What Is a Business License in Dubai?
A business license in Dubai is an official permit that allows a company to operate legally.
It is issued by:
- Department of Economy and Tourism (DET) → for mainland companies
- Free Zone Authorities → for businesses inside Dubai’s free zones
A license defines:
- ✅ Your business activities
- ✅ Where you can operate (mainland or free zone)
- ✅ The rules, benefits, and visa eligibility for your company
Operating without a license can lead to fines, closure, and legal action.
Types of Business Licenses in Dubai
Here are the main license categories recognized by DET and free zones:
1. Commercial License
- For trading, retail, e-commerce, and import/export businesses
- Allows buying, selling, and distributing goods within Dubai or globally
- Available in mainland & free zones
2. Professional License
- For service-based businesses (consulting, IT, design, education, marketing)
- Usually allows 100% foreign ownership
- Best for entrepreneurs who sell services instead of products
3. Industrial License
- For manufacturing and production (food, textiles, machinery, equipment)
- Often requires special approvals (e.g., Dubai Municipality)
4. Tourism License
- For travel agencies, tour operators, hotels, event management, entertainment
- Issued by DET in coordination with tourism authorities
5. Freelance Permit (Special Category)
- For independent professionals in media, tech, design, education
- Lets individuals operate under their own name
- Available in free zones like Dubai Media City, Dubai Internet City
Costs of Business Licenses in Dubai (2025)
Business license fees vary depending on jurisdiction, activity, and approvals.
- Free Zone License: AED 7,500 – AED 25,000
- Mainland License: AED 10,000 – AED 35,000 (excluding office rent)
- Special Approvals: Extra fees for regulated sectors (healthcare, education, tourism, etc.)
Startup Works Packages start from AED 4,999, making it one of the most affordable ways to get licensed.
Steps to Get a Business License in Dubai
Follow these steps (applies to both mainland and free zone):
- Select Business Activity → Check approved activity list from DET/free zone
- Choose Jurisdiction → Decide between mainland or free zone
- Select Legal Structure → LLC, sole proprietorship, branch office, etc.
- Reserve Trade Name → Must comply with UAE naming rules
- Apply for Initial Approval → DET or free zone authority
- Get Special Approvals → If your activity is regulated (e.g., medical, tourism)
- Pay Fees & Collect License → Complete final documentation and payment
Key Authorities in Dubai Licensing
- Department of Economy and Tourism (DET) – Mainland companies
- Free Zone Authorities – Issue licenses in their respective zones (IFZA, DMCC, RAKEZ, etc.)
How to Choose the Right License
- For Broad Access (UAE market): Mainland commercial license
- For Low-Cost Entry: Free zone professional license
- For Specialized Activities: Sector-specific (e.g., tourism, industrial)
Factors to consider:
- Business activity list (each authority has its own)
- Visa quota linked to license type
- Ownership preferences (100% foreign vs. local partner)
- Budget & renewal costs
Common Mistakes to Avoid
❌ Picking the wrong license type for your activity
❌ Ignoring visa quota requirements
❌ Not budgeting for renewals and hidden costs
❌ Assuming free zone licenses allow full mainland trading
FAQs About Business Licenses in Dubai
Q1: How long does it take to get a license?
3–10 working days depending on activity and authority approvals.
Q2: Can I upgrade or change later?
Yes, licenses can be amended to add/remove activities (extra fees apply).
Q3: Do free zone licenses allow mainland trade?
Not directly. You’ll need a local distributor or branch setup.
Q4: What happens if I operate without a license?
You risk fines, business closure, and legal penalties.
Q5: What is an LLC license in Dubai?
An LLC license in Dubai allows you to set up a Limited Liability Company, the most common business structure in the UAE. It requires at least two shareholders and limits personal liability to their share in the company. LLC licenses are ideal for businesses that want to trade directly in the UAE mainland.
Q6: Are a business license and a trade license the same?
Yes, in Dubai the terms business license and trade license are often used interchangeably. Both refer to the official permit that allows a company to legally operate and carry out approved activities.
Q7: What is the cheapest business license in Dubai?
The cheapest business licenses are usually offered by Dubai free zones, starting from around AED 4,999 – AED 7,500. These licenses are best suited for startups, freelancers, and small service providers looking for a low-cost entry into the UAE market.
Q8: How much does an LLC trade license cost in Dubai?
An LLC trade license in Dubai typically costs between AED 15,000 and AED 35,000, depending on the business activity, number of visas, and office space requirements. Additional approvals may increase the cost.
Q9: Do small businesses need a license in the UAE?
Yes. All businesses in the UAE, regardless of size, must have a valid license to operate legally. Even small home-based or freelance businesses require either a professional license or a freelance permit.
Q10: What is a Category 3 license in UAE?
A Category 3 license in the UAE generally refers to a classification used by the Ministry of Human Resources and Emiratisation (MOHRE) for employment and company categorization. Category 3 typically indicates smaller businesses with limited compliance benefits, while Categories 1 and 2 have more advantages for hiring and fees.
Conclusion
Choosing the right business license in Dubai is the foundation of a compliant and successful company.
At Startup Works, we’ve helped thousands of entrepreneurs avoid delays, penalties, and extra costs by guiding them to the right license at the right price.
Ready to start? Our packages begin at AED 4,999. Get expert help today.
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