For many people, their first steps into business are small – perhaps by working in their own front room and selling exclusively through the internet. Today, there are many enterprises being started by people online, such as tutoring, selling items they’ve crafted, or to freelance writing – and a decent living can be made from them.
If you live in Dubai and want to start up such a business, you must gain an e-trader licence first. But what is it and how do you apply for one? Our guide will show you how, covering the following topics:
- What is a Dubai e-trader licence?
- What is required for an e-trader licence?
- Dubai e-trader licence for expats
- Benefits of an e-trader licence
- Who applies for the e-trader licence?
- How to apply for the Dubai e-trader licence
- Why work with Worldwide Formations?
What is a Dubai e-trader licence?
All businesses in Dubai require a licence to trade, and e-traders are no different. The licence enables e-traders – who usually work at home – to run their business online in Dubai.
The e-trader licence has been a requirement since 2017 when it was introduced by the Department of Economic Development. It was brought in to regulate online businesses in Dubai, and to give confidence to customers that e-traders are legitimate and can be trusted.
It has particular benefits for sole traders that don’t require premises from which to run their operation. People who are resident in Dubai and the wider UAE and GCC citizens can apply for the licence.
What is required for an e-trader licence?
As with all licences in Dubai, to acquire an e-trader licence there are various conditions that must be satisfied. These include being at least 21 years of age, having registered online with the Department of Economic Development, and having an Emirates ID – this is to certify that they are a resident in Dubai or a GCC citizen. GCC citizens can also use a copy of their passport.
Dubai e-trader licence for expats
As only those who live in Dubai or are GCC citizens can hold an e-trader licence, expats must have gained their Dubai residence visa before making an application for it.
Applying for a residence visa is usually a process completed by an employer or owning a business. It can also be applied for by being sponsored by a parent or spouse.
However, as soon as a visa has been granted, you can apply for an e-trader licence.
Benefits of an e-trader licence
There are numerous benefits of holding an e-trader licence. Firstly, it means your trading name can be registered and therefore protected – in Dubai, two businesses are not allowed the same name, they must be unique.
The licence also means traders can upload, sample and promote what they are selling.
It also means that the business can trade online and doesn’t require premises – which is a relief for those setting up a business with limited capital. Some enterprises are suited to an online platform as they can be run from a home office.
Having the licence also means it is easier to register for and join in with training sessions and other activities run by the Department for Economic Development. These can be useful for networking with other businesspeople and gaining skills that could be important in the future.
For customers, it also makes things more convenient as it makes it easier to search for and find your business whether through social media or a search engine.
Having the licence also gives customers reassurance that, if they buy a product or service from you, they are buying from a legitimate business and not a fraudster who may be running a scam or selling fake goods. Building up trust with customers is vital for building ongoing trading relationships, and the licence is a good first step on that road.
Who applies for the e-trader licence
There are entrepreneurs in various sectors for whom the e-trader licence is particularly pertinent. For instance, those who work out of their own homes as virtual assistants or perhaps selling craftwork via their websites.
Similarly, freelancers in fields such as journalism and/or content creation, marketing and public relations or website design, can benefit from the e-trader licence as it enables them to use online marketplaces as well as social media to connect with people who may want to commission them for specific tasks or ongoing work.
As mentioned, startup businesses that are formed with little initial investment from the founder and are operating virtually – perhaps with a view to setting up physical premises at some point in the future, when a sales concept has been proven – can also benefit from the e-trader licence.
In a similar vein, entrepreneurs who sell more online than physically may prefer to take an e-trader licence – anyone from recruitment consultants to e-retailers.
It is important to note than an e-trader licence just covers the entrepreneur who makes the application and nobody else.
How to apply for an e-trader licence
There is a set process that people who want to gain a Dubai e-trader licence have to go through. The licence can be applied for at www.dedtrader.ae. New users of the site will have to undertake an initial registration process, which takes a few minutes. Those with existing accounts can simply log in. You can log in here with a UAE pass, which means presenting your fingerprint.
Following this, you need to input your Emirates ID number, along with an email address or mobile telephone number.
The next step is to pay the AED 1,070 fee for the e-trader licence, which must be settled within 24 hours of the Department of Economic Development sending the form to you. If the fee isn’t paid, approval is withdrawn. In addition to the main fee, AED 300 has to be paid to the Dubai Chamber of Commerce.
After the payments have been made, the applicant has to input data about the websites and social media apps that they plan to use to trade on.
If this is all accurate, a verification will be sent to you some minutes later.
When this is complete, and all supporting documentation has been submitted with it, the Department of Economic Development will check your application and verify it (or not). If it is successful, your e-trader licence will be sent to you in about three to five working days.
Why work with Worldwide Formations?
As this article has shown, applying for an e-trader licence has some complexities, which can trip up an entrepreneur who is not familiar with the regulations. Therefore, company formation specialists such as Worldwide Formations can be crucial to entrepreneurs in helping them to apply for the licence successfully first time.
Worldwide Formations’ team has been involved in setting up businesses for many years in the UAE and can negotiate the complexities of licence regulations with skill to allow an entrepreneur to focus on ensuring the business is ready to trade and make money from the off.
To find out more and to receive a personalised quote, please contact Worldwide Formations today.