A Dubai Free Zone business license is one of the most important steps that investors and entrepreneurs must take to start their businesses in one of the most attractive business environments in the world. Dubai\’s free zones offer many investment opportunities for both small and large enterprises, in addition to a variety of advantages that make them an ideal destination for local and international companies. Through its free zones, Dubai seeks to attract investors and provide an ideal and flexible business environment, where foreigners can own 100% of their companies, while enjoying significant tax exemptions and administrative facilities that make the process of obtaining a business license quick and straightforward. In this article, we will learn about the cost of issuing and canceling a business license in the Dubai Free Zone.

A business license in the Dubai Free Zone is an official permit that allows a company to operate within that area legally. It is essential for any business activity that wishes to benefit from the unique advantages offered by free zones, such as the ability to import and export without paying customs taxes, in addition to enjoying an advanced infrastructure that supports all types of businesses, whether commercial, industrial or service. Commercial licenses in Dubai\’s free zones include several types that suit different economic activities, such as the general commercial license, industrial license, and professional license, which provides investors with multiple options that suit their needs and aspirations.

When applying for a commercial license, investors need to prepare a set of necessary documents and complete some administrative procedures. The authorities in Dubai seek to facilitate this process, making obtaining a commercial license flexible and smooth. Thus, Dubai provides an ideal environment to attract companies from various sectors, enhancing its position as a global center for trade and investment.

Steps to obtain a commercial license in the Dubai Free Zone

Here are the general steps to obtain a commercial license in a free zone in Dubai:

Choose the free zone: Search and choose the free zone in Dubai that suits your company\’s activity.
Choose the type of company: Decide on the type of commercial company you want to establish (sole proprietorship, private joint stock company, public joint stock company, etc.).
Determine the business activity: Determine your main and subsidiary business activity.
Determine the company name: Choose a name for your company that complies with the laws of naming companies in the free zone.
Submitting the application: Submit your application for a company license at the registration office in the free zone.
Preparing the documents: Prepare the required documents for the trade license, such as passport, personal photos, residence document, lease contract (if applicable), business plan, etc.
Paying the fees: Pay the required fees to submit the application and obtain the trade license.
Approval and receipt of the license: After reviewing your application and ensuring that all requirements are met, your trade license will be issued.
Opening a business bank account: Open a business bank account in the name of the company at one of the approved banks in the free zone.
Issuing work visas: You may need to start the process of obtaining work visas for employees and managers.
Tax and regulatory compliance: Ensure compliance with all tax controls and government regulations in the free zone.
Starting the business: After obtaining the necessary licenses, you can start operating your business in the free zone.

Cost of a commercial license in the Dubai Free Zone

The cost of a commercial license in the Dubai Free Zone depends on several different factors that may affect the final costs. Here are the most important factors that contribute to determining the cost:

Type of business activity: The cost of the license varies depending on the type of activity you wish to practice. Commercial, industrial and service activities may require different fees depending on the legal and operational nature of each activity.
Location in the free zone: The different free zones in Dubai offer a variety of options and varying fees, some of which may be dedicated to industrial activities or logistics services, while others provide specialized services in technical or commercial activities.
Company size and number of employees: The cost of the license may increase or decrease depending on the number of employees required to issue visas and the size of the company. Small and emerging companies may obtain less expensive packages compared to large companies.
Office or commercial space rent: The costs of renting office space or commercial facilities vary depending on the free zone. Some free zones offer virtual offices for small companies, which are a less expensive option.
Administrative and government fees: The cost of the license includes administrative and government fees to cover registration procedures and legal transactions. These fees vary depending on the size of the company and activity.
Issuing visas: Part of the cost depends on the number of visas required for employees. The more visas you need, the higher the costs of the license.
Annual renewal fees: After obtaining the commercial license, it must be renewed annually. Renewal costs vary depending on the type of activity and the size of the company, but are usually less than the cost of the first issue.
Other additions: The cost may include some additions such as registering with the Chamber of Commerce or obtaining additional permits depending on the type of activity.

Costs of cancelling a trade license in Dubai

The costs of cancelling a trade license in Dubai depend on several factors related to the size of the company, the type of business activity, and the location in which the company operates. Here are some of the factors that affect the costs of cancelling a trade license:

Government fees: These include the fees required by the relevant government authorities to complete the procedures for cancelling a trade license. These fees vary depending on the type of activity and the location of the company (inside or outside the free zones).

Visa closure: If the company has employees or work visas associated with it, these visas must be settled or cancelled before the license cancellation process can be completed. This requires paying a cancellation fee for each visa.

Financial obligations settlement: Costs may include any unpaid financial obligations such as customs duties, taxes (if the company is subject to VAT), and overdue bills. All debts and financial obligations must be settled before the license can be cancelled.

Bank account closure: Cancelling a trade license requires the closure of the business bank accounts associated with the company. There may be administrative fees associated with closing the accounts.
Liquidation of contracts: If the company has contracts with other parties, such as leases or service contracts, these contracts must be terminated or settled, which may result in additional fees or compensation.
Return of guarantees: In some cases, you may need to recover financial guarantees or deposits that have been provided to government agencies or other entities. This requires legal procedures that may entail additional fees.
Chamber of Commerce Settlement Fees: If the company is registered with the Dubai Chamber of Commerce and Industry, any late fees or administrative requirements must be settled before the license can be cancelled.
Lawyers’ or legal advisors’ fees: In some cases, you may need lawyers or legal advisors to facilitate the cancellation process, which may add additional costs to the process.
Costs related to liquidating assets: If the company has assets (such as property or equipment) that need to be liquidated or sold. This may result in additional costs related to the sale or disposal procedures.

In conclusion, obtaining a trade license in the Dubai Free Zone is a pivotal step to starting and continuing a business in a flexible and supportive environment. The benefits offered by free zones, such as full foreign ownership, tax exemptions, and logistical and legal facilities, make them an ideal destination for aspiring businesses and investors. In addition, this license enhances the ability of businesses to expand into international markets and benefit from Dubai’s strategic location as a link between Asia, Europe, and Africa.

A Dubai Free Zone business license gives companies access to an integrated business environment that enables rapid growth and flexibility in dealing with various commercial and industrial activities. With advanced infrastructure and easy access to government and administrative services, new companies can start their operations quickly and avoid complex bureaucratic procedures. Dubai, with its various free zones, is home to startups and small companies as well as large multinational companies looking for greater opportunities.

Moreover, the variety of options available to companies in terms of the type of activity and commercial fields makes Dubai’s free zones a dynamic business environment that meets the needs of investors from various sectors. With the continuous support of the government to encourage innovation and investment, companies can benefit from various incentives that aim to enhance the business environment and provide more opportunities.

Finally, obtaining a commercial license in the Dubai Free Zone represents a gateway to success and prosperity in the business world. Whether you are looking to establish a new company or expand your existing business, a commercial license in this zone will open the doors to a bright future full of promising business potential and opportunities in one of the fastest growing markets in the world.

Top Frequently Asked Questions About a Commercial License in the Dubai Free Zone

Can foreigners own 100% of a company in the free zone?
Yes, the free zones in Dubai offer the advantage of 100% foreign ownership, making them an ideal destination for international investors.

How long does it take to obtain a commercial license in the free zone?
The process of obtaining a commercial license usually takes a few days to two weeks, depending on the type of activity and the requirements of the competent authorities.

Can a commercial license be used to conduct commercial activities within Dubai?

No, a commercial license in the free zones allows conducting commercial activities within the free zone or outside the UAE, but activity within Dubai requires obtaining a license from the local authorities.

Are there capital requirements to establish a company in the free zone?
Yes, capital requirements vary depending on the type of business and company. Some free zones require a minimum paid-up capital to establish a company.