Penalties On Expired Business License in Dubai - IBG Consulting Dubai

Penalties On Expired Business License in Dubai

July 12, 2018by admin

Among many flourishing economies in the world, very few have achieved what Dubai accomplished in less than 40 years of development. From a local trading community thriving on petroleum products, Dubai transformed its economic outlook from an oil-dependent state to an international business outpost, positioning the rising global demand of company formation sectors towards is its enriched business landscape. Owning to its Strategic location, specialized infrastructure, lucrative investment laws, world-class facilities and increasing GDP, Dubai currently privileges among the top 5 investment destinations for foreign entrepreneurs, SMEs, and Large Scale Corporations.

Mainland Business License Renewal

While opening a company in Dubai can be a risky venture, managing one requires even more care. Every investor needs a Business License in Dubai to register his/her company and legitimately conduct operations locally or internationally. These licenses are allocated to specific business activities and offer specialized legal structures to fulfill the exact requirements of the investor. Once the License has served its term, a renewal process is in order to prevent any fines from being levied by the Dubai government. Here are 3 ways in which a Dubai business can be penalized due to a delay in business license renewal.

  1. Monetary Fines on Companies

In mainland Dubai, the Department of Economic Development is the legislative authority responsible for overseeing the business licensing/registration process and monitoring the current legitimacy of the registrants. To facilitate business owners in renewing their trade licenses, DED offers various channels to enable fast-track business renewal process for which a business can avail the services of a professional consultancy agency or PRO services provider in Dubai is not contracted by the business entity. According to DED rules & regulations, a business practicing its operations without a permit can be fined AED 5000, adding another AED 250 if it fails to renew it in the specified time. Similarly, a rogue office establishment overlapping an existing business license can make the investor liable for a fine of AED 2000.

  1. Company Getting Blacklisted

In other instances, a company that continues to break the law by practicing its business activities without licensing permit and refuses adherence to DED’s licensing authority, the company will be convicted as a Blacklisted entity. By entering the Blacklist, the company’s transactional capabilities will be blocked, visas revoked and sponsors dissociated with the probability of the owner, shareholders, directors and managers’ deportation from the UAE.

  1. Prohibition on Company’s Expansion Phase

SMEs or Small and Medium Enterprises are most susceptible to license renewal penalties. A small business requires annual license renewal, making it more difficult to manage on short lengths. If a small business fails to renew its license within the legal timeline, it may not be allowed to expand its operations in future given the circumstances. This may result in insolvency, rendering the business for either voluntary or compulsory liquidation. Any SME seeking to grow and expand in Dubai must maintain full compliance with DED’s license renewal laws.

2018’s Relaxation on Dubai’s Company Renewal Terms

Maintaining Dubai’s business friendly image, the UAE government introduced a series of reforms in the Q2 of 2018, providing incentives for businesses in need of financial and legal assistance. One its decisions were centered on providing relaxation for business owners by exempting all fines imposed on them.

This development on expired business licenses in Dubai will serve as a major relief for SMEs, helping facilitate license renewal by the end of 2018. As the business community hailed this decision, the Director- General of Department of Economic Development in Dubai, Sami Al Qamzi urged business owners with financial backlogs to avail this opportunity and apply for license renewal to restart their operations.

Adding a statement to Khaleej Times, Sami Al Qamzi said,

“This will add to the financial benefits of the owners of expired business licenses, restore legal records and licenses, and help the business community in Dubai enhance their competitiveness.”

How IBG Can Help?

As UAE’s award-winning Business Setup Agency, IBG Consulting has the most qualified and seasoned PROs to help your business keep track of its renewal dates, file legal documentation, get approvals and provide complete assistance even after you get your license renewed. We assign a dedicated PRO to oversee your company’s business license renewal process, taking care of business license fees and paperwork while liaising with government departments to represent your corporation. Contact our Consultants now or leave us a message at

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