Live the Dream – Dubai Start-Up Advice Series by Alpha Pro Partners
Setting up a business in Dubai can be exciting and extremely rewarding. However, there are many additional licenses and permissions you may need to prevent unnecessary fines and disruption. Our first impression may be to frown upon additional red tape but it is important to note that in many cases these additional licenses are required to ensure regulation and protection for the consumer and to ensure that competitors are fully regulated. In this guide, we will examine some of the more common and unusual licenses required during a business's registration. We will also consider whether or not said permits would be appropriate for your own business.
Are you setting up a business in Dubai which handles the news, sells internet services, or provides entertainment? You are required by law to hold a media license. However, to be able to hold this license, you must first fulfill some basic criteria.
- You must be at least 25 years old, and a resident of the United Arab Emirates.
- You may also be a resident of a country based within the Gulf Cooperation Council remit.
- An application must be completed by yourself.
- The appropriate educational experience and qualifications are essential.
- You must have a scheduled salary during the license duration.
- You cannot have been convicted of a crime or dishonesty.
- You must not be in debt to the GCC.
Media licensing rules can go a little more in-depth. However, these are the most critical points to consider. But where might you need to use a media license? Here are a few examples.
- Selling, importing, or distributing books
- You are involved in the printing of news or other media
- If you are producing and selling advertisements
- You make films for profit
- If you are programming code or videogames for profit
- If you provide internet services
- If you are offering web design and social media services
Media Licenses are applied through the NMC (National Media Council) website.
If you wish to run a training center or educational facility, you will need a specific educational permit. Depending on the number of courses or programs you run, you may be expected to pay more. An initial application will cost you AED 5,000. Issuing a simple license that allows for two training schemes will cost an extra AED 25,000. You can add training schemes to your license, at a fee of AED 2,500. During the application, you will be required to complete a registration plan and a list of the courses you’d like to offer. You will receive a full commercial license, a lease notification, health and safety documents, and a map of your location. Training Licenses are applied through the KHDA (Knowledge and Human Development Authority) website.
Food Service Licenses
If you wish to serve food in Dubai, you must hold a specific license. To apply for a food license, you will need to produce a complete business plan. It must include financial targets and expectations, market research, and anything you may have in place to protect your business. A license fee for starting a food business will typically cost you around AED 12,000. However, this is just one of many costs you will need to bear in mind when getting started.
What’s more, you should:
- Ensure your kitchen and/or restaurant area is fireproof
- Make sure you have appropriate food storage
- Ensure your kitchen measures 300 x 380 square feet in area
- Have facilities for cleaning and washing of hands, food, and utensils
- Install an appropriate drainage solution
- Make sure your kitchen and restaurant have plenty of ventilation
Applying for a food and safety license will ensure you meet all these targets. You may also wish to apply for pork or Ramadan permits, depending on your services. Food Services Licenses are applied through the Dubai Municipality website.
If your Dubai business imports materials or supplies goods and/or services worth more than AED 375,000 per year, you must register for VAT. Failure to pay may incur penalties starting from AED 20,000. VAT licensing allows you to pay the tax collected from customers to the government. You may also be refunded on the tax you pay out via suppliers.VAT registration can be made through the FTA (Federal Tax Authority) website.
E-Commerce – Additional Licenses and Permissions
Even if you are setting up an online business with no physical location, you will still need a specific license to operate in Dubai. You must first choose your business location and register a business name. Then, you must apply for a permit with the Department of Economic Development. You will likely need to pay around AED 10,000 to register your trade name and obtain your license. Do also be aware that you may need a specific license for specific Dubai business registration. To apply for a mainland license can be made through the DED (Dubai Economic Department) website.
Customs registration is crucial if you are handling goods from overseas to import, export and re-export. It is also required even if you only trade between the mainland and certain Free zones such as JAZFA (Jebel Ali Free zone). In Dubai, you will need to pay AED 100 to register for customs licensing. That will allow you to import legally, export, and use materials and goods from elsewhere around the world. This is one of the easiest licenses to apply for when setting up a business in Dubai. You can complete your application online in full. Do note that the exporting of goods with the UAE’s free zones will not incur any charges. All importing, however, will need to be authorized with an official license.
Shisha smoking is very popular in Dubai. Therefore, the government has requested that licenses be obtained for Shisha businesses to set up and operate. For an indoor permit, you will need to pay AED 20,015. Extended permissions for outdoor use will cost up to AED 40,015. There are a few other points you need to consider when setting up a Shisha business. For example, you will be restricted in terms of how close you are to mosques or childcare facilities. You must also be careful when setting up your entrances and should not use more than 50% of your space for smoking. Shisha Licenses are applied through the Dubai Municipality website.
Setting Up a Business in Dubai?
It is essential to make sure you are fully licensed to trade in Dubai. Otherwise, you may incur fines, or may even face prosecution. Take time to read through application documents and never be afraid to ask for advice. Setting up a business in Dubai can take time. However, you must make sure you are compliant with the local law at all times.
This article is written in general terms and therefore cannot be relied on to cover specific situations; application of the principles set out will depend upon the particular circumstances involved and we recommend that you obtain professional advice before acting or refraining from acting on any of its contents.