Thinking about setting up an import export business in Dubai? Dubai trade statistics from 2020 show that the total value of imports, exports, and re-exports in the United Arab Emirates totalled a whopping $1.182 trillion AED.
Clearly, Dubai is a great place to start and grow these types of trade businesses. It is, after all, a well-developed city with plenty of commercial opportunities. However, is it as easy to set up a business in the UAE as it seems?
Honestly, kind of, as long as you have the help of experienced experts in Dubai company formation. Outlined here are the benefits and hurdles of setting up a successful trading business in Dubai and across the UAE.
Starting an Import Export Business in Dubai
Dubai is a city with a long history of trade and commerce. For centuries, merchants from across the globe have flocked to its bustling souks and markets in search of goods from all corners of the world.
Today, Dubai continues to be a major trade hub for businesses. Thanks to its strategic location at the crossroads of East and West, Dubai is uniquely positioned to facilitate import export trade between the two regions.
Moreover, the UAE offers a number of significant advantages for businesses, including a favourable tax regime, a pro-business culture, and a growing population of consumers with high disposable incomes.
Did your ears perk up regarding the favourable tax situation in Dubai? It’s a massive plus. Corporations are taxed at 0% (yes, zero) on income up to AED 375,000 just 9% on income above AED 375,000.
Entrepreneurs looking to trade in Dubai also enjoy well-developed infrastructure. This makes the region perfect for business activity in the UAE and beyond. With a modern airport and seaport that accommodates large shipments, trading activities have never been easier.
The UAE Economy Depends on Trade Activities
The UAE has a strong economy with many business opportunities arising for entrepreneurs in the region. As such, there’s now a strong demand for imported goods in Dubai.
This is particularly true as climate change becomes more and more of a concern. The United States Foreign Agriculture Service reported in January of 2022 that due to climate issues causing water shortages, the Middle East relies on foreign imports to meet nearly 90% of its food needs.
The same study also found that throughout the UAE, 34% of consumers are willing to pay premium prices in order to purchase their favourite brands. Import export trading activities from the United Kingdom and the United States are in high demand as a result.
Here’s your guide to establishing a Dubai import export company:
Register Your Dubai Business
Before you can conduct any import export business activities, you need to register your Dubai business.
Here, we suggest that you consult the services of business setup consultants in the UAE. They are experts in the field of establishing businesses and can help you understand your options. For example, learning about different corporate structures is incredibly important. Do you know what a limited liability company (LLC) is? And what about the difference between an LLC vs. sole proprietorship in Dubai.
Once you have your business idea, company structure and your commercial and trade licenses, you can then begin the application process.
The first step is to fill out an online application form. You will need to provide basic information about your business, such as its name and address. You will also need to upload some documents, such as your commercial license and registration papers.
Once your application is complete, you will submit it to the Dubai Department of Economic Development for review.
If everything is in order, you will be issued your UAE import-export business license within a few weeks. With your license in hand, you can soon begin trading.
Acquire An Import Export License in Dubai
Now, if you want to set up an import export business in Dubai, you’ll need to obtain a trading license from the Dubai Chamber of Commerce and Industry. The typical cost of an import export license depends on the type of business activity you undertake.
Generally, the cost of an import export business license is around AED 2,000. On top of the license fee, businesses are required to pay an annual registration fee of AED 1,000.
Consider Renting an Office Space or Flexi-Desk
Once you pay the license and registration fees, you will likely need to obtain physical office space in Dubai. The cost of renting office space can vary widely but is typically around AED 5,000 per month.
Another alternative is a Flexi-desk option, which suits many new business owners and negates the need for a large office space.
Obtain a Trade License
Before you start operating a Dubai business, you’ll need to obtain a trade license from the Department of Economic Development. The cost of the trade license depends on the type of business, but is typically around AED 3,000. Firstly, complete an application form and submit to the Department of Economic Development. You can typically download this from their website or ask for a copy of the form in-office.
Next, you will need to provide proof of your trade license from the Dubai Chamber of Commerce and Industry. Once you have these two documents, you will then need to provide a letter of guarantee from a bank in Dubai.
Lastly, submit a copy of your passport and UAE residence visa. Once you have all of these documents, you will be able to apply for a trade license and embark on your business activities in Dubai.
Understand Important Dubai Customs Requirements
Before celebrating, we suggest that you consider Dubai customs requirements that might apply to your business.
International import and export trade opportunities in Dubai are ample and varied. However, it’s important to be aware of specific Dubai customs requirements of both the UAE and the country of origin of the goods being shipped.
Generally, all imported goods must be declared to UAE Customs, and relevant taxes and duties will be applied. There may also be additional requirements for specific types of goods, such as food products, beauty products or pharmaceuticals.
It is also important to be aware of the import and export regulations of the destination country. These regulations can vary significantly from those of the UAE. In addition, you’ll need to be aware of related tariffs and other taxes that may apply to your products.
Failure to comply with customs regulations in the UAE can result in delays, fines, or even seizure of goods. Therefore, it is essential to conduct careful research and consult with company formation experts before beginning your business setup process.
Don’t Forget About a Visa
If you want to trade goods in Dubai, you will need to obtain a visa. The UAE has strict laws regarding the transportation and trade of goods, and a visa is required for all shipments.
There are two types of visas available: a transit visa and an import-export visa. A transit visa is valid for 14 days and an import-export visa is valid for 30 days. Both visas allow you to transport goods within their respective time period.
However, if you plan to live and work permanently (or even semi-permanently) in the UAE, a residence visa is a better choice.
To apply for a visa, you will need to submit an application form, emirates ID, passport photos, and a copy of your passport. You can apply for a visa online or at a UAE consulate. If you are applying for a transit visa, you will also need to provide a copy of your travel itinerary.
The processing time for visas varies, but it generally takes about 2-3 weeks to receive a decision. Once your visa is approved, you will be able to pick up your shipment at the port of entry in Dubai.
Work With the #1 UAE Business Solutions Experts
Trading in Dubai can be a daunting task. With the help of the #1 UAE business solutions experts, you can be up and running in no time.
As company formation specialists, we’ll help you navigate the process of setting up a company in Dubai. With our expert guidance, you can focus on what’s important — running your new business and achieving your goals.
Contact us today to learn more about how we can help you start a profitable import and export company in Dubai.