Industrial Manufacturing License in Dubai

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Industrial Manufacturing License

For every industrial activity, an Industrial Manufacturing License is needed. The rule of thumb is that an activity is likely to be industrial if it involves the use of specialized plant equipment. Some of the examples of industrial activity in the United Arab Emirates are as follows

The Industrial Manufacturing License is granted by the Department of Economic Development in the emirate where you set up your plant. For example, if you were setting up a factory in Sharjah, the relevant authority would be the Sharjah Economic Development Department or SEDD. The rules are different for each emirate. For instance, you need both a commercial space for your operations as well as a warehouse for storage in Dubai. A virtual office cannot be used to obtain an Industrial Manufacturing License.

The company for which the Industrial Manufacturing License is applied must have a Local Sponsor who owns 51% of the shares. The Local Sponsor must be an Emirati (this is the term used to refer to those who are citizens of the United Arab Emirates) who has attained the age of 21 or a company incorporated in the United Arab Emirates that of fully owned by Emiratis. So the company formation documents must be drawn up accordingly at the time of incorporation.

A good business setup consultant can put you in touch with the right Local Sponsor, who will agree to a hands-off approach when it comes to the running of the company. He/She can sign over a Power of Attorney document entrusting the affairs of the company to you. This way, you will be in total control over your company. The Local Sponsor does not take home 51% of the profits from the company, but he/she needs to be paid a Local Sponsor Fee in return for his/her services towards your company. The Local Sponsor legally represents your company before all Government agencies.

Before applying for an Industrial Manufacturing License, all the necessary approvals must be proposed to be carried out, these might be from the Ministry of Health and Prevention, the Ministry of Environment and Water, and/or the Ministry of the Interior. Your business setup consultant should be able to advise you better on which permissions are mandatory, depending on your operations.

How to Get an Industrial Manufacturing License

Your application must include a detailed project report, which outlines the need for starting industrial activity (or expansion of current industrial activity, if applicable). The Project Report should contain technical information, such as how production will be achieved with the help of production tools / equipment. It must also mention the estimated cost of production. The production equipment / machinery must meet existing UAE standards.

The Project Report must include the proposed number of employees for the industrial operation. The commercial space you have leased – you need to do this at the beginning of the process – must be large enough for all of them to work comfortably. A Location Plan is also needed, which shows where the different constituent units of the plant will be. Like where on the commercial space you have leased the cooling towers will be, where the chemical storage tanks will be, where the electrical failsafe unit will be and so on.

A Financial Report is also necessary, which shows that you will be able to continue running the plant after you have established it. You could have access to your own funds for running the plant, or you could be financed by a financial / banking institution. You need to submit a Bank Guarantee or a Letter of Credit from a financial institution in the United Arab Emirates as part of your application for an Industrial Manufacturing License.

The consent of the Municipality is a prerequisite for obtaining an Industrial Manufacturing License for your operations, if the plant is proposed to be located outside a free zone. You must also be a member of the local Chamber of Commerce and Industry. If all the documentation is in order, you can expect your Industrial Manufacturing License to be granted in 3-4 weeks.

You will find that the Government is very supportive and encourages manufacturing and industrial activity in the United Arab Emirates. If your product is expected to add value to the economy of the United Arab Emirates, you could receive assistance for research and development. The Government will also provide land for free or at concessional rates. If your product is new to the market (no similar product exists), you could hope to receive financing from a Government bank in the United Arab Emirates.

The Government will also provide water and electricity according to the operational needs of your plant, all at subsidized rates.

You are expected to comply with industrial safety regulations strictly, as well as adhere to all the provisions of the Labour Law. You must keep accurate records of all your workers, and see to it that they are qualified to operate plant equipment. This is in the interests of safety, to minimize the possibility of an industrial accident happening. Any input or raw materials imported into the country must not be used for any purpose other than what they were originally intended for.

If you appoint a Director for your industrial operations, this must be communicated to the Department of Economic Development. The Director is responsible for ensuring that every law and safety guideline is adhered to strictly.

Once the Industrial Manufacturing License is granted, you can begin the construction of your plant. This needs to commence within six months of the Industrial Manufacturing License being granted. After the construction of the plant has been completed, the Department of Economic Development provides you with permission to start functioning. You can then apply to be included in the Industrial Register. Any change in industrial operations must be notified to the Government authorities immediately.

Why Choose Us for Getting An Industrial Manufacturing License?

We have years of experience having helped set up companies on the mainland and in free zones. Our company formation experts are all experienced and have the necessary expertise in their chosen fields. We can guide you through the array of paperwork and help you secure all the mandatory approvals in order for you to be granted an Industrial Manufacturing License.

Licensing Categories Industrial Manufacturing License