Dubai’s economy ranked in the top furnishing economies. It influences the investors to invest here. We can see the enormous growth in the infrastructure of Dubai in the last few decades. The financial sector of Dubai has been increasing rapidly. Investors worldwide wish to build a business set up in the territories of Dubai. Every type of industry, tourism, trade, and logistics growing extraordinary. Starting a trading business in Dubai is a sage decision. Anyone, the local or foreign investor, can start a business. Do not fear if you do not know how to start a trading business. Experts can make your life easier.
Go into detail to know the step-by-step process of how you can get a trading license.
Develop a business plan
Developing a business plan is the primary step in starting a trading business. A business plan is a sum-up of factors necessary to run a business smoothly, such as growth chances, the number of competitors, and immediate and distance product details. It also provides information regarding the business activities such as what will be the size of the organization, marketing tactics and promotional strategies. Investors need a certain amount of investment to keep afloat in the sea of competition. All the mentioned factors ascertain the working of the business. Study all the factors to formulate an intelligent business plan.
Identify the business set zone
Dubai marketplace offers three zones to the businessmen, such as
- Freezone
- Offshore
- The Dubai mainland
At current, there are more than forty free zones in Dubai. Setting the business in the free zones offers multiple advantages, such as it offers zero percent tax on corporate and personal income. Businessmen can enjoy 100 percent ownership. Offshore zones are much like a free zone. It also offers 100 percent ownership and zero percent taxation on corporate and personal income, but businesses need a local partner to operate. In Dubai mainland, businessmen need a local sponsor that holds 51 percent of business shares to set up a trading business.
Choosing the location depends on the business activity and demands of the company. Setting up business in Dubai mainland is more beneficial than in other zones. This zone has much exposure, and you can engage with other enterprises in Dubai. There is no restriction on the work visa’s issuance, and businessmen can open multiple branches.
Find A Sponsor If You Are Starting a Business in Dubai Mainland
Businessmen need a local sponsor for starting a business in Dubai mainland. The sponsor must hold 51 percent of the total share of the company. It is compulsory to have a UAE national sponsor to start a business on the mainland. Local and corporate sponsorship are the two sorts of sponsorship permits available in Dubai.
Local sponsors will help you hold the rest of the 49 percent business shares. On the other hand, the corporate sponsor will give you 100 percent ownership.
Legal Formalities to Start a Business
Having a business license is essential to operate legally. A trading company needs a trading license to import and export various goods. The company will get a permit of trading various products like accessories, machinery, decorative items, garments, furniture and other electronics.
General Trading License Process Is Given Below
A trading company needs to follow the given steps to get a general trading license.
- Pick a trading name of the company
- Identify/plan the business activity
- Get approval from the Dubai economic department (DED)
- Get different essential approvals
- Prepare a Memorandum of association (MOA) and sign it by the partner, if needed
- Determine the business zone and get a tenancy contract duly attested by Ajaria.
- Pay the issuance’s license fee
The company needs to submit the original document to the trade license and commercial registration department in case of starting a business in the free trade zone or offshore. The Dubai economic department will issue the trading license, but the first trading company needs to get approval from the trade license and commercial registration department.
Paperwork REQUIRED FOR GENERAL TRADING LICENSE
Two approvals are required for passing a general trading license in Dubai:
- A license must be signed by legal representatives
- Memorandum of Association Attested approves company name and submit the approval letter to Dubai Economic Department (DED) with the copy of passport and visas of stakeholders and employees.
After getting all this, government officials will check all the documents, verify them from different departments, and enroll your trade name on Dubai’s commercial registry. The process does not end here; Dubai’s economic Department (DED) will do further verification. For this, they will send your paperwork to the Federal Ministry of Economy. You will get the final approval letter from the ministry. Now you can legally operate the trading business in Dubai.
