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What makes conducting a business without a license in the UAE to be dangerous?

Article image: What makes conducting a business without a license in the UAE to be dangerous?

The business of any category requires a “trade” license in Dubai. The requirements for this license as well as necessary permits from various agencies and government bodies vary depending on the business category. This means that business licenses for certain types of businesses in the UAE, such as financial services, medical services, printing, and publishing, or food trade, involve the issuance of more permits than for a general/standard trade license or another type of a license.

There are three categories of business licenses in Dubai required for the company’s operation. Depending on the character of business activity an enterprise plans to conduct, the following categories of a business license in the UAE are issued:

  • Commercial license – issued to a company that will be involved in the trade;
  • Industrial license – issued to a company that will deal with the production of something or will be engaged in any type of industrial activity;
  • Professional license – issued to service providers, professionals, artisans, and craftsmen.

Is it possible to run a business without a license in the UAE?

All COMPANIES in the UAE must have a license. Doing business without a license in the UAE is illegal. Depending on the circumstances, the company may be fined between 5,000 and 50,000 dirhams and receive an immediate ban on continuing its activities. If it is a question of trade, sales are also illegal without the establishment of a legal entity that is performed by an individual from their own apartment (home).

Persons conducting business without a license in Dubai can get a fine or even a prison term. The annual cost of the trade license is about 25,000 dirhams.

Doing business without a license in Dubai is also prohibited for freelancers who work on the territory of the country. In this case, the type of the required license depends on the character of the business activity.

Today, starting a business in Dubai has become faster and easier than ever. The Department of Economic Development (DED) is established in Dubai. Its functions include helping business owners launch and expand their operation escaping lengthy registration and administration processes.

There are two jurisdictions for doing business in the UAE: Mainland, on the one hand, and more than 35 free trade zones, on the other. Mainland and free zones offer various advantages depending on the type of business and specific activities you are involved in.

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