E-trader Licence Dubai: Everything You Should Know in 2022

Did you know that there are nearly 25,000 business licenses issued in Dubai during the first quarter of 2022? Many of these operate solely online, as well.

If you run an online business in Dubai, you’ll need to acquire an e-trader licence to legally conduct your business activities.

Interestingly, many entrepreneurs in the UAE are unaware of how to navigate this responsibility. The good news is that we’ve put together a guide that has all of the key details you need to know.

Let’s explore key info about getting an e-trader licence Dubai.

So, What Is an E-Trader Licence Dubai?

An e-trader licence is a permit that is issued by the Department of Economic Development (DED) in Dubai.

It grants businesses permission to operate an online store within the emirate. To be eligible for this licence, businesses must have a physical office space located within Dubai.

They will also be required to provide the DED with a business plan, as well as other necessary documents. The application process for an e-trader licence is fairly simple and straightforward.

However, it’s important to note that businesses will be required to pay a licence fee. The amount of this fee will depend on the business activity and turnover.

Once a business has been granted an e-trader licence, it will be able to start trading online. It’s important to note that businesses will need to renew their licence every year.

What Is the Purpose of an E-Trader License?

The government of Dubai has made it a priority to develop the emirate into a leading hub for online businesses.

In order to achieve this, they’ve put in place various initiatives and regulations — such as the e-trader licence. The purpose of this licence is to ensure that online businesses are operating legally and responsibly within Dubai. Additionally, the e-trader licence helps to create a level playing field for businesses operating in the online space.

This is because all businesses — both local and international — will be required to obtain this licence in order to operate legally in Dubai. Failure to do so will result in legal penalties.

What Are the Benefits of an E-Trader Licence?

There are numerous benefits that businesses can enjoy by having an e-trader licence.

One of the most prominent is the ability to operate legally in Dubai. Additionally, businesses with an e-trader licence will be able to build trust and credibility with consumers. This is because the licence demonstrates that a business is committed to operating in a responsible and legal manner.

Furthermore, businesses with an e-trader licence will be able to take advantage of various government initiatives. These include Dubai’s e-commerce strategy, which is aimed at supporting businesses operating in the online space.

Does This License Apply to Companies That Sell Through Social Media?

Yes, the e-trader licence applies to businesses that sell through social media platforms such as Facebook, Instagram, and Twitter. In order to obtain this licence, businesses will need to provide the DED with a list of their social media accounts.

This will enable the DED to monitor your company’s activities and ensure that they are operating in a legal and responsible manner.

Are There Any Restrictions on What Businesses Can Sell Through Their Online Store?

Yes, there are certain restrictions on what businesses can sell through their online store.

For example, businesses are not allowed to sell alcohol, tobacco, or pharmaceutical products. Companies are also prohibited from selling any products that are considered to be offensive or harmful. These terms are defined by the government and often include products like weapons, pornography, and illegal drugs.

In some cases, you may have to get a permit in order to sell certain products. Be sure you check with Dubai’s laws and regulations so that you don’t get in trouble.

It’s important to note that businesses must comply with all of the restrictions that are in place. Failure to do so could result in the cancellation of their e-trader licence. You would then be unable to legally operate your business in Dubai.

What Limitations Are There With an E-Trader Licence?

There are a few limitations that businesses should be aware of before applying for an e-trader licence.

One of the most notable is the fact that businesses can only operate one online store per licence. This means that businesses will not be able to sell through multiple platforms, such as their own website, as well as social media platforms like Facebook and Instagram. Another key limitation is the fact that businesses can only sell products that are physically located in Dubai.

This means that businesses will not be able to sell products that are imported from overseas. Finally, businesses will need to ensure that they have a valid trade licence before they can apply for an e-trader licence. This is due to the fact that the e-trader licence is only valid for businesses that are registered and licensed to operate in Dubai.

Can I Use My Licence in Places Other Than Dubai?

No, businesses are only able to use their e-trader licence in Dubai.

This is because the licence is specifically for businesses operating in the emirate. Businesses that are based in other countries will not be able to use their licence in Dubai.

This is important to keep in mind, as it means that businesses will need to obtain a separate licence if they want to sell products in Dubai.

How Long Is an E-Trader Licence Valid For?

An e-trader licence is generally valid for one year. However, businesses can apply for a renewal up to 90 days before the licence expires. Businesses that do not renew their licence before it expires will need to apply for a new one.

So, it’s in your best interest to be proactive and renew your licence on time to avoid any disruptions to your business. This will also prevent you from dissatisfying your customers.

What Are the Costs Associated With an E-Trader Licence?

The cost of an e-trader licence will vary depending on the type of business.

For example, businesses that are classified as small businesses will need to pay a fee of AED 5,000. businesses that are classified as medium businesses will need to pay a fee of AED 10,000. Lastly, businesses that are classified as large businesses will need to pay a fee of AED 20,000.

It’s important to note that these fees are subject to change, so it’s always best to check with the DED before you apply for your licence.

What Common Mistakes Do Entrepreneurs Make?

One of the most common mistakes that entrepreneurs make is failing to do their research before they apply for their e-trader licence. As we’ve already mentioned, there are a number of restrictions and limitations that businesses need to be aware of before they can sell products online.

If you’re not familiar with these rules and regulations, it’s likely that your application will be rejected. Another common mistake that entrepreneurs make is failing to renew their licence on time. This could cause a disruption in your company’s performance that could lead to the loss of customers.

Business owners need to make sure that they have a valid trade licence before they can apply for an e-trader licence. This is because the e-trader licence is only valid for businesses that are registered.

Finally, some entrepreneurs make the mistake of trying to operate their business without a licence.

It’s important to remember that businesses need to have a valid e-trader licence before they can sell products online. If you’re caught selling products without a licence, you could face fines or even jail time.

When Is It Not Appropriate to Get This Licence?

There are a few instances where it may not be appropriate for businesses to get an e-trader licence.

For example, if your business only sells products that are imported from overseas, you will not be able to use your licence in Dubai. In addition, businesses that do not have a valid trade licence will not be able to apply for an e-trader licence.

Another situation where it may not be appropriate to get an e-trader licence is if your business is based in another country and you only sell products online. businesses that are based outside of Dubai will need to obtain a separate licence if they want to sell products in the emirate.

Do I Have to Be a Resident of Dubai?

Yes, businesses that want to apply for an e-trader licence need to have a valid UAE residence visa. So, the most common type of visa that entrepreneurs use is the investor visa. However, there are other types of visas that can be used, such as the entrepreneur visa or the business setup visa.

The right one for you will depend on the type of business that you’re setting up.

What Supporting Documents Do I Need?

There are a few supporting documents that businesses will need to submit along with their e-trader licence application.

These include a copy of the applicant’s passport, a copy of the trade licence, and a copy of the agreement or ownership certificate for the commercial space where the business will be operating. businesses will also have to submit a no-objection certificate from their landlord if they’re renting their commercial space.

It’s essential that you have all the required documents before you apply. If something is missing, it will delay the process and you will have to apply again once you have the right documentation.

What Is the Application Process Like?

The application process for an e-trader licence is relatively simple. Businesses will need to complete an online application form and submit it along with supporting documents.

The DED will then review the application and issue a decision within three to five working days. Once the licence has been approved, businesses will need to pay the prescribed fees and collect their licence from the DED office.

Is There an Age Requirement?

Yes, businesses that want to apply for an e-trader licence need to be at least 21 years of age. Anyone younger than this will have their application rejected if they apply. Be sure you keep this in mind so you can avoid wasting time in the future.

What Are the Reasons My Business May Get Denied?

There are a few reasons why businesses may get denied an e-trader licence. One of the most common reasons is that the business does not have a valid UAE trade licence.

Another reason for denial could be that the commercial space where the business will be operating does not have the required permits and approvals. Businesses may also get denied if they cannot provide the required supporting documents or if their application is incomplete.

How Can Working With a Professional Help Me?

If you’re not sure whether or not your business is eligible for an e-trader licence, it’s a good idea to work with a professional who can help you navigate the process. A professional can also help you gather the required supporting documents and complete the application form.

This will save you time and ensure that your application is submitted correctly.

An E-Trader Licence Is Not as Complicated as It Seems

Although getting an e-trader licence Dubai might seem difficult to understand at first, it’s much easier than you might anticipate. Keep the above tips in mind when moving forward so you can avoid mistakes.

Looking for more information on how we can help? Feel free to get in touch with us today to see what we can do for you.