What is a trading license?
The type of licence you require to operate in Jafza will depend upon the activity your business intends to engage in.
The trading license (also known as the General Trading License, or setting up a Trading LLC) is the most common and sought after license type at Jafza. It covers all the aspects of buying and selling products in a business. The trading license offers multiple benefits over other types of licenses, which may not be suitable in some situations or may not be accepted at all in other licensing authorities or economic zones. It offers the highest degree of flexibility and freedom to operate a business.
How much does a trading license cost?
The cost of the license depends on the number of activities included in the license. Activities are a list of actions that will be part of business operations. This list of activities is created and maintained by the Dubai Department of Economic Development and a completed list of the activities can be downloaded here.
Activities are further classified into groups. A group is a list of similar activities. A single activity may exist only in a single group.
As a business, you have the choice of selecting 1 or more activity that defines the operations of your business. Hence the cost of the trading license will vary based on the following:
- If you have selected a maximum of 7 activities from a single group, the cost of the license will be AED 5,000 per year. It is essential to know that this cost is applicable only if all activities within the limit are from one single group only. Additionally, the cost will be increased by AED 500 for each additional activity beyond 7 activities in the group.
- If you have selected 2 groups, and if each group has a maximum of 6 activities, the cost of the license will be AED 8,500 per year. This means you may select up to 6 activities per group (12 in total) but you may not exceed more than 2 groups. Additionally, the cost will be increased by AED 500 for each additional activity beyond 6 activities per group.
- If you need more than 2 groups (irrespective of the number of activities) this will be considered as a general trading license. There is no limit on the number of activities or the groups that you may select for a general trading license and the cost of this will be AED 15,000 per year as a fixed fee.
** All mentioned costs are subject to change and a change in such cost will be communicated by Jafza.
When is a trading license required?
- If you are importing or exporting physical goods
- If you are importing physical goods, holding inventory and for the purpose of sale in UAE
- If you are purchasing goods from the local market, holding inventory and export the products outside UAE
- Holding inventory in any possible way requires a trading license.
You may not use the trading license to manufacture or produce goods in the UAE. You may, however, offer services as part of your business that compliments the sale and trade of goods.
Steps to get started with a trading license
The creation of a company with a trading license requires the following steps:
- You must complete the Jafza Application Form and the EHS Undertaking Form in their entirety and submit all required documents.
- You must select the type of company formation you would want to incorporate under. Refer to the company formation section on our website for more information.
- Once you have selected the formation, you will be asked to select the license type – this is where you need to select Trading License.
Speak to our business development and sales team if you need help regarding your trading license requirements. You can schedule a call or visit us at our sales centre in Jebel Ali Free Zone.