According to a joint study by Dubai Economy and Visa, E-commerce transactions will grow 23% on average annually between 2018 and 2022. it's worth noting that the average size of E-commerce transactions in the UAE in 2018-2019 is USD 144.

E-commerce penetration in the UAE is not only higher than the Mena region average of 1.9% and GCC average of three percent, but also highest in the region - 4.2% of total sales.

In this post I am going to answer the question: Do you need a license to start your business in the UAE, in particular, to sell goods online? Also, I would like to highlight the difference between the concepts of E-commerce and E-trading.

Alright, the first answer is yes, you would need a license in order to conduct the business activity in the UAE including e-trading or online shop as we may know.

E-commerce is in theory a marketplace where the seller and the buyer make a deal directly in return on a fixed or flexible commission to the provider of e-commerce. In its turn, the e-trading concept is slightly different - you sell the products that you own yourself.

A good example of an e-commerce website is the well-know amazon.com. So, in this scenario, you can see that there are numerous merchants that play a key role in the website. In comparison, in e-trading, the seller is only a single merchant with a set of products. There are plenty of suitable examples of e-trading on the internet. In this case, we will consider one of the local merchants known as Brands for Less. In most of cases, the e-trading concept would have its classic retail or wholesale outlet which may be found in the streets or malls.

Now that we know the difference between the two concepts, we may discuss the prices, requirements, and time frame to incorporate both the options. We will start with the e-trading.

E-trading companies usually ship within 3 or more working days and this will cost you USD 4.500 or more. E-commerce would be slightly more expensive and it amounts to USD 8.300+. Requirements are pretty simple: a copy of your passport, a copy of your last utility bill, a copy of your CV, and a bank reference letter. 

So, finally, we have covered questions about the necessity of your business license in order to sell online. We have covered the questions of requirements, costs and time frame.

Please contact me for more information and advice on online selling in the UAE.

Marsel Shadmanov

Head of Corporate Services of Garant Business Consultancy DMCC