Starting a business in Abu Dhabi can be a great opportunity for entrepreneurs. However, before you begin operations, you must get a commercial license. This license allows you to run a legal business in the city. If you are wondering how to get a commercial license in Abu Dhabi, this guide will help you understand the process in simple steps.
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What Is a Commercial License?
A commercial license is a legal permit that allows businesses to operate in Abu Dhabi. It is required for businesses involved in trading, selling goods, or providing services. This includes retail shops, general trading companies, real estate businesses, and more.
Why Do You Need a Commercial License?
Before you start a business in Abu Dhabi, you need a commercial license for the following reasons:
- Legal Business Operations – A commercial license ensures that your business is legally registered.
- Access to Business Services – It allows you to open a business bank account, lease office space, and hire employees.
- Compliance with UAE Laws – It ensures that you follow all rules and regulations set by Abu Dhabi authorities.
Steps to Get a Commercial License in Abu Dhabi
The process of getting a commercial license in Abu Dhabi involves several steps. Below is a detailed step-by-step guide:
Step 1: Choose a Business Activity
The first step is to decide on the type of business activity you want to engage in. Abu Dhabi’s Department of Economic Development (ADDED) provides a list of approved activities. Your business must fall under one of these categories.
- Retail business (e.g., supermarkets, clothing stores, electronics shops)
- Trading companies (e.g., import/export businesses)
- Service providers (e.g., advertising agencies, consultancy firms)
Step 2: Choose a Business Location
The location of your business matters. You can choose between:
- Mainland Business – Allows you to operate anywhere in Abu Dhabi and work with government projects.
- Free Zone Business – Offers tax benefits and full ownership but has location restrictions.
Step 3: Choose a Business Name
Selecting a name for your business is an important step. Follow these guidelines when choosing a name:
- The name must be unique and not already registered.
- It should not include offensive or religious terms.
- If you use a personal name, it should be in full (e.g., John Smith Trading LLC).
- The name should comply with UAE naming rules.
Step 4: Apply for Initial Approval
Before proceeding with registration, you need initial approval from ADDED. This approval confirms that your business idea is acceptable and meets legal requirements.
Step 5: Prepare the Required Documents
To get your commercial license, you must submit several documents, including:
- Passport copies of the business owner(s)
- Emirates ID copy (if applicable)
- Residency visa (for foreign investors)
- Trade name reservation certificate
- Initial approval certificate
- Memorandum of Association (MOA) if you have partners
- Office lease agreement
Step 6: Get Special Approvals (If Required)
Some businesses require additional approvals from other government departments. For example:
- Health-related businesses – Need approval from the Department of Health.
- Educational institutions – Require permission from the Abu Dhabi Department of Education.
- Food businesses – Must get approval from the Abu Dhabi Agriculture and Food Safety Authority.
Step 7: Pay the Fees
The cost of a commercial license depends on various factors such as business activity, location, and company structure. Generally, the fees range from AED 10,000 to AED 50,000.
Step 8: Receive Your Commercial License
Once all documents are submitted and fees are paid, ADDED will issue your commercial license. You will receive an official certificate that allows you to start business operations in Abu Dhabi.
Additional Things to Consider After Getting a Commercial License
After receiving your commercial license, you need to complete a few more steps before fully launching your business.
Register for VAT (If Applicable)
If your business revenue exceeds AED 375,000 per year, you must register for Value Added Tax (VAT) with the Federal Tax Authority (FTA).
Open a Business Bank Account
A business bank account is necessary for financial transactions. Choose a reputable UAE bank and submit the required documents, such as your commercial license, passport copy, and business plan.
Apply for Employee Visas
If you plan to hire employees, you must apply for work visas through the Ministry of Human Resources and Emiratisation (MOHRE).
Renew Your Commercial License Annually
Your commercial license needs to be renewed every year. Ensure that you submit the required documents and pay the renewal fees on time to avoid penalties.
Common Mistakes to Avoid
Many business owners make mistakes when applying for a commercial license. Here are some common errors and how to avoid them:
- Choosing the Wrong Business Activity – Make sure to select the correct activity that matches your business.
- Incorrect Documentation – Double-check all required documents before submission.
- Ignoring Special Approvals – If your business needs extra approvals, obtain them in advance to avoid delays.
- Late License Renewal – Always renew your license on time to prevent fines and legal issues.
Conclusion
Getting a commercial license in Abu Dhabi is a straightforward process if you follow the correct steps. By choosing the right business activity, preparing the necessary documents, and complying with UAE laws, you can start your business smoothly. If you need assistance, consulting with business setup experts can help simplify the process.
Would you like professional guidance on obtaining a commercial license in Abu Dhabi? Contact us today for expert advice and support!
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