How to get a DED License in Dubai?

A DED license or trade license is a legal permit to operate a business in Dubai Mainland, allowing for trade and activities within the specified license type. It is issued by the Department of Economy and Tourism (DET), the merged form of the former Department of Economic Development and the Department of Tourism, streamlining the business setup process in the emirate. Obtaining a DED license in Dubai involves choosing a license type, securing approvals, completing company registration, and fulfilling DED requirements. It offers business flexibility, access to the local market, and wider business reach without geographic restrictions. This article provides detailed instructions and information regarding the DED license in Dubai.

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What is the DED License in Dubai?

A DED License in Dubai, issued by the Department of Economy and Tourism (DET), is the official authorization required for businesses to operate legally within the emirate. It serves as a legal document that outlines the specific business activities your company is permitted to conduct. Obtaining a DED License is a crucial step for any business venture in Dubai Mainland, as it grants legitimacy and enables full access to the local market. This license type is essential for companies looking to establish a presence in Dubai's mainland and engage in a wide range of commercial, professional, industrial, or tourism-related activities.

Benefits of DED License in Dubai

A DED License in Dubai offers several advantages for businesses looking to establish themselves in the Emirate:

• Market Access: Unlike Free Zone licenses, a DED license grants access to the entire Dubai and UAE market, helping you tap into a broader customer base. It also allows you to trade within Dubai and across the UAE.
• Business Flexibility: DED licenses provide operational flexibility within Dubai. You can choose your business location freely and participate in government tenders, which can benefit growth. You can also choose from the nearly 2000 permitted business activities. 
• Simplified Setup: Obtaining a DED license can be a more streamlined process with potentially lower initial costs compared to Free Zones.
• 100% Ownership: DED licenses allow for full foreign ownership of your business, eliminating the need for a local partner in most cases. Still, you can appoint a Local Service Agent (LSA) to assist you in obtaining a trade license without legal involvement in your venture.
• Visa Sponsorship: DED licenses enable you to sponsor visas for your employees, facilitating the recruitment of international talent.

Types of DED or Trade Licenses in Dubai

There are four main types of DED or trade licenses in Dubai, each suitable to specific DED business activities:

1. Commercial License: This is the most common license type, ideal for businesses involved in trading activities such as import, export, wholesale, and retail trade. It allows businesses to trade goods and commodities across Dubai and the UAE.
2. Professional License: This license is required for businesses and individuals providing professional services such as consultancy (financial, legal, management), IT services, educational services, medical services, beauty care services, and many more.
3. Industrial License: This license is mandatory for businesses engaged in industrial activities within Dubai, such as manufacturing, production, or assembly of goods.
4. Tourism License: Issued by the Department of Tourism and Commerce Marketing (DTCM) in collaboration with DED, this license is required for businesses operating in the tourism sector, including travel agencies, tour operators, and tourism service providers.

The DED also offers additional specialized licenses for specific activities, such as for educational institutions, healthcare facilities, and restaurants.

Note: Choosing the suitable DED license depends on your business activity. For instance, a consulting firm would require a professional license, while a manufacturing company would need an industrial license. Ensure you select the appropriate license to operate legally in Dubai.

Also read: LLC Company Formation in Abu Dhabi

Who can apply for a DED License?

Any individual or entity meeting the requirements can apply for a DED (Department of Economic Development) license in Dubai. This includes:

• Entrepreneurs: Individuals looking to establish a business in Dubai, whether locals or foreigners.
• Companies: Both local and foreign companies aim to operate within the mainland of Dubai and the broader UAE market.
• Startups: Newly established businesses seeking to formalize their operations and enter the Dubai market.
• Professionals: Individuals offering professional services such as consultancy, healthcare, legal services, etc.
• Investors: Individuals or entities investing in businesses within Dubai and seeking to obtain the necessary permits and licenses for their operations
• SMEs (Small and Medium-sized Enterprises): Small and medium-sized businesses intend to establish a presence in Dubai and cater to local or regional markets.
  

Documents required for DED License in Dubai

The documents you'll need for a DED License in Dubai can vary slightly depending on your specific business structure and activities. However, here is a general list of the most commonly required documents:

• Valid Trade Name Certificate
• Original Initial Approval Certificate
• Emirates ID of all Partners (if applicable)
• Passport and Visa Copies of all Partners (if applicable)
• Tenancy Contract attested by RERA Dubai and approved by Dubai Municipality 
• Completed DED License Application Form
• Memorandum of Association (MoA) (for companies like LLCs, One Person Companies)
• Local Service Agent Agreement (if you appoint a UAE national representative)
• Approvals from relevant Government Bodies (if your business requires specific permits)

Learn about: LLC Company Formation in Sharjah

Steps to Obtain a DED License in Dubai

Acquiring a DED License in Dubai can be streamlined into a clear process with the following steps:

1. Choose Your Business Activity and Legal Structure: First, identify the specific business activities you plan to undertake. This will determine the most suitable DED license type (commercial, professional, industrial, or tourism). Then, decide on your legal structure, such as a sole proprietorship, limited liability company (LLC), or branch of a foreign company.
2. Reserve Your Trade Name: Pick a unique and appropriate trade name that complies with DED naming regulations. You can reserve your chosen name online through the DED website.
3. Apply for Initial Approval: Submit your initial application electronically on the DED website. This includes details about your business activity, legal structure, and proposed trade name. Once approved, you'll receive an Initial Approval Certificate.
4. Secure a Physical Office Space: Lease a commercial space in Dubai and register your tenancy contract with Ejari, the rental tenancy regulatory system. You'll need an attested copy of this contract for your license application.
5. Gather Required Documents: Compile the necessary documents as we mentioned. These typically include the Trade Name Certificate, Initial Approval Certificate, tenancy contract, passport copies, and other business structure-specific documents.
6. Finalize Legal Agreements (if applicable): If your chosen legal structure requires a Memorandum of Association (MoA) outlining ownership and governance, have it drafted by a legal professional. Additionally, if you appoint a Local Service Agent for sponsorship purposes, finalize the service agreement.
7. Obtain Additional Approvals (if necessary): Depending on your industry, you might need permits from specific government departments. Identify any such requirements and secure the necessary approvals before proceeding.
8. Pay License Fees: Once all documents are in order, settle the license fees associated with your chosen DED license type and business activity.
9. Collect Your DED License: After successfully completing the process and paying the fees, you'll receive your official DED License, authorizing you to operate your business within Dubai.

Learn about: How to setup a company in Dubai Mainland?

Cost for DED License in Dubai

The cost of obtaining a DED license in Dubai is not a fixed amount and can vary depending on several factors. These factors include the type of business activity you plan to conduct, the chosen legal structure for your company, and the location of your business operations. Additional fees are associated with the application process, such as business setup costs and potential fees for obtaining approvals from other government departments.

Conclusion

Getting a DED license in Dubai is essential for business setup within the emirate. This process, overseen by the Department of Economy and Tourism, involves selecting the appropriate license type, securing necessary approvals, completing registration, and fulfilling specific requirements. A DED license offers numerous benefits, including full access to the local market, operational flexibility, and the possibility of 100% foreign ownership. Following the outlined steps and ensuring all required documents are prepared can facilitate a smooth application process, enabling businesses to capitalise on the vast opportunities within Dubai.

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