Required E-Commerce License In Dubai?
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Those who have very little knowledge about the rules of business set up in Dubai often wonder whether they need a license to sell goods online here. The answer is yes, and more importantly, a trade license is mandatory for practising any kind of business activity in the UAE. In the case of starting an online business in Dubai, the entrepreneurs need to secure an e-commerce license.
An e-commerce license in Dubai encompasses a wide range of sectors including food, fashion, electronics, healthcare, IT & social media etc. E-commerce is regarded as a sunrise sector that successfully overcomes the pressures of the Covid-19 pandemic and promises a long-term growth outlook. The process of obtaining an e-commerce license in Dubai is straightforward and cost-effective. However, the assistance of business setup consultants in Dubai will come in handy to expedite the license approval process.
E-Commerce License in Dubai Free Zones
There are more than 35 free zones that offer cost-effective e-commerce licenses in Dubai. A free zone e-commerce license allows the investors to trade internationally with zero import duties. The investors can trade in the mainland on a free zone license provided they partner with a logistics company. The entrepreneurs are provided with a co-working space option along with the free zone e-commerce license. The co-working spaces come with all types of modern facilities.
E-Commerce License in Dubai Mainland
The Department of Economic Development (DED) also offers an e-commerce license called the e-trade license in Dubai. conduct through social media platforms. DED issues the E-trade license electronically and provides the social media businesses activities with a legal framework to sell the products or services.
The applicants need to apply for an e-trader license in Dubai mainland only if they wish to carry out business activities through Facebook, Instagram, Snapchat or any other social media platforms. The DED issues the e-trader license to individuals who are already residents in Dubai. The e-trader license is highly restrictive in this aspect when compared to the e-commerce license issued by the free zones.
Main Differences Between E-Commerce Vs E-Trader Licenses
Ben though an e-commerce license and e-trader license facilitates online trading in Dubai, there are certain fundamental differences. They are:
- An E-Commerce license provides more number business activities than the E-Trader license
- E-Trader license is provided mainly for those operating from residential sites (Makani is mandatory)
- E-Trader license mainly focuses on social media selling while e-commerce businesses are allowed to trade through their own websites as well as other websites (dropshipping)
- E-Trader licenses are issued for UAE/ GCC nationals, while e-commerce licenses are for all nationalities
Opportunities in the UAE E-Commerce Sector
By obtaining an e-commerce license in Dubai, investors are exposed to one of the fastest-growing business sectors in the Middle East region. E-commerce evinced signs of growth in the pre-pandemic period, but it skyrocketed post-pandemic when the lockdowns and social distancing norms changed consumer behaviour. A recent report released by EZ Dubai free zone and Euromonitor has found that the UAE and Saudi Arabia account for 75% of total e-commerce sales in the Middle East in 2020. The report states that e-commerce is forecast to grow by a CAGR of 19 per cent in the region.
The growth of e-commerce has witnessed an exponential surge, especially in the Post COVID-19 era when consumer behaviour underwent a drastic change. Online purchases have become a necessity, which forced retailers to remodel their business strategies.
Process of Setting up E-Commerce Business in Dubai
To get an e-commerce license in Dubai, the applicants are required to follow the below steps:
- Decide on a legal structure
- Choose a business location
- Register the company’s trade name
- Apply to get the e-commerce license
- Rent an office
- Collect the license
Free Zones Offering Cost-Effective E-Commerce Licenses
- Dubai CommerCity
- EZ Dubai by Dubai South Free Zone
- Dubai Internet City
- Dubai Multi Commodities Center (DMCC)
- Jebel Ali Free Zone (JAFZA)
E-Commerce Licenses in Free Zone of Other Emirates
- Sharjah Media City (SHAMS)
- Ras Al Khaimah Economic Zone (RAKEZ)
- Ajman Free Zone
- Ajman Media City Free Zone
- Sharjah Publishing City Free Zone
Choose the Best Business Setup Services in Dubai
The landscape of business setup in Dubai is favourable to forming e-commerce companies due to the wealthy consumers, a digital-savvy population, high digital penetration, and the rise of mobile wallet payment methods. These factors coupled with the change in consumer behavior precipitated by the pandemic have supported e-commerce growth in the UAE. Yet, the entrepreneurs need to tread cautiously while applying for the license for which the assistance of business consultants in Dubai such as Jitendra Business Consultants (JBC) is essential.
JBC can guide investors in choosing the suitable packages offered by the free zones or DED for setting up an e-commerce business in Dubai. JBC’s highly qualified business set-up experts have assisted thousands of entrepreneurs in forming their dream businesses in the UAE. JBC’s business setup services in Dubai cover vital aspects such as the selection of activities, documentation, visa application services, etc. JBC is the ideal one-stop solution for all kinds of business incorporation services required by foreign investors.