Industry License in UAE – How to Start a Manufacturing Unit in UAE?
- Industrial License in UAE - A Vital Contributor to the Trade and Economy of UAE
Industry License in UAE – How to Start a Manufacturing Unit in UAE?
The industrial license in UAE is a popular license category among entrepreneurs aiming to start manufacturing set up in the region.
UAE is a manufacturing hub with large and small manufacturing units operating in the region. The industries in UAE are spread over a wide range of business categories and focus on the local and international markets.
Why Choose UAE for Establishing a Manufacturing Company?
Investors prefer UAE for establishing their manufacturing unit due to:
- Strategic Location – Easily Reach out to Global Markets
- Business Friendly Laws and initiatives by UAE Government
- Robust Transport Network – Airport, Seaport, Road Connectivity
- World-Class Infrastructure Facilities
- Ease of Company Incorporation
- Robust Business Infrastructure
- Secure Banking Operations
- Transparent and Fast Customs Clearance Process, and more
Industry License is a huge business investment as the manufacturing setup requires heavy capital for sourcing the machinery, building the manufacturing setup, maintaining the equipment, etc.
Along with that, there will be a lot of overhead cost-covering employee salary, raw material procurement, warehouse expense, and more.
Choosing the right Business Jurisdiction for Obtaining Industry License
Hence choosing the right business jurisdiction for setting up a manufacturing setup and obtaining the industrial license is critical for seamless business operations for the company in the region.
For the investors to obtain the industry license there are two business jurisdictions in UAE to choose
- Open a Mainland LLC Company
- Establish a Free Zone Company
Industrial License comes with huge capital requirements to successfully operate the company and bring the product to the market.
In UAE, there is a minimum capital requirement of AED 250,000 and 10 employees to obtain an industrial license. Based on the business activity required there will be certain pre-approvals and documents to be submitted for assessment to issue the Industrial License.
Industry Sectors Requiring Special Approvals
Following industry sectors have some pre-approvals to be obtained before proceeding with the issuance of business licenses in UAE.
- Oil and Gas Extraction Factories or Refineries
- Mineral Ore Extraction or Purification Factories
- Energy Management – Solar, Wind, Thermal
- Factories with capital Exceeding AED 250,000
The Manufacturing industry sector is a key contributor to the UAE’s Non-Oil Trade. UAE is constantly diversifying its business infrastructure and providing the required support to global investors.
UAE offers the right infrastructure support for entrepreneurs to easily establish long-term strategic projects that will contribute significantly to the progress of the UAE.
Industry License in UAE – Things to Know
Industrial License enables a company to perform certain business activities such as manufacturing, processing, re-exporting, and allied industrial activities in UAE.
There are certain environment clearances, municipality approval of the manufacturing site, human resource requirements the organization must meet before applying for the industrial license
Also, for organizations with a capital of AED 250,000 and above there is a mandatory requirement of submitting a business report to the authorities.
The report includes details of the factory’s operational plan, business goals, information about production tools, cost of operation, financial support, employee information, and more.
Steps in obtaining the industrial license from Dubai Economy
- Entrepreneurs must choose the right tradename for the company and get the name approved from the Dubai Economy
- Choose the right business activities and get the required approval
- Depending on the complexity of the business activity, there needs to special permits issued from the Government Authorities (For example for Pharmaceutical Companies, it requires a permit from the Ministry of Health)
- Pay the required fees and submit the investor details, and other supporting documents (business plan if applicable) to get the Manufacturing License issued from the authorities
Business Activities under industrial License
The list of business activities that are allowed under the industrial License are:
- Raw Material Processing
- Petroleum and Metal Extraction
- Fabric Production & Textile Manufacturing
- Die Casting, Casting of Iron & Steel
- Appliances and Machinery Manufacturing
- Food and Beverages Production
- Paper Product Manufacturing
- Furniture, wood, rubberwood products manufacturing
- Light Aircraft Manufacturing and Maintenance
- Spare Parts Production – Automobiles, Ships, Yachts, Heavy Equipment, etc.
Please note the above list is not an exhaustive listing. There are more than 100+ business activities are available under the industrial license category.
Documents required for obtaining Industrial License in UAE
- Application Form duly filled-in for the industrial license from Free Zone
- Shareholder passport copy & photograph
- Memorandum of Association with Free Zone
- Factory Plan/Blueprint (optional)
- Lease Agreement for the Manufacturing Unit
- Proof of financial support by providing bank statement, financing options for the manufacturing unit
Specific Approvals Required for the Industrial License
- Clearance from Economy and Ministry of Commerce
- Approval from Dubai Municipality Planning Department
- Dubai Electricity and Water Authority (DEWA) permit- Electricity, water, and other utilities, etc.
- Approval from Dubai Health Ministry
- UAE Ministry of Interior approval
Industrial License in UAE – Supporting Industrial Growth
The industrial license in UAE plays a vital role in shaping up the overall trade and economic outlook of the region.
Manufacturing companies in UAE get special customs and tax exemptions for meeting certain criteria such as
- sourcing locally produced raw material for production in UAE
- Goods aimed at national consumption with export to outside of UAE
- Industrial sectors that Government has earmarked for future development and more
Manufacturing Sector is a major focus area for UAE to improve the exports and trade value. From Oil & Gas Manufacturing to Healthcare Devices Manufacturing, UAE has a wide range of industry presence and is actively growing in volumes.
UAE offers the perfect infrastructure and ecosystem for entrepreneurs and companies (large & small) to expand their business in UAE and the global market seamlessly.
To know more about the process of obtaining an industrial license in UAE, connect with our expert Business Consultants right away!
Contact: Aurion Business Consultants