Establishing a company in Dubai is a strategic move that places your business at the crossroads of global trade.

However, the first and most critical decision an entrepreneur faces is selecting the correct business license.

In Dubai, your license type doesn’t just define what you do; it dictates your legal structure, visa eligibility, and even where you can rent office space.

As we navigate the 2025 regulatory landscape, this guide provides an expert breakdown of the main business license categories in Dubai, incorporating the latest cost data from the Department of Economy and Tourism (DET) and leading free zone authorities like DMCC, JAFZA, and IFZA.

The Professional License (Services & Consultancy)

The Professional License is designed for individuals and companies that provide services based on intellectual or specialized skills.¹ This is the preferred route for consultants, IT specialists, designers, and artisans.

• Key Advantage: Traditionally, a professional license on the mainland allowed 100% foreign ownership long before the 2021 Commercial Companies Law updates, provided a Local Service Agent (LSA) was appointed.

• Common Activities: Management Consulting, IT Services, Legal Services, Marketing, and Healthcare.

• 2025 Cost Estimate (First Year):

  • Mainland: AED 12,000 – AED 25,000 (Excluding office rent).

  • Free Zone (e.g., IFZA or Meydan): AED 12,900 – AED 18,000 (Package inclusive of flexi-desk).

 

The Commercial License (Trading)

The Commercial License (often referred to as a Trade License) is the backbone of Dubai’s economy. It is mandatory for any business involved in the buying and selling of goods, including import, export, retail, and wholesale.

• Key Insight: If you plan to trade in multiple unrelated product categories (e.g., electronics and garments), you will require a General Trading License, which carries a higher premium and stricter audit requirements.

• Common Activities: General Trading, E-commerce, Real Estate Brokerage, and Retail.

• 2025 Cost Estimate (First Year):

  • Mainland: AED 15,000 – AED 35,000.

  • Free Zone (e.g., Dubai South): Starts at AED 12,000 (Zero-visa package).

  • Premium Zone (DMCC): Approx. AED 20,265 (License only).

 

The Industrial License (Manufacturing)

The Industrial License is required for businesses engaged in manufacturing, production, or manual processing.⁵ This category is strictly regulated and requires a physical warehouse or factory.

• Regulatory Requirement: You must obtain external approvals from the Ministry of Industry and Advanced Technology (MoIAT) and the Dubai Municipality (Environment and Health departments).

• Common Activities: Food production, textile manufacturing, chemical processing, and metal works.

• 2025 Cost Estimate (First Year):

  • Setup Costs: AED 25,000 – AED 120,000 (Highly dependent on facility size and utility requirements).

  • Government Approvals: Budget AED 5,000 – AED 10,000 for external permits.

2025 Comparative Cost Breakdown: Dubai Free Zones

For international investors, Free Zones offer the most streamlined path to setup.

Below is a comparison of entry-level costs for 2025:

 

Free Zone Authority	License Category	Est. Starting Cost (AED)	Value Proposition
Meydan Free Zone	Service / Trading	AED 12,500	“Fawri” 60-minute instant license issuance.
IFZA	Professional / Trade	AED 12,900	High flexibility, no physical office required.
DMCC	General Trading	AED 20,000+	Global hub for gold, diamonds, and crypto.
Dubai South	Logistics / E-comm	AED 12,000	Proximity to Al Maktoum Airport and Expo City.
JAFZA	Industrial	AED 15,000+	Best for heavy industry and sea-logistics.

Hidden Costs: What Entrepreneurs Often Overlook

When budgeting for a “Dubai trade license,” the sticker price is rarely the final cost.

Expert setups account for these often-hidden line items:

1. Establishment Card (Immigration): AED 1,800 – AED 2,500 annually. This is required before you can apply for any visas.

2. E-Channel Registration: Approx. AED 5,000 (Year 1) / AED 1,000 (Renewal). This is the digital system for managing UAE visas.

3. VAT & Corporate Tax Compliance: While many free zones offer 0% tax, the 2025 regulations require Corporate Tax Registration for all entities. Failure to register can result in an AED 10,000 fine.

4. Visa Security Deposits: Many free zones require a refundable deposit (AED 2,000 – AED 3,500 per visa).

5. Document Attestation: Expect to pay AED 500 – AED 1,500 for notarizing MOAs or educational certificates.

Practical Guidance: Choosing Your Jurisdiction

• Mainland (DET): Choose this if you want to sell directly to the UAE local market or bid for government contracts. You will need a physical office (Ejari) and may face higher initial fees but benefit from unlimited visa quotas based on office size.

• Free Zone: Choose this for 100% foreign ownership, 0% personal/corporate tax (on qualifying income), and simplified customs. Note that you generally cannot trade directly on the mainland without a local distributor or a Dual License (available in some zones like Abu Dhabi or Dubai South).

 

2025 Market Update: The “One Free Zone Passport”

A significant update for 2025 is the expansion of the One Free Zone Passport initiative.

This allows businesses registered in one Dubai free zone to operate in others without a second license, drastically reducing the cost for companies needing multi-hub logistics or specialized tech clusters.

Summary Checklist for 2025 Setup

1. Define Activity: Check the DET or Free Zone activity list (over 2,100 options).

2. Select Jurisdiction: Balance the initial cost vs. market access requirements.

3. Reserve Trade Name: Costs approx. AED 600 – AED 1,000.

4. Secure Initial Approval: This is your “green light” to begin leasing.

5. Sign Lease: Whether a flexi-desk or warehouse, your license won’t be issued without a registered address.

6. Open Corporate Bank Account: Budget 4–8 weeks for this step; many banks require a minimum balance of AED 50,000 – AED 100,000.

Disclaimer: Cost figures provided are estimates based on current 2025 market data and are subject to change by relevant government authorities. Always consult with a licensed business setup consultant like next generation advisors for a tailored quote.