The outbreak of the pandemic has ushered in a slew of developments, including a growing trend toward shifting corporate operations to internet platforms. The internet has shown to be an efficient means of conducting product and service sales.
With the passage of time, more people and organizations are opting for online transactions and sales rather of face-to-face interactions, which may be awkward and time-consuming. Because of this significant shift in the market, many people have decided to create an online business with an e-trader or e-commerce license. These licenses are a necessary and essential need for those wishing to perform legitimate online commercial activities within the UAE. In this post, we'll look at what these licenses are, how they differ, and how they might apply to your firm.
An ecommerce license Dubai is a legal permit granted by the UAE government that allows its holders to conduct business activities related to the purchase and maintenance of product inventories, as well as the delivery of said inventory. For this license to be applicable to the business, all of this must be done through an internet platform such as a website or social media channels. Obtaining the license is a simple process that may be done either through your emirate's relevant agencies or by applying online. If you want to start a business in a free zone, you can apply for a license through a free zone authority as SPC Free Zone.
What is an E-trader license?
An e-trader license is a relatively new type of government-issued license that allows its holders to conduct online trades. This license was created to give UAE and GCC nationals more control over their business activity on social media sites.
Though they appear to be similar at first glance, they have distinct qualities that set them apart. The following are the significant differences:
1. E-trader licenses are only available to UAE/GCC citizens, whereas e-commerce licenses are available to anybody in the world.
2. E-trader licenses are only awarded for residential premises, which necessitates the submission of Makani paperwork.
3. E-trader licenses allow users to do business on social networking networks, whereas e-commerce licenses allow users to conduct business on other websites.
4. When compared to e-commerce licenses, e-trader licenses do not allow for as many business activities.
5. An e-trader license restricts the scope of business to the UAE's borders and allows only a sole proprietorship-based legal structure, in contrast to e-commerce licenses, which provide holders with an international reach, allowing them to sell and buy products outside of the country while also allowing them to choose their legal structure.
What applies to you?
It's simple to tell what applies to your internet business just by looking at the differences. When it comes to deciding between an e-trader and an e-commerce license, factors such as nationality, scale of operations, scope of activities, legal structure, and free zone accessibility all play a role.
If you are a foreign investor, you should get an e-commerce license instead of an e-trader license because e-trader licenses do not apply to people who are not UAE or GCC citizens. E-trader licenses are not the best option if you want to launch a large-scale business because they are designed for small-scale, work-from-home businesses. Furthermore, the type of business you want to conduct may or may not be covered by an e-trader license. Analyzing what you want from your internet business will assist you in determining which license is best for you.
Contact our expert advisers at 800 SPC FZ immediately to learn more about which license is suitable for your business and how to apply.
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