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The Essential Guide to UAE Manufacturing Licences

Jun 28, 2023 | UAE Company Setup

Are you looking to get into the booming manufacturing industry in Dubai? You’re in the right place! In this essential guide, we’ll walk you through the process of obtaining a manufacturing trade licence, including costs, requirements, and benefits. Read on to find out all you’ll need to know about obtaining an UAE manufacturing licence.

With Dubai’s strategic location, pro-business government policies, and top-notch infrastructure, there’s never been a better time for you to set up shop in the UAE. We’ll also explore the reasons for setting up a manufacturing company in Dubai and provide a step-by-step guide to obtaining an industrial manufacturing licence.

Manufacturing Licence UAE: Costs & Requirements

Overview of the manufacturing industry

Did you know the manufacturing industry in the UAE is booming like never before? Licences are up for grabs in a variety of sectors, from manufacturing to import/export, housekeeping, and even freelancing.

This thriving sector is a major contributor to the country’s GDP, exporting products worth a whopping AED 167 billion annually.

Dubai, in particular, is the place to be for setting up a manufacturing company. This is due to the following reasons:

  • Dubai’s strategic location
  • Easy access to international markets
  • Supportive government policies
  • Business-friendly environment
  • Top-notch infrastructure, and skilled workforce

How to get a manufacturing licence in Dubai

If you want to operate a manufacturing business in the UAE, you’ll need a manufacturing trade licence. The process involves getting the green light from Dubai authorities. Apply to the Department of Economic Development (DED) and obtain municipality permission for plant construction.

You’ll also need to secure approvals from various authorities. For instance, you might need a thumbs up from the Ministry of Health and the Ministry of Environment and Water. Some industries that require an industrial licence include:

  • Bread manufacturing
  • Textile manufacturing
  • Metal casting
  • Equipment and engine manufacturing
  • Petroleum product manufacturing
  • Paper manufacturing.

To qualify for a manufacturing trade licence, businesses must have physical premises, at least AED 250,000 in startup capital, and a minimum of 10 employees. To set up an industrial company in Dubai, you’ll need several permits and licences, including:

Oh, and if you’re into chemical trading or manufacturing businesses, you might need extra licences and approvals due to the controlled nature of certain chemicals. In such cases, approval may be needed from the Dubai police and other relevant agencies.

Stock Photo Taken In Manufacturing Company UAE

Cost of obtaining a manufacturing business in Dubai, UAE

Are you curious about the cost of starting a manufacturing business in Dubai? It ranges from AED 15,000 to AED 50,000. Factors affecting the cost include trade licences, tools and machinery, equipment, property or warehouse rental, visas, government approvals, and staff solutions.

The cost of obtaining an industrial licence in Dubai ranges from AED 25,000 to 27,000. This includes the licence application fee, registration fee, and other procedural costs. The exact cost may vary depending on the nature of the industrial activity, location, and other factors.

But hey, there are perks for industrial licence holders in the UAE, like favourable terms for renting industrial space. These companies also enjoy reduced rates for land, electricity, and water. They receive guidance on industry best practices, lower interest rates for innovative products, financial assistance during R&D, and prioritisation of high-quality products by the UAE government.

However, industrial licence holders must stick to certain obligations. For example, you must start construction within six months of approval. You’ll also be required to submit necessary data to the DED, register your industry in the Industrial Registry, and follow all laws and regulations related to land, hygiene, and industrial safety.

The UAE offers a strategic location, business-friendly laws, a robust transport network, world-class infrastructure facilities, ease of company incorporation, secure banking operations, and transparent customs clearance processes. These features make it an attractive destination for establishing manufacturing units.

With the UAE government aiming to increase the manufacturing sector’s contribution to the GDP from 11% to 25% by 2025, there are various incentives and support available to businesses in this sector.

Reasons to Set up a Manufacturing Company in Dubai

Access to International Markets

Dubai’s prime location provides seamless connectivity to global markets across Asia, Europe, and Africa. This advantage allows manufacturing companies to easily reach their target markets. Furthermore, Dubai’s advanced infrastructure includes top-tier seaports, roads, and airports, connecting major cities worldwide.

Pro-Business Government Policies

The Dubai government actively promotes business growth through numerous policies, including low registration costs, favourable regulations, tax exemptions, and support for startups and incubator programmes. These initiatives create a welcoming atmosphere for international investors, especially in the manufacturing sector.

Competitive Industrial Sector

Dubai’s manufacturing industry contributes significantly to the UAE’s GDP and is considered the most competitive in the Arab world. The city’s Industrial Strategy 2030 aims to further increase the industry’s GDP contribution. With the “Made in UAE” label symbolising quality and value, Dubai proves itself as a top contender for manufacturing businesses.

World-Class Infrastructure

Dubai’s transportation, communication, and logistical infrastructure adhere to the highest standards, enabling manufacturing companies to efficiently transport their products across borders and reach target markets. This reliable infrastructure ensures smooth operations for businesses settling in the UAE.

Talented Workforce

Dubai boasts a pool of skilled workers, including engineers, technicians, and labourers, capable of operating and managing manufacturing facilities. This local talent mitigates the need to source skilled labour from other countries, making it easier for companies to launch their manufacturing operations in Dubai.

When setting up a manufacturing business in the UAE, entrepreneurs like yourself must follow a step-by-step process that includes product selection, trading name choice, document submission to the DED, drafting a Memorandum of Association, and obtaining all necessary clearances and licences.

With proper guidance and essential permits and licences, entrepreneurs can successfully establish their businesses and contribute to Dubai’s thriving manufacturing industry.

Stock Photo of Manufacturing Workers Working With A Licence

Additional Licensing Requirements for an Industrial Company in Dubai

Local Service Agent (LSA)

To obtain an Industrial Licence, a firm must have a Local Service Agent (LSA). The LSA will act as the company’s representative in dealings with the government authorities.

Comprehensive Environmental Report

Companies must submit a detailed report on their production plant when applying for an environmental permit. This report should include the plant layout design, process flow chart, and a list of required equipment and machinery.

Fire Safety Compliance

Adhering to fire safety regulations set by the Dubai Civil Defence is essential for all industrial establishments. This involves obtaining an initial approval certificate, submitting the commercial lease documents, and installing fire safety equipment according to the guidelines.

DEWA Connection Guidelines

Companies should ensure they follow DEWA’s guidelines and regulations. Compliance with these requirements supports the flourishing manufacturing industry and allows businesses to enjoy special customs and tax exemptions if they meet certain criteria.

Additional Considerations for an Industrial Manufacturing Licence UAE

If you’re planning to establish an industrial business in Dubai, it’s essential to understand the requirements and processes involved in obtaining an Industrial Licence. This licence is important for companies like yours to be involved in the production, processing, and packaging of various products.

To successfully apply for an Industrial Licence, your business must meet certain requirements, including partnering with a local service agent, securing a physical office and warehouse space, and allocating a minimum capital of Dh 250,000.

Required documentation includes:

  • Plant reports
  • Passport and residence copies for non-citizens
  • Feasibility studies
  • Partnership contracts (if applicable)
  • Trade licence copies
  • Balance sheets
  • Approvals from relevant ministries

The procedure for obtaining an Industrial Licence involves securing permission from Dubai authorities, which includes the DED, obtaining municipality permission for plant construction, and gathering approvals from the Dubai Municipality and other relevant ministries.

The cost of acquiring an Industrial Licence in Dubai varies depending on the business location, whether it’s mainland or free zone, with an average cost of around AED 35,000. While this may seem significant, numerous benefits come with holding an Industrial Licence in Dubai.

These benefits include favourable rental terms for industrial spaces, reduced rates for government-provided land, and subsidised rates for utilities. Additionally, the government offers support in the form of industry guidance, lower interest rates for innovative products, financial assistance during R&D, and prioritisation of high-quality products during official procurement.

However, businesses must also be aware of the obligations that come with holding an Industrial Licence. These include starting construction within six months of approval, submitting necessary data to the DED, notifying the DED when operations commence, and registering the industry in the Industrial Registry.

Remember to keep the DED informed about the following:

  • Any changes or amendments to your factory’s records
  • That you are not selling or leasing designated industry development property
  • Employee data
  • That you are using imported goods and materials for their intended purpose
  • That your company is adhering to land laws and regulations
  • That your company follows hygiene, fitness, and industrial safety guidelines

Any changes, such as the appointment of a director, must be reported to the DED.

Stock Photo of A Warehouse

Step-by-Step Guide to Obtaining an Industrial Manufacturing Licence UAE

You will need to begin by seeking permission from the DED, as well as the Dubai Municipality and other relevant ministries and authorities.

Prepare for paperwork and ensure your business meets certain requirements, such as having a local service agent (LSA), a physical office and warehouse, and a minimum capital of Dh 250,000. The average cost for obtaining an industrial licence is around AED 35,000 (remember, it can vary depending on the location of your business).

As a licence holder, you will enjoy numerous benefits, including favourable rental terms, discounted utility rates, industry guidance, and financial support.

Documentation and Additional Requirements for a Manufacturing Business in Dubai

When applying for an industrial manufacturing licence, gather all your essential documents such as plant reports, passport and residence copies, feasibility studies, partnership contracts, trade licence copies, balance sheets, and approvals from relevant ministries.

Environmental permits, fire safety approvals, and connections with DEWA are also necessary. If your business involves chemicals trading or manufacturing, expect additional licences and approvals from Dubai police and other agencies.

By following the proper procedures and obtaining the required licences, you can successfully establish your manufacturing business in Dubai and take advantage of its strategic location, world-class infrastructure, and supportive government policies.

Flourishing Future for Manufacturing Businesses in the UAE

The UAE’s lucrative manufacturing sector offers numerous opportunities for entrepreneurs like you seeking to take advantage of its strategic location, pro-business government policies, top-notch infrastructure, and skilled workforce.

By carefully navigating the process of obtaining a manufacturing licence in Dubai and adhering to the necessary guidelines and regulations, your business can successfully establish itself within this thriving industry.

Moreover, the UAE government’s commitment to expanding the manufacturing sector’s GDP contribution creates a promising landscape for investors, making the UAE an ideal destination for you to establish a flourishing and profitable manufacturing business.

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