Get Your Grocery Trade License in UAE

A Trade License is mandatory for legally operating any business in the UAE, including grocery stores, supermarkets, or mini-marts. The Grocery Trade License officially authorizes the sale of goods, including food and daily consumer items. In 2024, over 650,000 active business licenses were registered in the UAE, reflecting strong confidence in the business environment.

The grocery sector in the UAE is regulated not only by the DED but also by other key authorities like local municipalities and food safety departments. These bodies oversee health, hygiene, and food handling compliance. Businesses must undergo premise inspections, obtain food safety approvals, and ensure proper storage and layout before receiving final clearance.

Safe Ledger FZCO simplifies your grocery business setup. Whether you're opening a small baqala or a supermarket, we’ve got you covered. We handle trade license registration, documentation, and all necessary approvals. We also manage related legal services, so you can focus on growing your business with confidence.

A Grocery Trade License in the UAE is a type of Commercial License that allows you to legally sell food and household items like fruits, vegetables, dairy, drinks, and packaged goods. It also covers storing, displaying, and importing these products.  The license mandates strict food safety compliance, including hygiene, temperature control, pest management, and selling products before expiry.

You must also buy from approved suppliers to ensure food quality. Starting in 2025, new laws like the Nutri-Mark labeling system will come into effect. This will require certain food items to carry clear nutrition labels (from A-E) based on their nutritional value. Therefore, grocery businesses should proactively start preparing to meet these regulatory updates.

The UAE offers broad eligibility for obtaining a grocery trade license, welcoming both UAE nationals and expatriates, including Indian citizens and NRIs looking to enter the UAE retail sector. Individuals planning to launch a new grocery business, as well as existing companies seeking to expand into retail, can apply for this license.

• 100% Foreign Ownership for Expatriates

One of the most business-friendly updates in recent years is the UAE’s amendment to the Commercial Companies Law, which now allows 100% foreign ownership for many mainland business activities, including grocery retail. This removes the older requirement for a UAE national to hold 51% of shares in an LLC. Entrepreneurs can now fully own and operate their grocery stores independently, making the UAE a highly attractive location for international investors.

• When a Local Service Agent (LSA) Is Needed

While grocery trade usually falls under commercial activity (where 100% ownership is permitted), some legal structures like Sole Proprietorships may still require a Local Service Agent (LSA). The LSA does not hold shares or manage operations but supports licensing and compliance matters, often for a fixed annual fee.

LSA is typically required for sole proprietorships or professional licenses, which are less common for grocery businesses that are usually registered as LLC.

• NOC Requirement for Expatriates with Existing Employment

Expatriates already working in the UAE may need to obtain a No Objection Certificate (NOC) from their current employer. This is especially relevant when starting a mainland business while holding a valid work visa. The NOC confirms there’s no conflict with the employee’s current job.

Note: Free zones may waive the NOC requirement, depending on the zone's policies.

Emirate-Specific Variations: Although Dubai has been quick to implement these changes, rules can differ across emirates. Each emirate may have its own list of activities eligible for full foreign ownership and may apply slightly different conditions. It’s essential to check with the local economic department or consult a professional before applying.

The UAE's grocery retail landscape is diverse, catering to varied consumer needs and preferences. Entrepreneurs can choose from several types of grocery business formats, each with its own characteristics, scale of operation, and target market.

1. Mini-mart / Baqala / Convenience Store

These are typically smaller retail outlets, often located within residential neighborhoods or areas with high foot traffic. They focus on essential daily items, snacks, beverages, and a limited range of groceries. Baqalas are a traditional part of the UAE's retail culture, offering everyday convenience to local communities.

Dubai Municipality classifies "Mini Store" under Activity Code: 4711004. In emirates like Sharjah, there are specific space requirements, for example, a minimum of 30m² for grocery stores.

1. Supermarket

Supermarkets are larger than mini-marts and provide a wider range of products. This includes fresh produce, meats, dairy, packaged foods, household goods, and sometimes personal care items. They cater to broader customer needs and are often used for weekly or bulk grocery shopping.

For Instance, Dubai Municipality lists "Supermarket" under Activity Code: 4711002, with a typical minimum area requirement of 2000 sqf or more. Different emirates have different municipality activity codes.

1. Hypermarket

Hypermarkets are the largest format of retail grocery stores. They combine a full-scale supermarket with a department store, offering groceries alongside electronics, clothing, homeware, and more. They often allow for bulk buying or wholesale shopping. Popular hypermarkets in the UAE include Carrefour and Lulu Hypermarket.

1. Specialty Store

This category refers to stores focused on specific product niches. Examples include outlets specializing in organic foods, gourmet products, ethnic foods, or health-focused items like vegan or gluten-free goods. These stores cater to targeted customer preferences and often offer curated selections not widely available in general supermarkets.

The choice of which type of grocery business to open depends on several factors, including the entrepreneur's investment capacity, target demographic, chosen location, and the desired product range.

Note: Some free zones (e.g., Ajman Free Zone, Sharjah Media City) may also permit grocery store setups for niche or specialty formats, although typically with warehousing rather than front-end retail. Each Emirate in the UAE has its own set of activity codes, so listing all of them here is not possible.

Obtaining a Grocery Trade License in the UAE involves a structured, multi-step process. While the specifics can vary slightly between emirates (e.g., Dubai, Abu Dhabi, Sharjah), the general framework is similar.

Step 1: Develop a Comprehensive Business Plan

The business plan should clearly outline your grocery store concept, target market, product range, competitor analysis, and financial projections, including startup costs, operational expenses, and revenue forecasts. It also defines your operational strategies. Many authorities may also require the plan during the Grocery Trade License Application process.

Step 2: Choose a Legal Structure

Entrepreneurs must select the appropriate legal form for their grocery business. Common options include a Limited Liability Company (LLC) or a Sole Proprietorship. LLCs are usually the preferred legal structure for grocery stores in the UAE, as they allow multiple partners, offer liability protection, and are well-suited for commercial trading activities. With recent reforms, many commercial activities on the mainland now allow 100% foreign ownership for LLCs.

Step 3: Select and Reserve a Trade Name

Choose a business name that aligns with UAE naming conventions. It must be unique, not offensive, and free from religious references or famous brand names. The name should reflect the nature of your business and, if applicable, include your legal structure abbreviation (e.g., LLC). Once approved and reserved through the Department of Economic Development (DED) or its equivalent in your chosen emirate, the trade name remains valid for 6 months, so it’s essential to proceed with the licensing process within that timeframe.

Step 4: Obtain Initial Approval

After finalizing your business activity, legal structure, and trade name, apply for initial approval from the DED or (Department of Economic Development or Tourism) DET for Business licensing and regulation. This step confirms that the government has no objection to your proposed business setup. You may also need to submit your business plan at this stage, which you created at step 1.

Step 5: Secure a Commercial Space and Register a Tenancy Contract (Ejari)

A physical location is required for all mainland grocery businesses. The premises must meet standards for safety, ventilation, hygiene, and accessibility, as set by local authorities. After securing a suitable location, register the tenancy contract through systems like Ejari in Dubai, as each emirate may have its own tenancy registration platform. This registered lease is a prerequisite for license issuance.

Step 6: Get Additional Approvals and Permits

This stage is particularly critical for grocery businesses due to the handling of food products. It can involve multiple interactions with different departments and may be the most time-consuming part of the process.

• Municipality Permit: Approval from the local Municipality is needed to ensure your shop meets layout, hygiene, and safety standards.
• Food Safety Permit: If you plan to sell perishable goods like dairy or meat, a permit from the Food Safety Department is required. This may involve inspections.
• Signage Permit: You must obtain permission to display your store’s signage or advertising on the storefront.

Additional permits, such as waste management approval, may be needed based on store operations.

Step 7: Draft and Notarize Memorandum of Association (MOA)

For LLCs or partnerships, drafting an MOA is mandatory. However, if your business follows a different structure (like a sole proprietorship), an MOA is generally not required. This legal document outlines ownership percentages, partner roles, and business objectives. It must be notarized through a registered public notary before submission.

Step 8: Submit Final Application and Pay Fees

Once all documentation and approvals are ready, submit your final application to the DED/DET. This includes the MOA (if required), permits, and other supporting documents. Pay the applicable government fees to initiate the license issuance.

Step 9: Receive Your Grocery Trade License

After a successful review and payment, your Grocery Trade License will be issued. This officially authorizes your business to start operations legally within the UAE.

Note: Most grocery businesses operate under mainland licenses, though certain Free Zones may allow wholesale food trading.

The application process for a Grocery Trade License in the UAE requires the submission of a comprehensive set of documents. Document collection should begin early in the setup process, as some items take time to prepare or obtain.

• Completed Trade License Application Form: Obtained from the DED/DET or the relevant economic authority in the chosen emirate.
• Passport Copies of All Business Partners/Shareholders and Managers: Clear copies of valid passports are needed for everyone involved in the ownership and management of the company.
• UAE Residence Visa and Emirates ID Copies: For partners, shareholders, or managers who are UAE residents, copies of their valid residence visas and Emirates IDs are required. For non-residents, a copy of their visit visa or entry stamp may be needed.
• Trade Name Reservation Certificate: Proof that the chosen business name has been approved and reserved by the DED/DET.
• Initial Approval Certificate: The certificate issued by the DED/DET confirming preliminary approval for the business activity and name.
• Attested Memorandum of Association (MOA): Required if the business is established as an LLC or another type of partnership. This document must be drafted as per legal requirements and typically needs to be notarized.
• Tenancy Contract (Lease Agreement): A valid lease agreement for the commercial premises of the grocery store is mandatory. In Dubai, this tenancy contract must be registered with Ejari.
• Comprehensive Business Plan: Outlining the business concept, market analysis, operational plan, and financial projections.
• No Objection Certificate (NOC) from Current Sponsor/Employer: If any expatriate partner/shareholder is currently employed in the UAE under another company's sponsorship, a NOC from their current sponsor/employer is generally required for a mainland license application.

Documents Specific to Grocery and Food Businesses:

• Approvals from the Local Municipality: These pertain to the suitability of the premises, adherence to health and safety codes, layout plans, and other specific requirements for food retail establishments.
• Food Safety Permit / Food Trade License: Issued by the Food Safety Department of the Municipality (or equivalent authority), this permit is essential for businesses handling and selling food products.
• Food Safety Training Certificates for Staff: Employees involved in handling food may need to undergo mandatory food safety training and obtain relevant certifications.
• Waste Management Plan/Permit: Approval for the store's waste disposal methods, ensuring compliance with environmental regulations.
• Trademark Registration Certificate: If the grocery store intends to sell its own branded products or operate under a unique store brand, trademark registration with the Ministry of Economy might be necessary.

Document requirements may vary based on business structure and applicant status. Always confirm with the DED/DET or a trusted setup provider before applying to ensure compliance.

The cost of obtaining a Grocery Trade License in the UAE is not a fixed amount; it varies significantly based on several key factors. Costs vary based on several factors, including the emirate (e.g., Dubai, Abu Dhabi), mainland vs. free zone setup, and the store’s size and type. Other cost factors include the legal structure chosen and the number of visas your business requires. Entrepreneurs must understand that the license fee itself is only one component of the total initial investment.

Estimated Initial Investment for a Small to Medium Grocery Store in UAE 

Note: This table provides indicative ranges and should not be considered a formal quotation. Actual costs can vary significantly.

Understanding your grocery trade license’s validity, renewal, and cancellation process is key to staying compliant and running smoothly in the UAE.

Validity of Grocery Trade License UAE

A Grocery Trade License in the UAE generally follows the same validity rules as standard trade licenses:

• Standard term: Valid for 1 year from the date of issue. Most grocery businesses renew annually.
• Multi-year option: Select free zones or mainland authorities may offer 2 or 3-year licenses, paid upfront. This can provide small cost savings and reduce administrative effort 

Be sure to check your specific free zone or local authority whether multi-year renewal is available for grocery trade licenses!

Renewal of Grocery Trade License UAE

Grocery Trade License Renewal before its expiry date is a mandatory requirement. Failure to do so can result in penalties, including fines and potential disruption to business operations. The renewal process generally involves the following steps:

1. Ensure Tenancy Contract Validity: The lease agreement for the commercial premises (registered with Ejari in Dubai) must be valid at the time of renewal. Often, authorities require the lease to have at least one to three months of validity remaining.
2. Obtain External Re-Approvals (if applicable): Certain business activities, especially in the food sector, may require ongoing compliance checks. Therefore, renewed approvals from external bodies like the local Municipality or Food Safety Department might be needed as part of the license renewal process.
3. Submit Renewal Application: The renewal application is typically submitted through the online portal of the DED/DET (or the relevant free zone authority if applicable) or via an authorized service center.
4. Pay Renewal Fees: The renewal fees are usually similar to the initial license issuance fee, although there can be minor variations. Additional small fees, such as the Knowledge Dirham and Innovation Dirham, may also apply.
5. Receive Renewed License: Once the application is approved and fees are paid, the renewed Trade License is issued. This is often provided as a digital copy, downloadable from the authority's portal, though a physical copy might also be available.

Renew your Grocery Trade License early, which opens a month before expiry. Avoid penalties by submitting documents on time; processing is often quick if everything is in order.

Cancellation of Grocery Trade License UAE

If a decision is made to close the grocery business, simply ceasing operations is not sufficient from a legal standpoint. A formal Trade License cancellation process must be followed to legally dissolve the business entity and avoid long-term liabilities. Reasons for cancellation can include bankruptcy or a voluntary decision by the shareholders to wind up the company.

The cancellation process typically involves:

1. Resolution for Liquidation: For LLCs and other corporate structures, a resolution from the shareholders or board of directors authorizing the company's liquidation and appointing a liquidator is usually required. This resolution may need to be notarized.
2. Application for Cancellation: An application for license cancellation must be submitted to the DED/DET or the relevant free zone authority.
3. Newspaper Advertisement: An announcement of the company's liquidation and impending closure is typically published in local newspapers. This provides a grace period (e.g., 45 days) for any creditors to submit their claims against the company.
4. Obtain Clearances: This is a critical phase involving multiple government bodies:
   • Ministry of Human Resources and Emiratisation (MOHRE): To cancel all employee visas and labor contracts, and ensure all end-of-service benefits and dues are settled.
   • General Directorate of Residency and Foreigners Affairs (GDRFA): For the cancellation of visas of partners and any remaining sponsored individuals.
   • Utility Providers: Clearances from electricity and water authorities (e.g., DEWA, ADDC) and telecommunication providers (e.g., Etisalat, Du) confirming settlement of all outstanding bills.
   • Federal Tax Authority (FTA): If the company was registered for Value Added Tax (VAT), it must apply for VAT de-registration and settle any pending tax liabilities.
   • Local Municipality and Civil Defence: Clearance may be needed, confirming no outstanding dues or issues related to the commercial premises.
5. Submit Final Documents and Pay Fees: After obtaining all necessary clearances and submitting a declaration from the liquidator (and partners) that no objections were raised during the grace period, the final cancellation documents are submitted. Applicable cancellation fees must be paid. For example, a license cancellation fee might be around AED 1,020, and a company dissolution fee could be AED 2,520.

Failing to cancel a Trade License properly can lead to fines, blacklisting, and legal issues. Compliance lapses, like an expired Ejari, can also block license renewal.

Sounds complex, right

Safe Ledger FZCO is here to handle your Trade License cancellation smoothly and compliantly. Contact us today to get started

Operating a grocery business in the UAE comes with a responsibility to adhere to a range of laws and regulations. Non-compliance can lead to significant penalties and operational disruptions.

Operating Without a Valid License

This is a serious offense. Businesses caught operating without a license or with an expired license face heavy fines, which can start from AED 5,000. Authorities can also issue immediate cease and desist orders, forcing the business to halt all operations. In severe or repeated cases, this can lead to blacklisting of the business and its owners, and potentially even deportation for expatriates involved.

Late Renewal of License

Failing to renew the Trade License on time incurs fines. These can be a fixed amount, such as AED 250, or a percentage of the renewal fee, potentially ranging from 10% to 50%.

Non-Compliance with Specific Regulations

For grocery stores, this is particularly relevant to food safety and product standards. Violations can attract substantial fines. For example, the Emirates Authority for Standardization and Metrology (ESMA), now under the Ministry of Industry and Advanced Technology (MoIAT), can impose fines from AED 10,000 to AED 100,000 for selling uncertified products. Other consequences include:

• Product Confiscation & Destruction: Non-compliant goods may be seized and destroyed by authorities.
• Sales Ban: Businesses may be prohibited from selling the offending products in the UAE market.
• Import Suspension: Import rights can be temporarily or permanently suspended for repeat violations.
• Legal Action: Repeated non-compliance can lead to legal proceedings, fines, or even license cancellation.

Unauthorized Use of Office Space

Using premises for activities not permitted under the license or failing to meet municipal requirements for the space can also lead to a Grocery Trade License penalty, for instance, AED 2,000.

Non-compliance can cause major business disruptions, damage your reputation, erode customer trust, and lead to legal issues that may impact your future business and residency status in the UAE.

Obtaining a Grocery Trade License is not just about legal compliance; it is the foundation that empowers you to build, grow, and scale a successful grocery business in the UAE.

1. Legal Authorization to Sell Food Products

A Grocery Trade License legally permits the sale of daily consumer goods, including perishable and non-perishable food items. Without it, you cannot open or operate a grocery store, mini-mart, or supermarket in the UAE.

2. Access to Wholesale Food Markets & Distributors

Licensed grocery stores gain access to authorized wholesale food suppliers, cooperatives, and distributors. This ensures a steady supply of certified products, better pricing, and consistent stock availability.

3. Compliance with Food Safety & Municipality Standards

With a valid license, your business is recognized by the local Municipality and Food Safety Department. This ensures your store meets hygiene, storage, and labeling regulations, critical in maintaining food quality and avoiding penalties or closure.

4. Customer Confidence & Loyalty

Being a licensed grocery business gives customers confidence that your products are fresh, hygienically handled, and regulated by authorities. This directly contributes to stronger customer trust and repeat business.

5. Eligibility for Specialized Approvals

Once licensed, your store can apply for additional permits (e.g., for meat handling, food imports, or refrigerated items), enabling business model diversification and broader product offerings.

6. Support for Grocery Delivery and E-Commerce

A trade license enables you to register with delivery platforms like Talabat, Noon, or Deliveroo. You can also legally run an e-commerce grocery store with relevant approvals, tapping into the UAE’s booming online food retail space.

7. Visa Sponsorship for Staff

Grocery businesses require manpower, from cashiers to store managers. With a valid license, you can sponsor employment visas for your team, making recruitment and retention smoother and legal.

8. Banking & Financial Access

A grocery trade license allows you to open a corporate bank account, apply for merchant POS terminals, and access credit facilities. This is crucial for managing inventory payments and daily cash flows.

9. Expansion Within the Retail Chain

With your first licensed outlet, you’re legally positioned to expand into multiple branches, each requiring its license but benefiting from your established track record.

10. Access to Government Incentives

Licensed grocery retailers may become eligible for local SME support schemes, commercial rent rebates, or municipality incentives aimed at improving community retail accessibility.

A Grocery Trade License does far more than permit sales; it connects your store to the UAE’s regulated retail economy, builds consumer trust, ensures food safety compliance, and supports long-term growth in one of the region’s most competitive and high-demand sectors.