Some investors are not aware of the restrictions that are applied in the United Arab Emirates (UAE) because every country is unique in its own. Most of the time, investors seek the help of the business setup consultants in Dubai for advising them in the right way when it comes to forming a company in the UAE.
With this, it is important that before you go forward with your plan to have a business setup in Dubai Mainland , you should be aware first of what kind of license your company would need and if its nature of activity is even allowed in the UAE at all.
Different Types of Licenses for Businesses in the UAE
A business owner should obtain the correct license by figuring out what the nature of activity is of his business. There are three categories of business licenses that companies can choose from to see to which their firm perfectly matches.
- Commercial License
A commercial license is for companies that are going to engage in commercial trade activity, such as trade in commodities, services, and goods. This type of license can also be obtained by general and specialized traders; other companies need to apply for this license as well, like transport, real estate, health institutions, retail, general trading, and construction.
- Industrial License
Any company that plans to deal with manufacturing or industrial activities should obtain this license for them to operate in the UAE. They are the companies that make natural resources and raw materials to be converted and altered. The aim of the companies then is to create new products; they can be either semi or entirely manufactured products that are made through manual or mechanical ways. This is why that in having this license, a physical office or warehouse is required to be acquired by the company.
There are also approvals from different governmental departments that will be issued alongside with the license. The validity of the latter is mentioned when it’s issued.
- Professional License
This license is for people who are craftsmen, professionals, firms that offer services, etc. A company that relies on a person’s professional expertise, which can be physical and mental skills, has to obtain a Professional License.
The license is also based on a person’s field of expertise and educational entitlement. Aside from that, there are several requirements, like public notaries, Chamber of Commerce approvals, documentations, etc.
Activities That are Not Allowed to be Conducted in the UAE
The main governing body of Dubai when it comes to business setup is the Department of Economic Development (DED). It oversees and handles the business activities that companies conduct in the Emirate.
DED reviews and ensures that the companies adhere to the rules and regulations of the country by checking that the nature of their activities do not cross any lines in accordance with the laws of the land. Although investors are encouraged to set up their business in one of the main business hubs in the world, there are still limitations that should be noted by the business owners.
Sine the UAE has the Islamic Law to abide to, which is applied throughout the UAE, there are restrictions when it comes to business activities that companies can perform.
The business activities that are not allowed to be conducted in the UAE are the following:
Food Products
Businessmen who plan to form a company or branch out their companies that engage in producing alcoholic and pork products should note that there are specific limitations and boundaries that should not be crossed.
Gambling
One of the business activities that are not allowed in the UAE is gambling, such as sweepstakes, betting shops, casinos, and other associated activities. This is an illegal activity that shouldn’t be at all planned to be performed in the UAE.
Pornographic and Prostitution
Another illegal activity that the UAE prohibits to be conducted, even the other countries, is pornographic and prostitution. The distribution and promotion of this is completely against the law.
It is important to be aware of these things because one single mistake can probably land you in jail or make you face huge fines. Even though some of the items are in the market (like the above-mentioned alcoholic drinks), there are still restrictions that should be adhered to by the business owners. That is why there are business setup consultants in UAE who are willing to advise businessmen with regard their decisions about their company formation.
Business Setup Consultants in Dubai, UAE
MAF Consultants is one of the leading business setup consultants in UAE for more than 30 years. We have been dealing with the dilemmas of various business owners from different industries. We can advise you with regard the above and other things you need help in. You can book a consultant with us today.
Veeramachineni Lalitha
I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank. My experience details : Linkedin