Overview

Whether you're shopping for personal use or for business, online shopping has become an integral part of our daily lives. With the rise of e-commerce enterprises that are quickly capitalising on today's increasing number of online buyers, this reality will become even more apparent in the future years.

In Dubai, UAE, there has been an increase in the demand for e-commerce licenses. According to the joint report ‘UAE eCommerce Landscape' published by Dubai Economy and VISA, the United Arab Emirates, which has the most advanced e-commerce sector in the entire MENA region, is on track to reach a stunning US$16 billion (AED 59 billion) in e-commerce transactions in 2019.

Several reasons, notably the rise of start-ups and tech-savvy consumers in the UAE, have contributed to the country's worldwide e-commerce positioning. More importantly, the UAE government is playing a key role in today's smart transactions between businesses and consumers by developing cashless payment choices for a variety of purchases and government services.

The procedure of obtaining an e-commerce license in Dubai (also known as an online business license) is both affordable and straightforward.

E Commerce License in Dubai, UAE

An E-commerce license allows you to conduct business over the internet with the help of a valid license. A typical firm may be run effectively and has a physical framework.

It will also cover the only little marketplace with a limited supply of commodities, resulting in a small profit or revenue. E-commerce license is a trading or exchange license that functions similarly to a physical business but is accomplished and carried out with the aid and support of the internet.

As previously said, the customer and seller are the main causes of this industry. They use the internet to exchange money and goods. This is why the company is referred to as an internet company. This business likewise necessitates the same licencing as other legitimate businesses.

Dubai Online Business License

E-commerce is a legitimate business, however it is conducted solely through the internet, as opposed to traditional business, which is conducted exclusively physically and has a physical structure.

Normal business only covers a small region and generates a tiny profit. However, an e-commerce business allows you to connect with people all over the world while also providing you with a substantial profit. With the use of the internet, the general population is now able to connect globally.

Changing Perceptions Towards Online Shopping & Ecommerce in Dubai

Due to the increased need for online shopping, obtaining an ecommerce license in the UAE is a potential business investment opportunity that will result in rapid market expansion. Customers' attitudes on online shopping and e-commerce are shifting, and more people are willing to experiment with online shopping possibilities.

Consumers are increasingly trusting internet buying platforms as the globe becomes more linked. In the future years, consumer spending on online retail platforms is likely to increase significantly. According to projections, eCommerce transactions in the UAE are predicted to reach AED 59 billion in 2019 and to expand at a rate of 23% annually between 2018 and 2022.

Dubai Economy Provides an E-commerce License

An Ecommerce License in Dubai will allow a corporation to sell goods over the internet and collect online payments in exchange for the sale of those goods. Depending on the company's business plan and sort of business, the scope of an Ecommerce firm can be expanded to foreign markets and varied categories.

One of the most appealing features of a Dubai Economy Ecommerce License is the ability to rent office space anywhere on the UAE mainland. A Dubai Economy E-commerce License will also allow the investor to rent a warehouse anywhere on Dubai's mainland to store items for e-commerce sales. However, in order for a foreign investor to receive an e-commerce license from the Dubai Economy, the appointment of a Local Service Agent for a yearly charge is required.

The Benefits of an E-commerce Company in the Dubai Mainland

• The investor can store products in a warehouse and sell them online in the UAE market with an Ecommerce License.
• In addition to the e-commerce license, the investor has the option of getting a general trade license. As a result, the opportunities for selling in the UAE, both digitally and physically, are expanding.
• As part of the VAT Law, all transactions in the UAE will be subject to a 5% VAT.
• Imports of products to be sold in the UAE will be subject to a 5% Customs Duty at the seaport or airport, depending on the mode of transport.
• On Dubai's mainland, a low-cost office setup is accessible. Low-cost warehouse and storage options are also available.
• For door-to-door delivery, logistics support and distribution agents are readily available.
• Additional freedom to grow into a full-fledged business by hiring more people and expanding the scope of the existing e-commerce license.

Dubai Free Zones Ecommerce License

For overseas investors, an Ecommerce License from Dubai's Free Zones is a cost-effective solution. Dubai's free zones provide investors with a plethora of business perks, including 100 percent foreign ownership, 100 percent profit repatriation, no customs duty, ease of business setup, convenient access to airports and seaports, and more.

Key Highlights of the Ecommerce License in Dubai Free Zones

• One of the most significant benefits of an e-commerce license from the Free zone is the ability to choose a virtual license rather than a physical license.
• A free zone e-commerce license package is an excellent choice for start-ups, freelancers, or entrepreneurs looking to test the market and begin their entrepreneurial adventure.
• In addition, the majority of the UAE's free zones provide tailored warehouse facilities to hold your goods and simplify trading.
• Customs duties are waived for Free Zone companies when they import goods into the zone.
• In addition, a number of Dubai's Free Zones have in-house Customs inspections, which aids in the speedier passage of goods into and out of the Free Zones.

Contact our team to learn more about the E-commerce License in Dubai Free Zones.

How can I get a Dubai E-Commerce License?

Factors such as rising internet usage, a favourable tax environment, and so on, operating an e-commerce business in the UAE can be beneficial. Starting an e-commerce firm in the UAE might be beneficial due to the growing number of internet savvy people. Follow the steps outlined below to obtain an e-commerce license.

Decide on your Company's Legal Structure

The first stage in obtaining an e-commerce license in Dubai is to determine your company's legal structure. To put it another way, whether to form an LLC (Limited Liability Firm), a one-person business, a branch of a parent company, a representative office, and so on. The formation of limited liability companies (LLCs) and branch offices are the most frequent in Dubai since they offer a number of benefits.

Decide on a Jurisdiction

The location refers to the location from whence you will obtain your license, not the site where you will open a shop or office. There are two types of zones in Dubai: (1) the Free Zone and (2) the Mainland. In a free zone, you have complete control over your business. In the case of the mainland, you must have a local sponsor who owns at least 51 percent of the company, with the remainder being your share. Similarly, both zones have their own set of benefits and drawbacks. You must weigh all of the aspects before deciding where to start your online business.

Trade Name Registration

Because your company has no physical location, use a name that people will remember quickly. People will be able to readily find your firm online if you utilise the trade name as your domain name. Make sure your domain name does not sound similar to that of another company, as this could lead to legal issues.

Submit an Application for a License

After you've decided on a location, you'll need to get an e-commerce license. Because this license is issued by the Department of Economic Development, it is critical to contact them first. For a corporation based on the mainland, the DED charges roughly AED 10,000 for trade name registration, first approval, and license issue. If you want to open a business in a free zone, you must first obtain a license from the applicable freezone authorities. The type of license you will receive is determined by the nature of your internet business.

Submit an application for an Initial Approval Certificate

A NOC from the authority to establish an e-commerce firm in Dubai is known as an Initial Approval Certificate. It is only valid for 6 months and cannot be renewed. When filing a trade name approval application, one can also apply for an initial approval certificate.

Create a Memorandum of Agreement and a Local Service Agent Agreement

You must draught and submit a Memorandum of Association (MOA) with the sponsor to the DED. If you want your company to be located on the mainland, you must complete this step. Any law firm can type the memorandum, which must include the particular arrangements and ownership percentages for all partners. This phase can be skipped by businesses establishing themselves in a free zone.

Register for a physical office in Dubai

The next stage would be to open an actual office in Dubai, as the Dubai authorities have made it necessary for a firm to have a physical location in order to be considered a legal entity.

Approval of the License in its Final Form

You will receive a business license within 1-7 days after completing all of the aforementioned steps, depending on the government.

Requirements for Import & Export

To get an importer's code, your company must be registered with one of the ports and customs administrations. Imported items are subject to a 5% customs levy in the UAE. Companies operating within a free zone will not be subject to import duties because they must sell their goods or services within the free zone.

Getting a Business Bank Account

You will be able to open a corporate bank account once you have successfully applied for an e-commerce trade license and established your business. Because the application process is short and easy, all you have to do now is decide which bank best meets your needs.

Benefits of Getting a Dubai E-Commerce License

The following are some of the benefits of obtaining an eCommerce license in Dubai:

• Repatriation of capital and income autonomy
• There are no limits on currencies.
• In the free zones, there is 100 percent foreign ownership.
• There is no business or personal tax.
• Operating costs are low.
• On an e-commerce license, there are no import duties.
• A three-year resident visa has been approved.

Support from Dhanguard

Distribution & Logistics

Logistics and distribution are one of the most important business components of online shopping organisations. It's critical to have your products stored in warehouses and to have them available for sale on a timely basis. As a result, fast logistics and delivery of the supplied goods to the client is critical. Choosing the right warehouse and distribution network is therefore critical for success in the online retail arena.

Website & Mobile Application

A comprehensive website with detailed product listings, a clear layout, and an easy checkout process must be established to extend the market base and get more audience. A smartphone app for e-commerce buying is also a must-have, given that mobile adoption is at an all-time high.

How can Dhanguard help you?

We'll find the best business formation bundle for you. Get expert advice on forming the correct e-commerce firm, including selecting the appropriate business jurisdiction, business activity, office type, and supporting services.

Set up your dream e-commerce business in the simplest method possible! To learn more, contact one of our skilled business consultants.