A trade license is the legal foundation for doing business in the United Arab Emirates. Whether you are launching a startup, opening a branch office or expanding your regional presence, you cannot operate without a valid license issued by the relevant UAE authority.
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This guide explains how to register a trade license in the UAE, how to renew it on time and how to maintain full legal compliance. The content is detailed, practical and written to help foreign entrepreneurs understand the complete licensing lifecycle in the UAE.
What is a Trade License in the UAE
A trade license is the mandatory permit issued by the Department of Economic Development or the relevant Free Zone Authority that allows you to legally conduct business activities in the Emirates.
The license type depends on the nature of your business. The three major categories are:
- Commercial license for trading and general business activities.
- Professional license for service and consultancy providers.
- Industrial license for manufacturing and production companies.
The UAE system is designed to attract global investors which means license rules are clear and the process is streamlined for international founders.
Mainland vs Free Zone Trade Licenses
Before applying you must choose whether you want a mainland license or a free zone license. This decision affects ownership structure, business activity, office requirements and compliance obligations.
Mainland trade license
- Issued by the Department of Economic Development of each Emirate.
- Allows you to operate anywhere in the UAE and internationally.
- Some activities may require approvals from other government bodies.
- No local partner requirement for most activities due to updated foreign ownership laws.
Free zone trade license
- Issued by a Free Zone Authority such as DMCC, IFZA, RAKEZ, JAFZA, SHAMS and others.
- Provides 100 percent foreign ownership.
- Usually faster setup with flexible office solutions.
- Some activities are limited to the free zone unless proper approvals are obtained for mainland operations.
Choosing the right jurisdiction affects not only your licensing but also bank account opening, visa issuance and long term expansion. Dewey and LeBoeuf can help you evaluate the most legally and financially suitable option.
Required Documents for UAE Trade License Registration
Although exact requirements differ slightly across Emirates and free zones, the core documents are generally the same.
- Passport copy of each shareholder.
- Recent passport sized photographs.
- UAE entry stamp or residence visa copy if available.
- Proof of address for shareholders.
- Proposed company name list.
- Business activity description.
- Office lease or virtual office agreement.
- Memorandum of Association or Articles of Association as applicable.
- Initial approval certificate from the licensing authority.
- Additional approvals for regulated activities such as healthcare, education, logistics or transport.
Preparing documents correctly prevents delays. Incomplete or inconsistent documents are one of the most common reasons for license rejection.
Step-by-Step Process to Register a Trade License in the UAE
1. Choose your business activity
Select the activity that fits the exact service or trade your business intends to perform. Incorrect activity selection can lead to penalties or later restrictions, so professional legal guidance is recommended.
2. Select trade name options
Prepare at least three business name options that comply with UAE naming rules. Names cannot include offensive terms or references to religious, political or country names unless approved.
3. Choose your business structure
Common structures include:
- Sole establishment
- Civil company
- Limited Liability Company
- Branch of a foreign company
- Free zone company
Each structure has different ownership, visa and liability rules.
4. Choose your license jurisdiction
Decide whether you will operate in a free zone or on the mainland. Evaluate cost, business activity, long term goals and whether you need freedom to operate across the UAE.
5. Apply for initial approval
Submit your documents to the DED or free zone authority for initial approval. This confirms that the government permits you to proceed with your chosen business activity.
6. Prepare the Memorandum of Association
For LLCs, a Memorandum of Association must be drafted and notarized. Free zones may require a simple incorporation form instead.
7. Secure a business location
Depending on the license type, you may need a physical office, flexi desk or virtual office.
8. Submit the final license application
Once all documents are completed you can file the final application. Processing time ranges from one day to a few weeks depending on the jurisdiction and activity type.
9. Receive your trade license
After approval, your trade license will be issued. You can then apply for visas, open a UAE bank account and begin operations.
Cost of Trade License in the UAE
The cost varies depending on Emirate, license type and free zone authority. The general estimate is:
- Mainland license starts from 10,000 to 25,000 AED.
- Free zone licenses range from 12,000 to 35,000 AED depending on package and office requirements.
Regulated activities may have higher costs because of additional approvals.
How to Renew a Trade License in the UAE
UAE trade licenses must be renewed every year to maintain legal operations. Expired licenses result in penalties, business restrictions and potential blacklisting.
Requirements for renewal
- Trade license renewal application form.
- Tenancy contract or Ejari renewed for at least one year.
- Updated documents of shareholders if needed.
- Approval letters for regulated activities.
- Payment of renewal fees.
Steps for renewal
- Renew your tenancy contract.
- Update any changes to business structure or shareholder details.
- Submit the renewal application through DED or the free zone portal.
- Pay the renewal fee.
- Receive updated license within one to five working days.
Renewing on time helps maintain your corporate bank account and immigration file without interruption.
Compliance Requirements After Obtaining Your Trade License
Once you have a valid trade license, you must follow several legal obligations to remain compliant in the UAE.
Maintain accurate corporate records
You must maintain updated records of shareholders, management, resolutions and financial transactions.
File economic substance regulation notification
Businesses engaged in specific activities must file ESR notifications and reports to show genuine business presence.
File Ultimate Beneficial Ownership declaration
All entities must identify their UBOs and ensure accurate information is submitted to authorities.
Comply with Anti Money Laundering rules
Service providers, trading firms and financial companies must follow UAE AML laws including record keeping and suspicious transaction reporting.
Renew visas and Emirates IDs
Companies must keep employee visas and Emirates IDs valid and updated.
Submit financial statements
Most free zones and many mainland companies must submit audited financial statements annually.
Renew your trade license every year
Renewal is mandatory for uninterrupted legal operations.
Common Mistakes to Avoid When Applying for a UAE Trade License
- Choosing the wrong business activity.
- Applying in an unsuitable jurisdiction.
- Relying on unlicensed consultants.
- Submitting incomplete or inconsistent documents.
- Missing annual renewals or compliance filings.
Legal oversight during setup reduces risk and protects your business from penalties.
Importance of Keeping Your UAE Trade License Active
Keeping your UAE trade license active is essential for uninterrupted and legally compliant business operations. A valid license allows you to open and maintain corporate bank accounts, sponsor employee and investor visas, and continue offering your products and services across the UAE.
An expired license can result in fines, account restrictions, frozen immigration files and even business closure notices. Regular renewal also helps maintain strong credibility with clients, suppliers and financial institutions. By renewing your license on time and staying compliant with UAE regulations, your company can operate confidently, avoid legal risks and build long term stability in the market.
Frequently Asked Questions about Trade Licenses in the UAE
How long does it take to get a UAE trade license?
Depending on the activity and jurisdiction it can take from one day to three weeks.
Can foreigners own 100 percent of a UAE business?
Yes. Free zones allow 100 percent ownership and most mainland activities also permit full foreign ownership.
Can I change business activities after obtaining the license?
Yes, you can apply for activity amendment through DED or your free zone authority.
Can I open a corporate bank account with a new trade license?
Yes. After receiving the license you can apply for a UAE bank account. Some banks may request additional documents or in person verification.
Do I need a local sponsor for a mainland license?
Most activities no longer require a local sponsor. Some regulated sectors may still require special approvals.
Is a physical office required?
Mainland companies usually require an office. Many free zones allow shared desks or virtual offices.
Why Work with Dewey and LeBoeuf for Your UAE Trade License
Trade licensing in the UAE is straightforward when done correctly but a single mistake can cause delays, penalties or rejection. Dewey and LeBoeuf provides full legal support to ensure smooth and compliant licensing for foreign entrepreneurs.
Our services include:
- Selecting the correct license activity and jurisdiction.
- Preparing and reviewing all legal documents.
- Handling initial approval and final submission.
- Managing renewals and annual compliance filings.
- Advising on banking, visas, ESR, UBO and AML requirements.
Our Dubai based legal team ensures your business is not only licensed but also fully protected under UAE law.
Contact Dewey and LeBoeuf today to register a trade license in the UAE with complete legal confidence and zero hassle.
E-mail: info@deweyleboeuf.com
Phone: +971 58 690 9684
Address: 26B Street, Mirdif, Dubai, UAE