How to get an Industrial Licence in Dubai, UAE: A Comprehensive Guide
Dubai, the shining pearl of the United Arab Emirates (UAE), has cemented itself as a major international economic centre renowned for its infrastructure, innovation, and advantageous position. Dubai attracts investors and entrepreneurs by providing a favourable environment for various commercial endeavours, including industrial enterprises. Getting an industrial licence is important if you're considering opening an industrial business in Dubai. We'll walk you through the steps of getting an industrial licence in Dubai, United Arab Emirates, in this post.
Understanding the Industrial Licence
Businesses in Dubai are permitted to carry out operations relating to the creation, production, processing, assembly, and manufacture of commodities. An industrial licence is the key to conducting business lawfully in the emirate, regardless of whether you want to open a factory, manufacturing facility, or industrial workshop. An industrial licence can be obtained directly from the Department of Economic Development (DED) or a free zone authority for large-scale industrial projects.
Select the Right Kind of Industrial Licence for Your Company
Dubai provides a variety of industrial permits that are suited for particular industrial operations. Industries that require an industrial licence include:
· Food Production
· Textile Manufacturing
· Metal Processing
· Equipment and Engine Production
· Petroleum Products Manufacturing
· Paper Production
Choose the Right Legal Structure
It's crucial to choose the right legal structure for your company before starting the process of getting an industrial licence. There are several choices in Dubai, including:
· Sole Proprietorship
· Partnership Company
· Simple Limited Partnership Company
· Public Joint Stock Company
· Private Joint Stock Company
· Limited Liability Company
· Branch of a Foreign Company
· Branch of a Free Zone Company
Prepare the Required Documents
The following stage is to assemble the appropriate paperwork for the industrial licence application when you've decided on the legal framework. Although the particular criteria may change, the common documentation consists of:
· An application
· A copy of each company partner's and owner's passport
· Passport-size photographs of the business owner and partners
· Business plan outlining the industrial activity and operations
· A lease or other arrangement for the commercial space
· No Objection Certificate (NOC) from the relevant authorities
· An LLC's Memorandum of Association (MOA) or its counterpart for other types of legal formations
· Environmental impact assessment, if applicable
· Any additional documents specific to the nature of the industrial activity
Select the Location
A crucial choice for your industrial venture is where to locate it. Dubai provides a number of alternatives, each with its own benefits, including mainland Dubai and other free zones. Free zones provide enticing perks, including complete foreign ownership, tax benefits, and streamlined processes. However, a mainland licence would be more appropriate if you want to serve the local market.
Apply for the Industrial Licence
It's time to submit your industrial licence application now that you have the necessary paperwork and have decided on a location. There are various phases in the application process, including:
1. Trade Name Reservation
You must reserve a trade name for your company before moving forward with the licence application. The Department of Economic Development grants approval for the trade name, while the trademark must be approved by the Ministry of Economy. The trade name should be consistent with Dubai's naming rules and represent the nature of your industrial operation; some of them are:
· The abbreviation of the company’s legal form, such as LLC, should accompany the trade name.
· It is essential that the trade name excludes inappropriate language and refrains from violating public sensibilities.
· The business name should be available and not already registered by another company.
2. Initial Approval
Before submitting an application for initial approval, securing the endorsement of government authorities associated with the specific activity is necessary. This pertains to activities that require official approval before the application process can proceed.
Foreign investors need to obtain the approval of the General Directorate of Residency and Foreigners Affairs (GDRFA).
A memorandum of association is necessary for legal forms such as Partnership, Limited Partnership, Limited Liability Company, Private Joint-Stock Company, and Public Joint-Stock Company.
Send your paperwork to the appropriate free zone authority or the Department of Economic Development (DED). If everything is in order, they will assess your application and give it their first approval.
3. Lease Agreement
Give a copy of the lease or rental agreement for the space where your company is located. The agreement must be legally binding and in accordance with applicable laws.
4. External Approvals
Depending on the nature of your industrial operation, you might need approvals from other pertinent authorities. For instance, the Dubai Municipality or the Dubai Civil Defence must approve specific enterprises.
5. Final Approval and Licence Issuance
After receiving all external approvals, you can complete the application's final step. Before issuing the industrial licence, the authorities will again assess your application and supporting documentation.
6. Renewal and Compliance
In Dubai, industrial licences have a one-year expiration date and must be renewed yearly. Furthermore, submitting your application 30 days before the expiration date is necessary.
If not, DED will charge a penalty for late payment, along with external fines of AED 200 per month. To prevent fines, following all legal requirements and renewing your licence on time is essential.
Seek Professional Assistance
For international investors, in particular, navigating the complexities of getting an industrial licence in Dubai may be challenging. The procedure may be simplified and ensure a good end by consulting with business advisors, legal professionals, or incorporation specialists knowledgeable about Dubai's rules.
To realise your idea of starting an industrial firm in this thriving and dynamic metropolis, obtaining an industrial licence in Dubai, United Arab Emirates, is an essential first step. The method may include several steps, such as selecting the appropriate legal structure, obtaining documentation, requesting a licence, and adhering to post-licensing requirements. You can confidently negotiate the regulatory environment and set out on a path to industrial success in the heart of the UAE with the appropriate planning, knowledge, and expert support.
How Can Ascent Partners Help?
Ascent Partners is a boutique consultancy providing bespoke, end-to-end corporate services ranging from company formation to accounting, bookkeeping, and compliance services for entrepreneurs looking to set up their next venture in the UAE. We work alongside to strategise, startup, and scale businesses in the UAE and the broader region.
With a combined experience of 50+ years, our expert consultants provide reliable and unparalleled guidance throughout all strategic phases of a business' evolution.