How to Get a General Trading License in Sharjah

Are you planning to launch your business in Sharjah? If so, one of the most crucial steps you'll need to take is acquiring a trade license. This essential document grants you the legal authority to conduct business activities within the Sharjah emirate. With various trade license categories available, each one permits specific commercial activities, making it important to choose the right one for your business needs.

In this comprehensive guide, we'll walk you through the process of starting a business in Sharjah, with a particular focus on obtaining a general trading license. Whether you're new to the business landscape in the UAE or looking to expand your operations, this guide will provide you with all the information you need to get started.

Why You Need a General Trade License in Sharjah

In the United Arab Emirates, securing a trade license is mandatory whenever you intend to start a business. The trade license not only legitimizes your business but also specifies the nature of the activities you are permitted to undertake. Operating without a valid trade license can lead to hefty fines, legal issues, and even the closure of your business.\

Understanding the Role of the Department of Economic Development (DED)

The Department of Economic Development (DED) is the primary regulatory body responsible for issuing and overseeing trade licenses in Sharjah. Working in collaboration with the Sharjah Chamber of Commerce and Industry, the DED ensures that all businesses comply with local regulations and standards. The DED categorizes trade licenses into several types, including commercial, professional, and industrial licenses, each catering to different business activities.

However, it's important to note that certain business activities require additional approvals from relevant ministries and government authorities before a trade license can be issued.

Types of Trading Licenses in Sharjah

When it comes to starting a business in Sharjah, there are three main categories of general trading licenses available. Each type of license caters to different business activities, ensuring that businesses operate within the legal framework of the emirate. Below is a breakdown of these categories:‍

1. Commercial License

This license is applicable to all trading activities. It allows businesses to engage in the buying, selling, and distribution of goods within Sharjah and beyond. Whether you're dealing in consumer goods, electronics, or other products, a commercial license covers your operations.

2. Professional License

This license is designed to protect professionals, artisans, service providers, and craftspeople. It is ideal for businesses offering specialized services such as consulting, legal services, or skilled trades. The professional license ensures that individuals and companies are recognized for their expertise and are authorized to operate in their specific fields.‍

3. Industrial License

This license is required for businesses that intend to engage in manufacturing and industrial operations. It permits the establishment of factories, production facilities, and other industrial activities. An industrial license ensures that businesses comply with environmental and safety regulations while contributing to Sharjah's industrial growth.‍

4. Other Specialized Licenses

In addition to the primary trading licenses, Sharjah authorities also grant other unique licenses under specific conditions. These include:

• Business Operation Permits: For businesses that require temporary or short-term licenses for specific activities or events.
• Entrepreneurial Business Licenses: Targeted at startups and small businesses, these licenses are designed to encourage entrepreneurship and innovation within Sharjah.

These specialized licenses cater to niche business needs, offering flexibility and support for various business models.

Cost of Obtaining General Trading License in Sharjah

The cost of acquiring a general trading license in Sharjah typically ranges from AED 5,000* to AED 30,000*. However, the actual cost can exceed AED 30,000*, depending on various factors that influence the licensing process. These factors include the nature of the business, the type of license required, the location of the business, and any additional approvals needed from relevant authorities.

For precise details on obtaining a trading license in Sharjah, it’s advisable to consult with professionals who specialize in business setup services. RadiantBiz offers expert guidance on the entire process, helping you navigate the complexities and ensuring a smooth setup of your business in the emirate of Sharjah.

Steps to Get General Trading License in Sharjah

To obtain a trading license in Sharjah, follow these key steps to ensure compliance and avoid delays in your business setup:

Step 1: Determine Your Business Activities

The first and most important step is selecting the business activities you intend to carry out. In Sharjah, a single trading license can cover up to 10 different business activities. It’s essential to choose your activities from the Sharjah Economic Development Department (SEDD)'s approved list of business activities to ensure alignment with the local regulations.

Step 2: Select the Legal Structure

Once your business activities are defined, you must choose the appropriate legal structure. Common options include sole proprietorship, Limited Liability Company (LLC), or a partnership. The legal structure you select will impact your liability, ownership, and taxation, so it's crucial to choose the one that fits your business model.

Step 3: Choose a Business Name

Next, choose a unique trade name that adheres to UAE’s naming conventions. Ensure that the name is easy to remember and not already registered. The business name should avoid offensive terms, religious references, or abbreviations related to governmental organizations.

Step 4: Apply for Initial Approval

Once the business name, structure, and activities are chosen, apply for initial approval from the SEDD. You can do this online or in person. This approval indicates that your business concept complies with local regulations, although it does not yet allow you to begin operations.

Step 5: Secure Office Space

To legally operate your business in Sharjah, you must secure a physical office space. Depending on your business needs, you may choose between free zone or mainland locations. The office space must be approved by the Sharjah Municipality.

Step 6: Prepare Required Documents

Prepare all necessary documents, including:

• Trade name certificate
• Initial approval letter
• Memorandum of Association (MOA)
• Office lease agreement

Depending on your business type, additional approvals may be required from other government bodies.

Step 7: Submit Your Application

Once all documents are prepared, submit your complete application to the SEDD. Double-check all details to avoid any processing delays.

Step 8: Settle the License Fees

Once your application is submitted, pay the necessary fees. These fees will vary based on the legal structure and business activities. It’s important to budget accordingly, as changes in regulations can influence the total cost.

Step 9: Obtain Your Trade License

After the final approval and payment, the SEDD will issue your trade license. You can now legally operate your business in Sharjah.

Following these steps will ensure a smooth and efficient process in obtaining your trading license in Sharjah, allowing you to start your business confidently.

Why Sharjah is an Ideal Place to Launch a Business

If you haven't considered it yet, there are several compelling reasons to establish your company in Sharjah. This emirate offers a range of benefits that make it an attractive destination for entrepreneurs and investors alike:

1. 100% Profit Repatriation

Businesses in Sharjah enjoy the advantage of being able to repatriate 100% of their profits. This financial freedom allows companies to maximize their earnings and reinvest in their growth without restrictions.

2. Exemption from Customs Charges and Taxes

Companies operating in Sharjah are exempt from customs charges and taxes on imports and exports. This benefit significantly reduces operational costs and enhances the profitability of businesses engaged in international trade.

3. Strong Infrastructure and Networking Opportunities

Sharjah boasts a robust infrastructure, including modern transportation, communication networks, and utilities. Additionally, the emirate offers excellent opportunities for business networking, connecting entrepreneurs with industry leaders and potential partners.‍

4. Excellent Storage and Industrial Facilities

The emirate provides top-notch storage and industrial facilities, making it easier for businesses to manage their supply chains and manufacturing processes. These facilities are crucial for businesses in sectors like logistics, manufacturing, and distribution.

5. Growing Business Hub

While Sharjah’s businesses may not be as large as those in other emirates, they are making significant strides. Sharjah has become one of the top business hubs in the region, right after Abu Dhabi and Dubai. Each year, the emirate attracts a growing number of entrepreneurs and start-ups, drawn by the promising business environment.

6. Abundant Business Opportunities

Sharjah offers a wealth of business opportunities for investors and entrepreneurs. The emirate’s strategic location, coupled with its supportive business environment, makes it an ideal place for launching and growing a successful business.

This emirate might be advantageous for investors and business owners. 

Various Business Structures in Sharjah

The type of business structure you choose in Sharjah will determine the paperwork and requirements needed to obtain a general trading license. Businesses in Sharjah can be organized under several corporate arrangements, including:

1. Limited Liability Company (LLC)

An LLC is a popular business structure in Sharjah, offering liability protection to its shareholders. It’s suitable for a wide range of business activities and is commonly used by both local and foreign investors.

2. Partnership Company

A partnership company involves two or more individuals or entities sharing ownership, responsibilities, and profits. This structure is ideal for businesses where collaboration between partners is essential.

3. Branch of a Foreign Company

Foreign companies can establish a branch in Sharjah to conduct business operations. This structure allows the parent company to expand its presence in the UAE while maintaining full control over the branch’s activities.

4. Branch of a Local Company

Local companies in the UAE can also establish branches in Sharjah. This structure enables businesses to extend their operations to Sharjah while operating under the umbrella of the parent company.

Common Requirements for Obtaining a Trade License

Regardless of the business structure you choose, there are a few common requirements you must fulfill to obtain a trade license in Sharjah:

1. Choosing a Business Name: Select a unique business name that complies with UAE naming conventions. The name should reflect the nature of your business and be easy to remember.
2. Submitting Additional Paperwork: Along with your trade license application, you may need to submit extra documents. For example, a GCC corporate branch requires verified documents from both the UAE Embassy in the Gulf State and the UAE Ministry of Foreign Affairs.
3. Specific Requirements for Public and Private Shareholding Companies: Public and private shareholding companies have additional criteria and documentation requirements. The application form must comply with the regulations set forth in the Commercial Registry Act and its rules.

What is the Cost of Renewing Sharjah Trade License?

The cost of renewing a general trading license in Sharjah varies depending on several factors, including the type of license, the nature of the business, the ownership structure, and other relevant criteria. Since these costs can differ significantly from one company to another, it is recommended to contact the Sharjah Economic Development Department (SEDD) for a more accurate estimate.

For further assistance and detailed information, you may also consult with one of our business formation advisors. They can provide you with tailored guidance and help you navigate the process of renewing your trade license in Sharjah.

How to Renew Your Sharjah Trade License

Renewing your Sharjah trade license annually is essential, as the license is valid for only one year. Operating a business in Sharjah without a current trade license is not permitted. To ensure your business remains compliant, follow these steps to renew your trade license:

Required Documents

• Sharjah Trade License Renewal Form: Complete the renewal form provided by the Sharjah Economic Development Department (SEDD).
• Copies of Passports or UAE National ID: Submit copies of the passports or UAE National IDs of all business owners and partners.
• Photocopies of Family Books (UAE Citizens): UAE nationals must also provide photocopies of their family books (Khulasat Al Qaid).
• Lease Contract: Include a valid lease contract for the business premises, which must be attested by the Sharjah Municipality.

Once all the necessary documents are assembled, submit them to the SEDD to complete the renewal process. Ensuring timely renewal of your trade license is crucial for maintaining your business operations in Sharjah.

RadiantBiz can help you obtain a Sharjah trading license. 

Our team is eager to discuss your business project and help you succeed in Sharjah's vibrant business environment. The experienced business setup advisors at RadiantBiz are here to assist you with every aspect of starting your business, including the application process for obtaining a general trading license in Sharjah.

Contact us today for a free consultation. We look forward to supporting you on your journey to launching a successful business!

FAQs

Q1: I already have a Dubai general trading license. Can I operate in Sharjah?

No, a Dubai license does not permit commercial operations in Sharjah, as they are separate jurisdictions. You would need to apply for a Sharjah general trading license to conduct business within the emirate.

Q2: Are general trading licenses available for all nationalities?

Yes, individuals and companies from all nationalities can apply. However, foreign applicants must appoint local service agents or business partners from the UAE for complete ownership.

Q3: Can I obtain a trading license if my office is based in a free zone?

No, having commercial space on the mainland is mandatory for general trading licenses, as free zone regulations differ. However, certain free zones may offer their own trading licenses.

Q4: What systems are required for document submission?

All applications are now processed online through SEDD's digital portal. You will need active email addresses and mobile numbers for all proposed license shareholders to register.

Q5: Can I amend the license to include additional partners later?

Yes, general trading licenses in Sharjah allow for the addition or removal of partners through amendment requests submitted online via SEDD's platform.

Q6: How long is the validity of the initial approval?

Initial approvals are typically valid for 60 days. If the license is not collected within that time, applicants may need to reapply with updated documents.

Q7: Do IT systems for stock management require SEDD approval?

No, general trading license holders can choose and install any secure IT systems for inventory management without needing specific SEDD clearances.

Q8: Can I open multiple branches with a single trading license?

No, separate licenses are required for each commercial facility, even if they operate under one parent company.

Q9: Where can I find detailed information in English?

Sharjah SEDD's official website provides comprehensive English guides, cost tables, document checklists, and process maps for general trading licenses.

Q10: Can general trading licenses cover services like management consulting?

No, trading licenses are intended for tangible wholesale/retail goods. Service-based companies require professional or commercial licenses.

Q11: Are there nationality restrictions for local service agents?

UAE nationals, GCC citizens, or corporates lawfully based in the UAE can provide local service agency services or sponsorship.

Q12: Can people with investor visas apply directly?

No, resident visa holders with investor or partner status must appoint eligible local service agents with the appropriate profile to co-apply.

Q13: Are there any restrictions on the goods traded?

Yes, some goods may require additional clearances. For example, food items need municipality approvals, and telecom products require TRA permissions. It's best to check with SEDD beforehand.

Q14: Can a freelancer apply for a general trading license?

No, freelancers or those working from home are not eligible. Applicants must have commercial premises to conduct trading activities under the license.

Q15: How can I expedite my application approvals?

Hiring reliable PRO services can help by following up more frequently with SEDD officials to resolve queries faster, leading to quicker processing.

Q16: Can a business operate before collecting the license card?

No, commercial activities can only begin once the license holder has physically obtained the printed license card from SEDD after all approvals.

Q17: Do I need an existing office to apply?

Yes, applicants must first secure commercial property suitable for trading activities, as per municipality zoning, before applying to SEDD.

Q18: Can a business relocate to another emirate later on?

Yes, Sharjah general trading license holders can request to change premises to another emirate, such as Dubai, through proper amendment procedures.

Q19: Where do I collect the original license?

License holders can collect the final approved original hard copies of the license and computer cards directly from SEDD offices after printing.

Q20: Can I surrender a license if the business activities are no longer viable?

Yes, there is a cancellation process that allows for the voluntary surrender of a general trading license in Sharjah if the owner no longer intends to conduct business.

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