How to choose the business activities on your Dubai licence

Pick the narrowest set of activities that honestly covers what you will sell in the next year or two, taken from the official list of the authority licensing you. On the mainland, that is the Department of Economy and Tourism (DET) list on the Invest in Dubai portal. In a free zone, it is that zone's own list. Resist adding activities "just in case": each extra line can bring an approval, a cost or a question from your bank.

Activities are the first decision in the setup sequence, and an easy one to rush. This guide explains how the list works, how to choose, which activities need outside approval and the mismatches that cause problems later.

What a business activity is, and why the wording matters

The UAE has more than 2,000 business activities. Each has a code and an official description, and your licence lists the ones you hold, word for word. Your activities decide your licence type (commercial, professional or industrial), which our guide to Dubai trade licence types explains. They also matter to people who never see your business plan:

• Banks compare your activities with your business plan and with the payments going through your account.
• Dubai Customs issues importers a business code based on their trade licence, so imported goods need to fit your licensed activities.
• MOHRE expects the professions you hire on the mainland to match your company's activity.
• Approval bodies look at the activity on your application, not your marketing description, when deciding whether you need their sign-off.

The law is direct about this. The Commercial Companies Law requires a company to obtain all the licences and approvals for an activity before it starts carrying it out. Your licence is the boundary of what your company may do.

How to choose your activities

1. Describe the business in one sentence. Say what you sell, to whom and where. "We design and build websites for UAE businesses" is a useful start; "digital solutions" is not.
2. Search the official list. Use the activity search on the Invest in Dubai portal for the mainland, or the free zone's own list. Search by keyword, then read the full description of each result, not just its title. To compare free zones, see our free zones overview.
3. Check what each activity brings with it. Note the licence type, the legal forms it allows, any outside approval and any premises rules. The legal form must match the activity.
4. Cover the next two years, not the next ten. Include an activity you will start soon. Leave out ideas you might pursue one day; you can add activities later.
5. Read the list as a bank would. If your activities make the business look broader or riskier than it is, narrow them. Our guide to opening a corporate bank account explains what banks check.

Free zone lists are separate from DET's, with their own codes and groupings. RAKEZ, for example, tags each activity with a licence type and an activity group. An activity you found on the mainland list may be worded differently in a free zone, or missing altogether, so check the list of the exact zone you are considering before you pay anything. Titles that look alike can also cover different ground: the description, not the title, decides what you may do.

Which activities need outside approval?

Regulated activities need approval from another authority before they can be licensed. The UAE government gives these among its examples:

The list goes on to telecoms, aviation-linked activities such as ticketing travel agencies, agriculture and veterinary work, and land transport. Timing varies too. Activities related to legal affairs, security and securities need their approval before you can even apply for initial approval. Others can run alongside the licence application.

Build the approval into your timeline before you sign a lease. An approving body can have its own premises or staffing requirements, and you want to know them before you commit to an office.

Combining activities on one licence

Most businesses hold more than one activity, and related activities, such as web design and software development, usually sit together without trouble. Problems start when activities pull in different directions:

• Different licence types. Mixing trading and professional activities can change the licence type or legal form you need, or call for a second licence. Ask before you assume they can share one licence.
• Extra cost. Free zone packages usually include a set number of activities and price additional ones separately.
• Extra approvals. One regulated activity brings its approval process to the whole application, even if it is a small part of your plans.
• General trading. A general trading activity covers many unrelated goods. It is flexible, but banks look at it more closely than a trading activity for one product group.

In a free zone there is a tax angle too. Your activities help determine whether income can qualify for the 0% corporate tax rate, so read our guide to free zone qualifying income before you finalise them. This is general information, not tax advice.

Mismatches that cause problems later

Say you license an IT consultancy, and a client asks you to supply 40 laptops along with the setup work. Your licence covers advice and services, not trading in hardware. The laptop invoice falls outside your licensed activities, your bank may question a large supplier payment that does not match your profile, and importing the laptops in the company's name runs into customs registration. Adding a computer trading activity before you accept the order avoids all three.

Other common mismatches:

• Hiring outside your activity. A clinic role on a consultancy licence, for example, is unlikely to get a work permit, because the profession must fit the company's activity.
• Payments the bank was not told about. Income from a line of business missing from your licence and your bank profile invites a review of the account.
• A licence that oversells. Ten loosely related activities make a small company look like a trading house, and banks may treat it like one.

Changing activities after you start

You can add, remove or change activities through a licence amendment with DET or your free zone. Expect fees and, for regulated activities, a new approval. A change can also affect your licence type, legal form or premises. When your activities change, tell your bank, and check whether your VAT or corporate tax position changes with them.

If you want a second pair of eyes on your activity list, our business setup team can check it against DET and free zone lists before you apply.

Sources

• UAE Government portal: steps to start a business on the mainland, including outside approvals
• Ministry of Economy and Tourism: establishing companies
• UAE Government portal: recruiting on the mainland
• Dubai Customs: frequently asked questions on business registration
• Ministry of Economy and Tourism: companies legislation, including the Commercial Companies Law
• RAKEZ: licence activity list