If you think you are ready to take the plunge and take your small business or idea to the cloud, then an e-commerce business might seem like the ideal option. Most people envision starting an e-commerce business from the comfort of their own home, but what they often tend to forget is that they will need an e-commerce license in order to open a bank account, have online merchant facilities i.e. accept payments online and they must have a license to operate legally.
Onshore regulators and Dubai Free Zone’s refer to E-Commerce Licenses as an E-Trading Licenses. Free Zones in the northern Emirates refer to the activity as an e-commerce license.
If you have an online platform and you wish to generate money from that online platform, you will be required to obtain a license. There is a lot confusion in terms of whether or not these activities constitute conducting commercial activities within the UAE, given that they are online. However, the simple fact that you are exchanging money for a service or product, constitutes it to be an operating business.
The types of e-trading or e-commerce activities are restricted through the onshore regulators. They have restricted the e-commerce or e-trading activities to the following:
- Jewellery and precious stones E-Trading;
- Garments, Textiles and Gifts E-Trading;
- Publications and Media Materials E-Trading;
- Household, Professional and Personal Goods E-Trading;
- Vehicles and Transport means E-Trading;
- Equipment E-Trading;
- Sport and Recreational Events Tickets E-Trading
Unlike the free zone’s they do not have a general e-trading licence that covers all types of services and products.
If you are looking at setting up an online business and are looking to license your operation. Please get in touch with one of our consultants to help guide you on the best business activity and jurisdiction for your e-commerce license.