Interesting facts:
Full versionOne of the mandatory requirements for starting a business in the United Arab Emirates is a business license corresponding to the declared activities approved by the regulator. Licenses are issued by the relevant authorities of each emirate (DED) or free zone administrations, depending on the jurisdiction of registration (each emirate has its own licensing rules). Depending on the type of company, business registration is carried out in the mainland UAE (through the Department of Economic Development (DED)) or in free zones.
Particular types of companies, apart from licenses, are also required to receive approvals for incorporation from the relevant ministry. For instance, manufacturing companies are from the Ministry of Industry; banks and other financial institutions are from the Central Bank of the UAE; and medical and pharmaceutical firms are from the Ministry of Healthcare.
The time it takes to obtain a license depends on the jurisdiction and type of activity and can range from a few days to several weeks. The license fee depends on several factors: the annual office lease charges, the scope of services, and the type of company. Typically, the cost of a license depends on the emirate, type of activity, and office requirements and can vary significantly. Specialized licenses can be significantly pricier and take significantly longer to obtain.
Clarify the cost of opening company, corporate or personal bank account, obtaining a residence visa, or another question regarding business in Dubai, UAE:
A commercial license is required to open a trading company in the UAE. It is issued to companies registered in the UAE mainland and free trade zones, as well as to firms established in free trade zones. Free trade zones use FZE (single shareholder) and FZCO/FZC (multiple shareholder) licenses, depending on the specific free zone.
Professional license covers activities associated with provision of professional services - consulting, audit, legal services, etc.
This license is issued for businesses engaged in manufacturing or industrial activities. It may be issued to companies on the mainland, and companies registered in FTZ and having legal status of FZE and FZC.
By meeting the In-Country Value (ICV) program requirements and other localization criteria, a company may qualify for additional preferences and be issued a national industrial license. Products exported by such companies to Gulf countries are exempt from customs duties. While companies in free zones can conduct international business, operating in the mainland UAE requires additional requirements or the involvement of a local distributor.
Most licenses in the UAE are issued for one year with mandatory annual renewal (long-term options are available in some free zones). They must be renewed after this period fires out. The UAE imposes penalties for expired licenses, including administrative fines, blocking, and termination of the company's operations.
Choosing the right license, choosing a jurisdiction (mainland or free zone), and timely renewal are key to stable business operations in the UAE.
Choosing an appropriate type of license and the place of registration is a critical aspect when establishing a business in the UAE as it directly impacts on its abilities, tax regime, and market access. Errors at this stage could restrict operations and create costs.
Dubai-Freezone specialists will assist you in deciding the best license type, registering a company in the UAE mainland (mainland) or within a free zone, and provide full support—from paperwork to opening a corporate bank account and getting residence visas.
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