One of the key early steps in starting a business in the UAE is aligning your activities with the licenses on offer.
In most cases, this may seem like common sense. But with thousands of activities to choose from, it usually requires an expert eye.
Activities are generally split into several key categories – commercial, professional, and industrial – though other license types are available.
The one I am going to cover today, industrial, is often referred to as the manufacturing license. This is because all activities under this license concern the production, fabrication or assembly of goods.
Essentially, if you are intending to transform parts or raw materials into a finished product, you will require an industrial – or manufacturing – license to do so.
With the right guidance, applying for a manufacturing license in Dubai can be quick and painless. The following guide details the UAE manufacturing license requirements as well as the process involved in obtaining one.
Manufacturing license sectors in Dubai or in the UAE
Dubai and its neighbouring emirates are home to many thriving manufacturing industries, covering the production of a wide range of goods. Sectors include:
- Auto parts
- Casting of metals
- And many more
How to apply for a UAE manufacturing license
There are a few administrative tasks to take care of before applying for your UAE manufacturing license.
The first is to choose your company name. This process takes on more importance here in Dubai than elsewhere. That’s because as well as the need for a name that’s catchy and captures the essence of your business, you’ll also need to stick to the UAE’s clearly defined naming conventions.
In short, UAE company names must not contain any blasphemous or offensive language, any references to well-known institutions or any abbreviations of your name – though your full name is acceptable.
Your name should also have a legal entity attached to it such as FZE or LLC. It must also relate to your business activity, not resemble the name of any other company, and be available to register.
You’ll also need to clearly outline your business activities. Manufacturing is not enough. You must specify the type of manufacturing you intend to undertake.
Your activity or activities must be chosen from a pre-determined list. It’s important that you list every activity that applies to your business when making your application as failure to do so can lead to fines or even license revocation.
Once these steps are complete, you can start the process of applying for your manufacturing license in Dubai, or elsewhere in the UAE.
The first step is to gain approval to build or operate a factory. This must be obtained from your local municipality.
Once you have this, you can apply for your license. If you are setting up in the UAE mainland, you should make your application to the Dubai Department of Economic Development (DED) or the equivalent in your emirate.
If you’ve chosen a free zone setup, you should apply directly to the managing authority of your chosen free zone.
In both cases, you are usually required to submit several documents along with your application form, including:
- A copy of your passport – and that of any other shareholders
- Your business plan
- A copy of your signature
- A No Objection Certificate from your current employer (if applicable)
When setting up in the mainland, you’ll also require approvals from the Chamber of Commerce and Industry, Ministry of Health, Ministry of Environment and Water Approval, Ministry of Interior Approval and other government bodies.
This is not required when setting up in a free zone and is one reason why, as well as being the most cost-effective option, free zone incorporation is often the simplest solution for most businesses.
If approved, licenses are usually issued within two weeks.
What are the requirements to get a manufacturing license in Dubai?
There are several requirements for all manufacturing businesses in Dubai and the UAE.
To be eligible for a license, you must have a physical premises, not a virtual office. You must have at least AED 250,000 in capital and you must employ at least 10 people.
You are also required to produce a report detailing the specifics of your factory, including floorplans, tools and financing information. If you are setting up in a free zone and using an existing factory, this step is not necessary.
You must also conduct a feasibility study into your business proposition.
Manufacturing license in Dubai – cost
There are numerous costs involved in starting a manufacturing business. As well as the cost of materials, tools, premises and workforce, you’ll also need to consider visas, approvals and licenses.
The most cost-effective way to get set up is to incorporate your business in a UAE free zone. By doing so, you remove the costs of additional approvals and can usually make use of tools and premises at much lower rates than in the mainland.
To obtain your UAE manufacturing license, you should expect to pay in the region of AED 15,000 to AED 50,000. In some cases, this will include the visa eligibility and the use of premises.
The best way to ascertain the costs involved in starting your business is to talk to a company setup expert who can provide you with a quote based on your specific requirements.
Setting up a manufacturing business in Dubai, UAE
By following the steps above, it is possible to obtain your trade manufacturing license in Dubai, UAE.
However, it is always advisable to undertake the steps with the assistance of a registered company formation agent to eliminate any potential hassles that might arise.
With more than 15 years of experience in company incorporation, Worldwide Formations can help you get your business up and running within a week or two. We’ll manage your license and visa application and correspond with all relevant authorities for you. All you need to do is wait for the green light to start trading.