Starting a business in Dubai is a dream for many entrepreneurs and investors. And since it is not a very complicated process, the rate in which new businesses come to Dubai is increasing every year. There is also an increase in the number of business set up company in Dubai to help businesses launch easily in the Dubai market. But before stepping into the market, most business owners are confused about the type of license they should choose for their business. Choosing the right license is important for a new business set up in Dubai to function without any problems or issues. Let's discuss the types of licenses in Dubai in detail in this article.
For entrepreneurs who want direct access to Dubai’s local market, a mainland license is often the first choice. A mainland license allows companies to set up a business in Dubai and operate anywhere in Dubai and across the UAE. Businesses with this license can serve local customers directly, open physical shops or offices, and even take on government contracts. The mainland license is divided into several types depending on the nature of the activity.
A commercial license is given to companies who set up a business in Dubai in trading activities, such as buying, selling, or importing and exporting goods. A professional license is designed for service based companies such as consultants, educators, healthcare providers, or designers. If a business focuses on production or industrial work, then an industrial license is required. Now, the Dubai government has also started providing an e-commerce license to set up a business in Dubai. This gives entrepreneurs the ability to run online businesses while maintaining a registered office in Dubai.
The biggest advantage of a mainland license is flexibility. A business set up in Dubai with this license can trade freely across the UAE and expand into different sectors. With liberty comes responsibilities. A business set up in Dubai with a mainland license needs a physical office space and depending on the business activity, additional approvals will have to be secured. This will increase the costs, but when considering the benefits of being able to work directly in the local market, it is worth the spend.
Free Zone LicensesAnother popular option for a new business set up in Dubai is the free zone license. Free zones are special business areas that were created to attract foreigners. This zone has a wide range of benefits for a business set up in Dubai. With a free zone license, business owners can set up a business in Dubai with 100% ownership and without the need for a local partner.
Free zone licenses also come in different forms. A trading license is for a business set up in Dubai that buys and sells goods internationally. A service license is for consultancy firms, IT companies, marketing agencies, and other professional services. In the free zone, a business set up company in Dubai that is into production or manufacturing will have an industrial license. With the rise of digital entrepreneurship, many free zones now issue e-commerce licenses, which allow online businesses set up in Dubai to operate smoothly.
One of the biggest attractions of free zones is the simplicity of setup. Many free zones offer packages that include office space, visas, and company registration, all under one roof. Some even provide virtual office options, which allow entrepreneurs to set up a business without needing a physical space. However, businesses in free zones have limited access to the mainland market. To sell directly in Dubai, they usually need a local distributor or additional arrangements. To set up a business in Dubai in the free zone, is an efficient and cost effective choice for companies focused on exports, digital services, or international trade.
Dual LicensingSome businesses set up in Dubai want the advantages of both mainland and free zone operations. For them, Dubai offers dual licensing. With this option, a business can register in the free zone and operate in the mainland market. With dual licensing a business set up in Dubai can get the benefits of 100% ownership and tax friendly rules of the free zone and do business directly in the Dubai market. Dual licensing is useful for companies that want more freedom in their operations without setting up two completely separate businesses.
A business set up in Dubai with dual licensing has wider access, but it comes with more paperwork and regulatory requirements. The business must comply with the rules of both the regions and the costs will also be slightly higher compared to choosing just one option. But for entrepreneurs with ambitious growth plans, setting up a business in Dubai with the dual license is a solution with a lot of freedom and opportunity.
Special LicensesApart from the standard mainland and free zone licenses, Dubai also offers special licenses for a new business set up in Dubai, designed for specific sectors. One of the most popular is the freelancer permit. Freelancers and solo professionals commonly use this. There are many individuals who prefer to work independently without setting up a full business in Dubai. For example, writers, designers, photographers, trainers, consultants etc. Freelance permit license is meant for them. They are usually affordable and flexible, allowing people to issue invoices and legally work with clients.
Another special license is the tourism license, which is for a business set up in the travel and hospitality sector. Travel agencies and tour operators need this license to work legally in Dubai. Also, a new business set up in Dubai in the industrial or heavy manufacturing sector must obtain an industrial license, which requires compliance with environmental and safety regulations.
CONCLUSIONDubai is one of the most attractive destinations for entrepreneurs because it has opportunities and all the facilities required to set up a new business in Dubai. Licensing is the foundation that determines how a business operates, what customers it can serve, and how it grows in the future. The city has a wide range of licenses for almost all kinds of new business set up in Dubai. By understanding these options and choosing the right kind of license, business owners can achieve long term success. A reliable business set up company in Dubai can help business owners ease the process of setting up a business in Dubai.