A to Z of General Trading Company Registration in Dubai

Registering a General Trading company in Dubai allows you to trade various types of goods, including food, clothing, and electronics simultaneously, without the usual limitations of single-activity trade licenses. This type of activity, which can be carried out in both Mainland and Free Zone formats, allows 100% ownership for foreign investors due to the removal of the requirement for a local partner. By registering this company, in addition to benefiting from advanced infrastructure and tax exemptions, the possibility of obtaining a UAE residence visa for you and your family is provided.

Nature of General Trading Company

A General Trading company is a legal structure that allows you to trade various types of goods. Unlike limited trade licenses dedicated to only a specific category of products, here your hands are free. These companies can operate simultaneously in fields such as food, clothing, electronics, and building materials. Of course, it should be noted that some specific goods like pharmaceuticals or weapons require separate approvals from competent authorities. This type of license gives you the capability to act as an intermediary between manufacturers and buyers globally.

Benefits of Registering a General Trading Company in Dubai

Choosing this city for economic activity has multiple reasons that go beyond its geographical location. The tax system of this region counts as one of the biggest incentives for international traders. The absence of personal income tax and low corporate tax (in Free Zones) increases investors’ net profit. Additionally, air and sea transport infrastructure in this city is at a world-class level. Other benefits are as follows:

• Ease of obtaining permanent residence visas for shareholders and their families (One of the main goals of company registration for investors is obtaining a residence visa. To facilitate this process and ensure a comfortable life in Dubai, investing in residential property is the best option).
• Possibility of trading with the whole world without currency restrictions.
• Access to a specialized and multinational workforce.
• Economic stability and high investment security.
• 100% company ownership for foreign nationals in many cases.

Reviewing Different Areas for Establishing a General Trading Company

For registering a General Trading company in Dubai, you have two main options: Mainland and Free Zone. Choosing between these two depends on your business strategy and target market. Each of these areas has specific rules and features that must be reviewed before taking action. These features are as follows:

Features of Activity in Mainland

Companies established in the Mainland operate under the Dubai Department of Economic Development (DED). These companies are allowed to sell goods and offer services directly in the UAE domestic market. Also, they will have no restrictions for carrying out government projects. Key features of this area include:

• Freedom to open an office anywhere in the city (Besides commercial options, focusing on residential property and managers’ residence near the workplace is also notable).
• Possibility of direct trade with consumers inside the UAE.
• Unlimited number of visas depending on office size.
• Capability to collaborate with government entities.

Features of Activity in Free Zones

Free Trade Zones are specific areas administered by independent rules and regulations. These areas are mostly designed for companies whose focus is on international trade and re-export. There are over 30 Free Zones in Dubai, each focusing on specific industries, such as JAFZA (Jebel Ali Free Zone) or DAZ (Dubai Airport Free Zone). Important points about Free Zones include:

• Full and permanent tax exemptions.
• 100% foreign ownership without any conditions.
• No requirement to have a physical office in some areas (using a Flexi Desk).
• Restriction on direct sale of goods to the domestic market (must be done through a Mainland agent).

Reviewing Conditions Required for Registering a General Trading Company

The UAE government, by reforming trade laws, has removed the condition of having a local partner for many activities, and now the possibility of 100% ownership is provided for foreign investors. Applicants must, in addition to being of legal age and having a valid passport, provide sufficient initial capital to cover government fees and office rent and be free of any security bans. Essential conditions and requirements for company registration include:

• Security Status: Absence of the applicant from the UAE security blacklist.
• Name Selection: Selection and approval of an authorized trade name.
• Place of Activity: Renting a physical office space (Mandatory for Mainland companies).
• Legal Documents: Drafting the Memorandum of Association (MOA) and receiving security approvals.
• Financial Capability: Having sufficient budget for registration and setup costs.

Rules Regarding Sponsor or Local Partner When Registering a General Trading Company

The removal of the old requirement of having a local partner (with a 51% share) has occurred in the Mainland, while Free Zones have maintained the policy of full ownership without the need for a sponsor. Key points regarding ownership and sponsorship are as follows:

• Full Ownership: Possibility of registering a company with 100% shares in the name of foreign nationals in the Mainland.
• Free Zone: Continuation of the law of no need for a sponsor and full investor ownership from establishment.
• Local Service Agent (LSA): Replacing the sponsor with an agent to perform administrative and government affairs (without having ownership rights or shares).
• Removal of Barriers: Elimination of legal challenges related to the mandatory transfer of a portion of shares to an Emirati partner.

Documents Required for General Trading Company Registration File

Collecting correct and complete documents is the first step to prevent delays in the administrative process. An incomplete file can lead to request rejection or prolongation of the approval process. The list of documents might differ slightly depending on the activity type and selected area, but the generalities remain valid. Essential documents include:

• Passport copy of all shareholders and managers (with at least 6 months validity).
• Personal photo with white background.
• Copy of tourist or residence visa (if present in the UAE).
• Several suggested options for the company name.
• Business plan (for some Free Zones).
• No Objection Certificate (NOC) from current employer (if currently employed in the UAE).
• Memorandum of Association (MOA).
• Business premise lease contract (Ejari) and its plan.
• Completed registration application form.
• Emirates ID for individuals who have residency.

Step-by-Step Stages of General Trading Company Registration in Dubai

The process of registering a General Trading company in Dubai is a systematic process that must be done in order. Observing the sequence of stages helps you receive your activity license in the shortest possible time. These stages usually take between one week to 10 working days. Company registration stages are as follows:

Determining Activity and Legal Structure

First, you must specify exactly what goods you want to trade. Although the General Trading license covers various types, you must determine the company’s legal structure (e.g., Limited Liability Company – LLC). Choosing the correct structure has a direct impact on the partners’ legal responsibilities.

Selecting and Reserving Trade Name

The selected name must not be duplicate and must not conflict with UAE religious and cultural values. Also, using abbreviated names or words implying affiliation with the government is prohibited. After initial approval, the company name is reserved for you.

Receiving Initial Approval

At this stage, you must obtain the initial approval of the Department of Economic Development (DED) or the relevant Free Zone authority. This approval shows that the government does not object to establishing your business and the nature of your activity. Without this document, continuing the stages will not be possible.

Drafting MOA and Office Rent

The Memorandum of Association (MOA) must be drafted and signed by all parties. This document specifies the share percentage, rights, and duties of each member. Simultaneously, you must proceed to rent an office and receive the official lease contract (Ejari). Having a physical address is mandatory for Mainland companies. Alongside the office, focus on residence as well; because comfort in the living place has a direct impact on business productivity.

Paying Fees and Issuing License

After completing all documents and approvals, it is time to pay government fees. The payment voucher is issued, and after settlement, the final license is printed and delivered. Now your company is legally born.

General Trading Commercial Company Setup Costs in Dubai

Accurate estimation of the required budget is one of the most important parts of planning. The cost of registering a General Trading company in Dubai depends on numerous factors, and a fixed number cannot be announced for everyone. Usually, for Mainland companies, a budget between 30,000 to 50,000 AED (excluding office rent) is estimated. In Free Zones, this amount might start from 15,000 AED depending on the selected package and continue to higher amounts. Costs can be approximately divided into the following sections:

• Initial approval and name reservation cost.
• License issuance cost (which is usually higher for General Trading than normal licenses).
• Office rent (Ejari cost).
• Document translation and official document registration costs.
• Immigration and visa issuance related costs.
• Consulting and lawyer service fees.
• Annual renewal cost.

Obtaining UAE Residency Through Company Establishment

One of the most attractive benefits of registering a General Trading company in Dubai is the possibility of obtaining a residence visa for the investor and their family. This visa, usually issued with a 3-year validity (2 years in some areas), allows you to live in the UAE as a resident. We are here to solve your main problem, which is the place of residence, after obtaining the license. Although our field of work is not company registration, you can count on our team’s expertise and advice for selecting the best residential areas near Dubai’s commercial hubs. Visa acquisition steps after license issuance are as follows:

• Receiving Establishment Card.
• Entering the country with Entry Permit visa.
• Performing medical tests and fingerprinting.
• Receiving Emirates ID card.
• Stamping visa in the passport.

This residency is renewable as long as your company is active and its license is renewed. This method counts as one of the most reliable ways to migrate to the UAE.

Tips on Opening a Bank Account for Company Registration

After receiving the license and residency, opening a corporate bank account is the next and very important step. UAE banks have strict rules for anti-money laundering, and opening an account might be slightly time-consuming. General Trading companies, due to high turnover and international connections, usually have to submit more precise documents to the bank. To facilitate this process, consider the following:

• Maintaining the average balance required by the bank.
• Providing business records and 6-month account statement (from origin country or other accounts).
• Having an active website and strong company profile.
• Specifying potential customers and suppliers.
• Physical presence of all authorized signatories at the bank.

Legal and Tax Obligations When Registering General Trading Company Dubai

After starting activity, observing UAE tax laws must be considered. Although there is no income tax, Value Added Tax (VAT) at a rate of 5% is applied to most goods and services. If your company’s annual turnover exceeds 375,000 AED, you are required to register in the tax system and file returns. In addition to VAT, Corporate Tax with a rate of 9% has also been introduced for annual net profits above 375,000 AED. Keeping precise accounting books and using approved financial software seems inevitable to avoid heavy fines. Annual auditing is also mandatory for some companies.

Difference Between General Trading License and Other Licenses

Understanding the difference between this license and other business permits is highly important. Normal licenses or “Commercial License” usually limit your activity to a specific commodity group. For example, if you have a textile trading license, you cannot import car parts. But in the General Trading license, this limitation does not exist, and the possibility of trading multiple unrelated goods at one time is provided. Also, the cost of obtaining this license is slightly higher than specialized licenses. The reason for this price difference is the breadth of the activity field and its greater revenue-generating potential. The credibility and prestige of these types of companies are also usually evaluated higher by banks and financial institutions.

Final Conclusion

Registering a General Trading company in Dubai counts as the best path for merchants who want freedom of action in exchanging various goods without the cumbersome limitations of single-activity licenses. This legal structure with the possibility of 100% ownership for foreign nationals, both in Mainland and Free Zones, has completely removed the old requirement of having a local partner, and by obtaining this license, in addition to benefiting from tax exemptions, the path to obtaining UAE residency for the investor and their family members is paved. Although the setup cost of this company is slightly higher than normal licenses, special banking credibility and currency revenue potential make it an unrivaled option.

FAQ

Do I need to rent a physical office for this General Trading company registration?

Yes, for General Trading companies in Mainland, having a physical office space and official lease contract (Ejari) is mandatory. This contract is important for government inspections and especially for opening a bank account. Some Free Zones offer Flexi Desk options, but these options usually have less credibility with banks for large trading companies.

How long does the process of General Trading company registration and obtaining residency take?

The administrative process of company registration is very fast, and license issuance usually takes between 3 to 5 working days. But the complete process including receiving Establishment Card, performing medical tests, fingerprinting, and issuing residence visa and ID card (Emirates ID) might take a total of 2 to 3 weeks. Your physical presence is mandatory for medical and fingerprinting stages.

How is the tax status for General Trading companies?

In the tax structure of companies, there are two fundamental pillars that must be observed. First is Value Added Tax (VAT) with a rate of 5%, registration in which is mandatory for companies with annual revenue over 375,000 AED. The second tax is Corporate Tax, which applies a 9% rate on annual net profit exceeding 375,000 AED.

How many visas can I receive by registering a General Trading company?

The number of visas you can request (Quota) depends directly on your office size. Usually, one visa is allocated for every 9 square meters of office space. Of course, you receive an Investor/Partner Visa as the owner, and you can separately get residence visas for family members (spouse and children) which is independent of the company quota.