Business Setup Dubai .

How to start a trading Business in Dubai?


Dubai has been continuously topping all the rankings that have dubbed it as one of the influential business destinations in the world. Over the last few decades, there has been enormous growth in the business and financial sectors of Dubai. Industries such as tourism, trade, logistics have all shown extraordinary growth. So, beginning a trading business in Dubai is a no-brainer. As it has proven to be a beneficial investment for both the local and foreign investors. If you were thinking of starting a trading business in Dubai and were not sure how to start it exactly, then do not fear as we are about to make life considerably easier for you.

Following is a step by step guide on how to get a trading license in Dubai.

Procedure to Start a Trading Company in Dubai

Form a business plan

The primary step for starting a trading business is to form a business plan. A great business plan will analyze virtually all the factors such as market conditions, competitions, both immediate and distant products, and business activities, the total number of employees that need to be hired, office space requirements, Initial capital investment required, marketing tactics and promotional strategies. Investors needed to join the venture to provide sufficient capital to keep it afloat. These factors ascertain the workings of the business. Study and research these factors completely and formulate a smart business plan.

Choose the Location

Dubai marketplace is classified into three jurisdictions or locations, such as

  • free zones,
  • offshore, and
  • the Dubai mainland

There are, at present more than forty free zones in Dubai. The free zone offers a 100% tax exemption on corporate and personal income and a hundred percent ownership to the foreign investors. In the Dubai mainland, International business investors are required to find a local sponsor for setting up a business that holds 51% shares of the total business. The offshore company is the corporation that is set up in the country separate from the land of the residence of the investor. Choose the location according to the demands of your company and the business activities you plan on doing. It is better to start your business in Dubai mainland because there is more increased exposure to the consumers; you can engage in trade with other enterprises in Dubai. As there is no restriction on the issuance of work visas and can easily open multiple branches.

Find a Sponsor (in case of starting a trading company in the Dubai mainland)

If you want to set up your company in the Dubai mainland, you need to find a local sponsor for your business. The sponsor will hold 51% of the total shares in your company. You cannot start a company in the mainland without arranging for a local sponsor who is a UAE national to sponsor your business. There are two sorts of sponsorship permitted in the UAE;

  • local sponsorship and
  • corporate sponsorship.

While a local sponsor will allow you to hold 49% of the shares in your business, yet the corporate sponsor will give you 100% ownership by invoking the investor’s right protection contract.

Legal Formalities

Acquiring a license for your business is very essential as it makes your business legal. The company whose primary business activity is the general trading, importing and exporting of various goods needs a general trading license. This license will permit the trading of products like garments, accessories, machinery, furniture and decorative items, and other electronics.

Steps to get a general trading license are as follows:

. 1 Choose a trading name for the company

  1. Plan your business activities
  2. Choose a trading name for the company
  3. Apply for the Initial approval from DED.
  4. Getting external approvals
  5. if needed Prepare Memorandum of Association (MOA) and got it signed by your partners
  6. Choose a business location and get a tenancy contract duly attested by Ejari.
  7. Apply to the Department of Economic Development (DED)
  8. Pay the fee for the issuance of the license

If you are applying for a license in the free trade zone or offshore, you are expected to submit the original documents at the trade license and commercial registration department. DED will issue the trading license after getting approval from the trade license and commercial registration department.

Paperwork required for application of general trading license in Dubai are as follows:

  1. A license application signed by legal representatives.
  2. Memorandum of Association Attested company name approval letter from DED Copy of passport and visas of partners.

Once you submit these documents, the government officials will check and verify and then add your trade name to Dubai’s commercial registry. The Dubai’s Economic Department will forward your paperwork to the Federal Ministry of Economy for its verification. The ministry will issue the approval letter on a successful publication.


For starting a trading business, you first want to draft a business plan. A good business plan will give control to your business by setting your goals and objectives. Once you have a great business plan, choose the right location for your company. The next move is to find a local sponsor for your company in case of setting up in Dubai mainland. And then apply for a general trading license.

Are you considering starting a trading business in Dubai? If so, then we at KWS Middle East will be more than pleased to help as our business setup consultants are well-versed and experienced in the process of company formation and can ensure a trouble-free and hassle-free experience.

Contact Us today and book our commitment-free consultation call!

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