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How to renew business license in Dubai with simple steps?

3 simple steps to renew business license in Dubai
January 12, 2024

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People who want to start a business in the UAE, have to get a license. Similarly, active companies have to renew business license in Dubai. So that they can keep serving the users in a better way during 2024.

After registering a company in Dubai, you have to renew your business license every year. Don’t worry, as the authorities in the UAE provide ease for renewal of existing business licenses. Also, you can get your business licenses renewal through business service providers, law firms, and service agents, etc.

Types of the business licenses

What are types of the business licenses?

Business activities come under the following categories of the licenses.

Read more: Get an eCommerce license in the UAE

Acquiring trade license in Dubai

How to acquire trade license in Dubai?

Follow these steps to obtain a trade license to use the business opportunities in Dubai.

  • Choose a name for your company.
  • Apply for registration of your business setup in Dubai.
  • Obtain the company’s Memorandum of Association (MOA) notarized by Department of Economic Development.
  • Relevant company documents are required to be filed.
  • You must have an establishment card from the Ministry of Labour.
  • Get your native workers registered with Ministry of Labour.
  • Native workers also need to be registered with the General Authority for Pension and Social Security.

Further reading: Get a Spa business license in Dubai

Filing legal documents for company license

Which legal documents you need to submit for company license?

Businessmen need to submit their company documents to the DED to get a trade license. Then, the entrepreneurs must apply for membership of the Dubai Chamber of Commerce and Industry (DCCI). To acquire Trade License/Commercial Registration Certificate, applicants must submit these original documents at DED’s Commercial Registry section or online.

  • Application form with the signature of company’s manager or company’s legal representatives
  • Memorandum of Association
  • Letter by DED’s approval for the name of the company
  • Company approval letter by DED’s Committee of Limited Liability Companies
  • Partners’ passport copies

After the submission of documents, the Commercial Registry decides whether or not the documents are valid. Thus, it checks the documents are in proper order, sans legal or other discrepancies. Upon the approval of the trade license application, the name of the company formally enters into the Commercial Register.

Consideration: UAE on course to post GDP growth

Never let Dubai business license expire

Why should not your Dubai business license expire?

Congratulations, if you have set up your business in Dubai already. You are navigating the thriving market of the UAE, and are ready for global growth. Naturally, you do not want to lose it, so you must not let your Dubai business license expire.

After all, it requires a ton of legal work to register your business from the Department of Economic Development (DED). Also, you have to complete documentation with the authority of the free zone, you choose as base of your operations. The same is the case with business formation in mainland Dubai.

Therefore, the time spent on the company incorporation process is too precious to neglect. At last, it may seem like you can at last just focus on your business. However, tread carefully in the murky waters doing business in Dubai.

Never, let your Dubai business license expire. This one carelessness can ruin all your hard work. Because, your business license expiry can result in critical problems for your company.

Here are four key points outlining the need for you to renew business license in Dubai.

Now, we briefly look upon these pointers that necessitate the need to renew business license in Dubai.

License expiry can get a company fined

You read it right. In case, you continue operating a company that has an expired business license. Then, you incur heavy fines for your transgressions.

The DED and other regulatory authorities of the UAE demand business license renewal well before their expiration date. Else, they severely penalize your company with monetary fines. Approximately, they charge you 200 AED for every month the fine remains outstanding.

However, it does not end there as per the Dubai’s laws. A business found working despite license expiry is liable for fines up to five thousand Dirhams (AED 5,000). Further, the authorities add AED 250 if the company continuously fails to renew their expired license.

They have to renew and re-submit the subsequent documentation within the time-frame. Similarly, a deviating office established without any prior permission that overlaps an existing business license can cause the business owner a fine of AED 2,000. Plus, it can lead to further financial penalties.

Spending a part of your profits on your business license renewal is way better. In comparison, think about the invasive inquiries from the regulatory authorities about your company license expiry. How did your company land in such a stage that led to the imposition of fines?

Especially, these inquiries are problematic if you are running a joint venture or have to report to shareholders. Since, having your business trade license expire, will place your organization in the line of unnecessary financial risk. They will most certainly make you look careless, unreliable and unprofessional.

Company with expired license can be blacklisted

In the event, your company continues operations despite business license expiry. The regulatory authorities can blacklist your company. Blacklisting of a company means placement of severe restrictions of on all kinds of business operations like the following.

  • The Company will not be allowed to participate in any business proceedings.
  • Visa could be annulled with a ban on travel.
  • Sponsors could break away from your Company, leaving you in a lurch.
  • The owner, managers, shareholders and directors in some cases could even be deported from the UAE.

You don’t have to panic just yet, as there is some good news. UAE’s government allows a grace period to all its business owners, so they can get their ducks in a row. During this grace period, you can renew your business license and registration.

Nevertheless, if you still fail to comply with the requirements — you will end up on the blacklist. Then, you will find yourself in a tough situation. Continuing your business after blacklisting is no walk in the park.

You will face dire punishments like blocking of day-to-day business tasks partially or entirely. It means that it is better that you stay on top of your legal duties in the UAE. You can avail legal advisory services to avoid any consequences.

Your business growth will be halted

Many companies organize their business operations at the beginning. However, chances are they start to miss important things in a year or two as their workload starts to increase. This is the exact reason in our experience that plays a big role in the downfall of SMEs and startups.

Small businesses are more susceptible to license renewal problems, as they require annual renewals. The requirement of annual renewals make it necessary for novice entrepreneurs to stay up-to-date. Therefore, if you are a little late in renewing of your business license, the authorities will suspend your business activities.

So, your company can not expand its operations in the future. For small businesses in the first few years of operation, even a trivial inconvenience throws a wrench in the works. Thus, it stops you from achieving the success and recognition that you deserve.

Besides, business licence expiry can also cause bankruptcy. It may make your company vulnerable to either voluntary or forceful liquidation. Because, all these disasters can halt your business growth, so you must avoid these at all costs.

Expired license can ruin your company

Everyone understands how hard it is to start a business, get it off the ground, and make it successful. It takes a lot of hard work, complete determination, along with significant capital investment. Why put everything on the line by letting your business license expire?

Keep in mind that business license expiry can ruin your company. To prevent this, take some measures like mark the expiry date on your business calendar. Set a reminder to get the renewal before the deadline.

Entrust this duty to someone more responsible within your organization. Or you can even hire an external company who can do the job for you. Whichever way you choose, ensure it works so that your business does not end up inevitable suffering because of it.

Insight: Get a residency visa in Dubai

Renewal of business license in Dubai

How to get your business license renewal in Dubai?

These are the steps you need to follow to renew business license in Dubai to reactivate it from expiry state.

Next, we take a look on this step-by-step process of the license renewal.

Have a valid tenancy contract

Ensure that your company has a tenancy contract that is valid for at least a month or more. Also, it must be verified and attested by Ejari. If the tenancy contract does not have the validity of 1 month, you cannot apply for renewal of the license.

Get ready the necessary documents

This is the list of compulsory documents for business license renewal.

  • A typed BR/1 form
  • Photocopy of tenancy contract
  • Ejari registration certificate’s photocopy
  • Business partners’ passport photocopies
  • Current business trade license’s photocopy

Apply for the renewal of license

Prepare an application for renewal of the license of your active business setup in Dubai. Then, submit this application along with all necessary documents to the DED. Accordingly, you can apply for renewal through e-services, mobile application, service centers, and law firms.

Make the payment

DED allots you a payment voucher after the application. Once, you receive the voucher, proceed with the payment. Subsequently, you will immediately receive your renewed business license after you make the payment.

Tip: Get an import/export license in Dubai

Conclusion

By now you are aware of the process to renew business license in Dubai. In case, you have a doubt about anything, you can take guidance from the business consultants. Whether, you are up for a company setup or want a license renewal, they will fully assist you.

Setting up your own business in the UAE is easy right now than it was ever before. Business advisors can take care of all of your licensing needs, whether a new license approval, or license renewal. So that you can focus on what really matters — growing and nurturing your business.

KWS Middle East is here to help you with all kinds of processes. Consequently, we support your efforts to take advantage of the business opportunities in Dubai. Furthermore, you can contact us for services like product registration, corporate bank account opening, and tax advisory across the UAE.

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