In Dubai, obtaining a business license is essential for establishing and operating a company. A business license serves as official authorization from the relevant government authorities, allowing individuals or organizations to engage in specific business activities within the emirate.
One of the factors that make Dubai one of the most business-friendly destinations in the world is its relatively straightforward licensing procedures, especially for foreigners that wish to do business within the emirate. Although Dubai began its rollout of a generous 9% corporate tax rate in June 2023, businesses operating under one of its various “free zones” will remain exempt from any corporate taxes.
The licensing process in Dubai is organized into four main groups: professional, industrial, commercial, and tourism licenses. Each group corresponds to different types of businesses and has its own set of requirements and regulations. Below, we explore each of these types of licenses, providing examples, procedures, costs, and conditions for renewal.
Please note that for each type of license below, the specific requirements and procedures may vary depending on the nature of the business and the jurisdiction within Dubai. We’ve provided a standard guideline of what’s needed to apply for and renew each type of license. However, it’s advisable to consult with the relevant authorities or seek professional assistance to ensure accurate and up-to-date information for your specific situation.
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Professional License
A professional license is required for individuals or companies engaged in various professional services, such as consultancy, legal, medical, or engineering practices. Some examples of professional licenses include those for doctors, lawyers, engineers, architects, accountants, and consultants.
One unique advantage of obtaining a professional license is that you can have 100% company ownership as a foreigner, even if you operate outside of an economic free zone. To operate with any other type of business license outside of a free zone, you will need to partner with a UAE national that must have a 51% ownership share.
The process of applying for a professional license generally goes something like this:
- Gather the necessary documents, including passport copies, educational qualifications, experience certificates, and any other relevant certificates or documents specific to your profession.
- Submit the required documents to the relevant licensing authority or regulatory body for your profession. Examples include the Dubai Health Authority (DHA) and Dubai Legal Affairs Department (LAD).
- Obtain initial approval from the licensing authority or regulatory body.
- Fulfill any additional requirements, such as obtaining a No Objection Certificate (NOC) from your sponsor or securing a physical office space, if applicable to your profession.
- Pay the required fees associated with the professional license application. The fees can vary depending on the nature of the profession and other factors.
- Finalize the license issuance process and receive the professional license.
The cost of a professional license in Dubai can range from AED 8,000 to AED 15,000, depending on the nature of the profession and other factors.
Professional licenses are typically valid for one year, and renewal requires fulfilling certain conditions, such as maintaining membership with professional associations, updating qualifications, and submitting relevant documents within the designated time frame.
Industrial License
An industrial license is needed for businesses that operate in manufacturing, processing, or production activities. This category encompasses industries such as factories, production plants, and manufacturing units.
This may include industrial operations like food processing, textile manufacturing, electronics production, and chemical manufacturing. It’s important to note that an industrial business may be subject to stricter regulations and capital requirements than other license types.
However, applying for an industrial license is not much different from any other type of business:
- Submitting an application to the relevant government authority, along with the required documents, such as a detailed business plan, financial statements, and environmental impact assessment reports.
- Obtaining initial approval and completing any additional requirements, such as securing the necessary industrial space, fulfilling health and safety regulations, and obtaining relevant permits.
- Paying the required fees, which can vary based on the size and type of the industrial activity.
- Finalizing the license issuance and receiving the industrial license.
The cost of an industrial license in Dubai can range from AED 15,000 to AED 50,000, with most falling between AED 25,000 – AED 35,000, depending on the scale and nature of the industrial activity.
Industrial licenses are usually valid for one year, and renewal requires compliance with specific conditions, such as maintaining health and safety standards, submitting annual reports, and adhering to environmental regulations.
Commercial License
Businesses that engage in trading or commercial activities, such as retail stores, restaurants, publishing and media, e-commerce businesses, specialized retail outlets, and import/export businesses, require a commercial license to operate in Dubai.
The process for obtaining a commercial license involves the following steps:
- Submitting the required documents to the Department of Economic Development (DED) or the relevant free zone authority, including:
- Application form
- Passport copies
- Proposed trade name
- Obtaining initial approval and completing any additional requirements, such as:
- Securing a physical business location
- Fulfilling health and safety regulations
- Obtaining necessary permits
- Paying the required fees, which can vary depending on the type of commercial activity and the location of the business.
- Finalizing the license issuance and receiving the commercial license.
The cost of a commercial license in Dubai can range from AED 10,000 to AED 30,000, depending on various factors, including the type of business activity and the location.
This type of license is typically valid for one year, and renewal requires meeting specific conditions, such as submitting financial statements, maintaining records, and adhering to trade regulations.
Tourism License
A tourism license is required for businesses in the tourism and hospitality sector, such as hotels, travel agencies, tour operators, and event management companies. Some specific types of tourism licenses include those for hotels, inbound or outbound tour operators, holiday homes, and desert safari operators. As arguably the most popular tourist destination in the UAE, a tourism license in Dubai is highly sought after.
The process for obtaining a tourism license involves the following steps:
- Submitting the necessary documents to the Department of Tourism and Commerce Marketing (DTCM) or the relevant free zone authority, including:
- Passport copies
- Proposed trade name, and
- Details of the business activity
- Obtaining initial approval and completing any additional requirements, such as:
- Meeting health and safety regulations
- Obtaining necessary permits, and
- Providing financial guarantees.
- Paying the required fees, which can vary based on the type and scale of the tourism activity.
- Finalizing the license issuance and receiving the tourism license.
The cost of a tourism license in Dubai can range from AED 10,000 to AED 50,000, depending on the specific tourism activity and other factors. However, the typical total cost of a tourism license in Dubai averages around AED 20,000 for most businesses.
Tourism licenses are typically valid for one year, and renewal requires fulfilling certain conditions, such as maintaining quality standards, submitting annual reports, and complying with tourism regulations.
In the end
Obtaining a business license is a crucial step for anyone wishing to establish and operate a business in Dubai. The emirate offers various types of licenses based on the nature of the business activity, including professional, industrial, commercial, and tourism licenses.
However, these are not the only requirements to keep in mind when applying for a business license in the UAE. Individual free zones may also have their own unique restrictions or requirements, such as:
- The type of business licenses that can be obtained.
- The type of allowed legal company structures, such as a Free Zone Company (FZC), Free Zone Establishment (FZE).
- The shareholder structure of the company. Some businesses and industries may have restrictions on 100% foreign ownership. Oil & gas, engineering and contracting, media, and certain professional or trading companies often require local sponsorship.
- The minimum startup capital. For example, in the DMCC, there is a minimum capital requirement of AED 50,000 per company and AED 10,000 per shareholder.
