Securing an industrial license in the UAE is of massive significance for manufacturing businesses. The UAE offers numerous opportunities for enterprises across all major industries and sectors, especially manufacturing, logistics and production. The country offers an advanced ecosystem for all types of manufacturing businesses, whether you are looking to grow locally or use the UAE as a launchpad for international expansion. Initiatives such as “Make it in the Emirates” and the UAE Vision 2030 are driving significant growth across key sectors, making the UAE the perfect place to grow your manufacturing business.
Here’s our quick guide to obtaining an industrial license in the UAE, outlining the key steps, requirements, and considerations.
What is a UAE Industrial License?
The UAE industrial license is a government permit that allows a manufacturing business to operate legally in the country. The activities allowed with the industrial license are:
- Transforming raw materials into finished goods.
- Assembling, processing, and packaging products.
- Manufacturing activities of any kind, from food production to heavy machinery.
An industrial license differs from a commercial or business license in the UAE. It involves an extensive review and approval of business activities, legal compliance, and environmental impact.
Why the UAE is a Prime Hub for Manufacturing?
Before getting into how you can obtain an industrial license in the UAE, it is imperative to know why the UAE has become so popular among regional and international manufacturing companies.
Here are some significant reasons:
- Strategic Location: The UAE is strategically located on the global map, connecting multiple markets across continents.
- World-Class Infrastructure: The UAE offers some of the most advanced facilities for manufacturing businesses, providing ease of operations, networking, and logistics.
- 100% Foreign Ownership: For investors, the UAE offers 100% foreign ownership of their mainland industrial business, a benefit previously limited to free zones.
- Tax-Friendly Environment: A 0% personal income tax and a low 9% corporate tax (which only applies to profits over AED 375,000) make it financially attractive.
Step-by-Step: How to Get Your Industrial License
Multiple steps are involved in acquiring an industrial license in the UAE. The process involves active collaboration between federal and local authorities to complete the verifications required to issue the associated permit.
Step 1: Define Your Business Activity and Legal Structure
The first step is to define the industrial activity clearly. This step will help determine the specific approvals required and will also make it clear for the authorities to designate a particular legal form for your company, such as a Limited Liability Company.
Step 2: Choose Your Location (Mainland vs. Free Zone)
The next step is to choose between the Mainland and Free Zone industrial license. A mainland license is issued by the Department of Economic Development (DED) and allows businesses to trade freely within the UAE and bid on government contracts.
On the other hand, industrial free zones like JAFZA (Dubai), KIZAD (Abu Dhabi), and Dubai Industrial City are well-suited for manufacturing businesses aiming to expand globally and focused on exports.
Step 3: Get Initial Approval and Reserve Your Trade Name
After selecting a particular license, the next important step is to request approval for a unique trade name that must not already be taken. This step formally begins the initial approval process for your industrial license in the UAE.
Step 4: Secure Critical External Approvals
In this phase, you must submit a business plan and factory layout to the concerned authorities for approval. You will need external approval from:
- Ministry of Industry and Advanced Technology (MoIAT): The federal body that provides the final “industrial production license.”
- Local Municipality: To ensure your manufacturing operations align with the health and environmental standards.
- Civil Defence: To approve fire safety and emergency plans for your factory.
- Other bodies (e.g., Ministry of Health, Ministry of Environment), depending on your specific activity.
Step 5: Secure a Physical Factory or Warehouse
To acquire an industrial license, a business must have a physical location in the UAE. You need to specify and acquire a location in the designated areas where manufacturing activities are allowed. You can either lease or purchase a factory or warehouse for this purpose, following which, you will submit the tenancy contract called Ejari to the authorities.
Step 6: Final Submission and License Issuance
Once you have collected all approvals, your tenancy contract, and your Memorandum of Association (MOA), you will submit the complete file to the DED or free zone authority. After a final review and payment of fees, your industrial license will be issued.
Key Industrial License Requirements in the UAE
While specific requirements vary by emirate and activity, be prepared to submit the following:
- Passport and visa copies for all shareholders.
- A detailed business plan or feasibility study.
- A comprehensive factory layout and blueprint.
- Proof of a minimum capital investment (often AED 250,000).
- All required external approvals (MoIAT, Civil Defence, etc.).
- A valid tenancy contract for an industrial warehouse.
Securing an industrial license in the UAE is a complex but attractive opportunity for manufacturing companies. While the process is straightforward, it involves multiple steps, several external approvals and strict compliance with the designated protocols. The industrial license can be easily obtained with the help of an expert company that offers licensing and visa assistance.
If you are looking for an industrial license in the UAE, look no further than Carltrix. Book an appointment today and start your license application right away.
