Starting a business in Dubai mainland for trading precious metals is a lucrative idea as the emirate is one of the leading hubs of precious metal trading. The landscape of business setup in Dubai is well-suited for precious metal trading activities given the emirate’s top ranking in the international gold and precious metals trading landscape. Foreign investors can have a seamless license obtaining process by applying through business setup consultants in Dubai.
In this blog, we will discuss some of the key aspects of opening a precious metal trading business in Dubai mainland. Having a basic understanding of the laws and regulations will help you ace the process of company registration in Dubai. Read ahead to know the key steps, requirements and benefits of setting up a precious metals trading business in Dubai:
Who Issues a Trade License for Precious Metal Trading in Dubai?
Since you are setting up a business in Dubai mainland, you need to approach the Department of Economic Development (DED) to obtain the Precious Metal trading license. DED regulates the process of business setup in Dubai mainland by issuing/renewing trade licenses. Business setup consultants in Dubai can assist you in navigating the procedures set out by the DED.
What Type of Trade License You Should Obtain?
DED issues a ‘Non-Manufactured Precious Metal Trading’ license, which allows you to carry out the trading of precious metals. It is a Commercial License that authorises the reselling of the basic ores of gold, silver, platinum and other precious metals in pre-extraction conditions, or in the form of ingots, blocks, threads or chips in pre-forming manufacturing. The activity code of the license is 4752060 and it comes under the activity group of Jewellery Trading. Providers of business setup services in Dubai can help you to apply for a license without any hassle.
How to Get a Precious Metal Trading License in Dubai?
You need to follow the standard procedures designed by the DED to obtain a precious metal trading license in Dubai. Foreign investors who are new to the land may find the steps of company incorporation in Dubai rather baffling. However, business setup consultants in Dubai can clear the path for you. You need to execute the below steps without fail to get a precious metal trading license in Dubai mainland:
- Select the business activity
- Decide a name for the company
- Determine the company’s legal structure
- Obtain initial approval from the DED
- Draft and sign a Memorandum of Association (MoA)
- Rent a premise for the company and get the rental contract attested by Ejari
- Submit all the documents
- Collect the precious metal trading license from the DED
External Approvals Required for Precious Metal Trading
You need to obtain approval from Security Industry Regulatory Agency (SIRA) to start a precious metals trading business in Dubai mainland. SIRA approval is required to ensure that your business meets all the required security measures. Approval from Dubai Police is also required to install security systems within your establishment.
Why Dubai is the Right Place to Start a Precious Metals Business?
You may now wonder why you are advised to register a company in Dubai to trade in precious metals. Dubai is a top trade hub for precious metals, especially Gold. As per a recent Khaleej Times article, between 20 and 40 per cent of the global gold stocks pass through Dubai every year. Dubai’s external trade stood at USD 58 billion in 2020, of which Gold was reported to be the top contributor. Moreover, Dubai’s gold & jewellery sector reported a 20% growth in trade value in the first quarter of 2020, unperturbed by the global impact of Covid-19. Moreover, the presence of the historic Gold Souk creates a supportive environment for business setup in Dubai for the traders.
Compliance Requirements for Precious Metal Businesses in the UAE
Precious Metals or Precious Stones dealers in the UAE are required to meet certain obligations related to Anti-Money Laundering and Combatting Financing of Terrorism (AML-CFT). Dealers in precious metals and precious stones fall within the category of Designated Non-Financial Business and Professions (DNFBPs), regulated by the Ministry of Economy. Such businesses are required to meet the following obligations:
- Register for the GoAML platform
- Create, review and update AML / CFT policies to mitigate the risks identified
- Appoint a Money Laundering Reporting Officer (MLRO) / AML compliance officer
- Provide AML-CFT training to the staff
- Maintain proper records and documents in relation to all the above recommendations
- Identify and report suspicious transactions
Start your Company Through Business Setup Consultants in Dubai
The process of business setup in Dubai involves several steps and requirements and hence it is advisable to have a certain level of prior knowledge before applying for the license. Foreign investors can gain insights into the licensing process through the best business setup consultants in Dubai such as Jitendra Business Consultants (JBC). JCA’s consultants are well-versed in the UAE Immigration Laws and Labour Laws which may come in handy for making the process accurate and error-free.
Apart from managing your license application, JBC can also assist with the opening of corporate bank accounts, and advise on compliance requirements such as AML-CFT, Economic Substance Regulations (ESR) and Ultimate Beneficial Ownership (UBO). Our consultants can help you navigate the immigration procedures and handle all the government formalities, approvals, work permits, and visa applications. We offer the best business setup services in Dubai that enable you to bring your dreams to life.