Dubai has become one of the most desirable locations in the UAE due to its growing GDP, stable economy, and strategic location. Setting up a business in the UAE is a promising venture, and choosing the right trade license plays a pivotal role in its success. A license is required to start a business in Dubai, whether on the Mainland or in one of the freezones. Obtaining a dual license in Dubai is becoming increasingly popular and is in high demand among businesspeople and entrepreneurs. Previously, the Department of Economic Development (DED) in Dubai had prohibited the acquisition of more than one company license. You can now obtain a dual license by registering a company with the Dubai Airport Free Zone Authority (DAFZA) or the Dubai International Financial Center (DIFC) and then applying for a business license with the Dubai Economic Department (DED). Thus, in today's blog, Dhanguard will extensively discuss the concept of dual licensing in the UAE. So, without any further ado, let's learn!
Dubai Economic Department Trade License
Dubai, the region's business hub, requires a trade license issued by the Dubai Economic Department (DED). The DED trade license is the key to unlocking the vast business potential in Dubai. Dual Trade Licenses streamline the process, allowing businesses to operate seamlessly across different sectors.
What gave rise to the Concept of Dual Licensing?
A Memorandum of Understanding was signed between DAFZA and the DIFC (MOU) to promote and run businesses in Dubai. They were able to do business across Dubai because of this deal. The Department of Economic Development (DED) has the authority to change any exercise relevant to corporate licensing, according to the Memorandum of Understanding (MOU).
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The Department of Economic Development will follow the incorporation of the company connected to dual-license and free zone (DED)
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The Memorandum of Understanding (MOU) cements Dubai's position as a world-class commercial destination by encouraging and fostering an investment-friendly environment.
Understanding Dual Trade Licenses
A Dual Trade License allows businesses to engage in multiple activities under a single license, providing flexibility and efficiency. Companies in free zones have long wanted dual licensing to operate numerous enterprises and expand their reach in the UAE market. Before the approval of the dual license, these companies could only function within the boundaries of the free zone in which they were registered. They missed several opportunities to trade in one of the Middle East's fastest-growing markets. With the DED's approval, the authorities could ensure improved governance and rules. The DED can change or expand the enterprise's current activity.
What are the Benefits of Having a Dual License?
The following are some of the potential advantages of having a dual license:
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Cost savings include not renting office space on the Mainland and the highly competitive prices of establishing the new business.
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Establishing an onshore branch of a free zone corporation usually takes less time than forming a new entity.
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Improved business development capabilities, especially in cases where an onshore license is necessary to engage with specific government bodies.
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Onshore contracting risk reduction.
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The presence of an onshore entity in the UAE may help you to get more visas.
Establishing a dual license entity is identical to installing a foreign firm branch in that you must appoint a local National Service Agent (NSA). The NSA will not be a stakeholder in the onshore addition but will act as the company's representative in administrative, labour, and immigration problems.
Documents Needed in Abu Dhabi to Grant a Dual License
Below is a list of documents that must be submitted to the DED.
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A copy of the free zone license for the parent firm
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An undertaking paper certifying that the company maintains a branch outside of the free zone in the Emirate
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A letter from the relevant free zone authorities stating that they have no objections
Eligibility Criteria for Abu Dhabi Dual License
Getting a dual license is more straightforward and affordable than the previous license system. In Abu Dhabi, United Arab Emirates, obtaining a dual license entails several prerequisites and eligibility criteria. A dual license will be available to businesses established in one of Abu Dhabi's free zones. Companies that are identified as branches in the free zones will be different.
Additional needs and qualifying standards for obtaining the Abu Dhabi dual license are as follows:
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An establishment card will not be issued to the dual license branch. Furthermore, the parent business will be in charge of sponsoring the branch employees' dual licenses. Because work permits may be secured without going through the usual onshore immigration channels, the recruiting process should be more accessible.
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It won't be required to hire a service agent to set up a dual license branch because the parent company will act as the sponsor in effect (national agent).
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It is also necessary to appoint a branch manager with dual licensing. In the manager's favour, a power of attorney will also be needed to guarantee that the management has the authority to act on behalf of the dual license branch and make crucial decisions in an emergency.
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The nameplate and physical address do not need to be a part of the branch's application sent to the DED. This is because the dual license branch won't need to register a different address with the DED to conduct business; instead, it can do so from the exact location of its parent company.
How to Obtain a Dual License in the United Arab Emirates
The steps to obtain a license are as follows.
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Send in the necessary paperwork to get your business a dual license in Abu Dhabi: supplying NOC and a dual license application form to the appropriate government agency.
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Once your initial clearance has been received, pay the dual license fees.
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The appropriate authorities will review your application when you have paid your application fees. You will receive your dual license upon full approval of your application. The dual license is often granted in two or three business days.
Ras Al Khaimah Trade License Check
Ras Al Khaimah, one of the seven emirates, has its own rules and regulations. Entrepreneurs must conduct a Ras Al Khaimah trade license check to ensure compliance with local requirements. Obtaining a Ras Al Khaimah Trade License is a pivotal step for entrepreneurs seeking to establish their businesses in this flourishing emirate of the United Arab Emirates. Governed by the Ras Al Khaimah Economic Zone (RAKEZ), the process is designed to be efficient and transparent. Entrepreneurs can choose from various license types based on the nature of their business activities, including commercial, industrial, and service licenses. Selecting the appropriate business zone, whether free zone or non-free zone, adds another layer of flexibility to cater to diverse business needs. The application involves submitting essential documents such as a business plan and passport copies, with subsequent approval leading to the issuance of the trade license. This official authorization not only legitimizes the business but also opens doors for seamless operations in the thriving business landscape of Ras Al Khaimah.
DIFC Trade License Cost
The Dubai International Financial Centre (DIFC) is a renowned financial hub attracting businesses globally. Understanding the DIFC trade license cost is crucial for companies considering a presence in this prestigious zone. Dual Trade Licenses provide a cost-effective solution for businesses looking to operate within the DIFC and expand their scope of activities.
Amendment to Dual License
The introduction of dual licensing has led to the implementation of specific procedures. This initiative has altered several items, including:
Additional Branch Addresses Are Not Needed
Previously, branches within an Abu Dhabi Free Zone required a different address. Another leasing agreement would be needed for this. Although branches can now operate out of the exact location as their parent company, they can still have separate office addresses.
Elimination of the Need for Local Sponsorship
By enabling parent firms to sponsor enterprises that apply for dual licenses, the dual licensing concept has eliminated the need for local agents. Thanks to this modification in the dual licensing, businesses can avoid additional costs and the arduous paperwork that goes along with it.
Choosing a Manager for a Branch
Censed branches must now appoint a branch manager. The Power of Arney is granted to branch managers, giving them the essential ability to oversee activities inside a unit.
UAE GDP Breakdown
To comprehend the significance of Dual Trade Licenses, it's essential to look at the UAE's GDP breakdown. The diversified economy comprises oil and gas, tourism, real estate, and more sectors. Dual Trade Licenses enable businesses to tap into multiple sectors simultaneously, contributing to the overall economic growth of the UAE.
The Dual License Initiative's Effects
According to the Department of Economic Development in Abu Dhabi, consolidating many branches and lowering the administrative and logistical burden will significantly boost significant economic sectors. The initial step in this approach is to promote local business opportunities.
The UAE will have a massive financial strategy with a substantial stimulus program in the future. It would boost the Emirate's economic expansion even more. Due to the dual licensing structure, existing businesses must assess their objectives and make any necessary revisions. Because companies based in the free zones would be allowed to operate on the Mainland, the cost of doing business would be significantly reduced.
How Dhanguard Can Assist You in Getting an Abu Dhabi Dual License
Different licenses may be granted based on the applicant company's operations. It will take a lot longer to process the tasks that require a great deal of government licenses and are very technical. Even though it's a straightforward process, many entrepreneurs, business owners, and well-established companies choose to hire Dhanguard in the UAE since they have the necessary knowledge to deal with essential renewals, interact with government representatives, and much more. Professionals in the business world can help you concentrate more on managing the company and less on petty issues. Contact us now, and we'll help you obtain an Abu Dhabi dual license.
Conclusion
In conclusion, the concept of Dual Trade Licenses in the UAE opens new doors for businesses seeking agility and diversification. Entrepreneurs should leverage this innovative licensing model to explore multiple sectors, ensuring a competitive edge in the vibrant business landscape of the UAE. Whether conducting a Ras Al Khaimah trade license check or considering the DIFC trade license cost, the strategic adoption of Dual Trade Licenses is a game-changer in pursuing business success in the Emirates. Thus, we hope this blog provides you with insightful information. For more information on other related aspects, feel free to check out our website or contact our Experts by visiting our Branch Office.