Due to easy access to the internet and the popularity of smartphones, the eCommerce economy is exponentially growing each day. Shopping online for furniture, technology, clothes, and many other items has become a common practice. Subsequently, the eCommerce sector is incrementing worldwide.
As a result, the United Arab Emirates Government is implementing new laws and other regulations to support investors who want to start their eCommerce businesses. Consequently, before establishing their online companies, they should obtain a UAE ECommerce license.
With an ECommerce business, it will be easier for you to reach a wider audience, as it is easier and not time-consuming. Everyone with internet access can shop online making a few clicks. For example, when you set up a local physical store the target audience of your company can be limited, but if you also open an online store, your corporation can reach a broader target as there are no barriers on the internet.
To obtain an ECommerce license Sharjah and any other location in the United Arab Emirates, you have to go through a process of approbation. This process is conducted by the Department of Economic Development or DED. Usually, investors and entrepreneurs acquire the services of a business consultancy agency to guide them through this overwhelming procedure.
With an ecommerce License Abu Dhabi, Dubai, individuals can easily do business over social media and other online platforms. Thanks to this license now it is more secure to buy products on the internet. In a short period, eCommerce licenses have become the most demanded business license in the United Arab Emirates. Allowing the region’s economy to expand and develop in no time.
Holding a business license like this provides your business with a legal identity in the region. Ultimately, helping business owners remain compliant with local laws and regulations.
Steps to Obtain an Ecommerce License Dubai
Having an Dubai ECommerce License can be very beneficial for your business. Therefore, to obtain one you must follow these steps.
Select a Legal Structure for Ecommerce License Dubai
Firstly, you must decide the kind of company you want to establish. It can be a sole proprietorship, a limited liability company, a subsidiary of an international company, or a representative office. The most popular structures in the region are branch offices and LLCs as they typically bring many benefits to business owners.
Pick a Location
When you want to obtain a business license, you have to decide the location where you want to get it. In Dubai, you can acquire it in two types of zones, Mainland and the Free Zones. In the Free Zones investors have 100% ownership of their businesses. On the other hand, in the Mainland, entrepreneurs need to have a local sponsor who will own 51% of the shares of the business.
Apply for the Authorization of the Dubai Economic Department
Thirdly, before you start your eCommerce business, you have to obtain the approval of the relevant authorities. Investors need to apply to the Dubai Economic Department for a business license for their eCommerce company. To obtain this type of accreditation they must compile the following documents:
- A copy of the valid passport, a summary of the registration, and residence proof of the foreign business owner.
- A copy of the valid passport of the local sponsor.
- No-Objection Certificate and Shareholder Resolution if necessary.
- If it is a partnership organization, they must present their partnership contract.
- Finally, Company Registration and lease agreement if necessary.
Additionally, while you submit these documents, you can apply for the Initial Approval Certificate. This credential will last for up to six months and is necessary to hold it while the business license is in process of approval.
For foreigners, collecting all these documents can be challenging, particularly for those who do not speak the local language. Nonetheless, this is where the support of a business consultancy agency is necessary. When you acquire their amenities, you will find partners within their team. These agents will assist you when dealing with any difficult situation it may present in the process of acquiring an ECommerce license Ajman or any other Middle Eastern region.
The main objective of companies offering business consultancy is to guide entrepreneurs and investors on their company formation in UAE process. With their solutions, business owners can streamline their operations before and after they establish their organizations. In the end, this will allow them to have the necessary tools to be in line with the United Arab Emirates laws.
Draft a Legal Structuration of your Business
Fourthly, investors have to draft their Memorandum of Association and Articles of Association to establish their organization as an entity. In this paperwork, they must indicate their company’s policies, rules, and other regulations to be followed by every staff member. The MoA and AoA are required in Arabic and English for better understanding.
Register an Office for rent in Dubai
The next step would be to find office space for your business. It is mandatory to have a space where to conduct your company from. Therefore, investors must rent or acquire any small, flexible, or virtual office to start trading.
With a business consultancy agency by your side, you can easily find office space in the United Arab Emirates. They have the best connections in the region and can help you find the place of your dreams.
Export and Import Requirements
Your business must be registered with one of the customs and ports authorities so you can obtain an importer’s code. The United Arab Emirates imposes a 5% customs duty on imported merchandise and products. Companies located in Free Zones will not have any import duty, due to them selling their products within this area.
Opening a Local Corporate Bank Account
Finally, after you successfully apply for your ECommerce license Abu Dhabi or any other Emirate, you will be able to open a corporate bank account. Applying for it is a quick process, you just have to be able to provide the necessary documents.
Benefits of Procuring an Ecommerce License in UAE
Having an eCommerce license is very popular in the region. As most of the local businesses have become to establish an online presence. There are many advantages to opening an online company, such as increasing your customer base, decreasing costs, extending your reach, and more.
With an eCommerce company you can enjoy the following benefits:
Free Ground Operation
The United Arab Emirates provides certain flexibility for investors and entrepreneurs to establish their organizations. They can choose to operate from Free Zones, Offshore, and Mainland depending on their business nature and size. Each location has its particular legal proceedings that business owners have to follow during their setup process.
The tech sector is dominant in the Middle Eastern Region. In consequence, the local government is always uplifting and infusing technology in every business sector. So, it is a great opportunity for investors who want to create an eCommerce company in this location.
Moreover, the United Arab Emirates has two Free Zones dedicated to tech startups and well-established corporations in the sector.
Possibility of Global Hiring
The United Arab Emirates is an open environment that embraces millions of foreigners as long as they contribute to the regional economy. New companies have the chance to hire employees from all across the world with the help of a recruitment agency. Your company could help candidates by providing them with an employment visa to keep them legally in Dubai.
No Personal Taxes
One of the most attractive features to investors is that the United Arab Emirates does not demand taxes from business owners. You can start your business operations with no extra taxes involved. Businesses will only have to pay a VAT of 5%.
100% Repatriation of the Capital
If your business does not gather enough profits and you want to close it down, you can do so. Dubai offers 100% flexibility to investors to repatriate their investments and profits by themselves.
Besides, they can deal with multiple currencies if they want to. Investors have the alternative to trade their business services and goods in any legal international currency.
Prospect of Business Expansion
Having an eCommerce license in UAE will open many doors for your business. When your company is located in the United Arab Emirates it is easier to enter into the near regions and start business activities. With an eCommerce business, you can establish a representative office in other zones.
Availability of Visa
The United Arab Emirates offers visas for investors who want to start an eCommerce business and acquire a license. It can be a difficult process, however, with the help of a business consultancy agency investors can go through this process swiftly. With an investor visa, you will be able to reside and do business in the UAE.
Other benefits include:
- Have a massive audience available to consume your goods and services.
- Being able to obtain office space quickly before starting your eCommerce business.
- Having the opportunity to promote your products in the United Arab Emirates via social media ads.
- The possibility of opting for a three-year resident visa.
- Feature your services and products on online marketplaces.
- The alternative is to legally participate in exhibitions and conferences to reach a wider audience.
- Protect your trade name and other types of intellectual property.
Conditions to Obtain an Ecommerce License in Dubai
It is important to be aware of the conditions there are in place to obtain an eCommerce license in the United Arab Emirates.
- GCC and UAE National investors should sell physical products, goods, and professional services on their social media accounts.
- Foreigners can sell professional services such as maintenance, event management, repair, and photography through their social media accounts. However, they should not sell physical products through these platforms.
It is outstanding that food products are not allowed to be sold under an eCommerce license. Nevertheless, there are some exceptions, in this case, investors should check with the Department of Economic Development to know if there are any food products allowed to trade under this certification.
Ecommerce License Cost in the United Arab Emirates
The eCommerce license Dubai Cost varies depending on various reasons. These factors are the number of visas applied for, the size of the business, if the investors are buying or renting office space and if the business will be placed in a Free Zone or Mainland.
So, the final cost of an eCommerce license in the United Arab Emirates goes from somewhere between AED 15.000 and AED 50.000 according to the requirements. Obtaining a Free Zone eCommerce license will always be cheaper than the other options.
With an eCommerce license Dubai, investors can run the following business operations:
- Jewelry, garments, textiles, and gifts e-trading.
- Ecommerce of publications and media materials.
- Household, professional, and personal goods e-trading.
- Ecommerce of vehicles and transportation.
- Equipment e-trading.
- Recreational events and sports tickets e-trading.
Ecommerce Support System
If you want your eCommerce business to survive, you must have a strong eCommerce support system. Investors need to be on top of keeping in line with their logistics support, order management, payment transfer solutions, and more.
Setting up a payment gateway is essential for eCommerce companies. On their website, they should integrate a secure payment solution that includes debit and credit card transactions. In the same way, investors need to have their stock organized and well-distributed. Efficiently storing products will save you from many difficulties. Plus, having a reliable distribution network will help you succeed in the eCommerce world.
To expand your audience, you should have an accessible website. Your online store must have a detailed listing of your products and services, an easy checkout process, and a simple layout.
Besides, once your business is fully established, you should start thinking about offering a mobile application for your customers as it will be easier for them to just go on the app and easily find what they are looking for. Offering this option will differentiate your business from the competition.
We can help you with the processes in the following government departments.