How Long Is a Trade License Valid in UAE?

Starting a company in the UAE means you’ll need a trade license. Without it, you can’t legally run your business. One of the first things every entrepreneur asks is how long this license lasts, and what happens if you forget to renew it. Let’s break it down clearly.

How Long Is a Trade License Valid in UAE?

A UAE trade license is usually valid for one year from the date of issue. Free zones and mainland authorities both follow this standard, but some areas like DMCC allow longer terms up to five years.

Most entrepreneurs get a one-year license whether they’re setting up a company on the mainland or in a free zone. It’s the baseline rule set by the Department of Economic Development (DED) and by most free zone authorities. After twelve months, you’ll need to renew to keep your business compliant.

Free zones often advertise quick and easy setup packages, but the validity stays the same—one year. Even if your package looks different in terms of cost or services, you’ll still face renewal at the end of the year. If your main concern is keeping costs under control, you can also look into a low-cost trade license in the UAE, which some zones provide for startups or smaller ventures.

There are exceptions. DMCC, one of the most sought after free zones, allows multi-year validity up to five years. That’s not the norm though, so unless you’re specifically choosing DMCC and paying for that longer option, you should assume your license lasts for a single year.

Renewal of Trade License

When to Renew

You need to renew your trade license every year, usually within a 30-day grace period after expiry.

The DED on the mainland and most free zones send reminders, but the responsibility falls on you. Waiting too long makes renewal harder and sometimes more expensive. Renewal dates matter because they’re tied to visas, bank accounts, and rental contracts.

The process is straightforward. You’ll submit updated documents, clear any outstanding payments, and confirm your business information hasn’t changed. Some authorities let you handle it online in minutes, while others may require physical submission.

If You Don’t Renew

Failing to renew your trade license can lead to fines, suspension of your business, and even visa cancellations.

Penalties start small, sometimes around AED 200 for each month you’re late, but they stack up fast. If you continue without renewal, your business risks being blacklisted, which can block future applications or partnerships.

Visas linked to your license become invalid if the license lapses. That can cause problems not only for you but also for employees and dependents under your sponsorship. Banks also freeze accounts tied to expired licenses, cutting off your ability to pay suppliers or receive funds.

The bottom line is simple: don’t delay renewal. The short-term cost of renewing is always less than the long-term damage of ignoring it.

Key Takeaways for Entrepreneurs

Most UAE trade licenses are valid for one year, with a few exceptions like DMCC offering up to five years. Renewal is mandatory to avoid fines, blacklisting, and visa problems. Setting reminders and tracking dates is the easiest way to stay compliant.

Think of your trade license like your car registration. You wouldn’t drive an unregistered car without risking penalties. Running a company without a valid license works the same way.

Practical tips help avoid headaches:

• Mark your renewal date on your calendar as soon as you get the license.
• Keep digital and printed copies of your license handy.
• Assign someone in your team to track renewal if you’re managing multiple licenses.
• Plan for the renewal cost as part of your annual budget.

These small steps save you from scrambling at the last minute or paying unnecessary penalties.

Conclusion

A UAE trade license isn’t permanent. In almost every case, it lasts one year and must be renewed on time. A handful of free zones like DMCC allow longer terms, but they’re exceptions, not the rule.

Renewing on time keeps your company compliant, protects your visas, and ensures your business keeps running smoothly. For any entrepreneur setting up in the UAE, knowing how long your license lasts isn’t just helpful—it’s essential