Abu Dhabi has made it compulsory for every business and organization to own a trade license. Just like anywhere else in the world, a trade license in Abu Dhabi also requires annual renewal to avoid problems such as penalties, banning of business, or other serious issues. The process of trade license renewal Abu Dhabi is supervised by the Department of Economic Development (DED), which has kept it pretty straightforward but with a lot of documentation.
So, here’s a brief guide explaining everything you need to know about the trade license renewal procedure, including the types of licenses issued to businesses in Abu Dhabi.
Trade licenses in Abu Dhabi
The DED has classified business activities under three categories of licenses, namely –
- Commercial license – Covers trading activities related to health, real estate, contracting, and commerce in general.
- Industrial license – Covers manufacturing and industrial activities
- Professional license – Covers professional activities that include deliverance of intellectual expertise and specialized services
The validity of all the above licenses is one year from the date of issuance, and the business owners must ensure to renew it on time to avoid any disruptions to their business operations.
Essential requirements for trade license renewal Abu Dhabi
Businesses operating in Abu Dhabi are required to renew their trade license every year. The application for DED license renewal needs to be submitted 30 days before the actual expiry. Any failure or negligence may result in a late fee of AED 200 per month.
Apparently, there are a few essential requirements for the DED license renewal process. These are –
- Ejari registration – The business owner must possess a registration certificate from Ejari for renewal of the license. The absence of an Ejari-approved tenancy certificate can lead to fine imposition.
- Tenancy contract – A tenancy contract is mandatory for trade license renewal Abu Dhabi. However, the business owners must ensure that it has a validity of one month or more. An invalid contract can lead to the rejection of the renewal request under legal obligations.
- Original trade license – The business owners must present a copy of their old trade license to get it renewed. A trade license allows them to carry out their business activities legally in the UAE.
- BR/1 form – The BR/1 form is a license renewal form. The business owners must fill out a BR/1 form with the signature of existing partners and submit it to the DED for approval, along with other supporting documents.
- Passport copy – The stakeholders involved in the business are required to present their passport copies to the licensing authorities.
The business owner needs to submit these documents to the DED along with the renewal form. They can choose to apply either online or offline, at their convenience. Nevertheless, the regulatory procedures and evaluations would be performed by the governing bodies irrespective of the application method.
Guide to Trade License Renewal Abu Dhabi
An expired trade license can cause problems for your business. Therefore, you need to renew it regularly to ensure compliance with the corporate laws and regulatory standards of the UAE. Here’s how you can proceed –
Check your tenancy contract
The tenancy contract is vital for the license renewal process, The company owners must make sure it is valid for not less than three months from the expiry of the license. However, if the date of expiry is less than the validity of the tenancy contract, the owner must renew the latter before proceeding with the trade license renewal Abu Dhabi. Also, make sure you have an Ejari for your tenancy contract before presenting it to the authorities.
Acquire third-party approvals
Certain activities may require prior approval from third-party authorities before the license renewal. For example, approval from the Department of Food Safety for a food business or the UAE Road and Transport Authority approval for transportation and logistics activities. Also, note that these approvals may involve a specific fee to obtain NOCs from specific departments to present before the DED.
Submit the application
Assemble the mandatory documents such as the tenancy contract / Ejari, the third-party approval/NOC, a copy of the old trade license, etc., and submit them to the relevant department. Abu Dhabi offers different application methods for license renewal – Online and Offline. The company owners can choose according to their convenience.
Get the payment voucher from DED
Once the renewal request is approved by the DED, it will issue a payment voucher that needs to be properly safeguarded. The applicant would need this later to pay the Abu Dhabi trade license renewal fees and obtain their renewed license from the authorities.
Read also: Ways Small Business Payment Processing Can Improve Your Customer Experience
Pay the renewal fee
Once you receive the voucher, proceed to the payment procedure. Make the payment and get the renewed license instantly from the authorities or from the online channel. Now, you can continue with your business operations in Abu Dhabi without any difficulty.
Conditions for Trade License Renewal Abu Dhabi
There are some conditions that need to be considered while renewing a business license in Abu Dhabi. Let’s have a look at them –
For renewing offline:-
- If the expiry date is more than three months, then the company owner must approach the Inspection Division in the Department of Economic Development.
- The renewal application should be submitted by the business owner or a legally authorized representative.
- If the license is for a subsidiary, the license copy of the parent company needs to be attached to the renewal form.
- If the subsidiary belongs to a foreign company, then the Ministry of Economy shall renew the license.
For renewing online:-
- The necessary documents need to be submitted in PDF format.
- The copies of the documents should be in a clear and correct format.
- The average size of documents must not be more than 70 Kbytes, and each shall have the corresponding label.
Consequences of not renewing trade license in Abu Dhabi
A valid trade license ensures the smooth functioning of business in the UAE. Timely renewal of license can save from the possibility of banning or blacklisting the company. Therefore, business owners are required to keep a check on the validity of the trade license as well as the tenancy contract.
On the contrary, if one fails to renew their trade license before the expiration date, here are the consequences they might have to face –
Monetary penalties
The DED can impose monetary fines on businesses that fail to renew their trade licenses. For instance, a penalty of AED 5,000 would be imposed for operating without a license, and further, a penalty of AED 250 per month would be applicable for trading with an expired license.
Blacklisting of the business
Companies operating without a license or with an expired license in Abu Dhabi can get blacklisted. This may lead to the termination of company operations.
Banning of the company
The DED in Abu Dhabi has all legal rights to shut down a company that operates with an invalid trading license. This may lead to serious consequences where the business owner may not be able to even re-establish their company in Abu Dhabi.
Connect with Shuraa Business Setup
The process of trade license renewal Abu Dhabi would be much easier when you work with with Shuraa Business Setup. Their dedicated team of experts will help you throughout the renewal journey, from arranging documents to securing approvals, and thus, ensure that everything’s sorted. They are committed to assisting their valuable clients right till the end.
So, without any further ado, connect with Shuraa today and share your business concerns. Just give a call at +97144081900 or mail your query to info@shuraa.com
