Commercial License in Dubai 2025: Cost, Requirements and Benefits
This in‑depth guide walks you through the essentials of obtaining a Commercial License in Dubai in 2025
Most people think getting a Dubai commercial license is just a checklist: fill out forms, pay fees, and wait for approval. But here’s the truth: if you approach it that way, you’re already at a disadvantage.
For entrepreneurs, timing and structure matter as much as the idea itself. In Dubai, the right structure starts with the commercial license.
This license is more than a compliance requirement. It’s a foundation that allows your business to operate legally, expand confidently, and build credibility with clients, suppliers, and financial institutions. From retail to import and export, from traditional trading to e‑commerce, the commercial license gives companies the authority to participate in Dubai’s fast‑moving economy.
A. Why It’s Important
In recent years, Dubai has introduced significant reforms that affect how and where businesses operate.
These include:
- Wider access to 100% foreign ownership in mainland companies
- Introduction of a 9% corporate tax on profits above AED 375,000
- Growing opportunities in e‑commerce and hybrid trading models
- Streamlined processes in both Free Zones and mainland jurisdictions
These changes make it an opportune moment for entrepreneurs and established companies alike to set up or expand operations in Dubai.
B. Understanding the Dubai Commercial License
A Commercial License in Dubai is the legal permit that allows businesses to engage in trading activities across the emirate. Issued either by Dubai Economy and Tourism (DET) for mainland companies or by the relevant Free Zone authorities, this license covers a wide range of business operations. It is one of the three primary types of business licenses in Dubai, alongside the Professional License and the Industrial License.
Definition and Scope
The Commercial License is designed for businesses involved in buying, selling, importing, exporting, or distributing goods. It is also the license required for retail and wholesale trade, as well as many forms of e‑commerce. Depending on your setup, it allows you to operate in the UAE, regionally, and internationally.
Typical activities include:
- General trading (multiple goods under one license)
- Specific trading (focused on a particular category, such as electronics or textiles)
- Import and export of goods
- Retail outlets and supermarkets
- E‑commerce and online trading platforms
- Logistics and distribution services
Difference Between Commercial, Professional, and Industrial Licenses
Understanding the distinction between these three licenses ensures you choose the one aligned with your business goals.
| Type | Key Purpose | Example Activities |
|---|---|---|
| Commercial License | Trading goods and commodities | Retail shops, import/export, wholesale trade |
| Professional License | Offering services, skills, or consultancy | Law firms, marketing agencies, consultancies |
| Industrial License | Manufacturing or industrial production | Factories, assembly plants, production units |
The Commercial License in Dubai is the most flexible if your goal is to buy and sell products. Unlike the Professional License, which focuses on services, or the Industrial License, which requires factory space and heavy regulatory oversight, the Commercial License is structured for trade and commerce.
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Legal Framework and Issuing Authorities
- Mainland Companies (DET)
Businesses established in the Dubai mainland must obtain a Commercial License from Dubai Economy and Tourism (DET). These licenses allow direct trade within the UAE and provide access to both local and international markets. - Free Zone Companies
Free Zones such as IFZA, DMCC, Meydan, JAFZA, and Dubai South issue their own Commercial Licenses. These licenses allow 100% foreign ownership and provide cost‑effective packages, but direct trade into the UAE mainland requires a local distributor or agent. - Offshore Entities
Offshore companies can obtain a Commercial License to handle international trading, though they cannot conduct direct business within Dubai without a mainland or Free Zone presence.
Activities Allowed Under a Commercial License
Your Dubai Commercial License can cover a wide range of activities, depending on the jurisdiction you choose. Common permitted activities include:
- Retail Trading: Opening shops, showrooms, and online stores
- Wholesale Trading: Supplying goods in bulk to other businesses
- Import/Export: Moving goods across international borders
- General Trading: Handling multiple product categories under one license
- Logistics & Distribution: Warehousing, supply chain, and freight operations
- E‑commerce: Selling products online, both locally and internationally
It’s crucial to specify the exact activities when applying, as this determines your compliance obligations and the approvals you may need from external authorities. For example, trading in pharmaceuticals or food products may require additional permits from the Dubai Health Authority (DHA) or the Dubai Municipality. Our professional experts at EZONE can guide you through a seamless setup.
C. Mainland vs Free Zone Commercial License
One of the most important decisions you’ll make when applying for a Commercial License in Dubai is choosing where to establish your business: the mainland under Dubai Economy and Tourism (DET) or one of the city’s many Free Zones. Each option has its own advantages, limitations, and cost considerations.
Key Distinctions in Jurisdiction and Market Reach
- Mainland (DET): A mainland Commercial License allows you to trade directly within Dubai and across the UAE without restrictions. It also gives you access to government contracts and tenders.
- Free Zone: A Free Zone Commercial License provides 100% foreign ownership and often offers more cost‑effective packages. However, trading directly in the UAE mainland requires working with a local distributor or establishing a mainland branch.
Pros and Cons of Mainland Setup
Advantages
- Full access to the UAE local market
- Ability to work with government entities and larger corporations
- Flexible office space options (co‑working, flexi‑desk, or traditional lease)
- Wider visa quota compared to most Free Zones
Considerations
- Corporate tax applies (9% on profits above AED 375,000)
- Office lease and Ejari registration are mandatory
- Costs are generally higher than Free Zone packages
- External approvals may be required for certain activities (e.g., food, healthcare)
Pros and Cons of Free Zone Setup
Advantages
- 100% foreign ownership, no Emirati partner required
- Attractive packages with lower initial costs
- Streamlined licensing and visa processes
- Many Free Zones offer sector‑focused benefits (e.g., DMCC for commodities, IFZA for SMEs, Dubai South for logistics)
- Possibility of 0% corporate tax if you comply with the qualifying Free Zone regulations
Considerations
- Cannot trade directly in the UAE mainland without a local agent or distributor
- Office options may be limited to flexi‑desks or shared spaces in smaller Free Zones
- Some industries require a mainland presence for credibility with clients and banks
- Customs registration is necessary for import/export activities outside the Free Zone
Offshore Options and Limitations
An offshore company (e.g., JAFZA Offshore or RAK ICC) may also obtain a form of Commercial License, but it cannot carry out business activities in Dubai directly. Offshore entities are mainly used for:
- Holding companies
- Asset protection
- International trading without a physical presence in Dubai
This route may work for businesses that do not require a UAE office or employee visas.
Case Examples: Choosing the Right Jurisdiction
- E‑Commerce Startup: A Free Zone license with a flexi‑desk in IFZA or Meydan Free Zone can reduce costs while providing a professional base for online operations.
- Import/Export Trading Firm: A mainland license is more effective in building credibility with banks, customs, and suppliers, even though costs are higher.
- Retail Outlet: A mainland license is essential for opening a physical shop in Dubai Mall or a high‑street location.
- Consultancy Trading Add‑On: Some consultancies establish a Free Zone base for services and add a mainland branch for trading activities.
D. Step‑by‑Step Process to Obtain a Commercial License
Applying for a commercial license in Dubai may seem complicated, but with the right business setup partner, the process becomes seamless, stress-free, and surprisingly fast. Below is a clear, practical step-by-step process that applies to mainland and Free Zone setups
Define Your Business Activities
The first step is to decide exactly what your business will do. Dubai Economy and Tourism (DET) and each Free Zone authority maintain official lists of permitted activities.
- If you plan to trade multiple categories (for example, clothing, electronics, and cosmetics), you may apply for a General Trading License.
- If your business is specialized (such as pharmaceuticals or auto parts), you will select a specific Trading License for that category.
Choosing activities carefully is crucial, as it impacts your license fees, required approvals, and even your visa quota.
Select the Legal Structure
Your legal structure defines how your business is registered and operated. The most common options include:
- Limited Liability Company (LLC): Popular for mainland setups; now often allows 100% foreign ownership.
- Sole Establishment: Suitable for single‑owner businesses.
- Branch Office: Ideal for foreign companies expanding into Dubai.
Your choice affects liability, ownership rights, and expansion possibilities.
Reserve and Approve a Trade Name
Trade names in Dubai must follow specific rules. They cannot:
- Contain offensive or religious terms
- Copy an existing registered name
- Use abbreviations of personal names without including the full name
Once reserved, the name is valid for a limited period (usually six months), during which you must complete the licensing process.
Obtain Initial Approval
This is a no‑objection certificate from DET or your chosen Free Zone authority, confirming that your proposed business activities are permitted. At this stage, no physical office or Ejari registration is yet required, but you will need to submit identification documents.
Secure Office Space and Ejari (Mainland Only)
If you are setting up on the mainland, you must lease a physical office or flexi‑desk and register the tenancy contract with Ejari. Free Zone businesses usually provide co‑working spaces or flexi‑desk options included in their packages.
Prepare and Submit the Required Documents
Standard documentation includes:
- Passport copies of all shareholders
- Recent passport‑sized photographs
- Residence visa copies and Emirates ID (if applicable)
- Trade name reservation certificate
- Initial approval certificate
- Memorandum of Association (MOA) or Local Service Agent agreement
- Tenancy contract and Ejari registration (for mainland licenses)
- External approvals if your activity requires it (for example, Dubai Municipality, DHA, or Civil Defense)
Pay License Fees
License fees vary depending on jurisdiction, activity, and office type. Mainland fees generally range between AED 10,000 and AED 25,000, while Free Zone packages start from around AED 12,500.
Collect Your Commercial License
Once approved, your license will be issued digitally. Some Free Zones email the license within days, while mainland DET approvals may take slightly longer, depending on documentation and activity type.
Complete Post‑License Formalities
After receiving your license, you may need to:
- Apply for a corporate bank account
- Register with Dubai Customs (if importing/exporting)
- Register for VAT (if taxable turnover exceeds AED 375,000)
- Apply for employee and investor visas under your license
E. Commercial License Costs in Dubai
One of the first questions entrepreneurs ask when considering a Commercial License in Dubai is: “How much will it cost?” The answer depends on several factors, including jurisdiction, business activities, office requirements, and visa quotas. Below is a realistic breakdown to help you plan your budget.
Government Fees Breakdown (Mainland)
For mainland companies under the Dubai Economy and Tourism (DET), the main cost components include:
- Trade Name Reservation: AED 600 – AED 1,000
- Initial Approval Certificate: AED 1,000 – AED 1,500
- Commercial License Fee: AED 8,000 – AED 15,000 (depending on activity type)
- Ejari Registration (Tenancy Contract): AED 1,000 – AED 2,000
- Memorandum of Association (MOA) Notarization: AED 1,500 – AED 3,000
- Service Charges & Admin Fees: AED 1,000 – AED 2,000
Estimated Mainland Total: AED 10,000 – AED 25,000 (excluding visas)
Free Zone Packages
Dubai Free Zones often provide bundled packages that include the Commercial License, flexi‑desk space, and visa quotas. Average starting points:
- IFZA: From AED 12,500 (1 visa quota, flexi‑desk included)
- DMCC: From AED 18,000 – AED 22,000 (premium location, international reputation)
- Meydan Free Zone: From AED 14,500 (popular for SMEs and e‑commerce startups)
- Dubai South: From AED 15,000 (ideal for logistics and trading businesses)
These packages vary widely depending on the number of visas required and the scale of your operations.
Hidden and Additional Costs
Beyond the headline fees, several other costs must be considered:
- Visa Application Fees: AED 3,000 – AED 5,000 per visa (government + medical + Emirates ID)
- Health Insurance: Mandatory for visa issuance; starts at AED 1,500 annually
- Corporate Bank Account Setup: Some banks require a minimum balance (AED 10,000 – AED 50,000, depending on the bank)
- External Approvals: Costs vary (e.g., Dubai Municipality approvals for food trading)
- Customs Registration: AED 500 – AED 1,000 annually for import/export businesses
Renewal Costs and Ongoing Compliance
Licenses must be renewed annually. Renewal fees are often similar to initial setup costs, but without one‑time charges like MOA notarization.
- Mainland Renewal: AED 8,000 – AED 15,000 annually
- Free Zone Renewal: AED 12,000 – AED 20,000 depending on the Free Zone and package
Additional renewals may include:
- Ejari lease renewals (for mainland)
- Updated visas and medical insurance for employees
- Trade name renewal if initially reserved
Budget Scenarios
Solo Entrepreneur (E‑Commerce or Consultancy with Trading Rights)
- Free Zone package with 1 visa: ~AED 12,500 – AED 15,000
- Additional costs: AED 3,500 for visa + AED 1,500 for health insurance
- Annual Estimate: ~AED 17,500 – AED 20,000
Small Trading Company (2–3 Employees)
- Mainland license: ~AED 18,000 – AED 22,000
- Ejari lease: ~AED 10,000 – AED 15,000 (flexi‑desk cheaper)
- 3 visas: AED 12,000 – AED 15,000 total
- Annual Estimate: ~AED 35,000 – AED 45,000
Large Import/Export Firm
- Mainland license: AED 25,000+
- Warehouse rental: AED 50,000 – AED 100,000 annually
- 10+ visas: AED 40,000+
- Annual Estimate: AED 120,000 – AED 180,000+
F. Renewal & Compliance
Obtaining a Dubai Commercial License is only the beginning. To maintain your right to trade, you must meet license renewal deadlines and comply with ongoing requirements set by Dubai Economy and Tourism (DET) or your chosen Free Zone authority. Ignoring these obligations can lead to penalties, frozen operations, or even license cancellation.
Annual Renewal Process
A Commercial License in Dubai is typically valid for one year and must be renewed before the expiry date. The renewal process involves:
- Submitting a renewal application to DET or your Free Zone authority
- Providing an updated tenancy contract (Ejari for mainland companies)
- Paying renewal fees
- Ensuring all employee visas and Emirates IDs are valid
Most Free Zones allow digital renewals, while mainland companies often benefit from working with EZONE professional advisors, who handle documentation efficiently and reduce the risk of delays.
Updating Activities and Shareholders
During renewal, you have the opportunity to:
- Add or remove activities if your business has expanded or shifted focus
- Update shareholder details, such as changes in passport numbers or ownership percentages
- Amend office details, especially if moving to a new location
These changes must be officially recorded, as operating with unregistered activities or outdated shareholder information can result in fines.
VAT Registration Requirements
If your taxable turnover exceeds AED 375,000 per year, you are required to register for Value Added Tax (VAT) with the Federal Tax Authority. Even businesses below this threshold may choose voluntary registration to improve credibility and reclaim input VAT.
Key compliance points:
- Filing VAT returns quarterly (or monthly for high‑turnover companies)
- Maintaining accurate invoices and financial records
- Ensuring VAT is charged correctly on eligible goods and services
Corporate Tax Obligations
Since 2023, the UAE has introduced a 9% corporate tax on annual profits above AED 375,000. This applies to most mainland companies and some Free Zone businesses unless they qualify for exemption under the Qualifying Free Zone Person rules.
Compliance includes:
- Filing audited financial statements annually
- Registering with the Federal Tax Authority for corporate tax purposes
- Keeping transparent, compliant accounting records
Auditing and Reporting Obligations
Depending on your license type and jurisdiction:
- Mainland companies must often submit audited financial statements annually to DET.
- Many Free Zones, such as DMCC and JAFZA, also require annual audited accounts to renew licenses.
- Smaller Free Zones (like IFZA or Meydan) may have lighter requirements, but still expect accurate bookkeeping.
Common Mistakes During Renewal
- Missing Ejari renewal: A lapsed tenancy contract can block your license renewal.
- Unpaid fines: Outstanding traffic fines, labor fines, or visa penalties can prevent license issuance.
- Ignoring VAT or tax compliance: Authorities now cross‑check VAT filings, making non‑compliance risky.
- Waiting until the last week: Renewals can take time, especially if external approvals are needed, so applying early avoids disruption.
G. Benefits of a Commercial License
A commercial license in Dubai does more than authorize you to trade. It opens doors that help your business establish credibility, attract clients, and operate efficiently across borders. In 2025, the benefits extend well beyond compliance; they position your company for genuine growth.
Legal Recognition and Credibility
Holding a commercial license shows that your business is officially recognized under UAE law. This credibility is essential for:
- Opening corporate bank accounts
- Signing contracts with suppliers and clients
- Building trust with new partners and investors
Access to UAE and Global Markets
- Mainland licenses allow unrestricted trading within Dubai and across the UAE.
- Free Zone licenses enable international trade while providing cost‑effective ownership structures.
This flexibility makes Dubai one of the best gateways for companies targeting the Middle East, Africa, and Asia.
Visa Sponsorship for Employees and Family
A Dubai Commercial License allows you to sponsor residence visas for:
- Your employees
- Their dependents (spouses, children, domestic staff)
- You and your family
This benefit makes it easier to attract skilled talent and provide stability for your team.
Flexibility with Business Activities
A general trading license lets you manage multiple categories of goods under a single license, reducing the need for amendments. Even with a specific trading license, you can later expand your scope through official approvals.
Opportunities for Growth and Expansion
- Eligible for government tenders and contracts
- Easier access to funding and credit facilities
- Ability to open branches and expand into new markets
- Leverage Dubai’s double taxation treaties for international deals
Tax Advantages
- Corporate Tax: Mainland companies pay 9% only on profits above AED 375,000.
- Free Zones: Many still offer 0% corporate tax if conditions are met under “Qualifying Free Zone Person” rules.
- No Personal Income Tax: Entrepreneurs and employees alike retain more earnings.
Professional Guidance for Smooth Operations
While the benefits are clear, maximizing them often requires careful planning. From choosing the right license type to structuring visa quotas and tax compliance, working with EZONE, one of the top business setup consultants in Dubai, ensures you don’t miss out on opportunities that could directly affect your bottom line.
H. Common Challenges & How to Overcome Them
Every year, countless entrepreneurs apply for a commercial license in Dubai, and many face the same stumbling blocks. Knowing these challenges and how to avoid them can save both time and money.
- Confusion in Activity Selection
Choosing the wrong business activities can limit your operations or lead to license amendments later. Always review DET or Free Zone activity lists carefully before applying. - Delays Due to Missing Documents
Incomplete applications are a common cause of processing delays. Ensure that all required documents, from passport copies to tenancy contracts, are ready before submission. - Issues with Trade Name Approvals
Trade names that violate UAE naming rules are often rejected. Double‑check the guidelines before submitting your reservation. - Hidden Costs
Many entrepreneurs budget for the license fee only, forgetting additional expenses such as Ejari, visas, health insurance, and external approvals. - Bank Account Opening Difficulties
Banks in the UAE have strict compliance checks. Providing a complete business plan and clean shareholder records improves approval chances. - Renewal Oversights
Late renewals, unpaid fines, or lapsed Ejari contracts can cause disruptions. Planning ensures smooth continuity.
Partnering with our advisors reduces these risks by ensuring every stage of the process is handled accurately and on time.
I. Future Outlook & Policy Trends
The future of doing business in Dubai is defined by broader access to 100% foreign ownership, tighter corporate tax compliance, rapid growth in e‑commerce and digital trade, more streamlined licensing through online platforms, increasing attention to sustainability standards, and new international trade agreements creating both new opportunities and the need for businesses to remain agile and well‑prepared.
Conclusion
Getting a commercial license in Dubai is often described as a process of forms, approvals, and renewals. But in reality, it’s a decision that shapes how your business will operate, grow, and be perceived in the years ahead.
The rules in 2025 give entrepreneurs more control than ever: broader access to full foreign ownership, stronger opportunities in e‑commerce, and faster licensing through digital platforms. At the same time, new responsibilities like corporate tax compliance mean there’s no room for guesswork.
That’s why many businesses choose to work with experts who understand not just the paperwork, but the bigger picture. At EZONE, our advisors help you make choices today that set you up for tomorrow.
Your license isn’t just permission to trade. It’s a statement that your business is ready to compete. The only question now is how you want to approach it.
FAQs about Commercial License in Dubai
Yes. Since recent regulatory reforms, many commercial activities in the Dubai mainland allow 100% foreign ownership. Free Zones have always permitted full foreign ownership. However, some regulated sectors (such as oil, gas, or financial services) may still require additional approvals.
A Commercial License covers specific trading activities, such as electronics or clothing. A General Trading License, on the other hand, allows you to trade in multiple categories under one license, offering more flexibility though it usually comes at a higher cost.
- Free Zone licenses: Typically 3 to 7 business days, depending on documentation.
- Mainland licenses: 1 to 3 weeks, especially if external approvals or Ejari registration are needed.
Not always. Many Free Zones offer flexi‑desk or co‑working packages that fulfill the office requirement. However, certain Free Zones and activities (like logistics or manufacturing) may require physical office or warehouse space.
The cost for a Dubai Commercial License varies depending on jurisdiction and activity.
Yes, but it depends on the jurisdiction. Some Free Zones allow multiple related activities under one license, while a general trading license is required for diverse activities across sectors.
Yes. A commercial license allows e‑commerce activities, provided you list them in your application. Some Free Zones also offer dedicated e‑commerce license packages.
Yes, all commercial licenses in Dubai must be renewed annually. Missing renewal deadlines can result in fines and disruptions.
Yes. Most banks in Dubai require a valid commercial license to open a corporate account. Additional documents such as a business plan, shareholder details, and proof of office space may also be requested.
While the process can be completed independently, many entrepreneurs prefer to work with experienced consultants. Partnering with EZONE business advisors ensures every step from activity selection to document preparation and renewals is handled correctly and efficiently.
