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E Commerce License in a Freezone! Your Guide to getting an E Commerce License ASAP!

By Dhruva Bhatt - 17 Jun 2022 Last Updated: 17 Jun 2022
E Commerce License in a Freezone! Your Guide to getting an E Commerce License ASAP!

Table of Contents 

  1. 1. E Commerce Business in a Freezone
  2. 2. Steps to Take Before Starting an E-Commerce Company in the UAE Free Zones
  3. 3. How to Apply for an E-Commerce License in a Free Zone
  4. 4. Essential Documents required to obtain an E Commerce License in a Freezone
  5. 5. Conclusion

Free zones, sometimes referred to as free trade zones or free zone authorities, are economic zones where products and services can be traded. Free trade zones benefit from 0% tax rates, advantageous customs duty rates, and a complete exemption from import and export taxes.

Free zones are particularly popular among businesses that value their privacy. This is due to 100 percent foreign ownership and the lack of an open directory of corporate information. Sensitive corporate data, such as shareholder information, is never made public.

Investors and businesspeople in each field have easy access to the lively places and services that surround Dubai. Multiple corporate activities can be carried out within each free zone authority.

Thus in today's blog, Dhanguard will discuss everything about E Commerce in a Freezone. So without further ado, let's learn!

E Commerce Business in a Freezone

Due to its high digital advancement and tech-savvy populace, the UAE is one of the greatest places to launch an e-commerce firm with favorable government rules. However, due to the COVID-19 epidemic and lockdown, people are only permitted to leave the house to buy supplies, which has resulted in a surge in e-commerce. This pandemic has altered the way people shop, as well as their taste and preference patterns. Because of the limits and social distance that exist in physical stores, it is clear that e-commerce will begin to increase in the next few months.

It should come as no surprise that e-commerce has begun to flourish in the UAE.It currently accounts for 4.2 percent of retail revenue and is expected to increase by 23 percent on average by 2022.

Though it is not solely due to COVID-19 and the lockout, it is also due to the UAE's ecosystem and how it continues to evolve for e-commerce and quick innovative business growth. Due to the following factors, the UAE, particularly Dubai, is one of the fastest developing e-commerce countries.

  • A high level of digital influence

  • A high level of consumer confidence in e-commerce and e-payments

  • A high-quality logistics infrastructure

  • Government assistance for business ventures

Steps to Take Before Starting an E-Commerce Company in the UAE Free Zones

With the rapid rise of the e-commerce platform, it is now more than ever advisable to establish an online business. However, there are some legal requirements in order to function. Before beginning, a trading license from a Free Zone or Mainland government is required.?

Here are some tips on how to start an e-commerce firm in the UAE:

Select the appropriate jurisdiction and obtain a trading license

The type of online business will determine which Free Zone and Mainland authority to use. In a mainland license, products can be sold directly, however in a free zone license, working with a local distributor is required.

The website's design, development, and debut

This is the most crucial aspect of e-commerce since it aids in the development of a relationship with customers and the promotion of items and services. This location will also make it easier to communicate with customers and learn about their tastes and preferences, which will help the e-commerce industry flourish. As a result, in order to create an income-generating website, it must be user-friendly, with proper web maintenance, secure hosting, and mobile usage.

Providing options of multiple online payments

It is vital for an e-commerce business to provide customers with an online payment option. Credit cards, debit cards, and mobile wallets are all integrated secure payment gateways.

System for secure logistics, storage, and delivery

If your internet firm sells actual things, you'll need to have a competent warehousing system in place to store them. This is just as crucial as the jurisdiction in which the firm will be established. After that, the next step is to set up a secure logistics system to ensure that products are delivered quickly and efficiently to customers. A third-party logistics provider or the owner's own logistics might be chosen.

Promote your goods or services

When everything is in place and the company is ready to go, the most important thing to remember is to sell the goods and services. It's critical to understand your target market and the kind of clients who will buy your product. To set the suitable customer and market, an effective market plan can be developed.

How to Apply for an E-Commerce License in a Free Zone

Obtaining an E Commerce trading license in a Freezone necessitates the completion of a set of processes that include:

Choose a Legal Structure

The first stage in obtaining an E commerce license in a freezone is to determine your company's legal structure. To put it another way, whether to form an LLC (Limited Liability Firm), a one-person business, a branch of a parent company, a representative office, and so on. The formation of limited liability companies (LLCs) and branch offices are the most frequent in Dubai since they offer a number of benefits.

Obtain a trademark registration

One of the few things you'll need to get your firm off the ground is a brand name. You can't truly start another critical process until your company, product, or service has a name.

Submit a Business License Application

Are you getting your products ready to sell on the internet? You'll also require a business license. If you choose a free zone, the permission will be issued by the Free Zone Authority (FZA).

Request a Certificate of Initial Approval.

A NOC from the authority to establish an e-commerce firm in Dubai is known as an Initial Approval Certificate. It is only valid for 6 months and cannot be renewed. When filing a trade name approval application, one can also apply for an initial approval certificate.

Create a physical space that is perfect for you.

The next stage would be to open an actual office in Dubai, as the Dubai authorities have made it necessary for a firm to have a physical presence in order to be considered a legal entity.

Follow the Import/Export Regulations

In order to get an importer's code, your company must be registered with one of the ports or customs administrations. Imported goods in the UAE are subject to a 5% customs charge. Because they must sell their products/services within the free zones, enterprises operating within them will not be subject to import duties.

Open a Bank Account for Your Business

You will be able to set up your corporate bank account once you have successfully applied for an E commerce trade license and established your firm. Because the application process is short and easy, all you have to do now is decide which bank best meets your requirements.

Essential Documents required to obtain an E Commerce License in a Freezone

  1. Copies of the stockholders' passports/visas

  2. A photocopy of the sponsor's passport or Emirates ID

  3. Agreement on Local Services (for Mainland Company Setup in Dubai)

  4. Certificate of No Objection from the relevant authorities (if any)

  5. Other supporting documents include the Memorandum of Association, Shareholder Resolution, and other legal documents (if any)

  6. The desired Free zone's company registration form

  7. Tenancy contract or lease agreement (if any)

Conclusion

We will choose the best business formation package for you. Get expert advice on forming the correct E commerce firm, including choosing the right business jurisdiction, business activity, office type, and supporting services, among other things. Set up your own E commerce business in the most hassle free manner possible! Thus, we hope this blog provided you with insightful information. For more information on other related aspects, feel free to check out our website as well or get in touch with our Experts by visiting our Branch Office.

Dhanguard provides the business setup and company formation services in Dubai, UAE with the guidance of our professional team of consultants. Faster and hassle-free company setup in Mainland and Freezone in UAE.

Dhanguard provides faster and hassle-free Trade License with minimum paper work. With the guidance of our professional team of consultants you will get General trading license, Freelance license, Etrader license, Event Management License, Travel Agency license in Mainland and Freezone in UAE.

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