An e-commerce License in Dubai is a legal permission for conducting online business in a particular jurisdiction, usually a nation or region. When a company only conducts business online, it needs an e-commerce license in Dubai.
The business can still need an e-commerce license in Dubai if the company has physical products but doesn’t make sales in person or at a physical location. However, they can choose to apply for a trading license in addition to an e-commerce license if the company needs to conduct sales in retail stores or showrooms in addition to using digital channels.
TYPES OF E-COMMERCE LICENSES IN DUBAI
Online businesses in the UAE have a few licensing choices. They rely on the kind of online business the applicant wants to operate.
- Portal License – The company’s business activity in the UAE will be referred to as a portal or e-marketplace if it serves as a middleman between the buyer and the vendor. The most well-known online marketplace is Amazon.com. The website acts as a forum for both the customers and the sellers who advertise their products.
- E-commerce license – Companies that want to sell their products online may apply for an e-commerce system. It could be a website that just sells a few different kinds of products or a large online retailer.
- Freelance license UAE – Anyone who works as a freelancer can now apply for a license because it is now lawful to do so in the UAE. With the license, they can promote and offer the services both locally and internationally online. For designers, IT specialists, instructors, personal assistants, and other common freelancers, it’s the ideal license.
- Service or commercial license – Even if the license does not specifically address e-commerce, this is not going to prevent them from conducting online business. Any commercial activity can be started as an internet firm. The way of sale is irrelevant in terms of the law. They can conduct marketing audits, offer educational training, conduct online food and clothing sales, and conduct any other form of business using the Internet.
- E-trader license – It is the least expensive approach to launch an e-commerce business in Dubai. The license is given by the Dubai Department of Economic Development and costs 1,070 AED.
DOCUMENTS REQUIRED TO APPLY FOR AN E-COMMERCE LICENSE
- Application for a license that has been signed by the proprietors or by their legal representatives
- Copy of the Fee Payment Receipt
- A DED letter of approval for the company name
- Copy of the business plan
- A copy of each partner and shareholder’s passport
- Memorandum of Association
PROCESS OF APPLYING FOR AN E-COMMERCE LICENSE IN DUBAI
- The applicant must choose the legal entity type that is best for their e-commerce firm. A Limited Liability Company (LLC), Free Zone Company, or Mainland Company are popular choices. Selecting the structure that best suits the company’s needs and goals is crucial because each structure has its own benefits and limitations.
- Choose the best location for the e-commerce company. Dubai provides many free zones that are tailored to e-commerce businesses and offer advantages like 100% foreign ownership, tax breaks, and simpler company registration processes. Refer to Dubai company registration for more information.
- Get the e-commerce company’s trade name approved by the Department of Economic Development (DED) in Dubai after choosing a distinctive and relevant one. Make sure that the name adheres to the requirements established by the DED.
- The applicant must make an e-commerce license application with the appropriate authorities once they’ve decided on the business structure and location. Depending on the firm structure they choose and the free zone they are operating from, the requirements and procedures could change. Prepare the required paperwork, such as business plan, copies of passports, and application forms.
- The applicant will be given an initial approval certificate after submitting the relevant paperwork and meeting the requirements.
- Prepare the company’s MOA and AOA. These legal documents describe the organization’s structure, operations, and internal policies. It is usually necessary for Mainland Companies and LLCs.
- The applicant can open a corporate bank account in Dubai once they receive the initial approval certificate and the necessary legal documentation. Select a bank that offers effective e-commerce transaction functions and meets business needs. Refer to the UAE corporate bank account opening for more information.
- The applicant will obtain their e-commerce license following the successful completion of the registration process and completion of all legal requirements. They are allowed to lawfully run your e-commerce firm in Dubai with the help of this license.
DIFFERENCE BETWEEN E-TRADER AND E-COMMERCE LICENSE IN DUBAI
In Dubai, the Department of Economy and Transportation (DET) issues two different kinds of licenses:
- e-Trader License
- e-commerce License
Despite the fact that they are both issued by the same organization, their implications and goals are different.
The size of the firm is the primary distinction between these two licenses. An e-commerce license is appropriate for a large-scale online enterprise that works with customers from around the world and utilizes social media platforms and websites.
In contrast, small enterprises that operate from their homes and deal with a limited supply of commodities should obtain an e-Trader license. An e-trader license might no longer be appropriate if the company expands, and an e-commerce license or another similar licensing might be required instead.
BENEFITS OF OBTAINING AN E-COMMERCE IN DUBAI
- High-standard manufacturing facilities and warehouses are part of Dubai’s well-developed infrastructure, allowing for effective material production, storage, and distribution for your e-commerce business.
- Dubai offers strong air connectivity to numerous locations across the world due to its seven international airports and two major international airlines. This is advantageous for online retailers who depend on air freight for quick deliveries.
- Dubai has one of the fastest broadband networks in the world, offering a dependable and quick internet connection for your e-commerce business. The management of online transactions, website performance, and customer service depend on this.
- The vast road network of the United Arab Emirates links Dubai to other nations like Oman and Saudi Arabia, making it simpler to grow the e-commerce company and reach customers in other markets.
- With a population that is technologically sophisticated and a high internet penetration rate, Dubai has a rapidly expanding e-commerce business. This offers lots of chances for the online store to reach a broad and expanding customer base.
Reach out to us at Relin Consultants – Leading Global Business Set Up Partners for further assistance with obtaining your e-commerce license in Dubai.
Can I do online business without a license in the UAE?
Without a business license, it is against the law to trade or operate any type of business in the UAE. Without a license, businesses can be fined up to 500,000 AED (137,000 USD). Selling using social media is also seen as operating an online business.
Does a Dubai e-commerce license require the rental of office space?
Depending on the Free Zone where one is setting up, an office space may or may not be required.
Can an e-commerce license be used to sell goods both inside and outside of the registered free zone in the UAE?
One can sell to the entire UAE with an e-commerce license, however, a distributor on the mainland is necessary.
What Can You Sell in Dubai if You Have an e-commerce License?
Selling sports equipment, gadgets, electronics, clothing, accessories, jewelry, precious stones, home goods, interior products, transportation goods, machine parts, and spare parts are all permitted in Dubai with an e-commerce license.
Is there a difference between e-commerce and e-treders licenses?
An e-trader license restricts the range of business to be within the borders of the UAE and only permits a sole proprietorship-based legal structure, which is a stark contrast to e-commerce licenses which give their holders an international reach allowing the sale and purchase of goods outside the country.