What Is a Commercial License in Dubai?

A commercial license in Dubai allows businesses to carry out trading activities such as buying and selling goods or services. It is one of the most common business licenses in the UAE, especially for entrepreneurs, e-commerce sellers, and import-export companies.

With a commercial license, you can legally engage in activities like general trading, logistics, retail, construction material sales, and more. It covers everything from physical goods to services offered for commercial gain. This makes it ideal for companies that want to operate in wholesale, retail, or distribution across the UAE and international markets.

Dubai offers three main jurisdictions where you can apply for a commercial license: Mainland, Free Zone, and Offshore. Each has different rules, benefits, and costs. Mainland businesses can operate anywhere in the UAE, while Free Zone entities enjoy tax benefits and 100% foreign ownership but are limited to their zones or need agents to sell on the mainland. Offshore licenses are usually for holding companies and international businesses without on-the-ground operations in Dubai.

Types of Commercial Licenses & Trading Activities

1. General Trading License

This is one of the most flexible licenses. It allows businesses to trade in a wide variety of products under one license. General trading covers multiple unrelated goods, such as electronics, clothing, food, and furniture. It is ideal for companies that plan to deal in different product lines under one business structure.

2. Specific Commercial Licenses

Some commercial licenses are limited to specific activities or industries. For instance, you can apply for a license focused on:

• Automotive spare parts trading
• Chemical and industrial equipment trading
• Food and beverage distribution
• Real estate brokerage
• Construction materials trading

This type of license is suitable for niche markets and businesses that want to focus on a specific product or service category.

Commercial vs Professional License

While a commercial license is for trading goods and services, a professional license is intended for individuals or firms offering professional expertise like consultancy, design, education, or legal services.

The key differences include:

• Ownership: A professional license can be 100% foreign-owned, while a commercial license in the mainland usually requires a local service agent or partner.
• Liability: Commercial license holders often form an LLC, limiting liability. Professional license holders may operate as sole proprietors or civil companies.
• Activities: Commercial focuses on trading. Professional is for skills or consultancy-based services.

Free Zone vs Mainland vs Offshore Comparison

• Mainland: Access to the entire UAE market, government tenders, and the ability to open multiple branches.
• Free Zone: 100% foreign ownership, tax exemptions, and simplified import/export procedures. Ideal for international trade.
• Offshore: Suitable for international operations without physical presence. No need for office space in the UAE.

Your choice depends on your target market, ownership preferences, and business activity.

How Much Does a Commercial License in Dubai Cost?

The cost of a commercial license in Dubai depends on various factors like jurisdiction, number of activities, visa quotas, office space, and legal structure.

Typical cost breakdown:

• Trade license issuance: AED 10,000 to AED 25,000
• Office rent or virtual workspace: AED 8,000 to AED 20,000 annually
• Visa quota (per employee): AED 3,000 to AED 6,000
• PRO services and admin charges: AED 2,000 to AED 5,000

Optional add-ons:

• E-Trader license for online-only sellers
• Import-export code registration
• Food truck or mobile trading permits

Prices may vary between free zones and mainland authorities, and annual renewal fees also apply.

Step-by-Step Setup Process in Dubai

1. Choose Business Activity & License Type

Start by defining what products or services your business will offer. This determines your license category and the legal approvals needed.

2. Reserve Trade Name & Legal Structure

Select a unique trade name and decide on your business structure (LLC, sole proprietorship, or partnership). Make sure the name follows DED guidelines.

3. Prepare Documents & Initial Approval

Gather essential documents like passport copies, visa status, business plans, and No Objection Certificates (NOCs) if required. Submit for initial approval from DED or the relevant free zone authority.

4. Office – Virtual or Physical

Depending on the jurisdiction, you will need to lease an office or opt for a Flexi-desk/virtual office. This address will be tied to your license.

5. Submit Application & Pay Fees

Submit your completed documents and pay the licensing and registration fees. Free zones usually offer bundled packages for ease.

6. Get Approvals (DED, Municipality, Sector-Specific)

You may need approvals from other entities, depending on your activity, such as food safety departments, Dubai Municipality, or other ministries.

7. PRO Services, Visa Allocation & Bank Account

Apply for visa quotas, Emirates IDs, and labor cards, and open a UAE corporate bank account. Many companies use PROs to handle this paperwork smoothly.

8. Renewals & Adding Activities

You must renew your license annually and update your activity list if your business expands. This is a straightforward process, but it must be done on time to avoid penalties.

Common Mistakes & How to Avoid Them

Many startups face avoidable setbacks during the setup process. Here are common issues:

• Choosing vague or unrelated activities, which leads to rejection
• Not getting the right NOC for restricted business categories
• Underestimating total costs, especially visa and office costs
• Poor visa planning or missed legal compliance steps
• Forgetting VAT registration or annual renewals

These can be avoided by working with experienced consultants like Lukadah, who understand UAE regulations in depth.

How Lukadah Can Help

At Lukadah, we specialize in business setup solutions tailored to your goals. Whether you’re launching a general trading company or a niche import-export brand, we provide complete support.

Here’s what we offer:

• Expert advice on business activity, structure, and jurisdiction
• End-to-end service, from name reservation to final licensing
• Visa and PRO services handled professionally
• Office space solutions: virtual, co-working, or permanent
• Fast-track packages launch in as little as 48 hours
• Transparent pricing with our online cost calculator

Contact us today to turn your business vision into reality.

FAQ

1. Can I own 100% of a commercial license?

Yes, especially in free zones. In the mainland, foreign ownership is allowed for many sectors under the recent law changes.

2. How long before I can start trading after applying?

Usually within 3 to 10 days, depending on jurisdiction and document readiness.

3. What about VAT registration?

If your annual turnover exceeds AED 375,000, VAT registration is mandatory. We help with the process.

4. Can I add more activities later?

Yes, you can update your license to include more activities, subject to approval.

Conclusion

Getting a commercial license in Dubai is a smart step toward tapping into the UAE’s fast-growing economy. From choosing the right activity to renewing your license, each stage matters. By working with a trusted consultancy like Lukadah, you avoid delays, reduce costs, and ensure full compliance.