Selling products that need approval
An e-trader licence does not cover goods that need special approval. They cannot be sold until it is obtained.
Business setup · E-commerce licence
Set up an online business in the UAE with the licence, VAT and customs sorted first
What an e-commerce licence covers, and what online sellers must handle for VAT and customs.
Who an e-commerce licence suits
An e-commerce licence is for a business whose shop is a website, an app or a social media account.
- Sellers of products who ship from stock they hold or from suppliers.
- Creators and freelancers who sell products or services through social media.
- Companies that run a marketplace or portal and want a licence that names it.
- Existing businesses that are adding an online channel and want to know whether their licence already covers it.
It is a poor fit if you need a high-street shop, if your goods need special approval you do not yet have, or if you want to rely on a free zone's tax position without checking the conditions. The licence lets you sell. It does not settle your tax, customs or invoicing.
The licence routes
There are two broad routes: the Dubai mainland e-trader licence, and e-commerce licences from free zones.
Dubai mainland: the e-trader licence
The Department of Economy and Tourism issues an e-trader licence to people who run a business from their home in Dubai. Dubai's portal describes it as designed for individuals who sell products or services through social media and online platforms. It is issued only as a sole proprietorship, and the owner carries full legal responsibility. The goods and services must be legally approved for trade in the UAE, and items that need special approval cannot be sold until it is obtained. The portal page does not state fees or the application steps, so we confirm both with the Department when we file.
Free zones
Several free zones issue e-commerce licences, and each describes its own scope. The DWTC Free Zone says its e-commerce licence allows established businesses with the legal rights to sell a range of goods and services online in and from Dubai's free zones. DMCC describes a suite of licences for e-commerce, from development to consultancy, and a link to warehousing through JAFZA. IFZA says its e-commerce licences allow business within the UAE with no physical store required, and notes that some products, such as pharmaceuticals, need specific approvals. RAKEZ asks for a Telecommunications and Digital Government Regulatory Authority no-objection certificate and either a national domain name or the account name and link of a social media page. Ajman Free Zone's activity list tags a range of e-trading activities and notes that approvals are needed for certain activities.
Read each zone's own page for scope. The licence name tells you little, and the activity wording on it tells you what you can sell.
What the e-commerce law asks of a seller
Federal Decree-Law No. 14 of 2023 on Trading by Modern Technological Means sets standards for digital merchants and consumer rights. Article 5 asks a merchant to obtain the necessary approvals, permits and licences from the competent authority, to make prices, logistics fees and payment fees and terms publicly available on its website or application, to avoid misleading methods, to give a detailed non-paper invoice, to keep a business continuity plan and to provide a technically secure environment.
Article 6 gives consumers the right to see the merchant's licence, address and contact numbers, and to use complaint channels. Article 7 covers returns and exchanges for goods that are defective, damaged, contrary to description or delayed, and removes the right for some items, such as foods that expire within three weeks. The law refers to the return period set in other legislation, so check the rules for your product before you publish a returns policy.
These are legal duties for the website, not just good practice. Build them into the shop before launch.
Want to talk this through?
Tell us about your business and we will point you to the right person. We reply straight away during office hours.
VAT and invoicing for online sellers
VAT is where online sellers most often go wrong, because the sale happens on a screen and the tax rules follow the goods and the customer.
The Federal Tax Authority's e-commerce VAT guide says a resident business must register when taxable supplies and imports exceed AED 375,000 over the previous 12 months, or are expected to in the next 30 days. Voluntary registration starts from AED 187,500. For a non-resident making taxable supplies in the UAE where nobody else accounts for the VAT, the threshold is in effect nil. The guide is dated August 2020, so we check the current text before we advise.
Where the supply happens
For goods, if they are in the UAE when supplied, the supply is in the UAE, and if they are outside, it is outside. Exports from the UAE to places outside the GCC implementing states are supplied in the UAE for VAT purposes. For electronic services, the supply is in the UAE to the extent of use and enjoyment in the UAE, and outside the UAE to the extent they are used outside.
Imports
Imported goods carry import VAT at 5%, unless they would be zero-rated or exempt if supplied in the UAE. It is charged on the customs value, including insurance, freight and customs fees. The importer named for customs clearance accounts for it, and a VAT-registered importer may account for it in its VAT return if the conditions are met.
Goods held in a Designated Zone
The Authority's Designated Zones guide says a Designated Zone is set by Cabinet Decision, and that a free zone that is not one is treated like any other part of the UAE. Goods supplied within a Designated Zone are treated as made outside the UAE by default, but a supply to someone who will consume the goods is treated as made in the UAE with normal VAT. The guide has no e-commerce section, so we confirm how it applies to a given stock holding.
We handle registration and filing on our VAT service, and the e-invoicing section below links to the system that follows.
E-invoicing
Ministerial Decision No. 244 of 2025, amended by Ministerial Decision No. 66 of 2026, sets the timeline. Businesses with revenue of AED 50,000,000 or more appoint an accredited service provider by 30 October 2026 and implement by 1 January 2027. Businesses below that revenue appoint by 31 March 2027 and implement by 1 July 2027. A pilot began on 1 July 2026, and voluntary use is allowed from then.
Business-to-consumer transactions are not subject to the system until the Minister decides otherwise, and a person dealing exclusively in them is not subject to it. A seller with any business-to-business sales is in scope for those. Most online sellers have some, such as wholesale orders or corporate buyers, so check your mix.
Customs, storage and delivery
Dubai Customs says duty on most goods is 5% of the CIF value, with some goods higher, and that a business must register with Dubai Customs to use its services. Tell us what you import and how, because the customs value feeds the import VAT calculation too.
Banking and payments
The law requires a merchant to disclose payment service fees and terms on its site. We found no official statement that a seller must use a particular payment gateway or account type, so we do not recommend one here.
The bank decides whether to open a business account. UAE banks must identify the company, its constitutional documents, its management and everyone who owns or controls 25% or more, and they rely on certified documents. An online seller should bring its licence, a description of the products and suppliers, the website or social account, and an explanation of how customers pay.
Corporate tax
A company's business income is within corporate tax: 0% on taxable income up to AED 375,000 and 9% above. A free zone company reaches 0% only as a Qualifying Free Zone Person, and online sales to mainland customers may be non-qualifying income.
An individual who sells through a sole proprietorship is taxed only when business turnover exceeds AED 1,000,000 in a calendar year, under Cabinet Decision No. 49 of 2023. The Federal Tax Authority's guide for natural persons uses a social media earner whose turnover is above that level as an example of a business subject to corporate tax.
Setting up, step by step
Choose the route
Decide between the Dubai mainland e-trader licence and a free zone e-commerce licence.
Confirm the products
Check whether any product or service needs an outside approval before it can be sold.
Apply and register
Apply to the authority. Some zones need a telecommunications no-objection certificate for the website or social account.
Open the bank account
Prepare the file the bank will ask for, and expect questions about suppliers and customers.
Register for tax
Register for corporate tax, and for VAT when your supplies pass the threshold.
Build the legal duties into the shop
Publish prices and fees, licence details and terms, and set up invoices and a returns policy.
Common mistakes
Forgetting import VAT
Import VAT is charged on the customs value including freight and insurance. It changes your margin.
Treating all sales as consumer sales
B2C sales are outside e-invoicing for now, but any B2B sales are in scope.
Assuming a free zone licence is tax-free
Free zone status does not give 0% automatically, and mainland sales may be non-qualifying income.
Costs
Fees depend on the route and the authority. We quote current figures for yours.
E-commerce licence
Get a quote
Depends on the route and the authority.
VAT registration
Get a quote
Our fee, quoted per case.
Corporate tax registration
Get a quote
Our fee, quoted per case.
An illustrative example
Illustrative example, not a client
A small online homeware shop
Two owners plan an online homeware shop that imports from several suppliers and delivers across the UAE, with a few corporate orders.
We choose the route. A mainland licence suits UAE customers, and a free zone with storage might suit stock. We check that no product needs outside approval, and prepare the bank file with the website and supplier details.
On tax, we model import VAT on the customs value, plan VAT registration as sales approach the threshold, and check whether the corporate orders bring them into e-invoicing. We register for corporate tax and set up bookkeeping so the VAT and customs figures reconcile from the first month.
Frequently asked questions
What is the e-trader licence in Dubai?
A Department of Economy and Tourism licence for people who run a business from home and sell products or services through social media and online platforms. It is issued only as a sole proprietorship.
Can a company use an e-trader licence?
Dubai's portal says the e-trader licence is issued exclusively as a sole proprietorship. A company needs a different licence, such as a commercial licence or a free zone e-commerce licence.
Do free zones offer e-commerce licences?
Several do, including the DWTC Free Zone, and DMCC, IFZA, RAKEZ and Ajman Free Zone describe e-commerce offers. Each describes its own scope, so read the zone's page.
Can I sell any product online?
No. Goods must be legally approved for trade in the UAE, and items that need special approval cannot be sold until it is obtained.
When must an online seller register for VAT?
When taxable supplies and imports pass AED 375,000 in the previous 12 months, or are expected to in the next 30 days. Voluntary registration starts from AED 187,500. For a non-resident making taxable supplies in the UAE, the threshold is in effect nil.
Is import VAT charged on goods I order from abroad?
Yes, at 5% on the customs value, including insurance and freight, unless the goods would be zero-rated or exempt if supplied in the UAE.
Does e-invoicing apply to online sellers?
Business-to-consumer transactions are outside it until the Minister decides otherwise. A seller with business-to-business sales is in scope for those, from 1 January 2027 for revenue of AED 50,000,000 or more, and from 1 July 2027 below that.
What does the e-commerce law require on my website?
Prices, logistics and payment fees and terms must be public, descriptions must not mislead, a detailed non-paper invoice must be provided, and the merchant's licence, address and contact numbers must be available.
Do I pay corporate tax on online sales?
A company's business income is within corporate tax. An individual is taxed only when business turnover exceeds AED 1,000,000 in a calendar year.
General information based on UAE rules at the time of writing. It is not tax or legal advice for your situation. Speak to us before you decide.
Talk to us about your business.
Tell us what you need and we will point you to the right person. We reply straight away during office hours.