Securing an E-commerce Business License in the UAE
Do you want to start selling products online in the UAE? If so, you will need to obtain an E-commerce Business License. The UAE is the eCommerce powerhouse among Gulf Cooperation Council (GCC) states. In 2020, the market leaped by 53% with a record-breaking $3.9 billion in eCommerce sales – 10% of total retail sales. In the year 2021, the revenues grew even more and reached up to US$8.5 billion, which played a significant role in placing it ahead of Vietnam and behind Austria. This blog will provide all the information you need to know about the process of securing a license for your E-commerce business setup, including what documents are required and how much it costs.
An E-Commerce Business License in the UAE will allow you to operate an online store and sell products or services to customers over the internet. The steps involved in applying for your eCommerce business license include:
- Choosing a jurisdiction
There are two options for you to choose from: Mainland or Free Zone. Each one has its own set of benefits that you should consider before making your decision.
– You will have access to the entire UAE market.
– There are no restrictions on the type of products or services you can sell.
– You can hire any nationality of employees.
– You will be restricted to selling only within the free zone.
– There may be restrictions on the type of products or services you can sell.
– You can only hire employees who are from the same free zone.
- Deciding the legal structure of your business
The three most common types of business structures in the UAE are sole proprietorship, limited liability company (LLC), and civil company.
– You will be the sole owner of your business.
– You will have full control over all aspects of your business.
– You will be responsible for all debts and liabilities incurred by your business.
Limited Liability Company (LLC):
– You will be one of the shareholders in your company.
– Each shareholder will have limited liability for the debts and liabilities of the company.
– The management and control of the LLC will be decided by its shareholders.
– This type of company can only be established by a UAE national.
– The company will have two or more partners, each of whom will be liable for the debts and liabilities of the company.
– The management and control of the civil company will be decided by its partners.
Register your trade name at the DED
The Department of Economic Development (DED) is the government body responsible for issuing trade licenses in the UAE. You will need to register your trade name with them before you can apply for your eCommerce business license.
To register your trade name, you will need to submit the following documents:
– Application form
– Passport copy of the owner
– Emirates ID copy of the owner
– No Objection Certificate (NOC) from your sponsor (if you are a foreigner)
– Trade name reservation certificate
- Apply for your license
Once you have registered the trade name for your E-commerce business setup, you can apply for your eCommerce business license. To do so, you will need to submit the following documents:
– Application form
– License registration certificate
– Passport copies of the shareholders/partner
– Local service agreement/civil works agreement
– Draft of the Memorandum of Association (MoA)
How much does it cost?
The E-commerce license cost in the UAE starts from approximately AED 15,000. Once you have paid the fee, you will be issued with a license that is valid for one year. You will need to renew your license every year in order to keep your business operating legally.