Are you thinking about starting an industrial business in Dubai or the United Arab Emirates (UAE)? If so, getting an industrial license is required for manufacturing and industrial firms that create semi-manufactured or fully-manufactured goods. In this comprehensive guide, we will walk you through the process of obtaining an industrial license in Dubai, the requirements, benefits, and everything you need to know to successfully establish your industrial business.
Industrial License in Dubai: An Overview
Dubai’s strategic geographical location, superior logistics, and well-organized infrastructure make it an ideal hub for industrial growth. The city connects the east to the west, making it a trading powerhouse. To create an industrial concern in Dubai or the UAE, it is essential to get an Industrial License. This license permits enterprises to carry out operations such as manufacturing, segregation, collecting, and packaging. The license is issued by the Department of Economic Development (DED) Dubai, but it also requires permission from the Dubai Municipality and other necessary agencies.
Understanding the Industrial License in Dubai, UAE
An Industrial License is required for the production or manufacturing of goods or commodities in an industrial setting. It entails the transition of raw materials or natural resources from their crude to refined condition. This transformation can be achieved through manual or mechanical intervention, resulting in semi-manufactured or fully-manufactured products. The Industrial License is issued by Dubai’s Department of Economic Development (DED), however clearance from other external organizations and ministries may also be necessary. It’s worth mentioning that having a physical warehouse in the UAE is a prerequisite for acquiring an industrial license.
How to Obtain an Industrial License in Dubai, UAE
The steps to obtain an industrial license in Dubai, UAE are:
- Initial Approval: Before setting up an industrial concern or making any alterations to an existing factory, obtaining initial approval from the concerned authorities is necessary.
- Application Submission: After receiving initial approval, you can proceed to submit your application for the Industrial License to the Department of Economic Development (DED).
- Processing Time: The processing time for the license application is approximately three months, during which the DED reviews the application and makes a decision.
- Application Approval: Once the decision has been made, you will receive an Application Approval notification from the DED within 15 days.
- Municipality Permissions: If your project involves construction or any physical alterations, you need to obtain prior permission from the Dubai Municipality.
- Additional Approvals: Depending on your industry, you may need to obtain approvals from other agencies and ministries, such as the Ministry of Health or Chamber of Commerce and Industry.
- Final Approval: If all requirements and documents are in order, the final approval for the Industrial License will be issued within two weeks.
Activities Covered by the Industrial License in Dubai, UAE
The Industrial License covers a wide range of activities related to manufacturing and production. Some of the major activities that fall under the purview of the Industrial License include:
- Manufacturing of textiles
- Paper manufacture
- Petroleum manufacturing of products
- Metal Molding
- Food production
- Manufacturing equipment and appliances.
Requirements for Obtaining an Industrial License in Dubai, UAE
Before applying for an Industrial License in Dubai, there are certain prerequisites that need to be fulfilled. These include:
- 51% Sponsor Share: Finding a local sponsor who holds a 51% share in the company is a mandatory requirement.
- Local License: A local industrial license, provided by the region of activity, is required for industrial enterprises.
- Office and Warehouse: Having a physical office space and warehouse in Dubai is mandatory for obtaining an Industrial License. Virtual offices do not fulfill this requirement.
- Employees: A minimum of 10 employees or workers is mandatory for industrial businesses.
- Capital Investment: A minimum capital investment of AED 250,000 must be allocated for the company. Additionally, specific machine specifications may be required.
Documents Required to get a Industrial License in Dubai, UAE
The documents required to get a industrial license in Dubai, UAE are:
- Detailed Report: A thorough report documenting the factory or industry, including the company plan, objectives, production equipment, manufacturing expenses, capital expenditure, and financing sources. Additionally, non-citizens are required to submit residence and passport copies.
- Feasibility Study: A feasibility study outlining the viability and profitability of the proposed industrial project.
- Partnership Contract: In the case of partnership firms, a partnership contract is required.
- Approvals from Relevant Authorities: Approvals from the Ministry of Health, the Ministry of Environment and Water, the National Media Council, and other relevant ministries and organizations are required.
- Copy of Balance Sheet: A copy of the balance sheet is required for financial verification.
Benefits of Holding an Industrial License in Dubai, UAE
Some of the benefits of holding an industrial license in Dubai, UAE are:
- Exclusive Rent Terms: Industrial businesses enjoy specially formulated terms for renting industrial spaces, providing financial benefits to investors.
- Land Allocation: The government may provide land at subsidized rates or free of cost for establishing industrial businesses.
- Utility Discounts: Industrial businesses are eligible for discounted rates on electricity, water, and other essential utilities.
- Guidance and Support: Industries receive guidance based on the modus operandi of similar industries, enhancing their operations and competitiveness.
- Financial Support: Innovative products can receive loans at reduced rates, and industries contributing to the national economy may receive financial support during research and development.
- Government Procurement Preference: The UAE government prioritizes high-quality products throughout official procurement processes.
Cost of Obtaining an Industrial License in Dubai, UAE
The cost of acquiring an Industrial License in Dubai is determined by a number of criteria, including whether your firm is located on the mainland or in a free zone. Furthermore, the kind of industry and any additional certifications or registrations necessary might affect the total cost. The average cost of acquiring an Industrial License in Dubai is around AED 25,000. However, it is critical to remain current on any changes to existing pricing guidelines, as costs may fluctuate over time. Starting an industry in a Free Zone jurisdiction might be more cost-effective due to cheaper establishment fees and other associated expenditures.
Conclusion
Obtaining an Industrial License in Dubai is an important step toward starting a manufacturing or industrial firm in the city. This comprehensive guide has given you a thorough overview of the procedure, requirements, advantages, and duties connected with acquiring an Industrial License. As Dubai’s industrial sector expands and thrives, this license provides chances for firms to contribute to the city’s economic growth. Seek expert assistance and consider collaborating with experienced specialists to ensure a smooth procedure and maximize the benefits of an Industrial License in Dubai.
