Does Your Company Have a General Trading License?

by commitbizadmin 11, Sep 2019

Does Your Company Have a General Trading License?

UAE is one of the topmost among all the other business hubs all over the world. With the aptest geographical conditions, UAE has been growing in every sector specifically in the Business sector and is also making the most out of it. UAE's contribution to the world economy is really substantial. With its highly professionally lucrative policies, well-regulated trading policies and easy access to the international market.

How to Start a Trading Business in Dubai

General Trading License

  • General trading license is one of the most popular trading licenses in Dubai as well as the UAE due to its no tax structure. It is a type of trading license dealing with retail and wholesale of goods, so, if a company wants to import or export or simply trade goods such as furniture, clothes or other products then they can apply for a general trading license.
  • For a company planning to open a business and perform trading activities, it will be important for such a company to have a general trading license for it to make the business legal in the eyes of law.
  • Such license covers everything from accessories, clothes to furniture and electronic appliances. So, a general trading license covers trading in mixed goods both locally as well as internationally. This simply means that a company is permitted to export, import or trade any number of products like toys, cosmetics and building material.
  • Apart from these products, there are also certain merchandises which are not allowed to be traded under general trading license, such as guns, alcohol, medical drugs, frozen goods and other medical products, cars etc. For such products, special approval is required from certain authorities and UAE municipalities after which one can trade such products under a commercial trade license.

General Trading License vs Trade License

In simple terms, a general trading license allows the businesses to retail as well as wholesale business to any type of goods within the UAE as well as outside the UAE, except those goods which are prohibited for trade without proper approval from authorities. Hence, the general trading license involves all types of goods except the exempted.

In case of a trading license, a business owner is only allowed to trade in specific types of goods only for which the license is registered. Other types of good available in the market cannot be traded except them being registered under the license.

Hence, the scope of a general trading license is large and wide enough as compared to the scope of a trading license.

Beneficial Aspects

Applying for a general trading license is a simple process provided every legal formality is duly met with. Likewise, a general trading license also meets every need for a trading business owner. Let's go through the various beneficial aspects of a general trading license:

1. Easy Setup Procedure

One of the most beneficial; aspect of a general trading license is that the UAE has a very smooth and straightforward setup procedure. It is actually easier than setting up a free zone. All you need to do is to get registered with the Department of Economic Development (DED). The registration will take only 90 minutes.

2. Minimum Setup Cost

It has been wrongfully said that setting up a business in the UAE is costly due to the licensing procedures and requirements that the demand for such setup in Dubai. In general, the average starting cost for the trading licenses ranges from AED 17,000 and probably the entire expenditure will not be more than AED 100,000. So basically, the cost is just parallel to the free zone’s setup.

3. No Trade Boundaries

Once a business owner has acquired a general trading license, such business then can be traded either locally or internationally anywhere. There are no limits on the trading of goods on the general trading license but there are restrictions on certain merchandise wherein special approval is required from higher authorities.

4. 100% Tax-Free

Every business owner or entrepreneur would love to invest in a country wherein the trading is tax-free. This is one of the main reasons why the UAE has been on the verge of growth and prosperity. So, if your business has a general trading license then you are required to pay no tax.

5. Multiple Shareholders

One of the many reasons why the trading license is popular amount many entrepreneurs and business owners is that multiple shareholders are allowed in such businesses. Although there is no maximum limit for shareholders the general starting requirement is 50. Such 50 can either be individuals or corporate entities.

6. Multiple Visas

General Trading license permits unlimited visas when setting up the business in the mainland. Although wherein there has been an increasing number of visas it is of utmost importance to get knowhow that there is a corresponding increase in the office space that is required to be acquired by such business owners. The general rule requires 100 sq ft of office space or warehouse per visa.

7. Audit Free Procedure

If a business is working under a general trading license, there is no requirement of submission of audit reports to the government authorities. Therefore, such businesses are not required to go through the yearly auditing process.

Therefore, a general trading License of great essence when it comes to export, import or trading of products locally or internationally. The other advantages include:

  • Low import duty.
  • 100% profit and capital repatriation.
  • Smooth lawful procedure.
  • Various banking facilities.
  • Apt visa facilities.
  • No currency restrictions
  • No audit required.

Your Advantages with Us

Being a professional business setup company in Dubai, we at Commitbiz are professionals in providing with all kinds of license services. We are experts having 15+ years of experience in business setup and other like services. In case of any query in relation to business setup or obtaining a license for such a business, feel free to contact us. We would be more than happy to help.