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 licences 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 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 licences required during a businesses registration.  We will also consider whether or not said permits would be appropriate for your own business.

Media Licences

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 licence.  However, to be able to hold this licence, you must first fulfil some basic criteria.

  • You must be at least 25 years old, and a resident of the United Arab Emirates.
  • You may also be resident of a country based within the Gulf Co-operation 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 licence 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 licence?  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 though the NMC (National Media Council) website.

Training Licences

If you wish to run a training centre or educational facility, you will need a specific educational permit.  Depending on the number of courses or programmes you run, you may be expected to pay more.  An initial application will cost you AED 5,000.  Issuing a simple licence which allows for two training schemes will cost an extra AED 25,000.

You can add training schemes to your licence, 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 licence, a lease notification, health and safety documents and a map of your location.

Training Licenses are applied though the KHDA (Knowledge and Human Development Authority) website.

Food Service Licences

If you wish to serve food in Dubai, you must hold a specific licence.  To apply for a food licence, 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 licence 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 has plenty of ventilation

Applying for a food and safety licence will ensure you meet all these targets.  You may also wish to apply for pork or Ramadan permits, depending on your services.

Food Services Licences are applied though the Dubai Municipality website.

VAT Registration

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 Licences and Permissions

Even if you are setting up an online business with no physical location, you will still need a specific licence 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 to obtain your licence.  Do also be aware that you may need a specific licence for specific Dubai business registration.

To apply for a mainland licence, this can be made though the DED (Dubai Economic Department) website.

Customs Licences

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 licences 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 occur any charges.  All importing, however, will need to be authorised with an official licence.

Shisha Licenses

Shisha smoking is very popular in Dubai.  Therefore, the government has requested that licences 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 upto 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 Licences are applied though the Dubai Municipality website.

Setting Up a Business in Dubai?

It is essential to make sure you are fully-licenced 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.

DISCLAIMER

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.

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