All we have to know about E-commerce in Dubai

Over the last few years, Dubai has experienced steady growth in the online retail industry. Eventually, the E-commerce business has become an ardent necessity for the economy as online shopping has become a significant part of our daily lives. The E-commerce market is flourishing with the increasing use of smartphones and easy accessibility of internet facilities in every corner of the UAE. 

• The UAE is one of the world’s largest B2C E-commerce markets and a leader in the Gulf Cooperation Council (GCC), with more than 60% of online buyers based in Dubai. Dubai’s dynamic growth in this industry, followed by advanced marketing facilities, makes it an ideal destination for foreign investors and budding entrepreneurs. 
• Traditional store-based retailers are now shifting towards improving the online shopping experience for consumers. For example, Emaar launched the noon website in 2017 as a definitive competitor to Amazon, and in 2018, it collaborated with E-bay to bring products from the US market. 
• Various government authorities have also migrated toward online platforms, where they are incorporated with online payments, to make services simpler for public users. Services include payment of utility bills, traffic services, licensing, visa issuance, etc. The Dubai Freezone Authority announced many new E-commerce business regulations for free zones, to accelerate foreign direct investment in the UAE. 

Start Your E-Commerce Business Now

As the E-commerce market has gained speed locally and internationally, consumers today can access numerous goods and services at just a click. Foreign investors looking to setting up an E-commerce business in Dubai must understand and consider plenty of procedures like E-commerce licensing, an E-commerce website, suitable logistic partners, payment and banking solutions, and VAT and tax implications.

Choosing a Jurisdiction

It is the foremost procedure for setting up your business in the UAE in these jurisdictions – Mainland or Freezone. E-commerce company formation in the mainland allows you to directly trade with the local market, with the help of a local agent and you can also take part in many government projects. Alternatively, a Freezone allows investors the benefits of trading in a low-taxed environment, with no repatriation of capital or profits, no currency restrictions, and 100% business ownership. 

Choosing a Business Name

It is undoubtedly an essential fact that an E-commerce company, with no physical presence in the local market, will have to choose a business name and use this as its domain name, which will make online business easier. The name should be compliant with the legal authority.

Obtain an E-Commerce License

You will need to apply for a professional e-commerce license under the Department of Economic Development (DED). The nature of the business will determine the E-commerce license type and a few documents will need to be submitted – completed application forms, passport copies, an MOA, and NOC. 

Website Development

As an online gateway, developing an interactive platform should be your primary goal. You will also need to set up an online payment gateway for safe monetary transactions, and you must register with the relevant postal services and customs authorities. 

About E-Commerce License in Dubai

Under the Department of Economic Development (DED), any new online business must apply for an E-commerce license. Your business will not be legalized until you receive this E-commerce license permit.

There are various E-commerce licenses in Dubai –

• E-trader licenses – This permit allows the sale of products and services online only; can be obtained under sole ownership only, and no office space will be allotted.
• Portal licenses – This permit is for all website product and service listings.
• Virtual company licenses – The Dubai Economy and the DIFC recently launched this permit, allowing local and international investors to carry out business activities in the area. 

E-Commerce License Cost in Dubai

In Dubai, an E-commerce license cost varies according to the size and nature of the business activities and which jurisdiction the business is located in. In Freezones, the E-commerce license can be acquired seamlessly and cost-efficiently as it is one of the cheapest available licenses in Dubai. 

The cost of an E-commerce license in Dubai is AED 5,750. However, there are a few additional license costs to consider for your E-commerce business – resident visa eligibility, virtual office space, registration under the authorities, etc. 

How can INCORP help you?

With more than 15 years of professional experience in this field, we offer dynamic solutions and stepwise procedures for setting up an E-commerce business in the UAE. We guide foreign investors and local entrepreneurs in building their businesses in the proper jurisdiction and with the right company structure and license, for their long-term and profitable growth. To learn more about this area, please Contact Us.