UAE is popularly known as the business hub of the Middle East. Over the last 2 decades, there has been an immense growth in the financial, business, trade and logistics sectors, due to which their contribution towards the world economy is substantial. There are many businesses interested in trading goods with neighboring countries; such people should have a valid general trading license to do the same.
What is a general trade license?
If a company wishes to export, import or trade goods or products like clothes, accessories, furniture, electronics, etc., it can apply for a general trade license. A businessman who seeks opportunities in import and export in the UAE should have a general trade license. If you have multiple trading activities that are in the same or different industry then a general trade license covers it all. Although costlier, having this license has its own perks and advantages. But there are certain products, like guns, cars, alcohol and medical products, which cannot be permitted to be traded through general trade license as these products require approval from higher authorities or clearances from UAE municipalities. However, those products are traded under a commercial trade license after going through the approval process.
Why should one apply for a general trade license in the UAE?
The approximate cost required to have a general trade license in the UAE is AED30,000 to AED40,000, depending upon several factors. A general trading license in the UAE can also be used as a legal holding structure within the UAE and other licensing authorities. The same is used for storage and warehousing.
The advantages of having a general trading license in the UAE are as follows:
- No Taxes: Any business would want to make a trading tax-free. One of the most important advantages of having a general trading license in the UAE is paying zero taxes. The holder of such a license doesn’t have to pay taxes on profits, income or on any other amount.
- Trade locally and internationally: By acquiring a general trade license, one can trade beyond borders. A trader can exploit all the possibilities of doing a business in local, national and international markets to gain profits.
- Straightforward Process: It is quite easy to get a general trade license in the UAE. This license is issued by the Department of Economic Development (DED) in Dubai. The whole process has been made hassle-free as an initiative from the government. In fact, applying for a general trade license is easier than setting up a company in free trade zones. The whole process takes around 1 week once you share the necessary documents with the DED, and you are all set to start your business anywhere in UAE.
- Apply for Multiple Visas: After getting a general trade license, one can apply for multiple visas for their employees. It depends on the size of the office; the bigger your office, the more visas you can get. Additionally, the businessman can also sponsor visas for dependents, i.e., spouse, child, parents, maid, driver, etc. But one should ensure to get an expert’s advice before commencing since this is an important process.
- Auditing Is Not Mandatory: Unlike other jurisdictions, one doesn’t have to submit auditing reports to government authorities in the UAE if they have a general trading license. Therefore they do not have to go through a yearly auditing process.
Apart from these, there are various banking facilities available for personal and corporate purposes. A company with a general trading license is allowed to have 100% repatriation of capital as well as profits. They do not have to deposit share capital in UAE banks. Due to these and several other facilities made available for the licensee, traders are getting wonderful opportunities to utilize their resources and become successful.
We at Commitbiz Business Setup Consultants have our team of experts to help entrepreneurs set up their trading business in the Dubai, UAE. Should you decide to open a business here, don’t hesitate to contact us, even if it’s just for a friendly advice.