.
3. What do you need to do to obtain a trade license in this emirate?
In case you desire to obtain a trade license in Dubai, you need to complete the application process during the setup process. And learning how to go through this procedure is the step that you take, and then the following ones:
- Determine the type of business that you want to operate in the emirate. This way, you will be able to know the category of the activities that it will carry out. For instance, you choose the commercial, industrial, or professional category.
- Select your main business activities so you can let the authorities know which license that your company will need is.
- Choose a proper name for your company to proceed with the license application process.
- After that, you must submit your application form to the concerned authorities, which could be the DED or a free zone authority.
- Wait until you get the initial approval so you can register your trade name.
- Then, you need to rent or lease business premises according to the trade license that you want to obtain.
- Get all required approvals to submit the final application along with the fee payment.
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You should also learn how to check your trade license online with a specialist or your business partner.
Here you will be able to learn how to apply for a commercial license in the emirate of Dubai, UAE.
4. What would happen if you let your Dubai trade license expires?
Operating your business with an expired trade license means legal trouble for you and your company. Therefore, you must make sure to carry out your trade license renewal in Dubai before it expires. In case you don’t renew your license, you will face some big fines as penalties or liquidations in some cases.
A fine of approximately AED 5,000 is among the usual penalties for investors who keep operating with an expired license. And you must also take into consideration the grace period you have for renewing your license after it expires. You’ll only have 30 days to renew or cancel your license, or you’ll have to pay AED 250 as a penalty.
There are other issues that your business could face besides fines if you avoid the trade license renewal in Dubai. For example, it could face bankruptcy, which could affect your company’s reputation and success significantly. And this bankruptcy could eventually lead to other consequences, such as voluntary or forceful liquidation, and even getting blacklisted.
You can learn about some new types of business licenses in Abu Dhabi that can be renewed every 3 years.
5. How should you carry out the trade license renewal process in Dubai?
If you need to learn how to renew trade license in Dubai online, you should keep reading this section. This process may vary a little depending on the exact Dubai business location in which your company operates. However, carrying out this simple process will only require you to follow three easy, general steps, which are these:
- Prepare the documents that the trade license renewal in Dubai requires, which we will mention in the next section. Remember that some documents need some planning, like the tenancy contract (it must be valid for at least one month).
- After you get all you need, you have to complete and submit your renewal application, which is the BR/1. There is the advantage that you can complete this process and submit all required documents online.
- And lastly, you will need to pay the trade license renewal fee to finish the process and get your license. You must keep in mind that you will receive your renewed trade license if you do not pay this fee. However, once you complete the payment, you will receive your license.
6. What are the required documents for completing the renewal process of your trade license?
Besides learning the renewal process, you need to gather several documents required for trade license renewal in Dubai. In case you renew your license through the DED, you will need these documents:
- A typed BR/1 form.
- Your Ejari Registration Certificate along with a photocopy of the tenancy contract.
- A photocopy of your current trade license.
- And some passport copies of all the business partners.
Most importantly, make sure that the tenancy contract is valid for at least one month. Besides, this document must be attested by Ejari, which is an online registration system. If your tenancy contract is not valid, you won’t be able to continue with the renewal process of your trade license.
In case you are operating in a free zone, the trade license renewal process will require other documents. And those documents are these:
- A copy of the trade license or the original document (it depends upon the free zone).
- The P.O. Box confirmation renewal.
- Some passport copies of the shareholders.
- Audit reports (if applicable).
7. How much can it cost to renew a trade license in this UAE emirate?
The trade license renewal fee in Dubai may vary according to the exact type of trade license that you choose. For example, the renewal fee for a service license is around AED 10,000, while the fee for renewing a general trading license is AED 25,000. Nonetheless, it is important to consider that these fees could also vary for other reasons.
For instance, the renewal fees in this emirate could also depend on your specific business activities. Besides, the size of the office or warehouse space might also influence the cost of the license renewal process. And another thing that you should always remember is that you must pay these fees annually if you want to keep running your business.
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8. How can Connectfz help you obtain more information about the trade license renewal process?
Every business process that your company needs to carry out can be easily done with Connectfz as your partner. And all license issuance and renewal procedures are also some of those processes in which we can help you. And besides, you can get several benefits from having a partner like us, such as saving both money and time.
As for the trade license renewal in Dubai, we can help you gather the documents you require for completing the process. On the other hand, you can request new licenses for your business with the several packages that are available. And these packages not only contain licenses but also visas and facilities that you will need for operating your company.
You should also be aware of other services that we provide for managing and improving your business exponentially. For example, if you request our HR consultancy services, you’ll be able to know how to correctly manage this department. Other services that could be useful are visa services, tax advisory, banking services, payroll, and many others.
Would you like to contact Connectfz to obtain more tips and information about the trade license renewal process in Dubai in the UAE? If you have any questions, call us on +97143316688. You can email us at firstname.lastname@example.org, and you will talk to one of our representatives who will answer your questions.