Business Setup UAE: Cost of Getting a Commercial License in Dubai
Understanding the cost of getting a commercial license in Dubai is a crucial step for any entrepreneur planning a business setup in UAE. Dubai continues to be one of the most business-friendly cities in the world, thanks to its world-class infrastructure, strategic location, and investor-friendly regulations. In this guide, we will uncover what goes into obtaining a commercial license in Dubai—from fees to procedures and tips to save money.
What Is a Commercial License in Dubai?
A commercial license permits companies to operate trading businesses in Dubai, including import/export, sales, logistics, and general trading. It’s required for businesses dealing in physical goods and is issued either by the Department of Economic Development (DED) for mainland companies or the authority of a free zone.
Factors That Affect the Cost of Getting a Commercial License in Dubai
When it comes to business setup UAE, understanding cost variables is essential. Several factors influence the total cost of obtaining a commercial license:
- Business Location: Setting up in a free zone has different fees compared to mainland registration.
- Number of Business Activities: The more activities listed under your license, the higher the cost may be.
- Office Space Requirement: Renting physical office space adds to the cost.
- Shareholder Structure: Whether you have individual or corporate shareholders can affect the processing fees.
Estimated Costs of a Commercial License in Dubai
Although prices may vary depending on specifics, here is a general breakdown:
- Initial Approval Fee: AED 150 – AED 500
- Name Reservation Fees: AED 620
- Commercial License Fee: AED 10,000 – AED 15,000 (renewed annually)
- Market Fees: 2.5% of the annual rent (for mainland businesses)
- Local Sponsorship Fees: AED 8,000 – AED 20,000/year (if applicable)
For comprehensive fee updates, visit the UAE Government Portal.
Types of Commercial Licenses Available
Entrepreneurs exploring business setup UAE options must choose the appropriate type of commercial license. Common types include:
- General Trading License: Suitable for companies dealing in a wide range of goods.
- Specific Trading License: For businesses trading in a single category such as electronics or textiles.
- Retail License: For enterprises running stores or shops.
Steps to Acquire a Commercial License in Dubai
- Choose Business Activity: Define what goods or services you intend to trade.
- Choose Legal Structure: Determine if you’re setting up as a sole establishment, LLC, or partnership.
- Register Trade Name: Submit a name reservation application to DED or relevant authority.
- Apply for Initial Approval: Obtain preliminary go-ahead by submitting required documents.
- Secure Office Space: Lease a physical or virtual office depending on your jurisdiction.
- Submit Documents and Pay Fees: Finalize application by submitting forms and fee payment.
- Receive License: The commercial license will be issued upon approval of all documents and fees.
Free Zone vs Mainland: License Cost Comparison
When choosing a zone for your business setup in UAE, you’ll need to consider both costs and business goals.
Free Zone
- License Fee: AED 10,000 – AED 14,000
- No need for local sponsor
- Best suited for international businesses
Mainland
- License Fee: AED 12,000 – AED 15,000
- Can operate throughout the UAE
- Requires local service agent (if 100% foreign-owned)
To determine the best fit, consider your target market and required office space.
Additional Costs to Consider
When calculating the cost of getting a commercial license in Dubai, don’t forget these auxiliary expenses:
- Visa Fees: AED 3,000 – AED 7,000 per visa
- Medical Tests and Emirates ID: AED 700 – AED 1,500 per person
- Document Attestation and Translation
- Business Insurance
All these contribute to the total expenses of your business setup UAE process.
Cost-Saving Tips for Entrepreneurs
You don’t have to break the bank to start a company in Dubai. Here are some cost-saving tips:
- Opt for virtual offices or shared coworking spaces.
- Choose free zones offering complete packages with license, office, and visa.
- Bundle services with a reputable business setup consultant.
- Compare license packages from different jurisdictions.
Benefits of Business Setup UAE with a Commercial License
Setting up your business in Dubai with a commercial license has several benefits, including:
- Full repatriation of profits and capital
- No personal income taxes
- Access to international and regional markets
- Ability to trade in local markets if licensed under the mainland
Renewal Costs for a Commercial License
The commercial license must be renewed annually. Below are the typical renewal costs:
- License Renewal Fee: AED 8,000 – AED 15,000
- Ejari (Office Rental Renewal): As per market rates
- Other documentation & PRO services: AED 1,000 – AED 3,000
FAQs
Can I operate across the UAE with a Free Zone Commercial License?
No, a free zone license typically allows you to operate only within the zone or internationally. To operate across the UAE, a mainland license is often required.
Is a local sponsor mandatory?
For mainland setups, a local sponsor is only required in specific types of businesses. Many professional setups and free zones now allow 100% foreign ownership.
Are there hidden fees in the licensing process?
Hidden fees are possible, especially if you’re unaware of market charges for Ejari, visa allocations, or translation services. Consult trusted sources or business consultants to avoid surprises.
Conclusion
The cost of getting a commercial license in Dubai can vary based on your desired business activities, location, and service providers. However, this investment opens up vast opportunities in one of the world’s most lucrative business environments. With the right planning and expert advice, your business setup in UAE can be both cost-effective and strategically sound.
Need help picking the right free zone? Check out our Best Free Zones in UAE for Business Setup guide for detailed comparisons.
Visit the UAE Government Portal for updated laws, fees, and regulations related to business licensing in Dubai.
