How to Get a Commercial License in Dubai: Cost & Process Guide

Starting a business can be daunting and scary for first timers. As you figure out your market and where you fit in a dynamic landscape like UAE, it helps to think about your business operations and setup process early on. This allows you to focus on your growing operations and establish a lasting advantage within your industry focus.

Dubai’s strategic location as a regional trade gateway provides international businesses with direct access to major markets across the European, African, and Asian geographies. Being at the center of a wealthy region, Dubai’s advanced economic development combines its diversified market and strong government-driven growth, making it an attractive destination for professionals and enterprises.

Setting up a business in the Middle East is one of the most strategic moves for entrepreneurs aiming to tap into global trade opportunities and economic activities. For example, applying for a commercial license in Dubai authorizes businesses to legally engage in trading, importing and exporting physical goods, as well as conduct retail operations across the UAE.

Whether you plan to start a general trading company, an e-commerce store, or a retail outlet, getting the right business license is the first step. This guide explains what a commercial license is, how to apply for one, the fees you need to pay, and the support available plus other benefits of operating under this license.

What Is a Commercial License in Dubai?

A commercial license in Dubai is an official permit issued by the Dubai Department of Economy and Tourism (DET) (also formerly known as the Department of Economic Development or DED) or by relevant authorities within Free Zones. This license is must-have for any business involved in trading or commercial activities including buying, selling, importing, and exporting goods within Dubai or across the broader UAE market. The DET serves as the central authority that reviews applications and coordinates with other government bodies for additional approvals of specific activities.

This type of license, compared to the rest, covers a broad range of operations and services, giving companies the flexibility to operate in Dubai. Businesses holding the license can operate locally and internationally, hire staff, and open corporate bank accounts, making it one of the most versatile and attractive option available.

The wide range of permitted business activities makes this one of Dubai’s most obtained licenses, especially for those whose activities require them to operate in both regional and international markets

Is Commercial and Trade License the same?

While often used interchangeably, commercial and trade licenses have distinct differences. Broadly, a trade license refers to the official permit issued by a governing authority in order for individuals or corporations to conduct business within a specific jurisdiction. A trade license is a mandatory requirement that applies to all types of businesses, regardless of their industry or scale of operations.

Meanwhile, a commercial license is a subcategory of the trade license specifically designed for businesses engaged in buying, selling, importing, exporting, or other trading activities. In other words, while all commercial licenses are trade licenses, not all trade licenses are commercial.

In Dubai, companies must apply for a license that matches their core business activities. The three main license types—Commercial License, Professional License, and Industrial License—serve distinct purposes depending on whether a business focuses on trading, services, or manufacturing.

Other options include the tourism License, which is a permit required for businesses in the hospitality and travel sector, such as travel agencies, event-related enterprises, tour operators, and vacation rental companies, to operate legally; and the e-commerce license (or eTrader License) that permits individuals to conduct business and sell goods and services online, typically through social media or their own website. The eTrader license does not allow for importing or exporting of goods.

Here are the key differences between the 3 main types of licenses issued depending on the nature of the business:

How to Get a Commercial License in Dubai (Step-by-Step for easy access)

To avoid any legal pitfalls and mistakes, starting a business requires owners to undergo a formal licensing process. However, it helps to know that owners must meet the following minimum criteria to obtain a business license in Dubai:

• Be at least 18 years of age. Minors above age of 15 may engage in trade subject to court approvals depending on the nature of the transaction and under guardianship or custody
• Have a valid passport, UAE visa or an entry permit (for non-residents).
• Have a clean criminal record
• Have a minimum share capital requirement, if required by the business

Here are the steps to get your commercial license in Dubai:

1. Identify your business activity
   Choose and identify your business activity/activities. Make sure to include all the related business activities that would apply to maximize your business license, subject to a maximum of ten activities per license.
   The official list of activities can be obtained directly from the Department of Economy and Tourism. Business owners can review permitted activities and codes via DET and relevant free-zone authorities.
2. Pick your legal structure
   Determine the business legal structure that best applies to your operations, taxation and desired liability for the business. Take into consideration that different business activities would require different structures, depending on the number and nationalities of the business owners.
   • Limited Liability Company (LLC)
     Permits up to 100% foreign ownership in many various sectors, with limited partner liability restricted to their share of the company’s capital.
   • Sole Proprietorship
     Owned by an individual with full control but unlimited liability, typically applicable for professional or service activities and smaller business by freelancers
   • Branch Office
     Usually an extension of the parent company, carrying out the same business activities under the same name. The parent company generally remains fully liable for its branch’s operations.
3. Confirm the requirements and select the jurisdiction
   Verify all licensing requirements directly with the Dubai Department of Economy and Tourism (DET). You can do this by visiting any of its branches, its business registration windows, or specialized agencies handling areas like exports and investments. The full list of activities eligible for licensing is also available on the official DET website.
   • Mainland Dubai
     Issued by the DET, a commercial license for a mainland company permits businesses to conduct activities within the UAE mainland and internationally. This type of license is ideal for enterprises engaging with local markets or maintaining retail locations.Over 1,000 commercial and industrial activities in mainland can be eligible for 100% foreign ownership, though some exclusions apply to activities with strategic importance.
   • Free Zones
     Commercial licenses that allow 100% foreign ownership, issued by free zone authorities allow trading within only the free zone and internationally. They can trade directly in the UAE mainland either via getting the local agent / distributor or if they get a special permit from authorities (dual license).
   • Offshore Companies
     While offshore entities can incorporate in UAE, they typically cannot trade directly within the UAE and its domestic markets. Offshore licenses are mainly used for international trade, asset management, or holding companies. Example businesses would include Asset protection, consultancy, and investment management.Specific free zones such as Jebel Ali Free Zone (JAFZA) and Ras Al Khaimah International Corporate Centre (RAKICC) provide and allow global entities to retain 100% foreign ownership and exemption from local taxes on income and profits, similar to benefits extended to those with commercial license. Additionally, offshore companies offer complete foreign ownership and have Avoidance of Double Taxation Treaty agreements (DTTAs) with 115 countries, including the United Kingdom.
4. Reserve your trade Name
   Select a trade name that represents your brand and aligns with your business identity. Ensure it follows naming regulations, including avoiding restricted or prohibited words. DET also does not allow any duplication of existing company names.
5. Request for an Initial Approval
   Submit an application for an Initial Approval and register your trade name. The total cost of issuing the initial approval is AED 120. You can apply online via the portal on Invest in Dubai, or visit any of the available service centers. The service is typically completed within 10 minutes.
6. Prepare the Constitutional Documents
   Prepare and notarize the MoA (Memorandum of Association) or AoA (Articles of Association) – documents which define your company’s structure, purpose, governing regulations and operational framework. For Dubai mainland LLC, you would typically prepare and execute MoA, while for free zone companies the standard document will be AoA.
7. Choose the Business Location that works best for your activities
   After you get the Initial Approval, you can officially lease premises (either a physical office or shared workspace).
   Contact first and check with the Planning Department of the Dubai Municipality regarding the space and verify that the your selected office area is suitable for your business before signing a lease. Sometimes, smart desk or virtual options are also available in free zone areas.
   The tenancy contract must be registered via Ejari for those in Mainland Dubai.
8. Complete the process for getting your Commercial License
   Submit your full set of application documents to the relevant authorities. To streamline the process, make sure all required documents are complete and settle the applicable license fees before submission. License issuance can take minimum of a week to complete.
9. Congratulations! You now have your license and can start operations.
   Once your application is approved, you’ll receive your Commercial License, marking the official start of your business journey in Dubai! The obtained license must clearly state your approved business activities. Make sure to keep this in a safe place, and ensure you are up to date for renewals.

What are the Costs and Business Requirements?

If you’re setting up your business in Mainland Dubai, expect to pay fees between AED 15,000 and AED 25,000 for a commercial license. This price range usually includes costs for trade name registration, initial approvals, and other government and administrative processing fees.

For entrepreneurs choosing a free zone setup, the cost can be lower, starting at an average of about AED 12,500. Please note that costs may vary based on the area, the package you select, and the business activities and additional approvals needed, if applicable.

To apply for the commercial license, prepare the documents required:

• Completed commercial license application form
• Passports of all shareholders/partners + manager (and visa/entry stamp if applicable)
• Emirates ID copies (if available).
• Approved trade name reservation certificate
• Notarized MoA or AoA
• Tenancy contract or Ejari registration for the company’s business address
• Any required external approvals for regulated business activities, as mandated by government authorities

Benefits of Commercial Licenses to your Business

While the process can be difficult and costly, there are benefits to undergoing formal process and obtaining the license required in order to ensure your business success:

• Legal Permission to Trade
  Setting up legal operations would save you the headache of dealing with more difficult processes in the long run.
• Government Incentive Programs
  A DET-licensed business is eligible for other forms of government support programs, such as funding, mentorship, special trade events and other Foreign Direct Investment (FDI) incentives.
• Access to Local and International Markets
  With a Dubai commercial license, your business can easily expand and operate within the UAE, while allowing you access to build better relationships across global markets.
• Streamline your Business Structure
  It’s much harder to open a company bank account, hire for your operations, and overall talk about growth in your business goals and target market without the license. Doing this in Day 1 would ensure things are in order before you even think of scaling.
• Ensure business and consumer protection
  Contribute to the economic development by creating a healthy environment for trade and business transparency.
• Tax Exemptions and Advantages
  Enjoy a tax-efficient, competitive business advantage, including 0% corporate tax for small businesses and no personal income tax.
• Strong Brand Credibility
  With a licensed registration, other businesses, customers and suppliers are more likely to trust and work with you closely.

With all these benefits and considering the depth of support available within its dynamic economy, it is in your best interest to find the right people you need to integrate seamlessly into the UAE business landscape. More than its booming tourism industry, businesses in Dubai are poised to become a strong hub and contender for bridging between massive economies in Europe and Asia.

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