How to get E-Trader License in Dubai
The government of Dubai has set its focus on becoming a leading e-commerce hub for local and international that’s why has rolled out several initiatives step to improve economic activity of their country. One of the initiatives is targeted at making it easier for entrepreneurs to swiftly acquire the e-trader license, which allows them to sell products and services online or through social media.
Many people ask the questions “What License do I need to sell online in the UAE?” and “Is it legal to sell through Instagram, Facebook, snapchat, tiktok, Pinterest, linkdln and other social media channels if you don’t have the correct license?”. Many people do not realize that it is illegal or legal in the UAE to sell products and deliver services without the suitable license.
The e-Trader License is intended to bridge that gap to allow an inexpensive, quick, straightforward License set up for UAE residents or citizens.
Dubai e-Trader License?
The e-Trader License in Dubai (also just called the ‘Trader License’) was initially launched in 2017 and is designed to help entrepreneurs sell services and products, both on social media and other online channels.
The e-Trader License was introduced and is managed by the Dubai Department of Economic Development (DED). The new License was launched by the DED following efforts to crack down on bogus and fake products being sold on social media channels like Instagram, Facebook and something else on online market places for money. The basic purpose to this License to normalize the sale of products and services steered through social media channel in Dubai. The resourcefulness continues to enhance transparency and customer self-assurance in online shopping. Now the online shopping becomes more secure with the e-Trader License, it also protects the trade name and allows the License owner to reach out to customers across exhibitions and sessions.
For individuals living in Dubai, who already have Dubai residency or UAE Citizens who wish to start a small business from home or using social media and other online market places, this License is a low cost and straightforward way to set up a License to compliantly sell products and services in the UAE.
What are the requirements to obtain an e-trader licence?
The e-Trader License allows UAE residents and UAE citizens to obtain a License without the requirement of a Local Sponsor or National Service Agent and at a significantly reduced cost.
This is a new development and an ideal cost-effective solution for individual business owners looking to acquire a License to sell professional services and products via social media.
The e-Trader License does not require an office space, meaning business owners can work from home to promote and sell products and services through their social media accounts or on a personal website. The License owner can also reach out to customers across exhibitions and conferences and market places.
There are, however, some limitations with respects to the trading of physical products and goods. Commercial trading happenings using the e-Trader License are only available to GCC nationals. Non-GCC nationals can only sell professional services with the e-Trader License, for example,
- marketing services,
- management services,
- consultancy services,
- web design
- advertising services
Key benefits of the e-Trader License:
You own the company 100% by hand – this is a ‘sole trader’ or ‘sole establishment’ erection, so the company is fully owned and not separate from the individual. This is not a limited liability company structure.
- No Local Sponsor,
- Local Partner,
- National Service Agent
is required for this license.
- No office space is required.
- You can obtain up to 3 employment visas if required.
Key limitations of the e-Trader License:
The License offers a diversity of activities. However, commercial trading-related activities (for example
- selling physical goods
are available for GCC nationals only.
The separate owner must already have a
- Dubai resident visa
- Emirates ID.
This License does not provide an investor visa for the owner.
A maximum of 3 employment visas is available with this license.
This License does not allow the owner to open a physical shop or commercial unit.
You can only sell products or services within Dubai. If you wish to sell in Abu Dhabi, you will have to obtain a separate e-Trader License in Abu Dhabi. In Abu Dhabi, this is called the Tajer Licence. See our article [here] for more information on setting up an e-Trader License or Tajer license in Abu Dhabi.
The owner must be able to provide an Ejari and Makani number to show they live in the Emirate of Dubai.
What are the requirements to get an e-trader license?
The License is available for UAE & GCC nationals and foreign nationals. There are two main types of e-trader license, both types have a wide variety of activities available:
UAE Nationals and GCC Nationals can obtain either a professional or commercial License but, foreign national ex-pats can only obtain a professional License.
The e-Trader is still subject to VAT and if the annual turnover of the company reaches the minimum threshold, then the company must register for VAT and charge VAT as with any other company in the UAE.
The e-Trader owner must meet the following requirements to set up an e-trader License:
- Be based in Dubai
- hold a valid Emirates ID
- Must be aged 21 or above
- Reserve a trading name
- Pay the required fees within 24 hours of License issuance
Renew the License annually within a month of the expiry date. If the Licensee fails to do so, the License will be automatically cancelled
Complete the registration process with the Dubai DED
Required documents for the e-Trader License?
- Registration process through Dubai DED
- Passport, UAE resident visa and Emirates ID
- Trade name reservation
- Dubai based Ejari
What are the costs and time frame to set up an e-trader license?
The current application processing fee from Dubai DED is AED 1,200.
There will be additional fees for commercial activity.
License fees can be paid up to 24 hours from the issuance of the payment voucher at Dubai DED.
The License will need to be renewed annually – annual renewal fees will apply.
The Dubai e-Trader License normally takes around 5-10 working days to set up.