How to Get a Ras Al Khaimah Business License?

Ras Al Khaimah (RAK) has firmly established itself as a premier destination for global entrepreneurs in the UAE. This northern emirate offers a strategic location, serving as a gateway to markets across the Middle East, North Africa, Europe, and Asia. More importantly, RAK presents a stable, secure, and highly cost-effective environment for business setup in the UAE.

The emirate is known for its streamlined processes, lower operational costs, and business-friendly government. Recent economic data support this trend. According to S&P Global, Ras Al Khaimah’s economy is forecast to see robust GDP growth, expanding by as much as 4% annually, driven by non-oil sectors like tourism, real estate, and manufacturing, making it an ideal destination for entrepreneurs. This blog offers a comprehensive guide on how to get a business license in Ras Al Khaimah. It covers the different license types, the step-by-step process, the Ras Al Khaimah business license cost, and the significant benefits of launching a venture in this dynamic emirate.

Investors and entrepreneurs find compelling reasons to select RAK over other commercial centers. The emirate combines affordability with world-class infrastructure.

• 100% Foreign Ownership: In RAK’s economic zones, foreign investors can own 100% of their companies. There is no requirement for a local UAE sponsor. This gives entrepreneurs full control over their operations and profits.
• Fast-Track Licensing: The Ras Al Khaimah Economic Zone (RAKEZ) is famous for its efficiency. RAKEZ even introduced an “Instant Business License” system. This allows entrepreneurs to get a business license in Ras Al Khaimah in 2–5 business days through its online portal.
• Minimal Paperwork and Digital Processes: Entrepreneurs can complete almost the entire setup process online. Physical visits are often not required. This digital-first approach saves valuable time and resources.
• Cost-Effectiveness: When compared to Dubai or Abu Dhabi, RAK is significantly more affordable. The Ras Al Khaimah business license cost is lower, and office space, warehousing, and living expenses are typically 25% to 50% cheaper, as per industry standards. This allows startups and SMEs to allocate more capital to growth.
• Strategic Location: RAK is home to Saqr Port, one of the largest bulk-handling ports in the region. It is also close to major international airports, making logistics and international trade highly efficient.

An entrepreneur must first choose the correct license type. The license must match the business’s intended activities. RAK’s primary licensing authority, RAKEZ, offers a wide range of categories.

• Commercial License is for businesses involved in trading. This includes the import, export, distribution, or warehousing of specific goods.
• General Trading License is a popular type of commercial trade license. It allows a business to trade a wide variety of unrelated products under a single trade license.
• Professional/Service License is for service-oriented businesses and professionals. It covers consultants, IT specialists, marketing agencies, legal advisors, and other skilled professionals.
• An Industrial  Trade License is for businesses in manufacturing, processing, assembly, or packaging. RAKEZ provides dedicated industrial zones with warehouses and land.
• Educational License is for opening educational institutions. This can include training centers, skill development institutes, or educational consultancies.
• Media License covers all media-related activities. Examples include marketing, advertising, content creation, publishing, and broadcasting.
• Freelancer Permit is a low-cost option for individuals. It allows them to work as independent professionals in media, education, and other service sectors.

The process for a business license in Ras Al Khaimah is designed to be fast and clear.

• Pre-Application Steps:
  • Choose a Business Activity: The entrepreneur must first select their specific business activities from the approved list (either RAKEZ or DED).
  • Choose a Legal Structure: The applicant decides on the entity type (e.g., FZE, LLC, Branch).
  • Reserve a Trade Name: The applicant must submit 2-3 name options for approval. The name must be unique and follow UAE naming rules.
• Required Documents Checklist:
  • A completed application form.
  • Passport copies for all shareholders and managers.
  • A brief business plan (required for some specific activities).
  • A No Objection Certificate (NOC) if the shareholder is already on a UAE residence visa.
  • Power of Attorney in Ras Al Khaimah if a consultant is handling the setup.
• Application Submission:

Once documents are ready, the applicant submits them through the RAKEZ or RAK DED online portal. The end-to-end process for obtaining a business license in Ras Al Khaimah involves the following key steps:

• Trade Name Reservation: Select 2–3 preferred names and apply for reservation via the portal. The name must follow UAE naming rules, and once approved, a Trade Name Certificate is issued (valid for around 60 days).
• Initial Approval: Apply for initial approval by submitting shareholder documents, a brief business plan, and details of the intended activity. This confirms that the proposed business is legally permitted in RAK.
• Lease Agreement / Office Space: Before license issuance, the company must lease a physical or virtual workspace, such as a flexi-desk, office, or warehouse—within RAKEZ or the RAK mainland. The signed lease (Ejari or equivalent) must be uploaded to the system.
• License Issuance: Once approvals and the lease are complete, the authority issues a payment voucher for the Ras Al Khaimah business license cost. Upon payment, the official license is granted, usually within 24 to 48 hours, and delivered digitally.
• Visa Processing: After licensing, investors and staff can apply for UAE residence visas under the company. The quota depends on the office size and license type. The process includes an entry permit, medical test, Emirates ID, and visa stamping.
• Corporate Bank Account: Finally, the business can open a corporate bank account with any UAE or international bank. Required documents typically include the trade license, tenancy contract, passports, and Emirates IDs.   
• Payment and License Issuance:
  • Once the application is approved (which can be very fast), the authority issues an invoice.
  • The applicant pays the full Ras Al Khaimah business license cost.
  • Upon payment, the official business license in Ras Al Khaimah is issued, often as a digital copy, within 24-48 hours.
• Renewal Process and Validity:
  • A business license in Ras Al Khaimah is valid for one year.
  • The process for renewing a business license in Ras Al Khaimah is simple. It is done annually through the same online portal.
  • The applicant must pay the renewal fee and ensure they have a valid tenancy contract (e.g., for their flexi-desk or office). Trade license renewal is a mandatory step to remain legally compliant.

The Ras Al Khaimah Department of Economic Development (RAK DED) and the Ras Al Khaimah Economic Zone (RAKEZ) determine the cost of setting up a business in Ras Al Khaimah. The exact amount varies based on the type of license, office requirements, and business activity. Here’s a concise overview of the key expenses:

1. Free Zone Business Setup Costs: Starting a business in Ras Al Khaimah’s free zones offers a cost-effective solution, with initial setup costs typically ranging from AED 10,000 to AED 15,000. These free zones cater to startups and SMEs with tailored packages that often include benefits like tax exemptions and flexible office spaces.
2. Mainland Business Setup Costs: Mainland business setups in Ras Al Khaimah come with slightly higher costs, starting at around AED 15,000. The exact cost depends on the nature of your business, required licenses, and visa requirements.
3. Office Space Rental: Office space rental in RAK is relatively affordable. Depending on your requirements, annual rental costs range from AED 5,000 to AED 20,000. Virtual office solutions are also available for businesses aiming to minimize overhead costs.
4. Visas and Immigration: Visa costs for both investors and employees should be factored into your budget. Investor visas generally start at AED 3,000, while employment visas depend on your workforce size. Family sponsorship visas are also available for business owners.
5. Additional Expenses: Other costs to consider include trade name registration, notary fees, and documentation charges. These can vary based on the business type and legal structure you choose.

When comparing, RAK’s packages are often significantly lower than the free zone license cost in Dubai or one in  Sharjah.

An entrepreneur must also choose a jurisdiction.

1. RAK Free Zone License: Issued by authorities like RAKEZ, a business setup in the Ras Al Khaimah free zone is the most popular choice for foreign investors. It guarantees 100% ownership and 0% corporate tax on qualifying income. It is ideal for international trade.
2. RAK Mainland License: Issued by the RAK Department of Economic Development (DED), a business setup in the UAE mainland allows a company to trade directly with customers anywhere in the UAE.

Free-zone companies typically cannot directly sell to the UAE mainland market without a local distributor or branch.

The Dual License Option: Accessing Both Markets

RAKEZ offers an innovative “dual license” solution. This allows a RAKEZ-registered free zone company to also obtain a mainland license from the RAK DED. This provides businesses with the benefits of operating in a UAE free zone (such as 100% ownership) while also granting legal access to the UAE’s local mainland market.

The legal structure, or entity type, defines the company’s legal framework. The choice impacts ownership rules and personal liability.

Common entity types in RAK include:

• LLC: Limited Liability Company is a company where the shareholders’ liability is limited to their investment. In RAKEZ, this is called a Free Zone Company (FZC) for multiple shareholders or a Free Zone Establishment (FZE) for a single owner.
• Sole Establishment: This is an entity owned by one individual. This person is 100% liable for the company’s debts. In RAK’s mainland, this is common for professional licenses.
• Branch: An existing company (either in the UAE or abroad) can open a branch in RAK. The branch is legally an extension of the parent company.

Ownership rules are the most critical legal point.

• In RAK Free Zones: Foreign investors are permitted 100% ownership for all licenses. A local sponsor or partner is not required.
• In RAK Mainland: Following recent UAE federal laws, 100% foreign ownership is now possible for most mainland business activities. However, some strategic or regulated activities may still require a UAE national as a partner or a Local Service Agent (LSA).

This is the most important decision in the setup process. The chosen activity dictates everything else.

• Importance of Matching: The business license in Ras Al Khaimah legally permits only the activities listed on it. Operating outside this scope can lead to large fines.
• Examples from RAKEZ:
  • An “E-commerce” license allows for online sales.
  • A “Professional/Service” license allows for “Management Consultancy.”
  • A “Commercial” license allows for “Trading in Building Materials.”
• Adding Activities: An applicant can often add multiple business activities under one license, as long as they are in the same category (e.g., all commercial or all professional). Adding activities can sometimes slightly increase the Ras Al Khaimah business license cost.
• Restricted Activities: Some activities are restricted and require special approval from federal ministries. This includes businesses in finance, healthcare, and education. Professional PRO services can help navigate these complex approvals.

Every business license in Ras Al Khaimah must be linked to a physical address. The requirements differ between the mainland and free zones.

• Free Zone Options (RAKEZ):
  • Flexi-Desk: This is the most common and affordable option. It provides the use of a shared desk and is often the minimum requirement to be eligible for a residence visa.
  • Co-working Space: A more modern, collaborative environment.
  • Serviced Offices: Private, fully-furnished offices.
  • Warehouses/Land: RAKEZ offers extensive industrial zones for manufacturing and large-scale trading.
• Mainland Requirements:
  • A mainland license requires a valid tenancy contract for a physical office space.
  • This contract must be registered with the RAK Municipality’s ‘Tawtheeq‘ system. This is a firm legal requirement.
• Virtual Office Solutions:

The “flexi-desk” package in RAKEZ essentially acts as a virtual office. It provides a legal address for licensing and remote operation without the cost of a full-time private office. This is ideal for entrepreneurs who wish to operate their company from abroad.

For international holding companies, a business setup in Ras Al Khaimah offshore is also an option, which does not require a physical office.

Ras Al Khaimah presents a compelling and intelligent choice for business setup. The emirate has successfully created an environment that is fast, affordable, and highly supportive of entrepreneurs.

The streamlined process for obtaining a business license in Ras Al Khaimah, combined with the low Ras Al Khaimah business license cost, makes it one of the easiest entry points into the UAE market. The flexibility of RAKEZ, the 100% foreign ownership, and the innovative dual license option provide a powerful platform for startups, SMEs, and large enterprises to thrive.