Monday, 21 April 2014

Procedure for Licensing Industrial Projects & Departments In-Charge

Procedure for Licensing Industrial Projects & Departments In-Charge

Obtaining No Objection Letter from the Municipality

In order to make sure that public safety and environment are safeguarded, the Municipality (through the industrial Unit of the Planning Department) intervenes directly to ascertain that the provisions of the Federal Law No. 1 of 1979 regulating industrial affairs are implemented, and also to ascertain that all conditions of health and professional safety set by the concerned local departments are met. This includes the following:
  • To advise and guide the investor and explain general instructions and guidelines, which have direct impact on the project. The unit will ensure that these instructions are complied with and well      considered in the preliminary feasibility study and advise the applicant to study its project from all aspects before starting execution.
  • To evaluate the technical studies and reports prepared to establish the project.
  • To determine the suitable location for the establishment of the project, and to take the necessary action for issuing the site plan.
  • To take the final decision for the issue of the industrial license.
  • To apply the control methods on the project after being established ensuring that all instructions are observed and the licensed scope of production is complied with.

Industrial Unit’s Role in Licensing Industrial Projects:

Approval shall be given after ensuring that all conditions are met, which could be divided into two categories: Projects having an adverse effect on environment or those related to food production. . Approval of such projects is subject to the following procedure:
  • Submission of the project study to the Public Health Department and obtaining their conditions in this respect and, subsequently, complying with these conditions.
  • Evaluation and study of the application by the unit in determining a suitable location for the project A lease agreement for the site shall be signed with the Real Estate Department.
  • Issuance of a temporary license for one year to enable the applicant to proceed with the construction project, install the machinery and recruit the necessary manpower.
  • Upon completion of the preparatory work, including equipping the factory but   before commencement of production, a unified report shall be prepared and referred along with the relevant documents to the Trade Licensing Department for issue of the final industrial license in order the factory can start operation and production.
In case the projects do not have negative effects on environment and not connected with food 

production or any other projects not included from the procedure of public health while the other 

procedure shall remain as mentioned above. In this case, the applicant shall be given a letter 

addressed to the Ministry of Finance and Industry, confirming that the Municipality has no objection.

Obtaining the initial approval from the Ministry of Finance and Industry

The Ministry carries out its responsibilities through the Industrial Department, which is responsible for the following: 
  • Issue of Industrial Production License.
  • Inscription in the Industrial Register.
  • Overseeing and following up all execution stages of the industrial project.
  • Considering the periodical reports and data submitted by the owner of the industry.
  • Extending guidance to industrial investors.
  • Granting exemptions to industrial firms.
  • Conducting Field Studies.
Submission of the initial licensing application: 

The owner of the project should submit an application on the specified form to the Industrial Department supported by the following document.
A report that includes all studies related to the project, a no objection letter issued by Dubai Municipality along with a site plan of the plot allocated for the project, attested by the competent authority in the Emirate, a document issued by one of the banks operating in the UAE and three photocopies of the owners of the project or his identity card. The Industrial Department of the Ministry reviews the applications for setting up industrial projects technically and economically line with the general plan of the emirate
In case the projects do not have negative effects on environment and not connected with food 

production or any other projects not included from the procedure of public health while the other 

procedure shall remain as mentioned above. In this case, the applicant shall be given a letter 

addressed to the Ministry of Finance and Industry, confirming that the Municipality has no objection to 

the Ministry’s approval for setting up the project. 

Obtaining the industrial license from the Economic Development Department

Submission of the license application: 

The owner of the project should submit the following documents:
  • Specimen of the proposed trade name of the firm.
  • Approval of the Minister of Finance and Industry.
  • The partnership agreement, notarized by the Notary Public of Dubai Courts
  • Photocopy of the owner (or owners) passport.
  • The site plan of the project attested by the concerned authority, or a photocopy of the lease agreement of the place of business.
  • Photocopy of the tenancy contract of the labor quarters.
In case all documents and papers are verified and accepted, and the owner has been found capable, 

the application of the license and proposed trade name shall be approved and referred to technical 


Technical Inspection Procedure: The Department shall coordinate with concerned departments in 

Dubai Municipality such as Planning, Public Health as well as the Civil Defense in the process of 

inspecting the factory. Officials of these departments will visit the factory and inspect it technically, after 

completion of the construction work, installation of machinery and equipment, preparation of the stores, 

offices, and other facilities to verify whether the conditions for professional safety and the requirements 

of public health and environment protection are met.

Payment of fees & issue of the license:

After completion of the above mentioned procedure, all documents and reports shall be verified to ensure that they are correct and in the light of that the annual fees shall be fixed and a receipt of the same shall be given to the project owner. The license shall be issued after payment of the due fees.
Registering Industrial Firm with the Dubai Chamber of Commerce and Industry
The Chamber is responsible for registering the industrial firms as per the following procedure:

Submitting an application with the following attached documents:

A - Documents Required for Registering Sole Proprietorships:
  • A copy of the license issued and ratified by the licensing authority.
  • A copy of the passport of the owner of the establishment.
  • A copy of the passport of the local agent and a copy of duly notarized agency.
  • A copy of the passport of the manager of the establishment.
  • Authorized signature cards to be filled up as well as Industrial Firms Data Form.
  • In case the license type is changed, the former license is to be attached.

B - Documents Required for Registering Companies.
  • A copy of the license issued and ratified by the licensing authority.
  • Copies of valid passports of the partners.
  • A copy of the contract of partnership, authenticated by the Notary Public of Dubai Courts Department.
  • A copy of the company’s memorandum and articles of association.
  • All documents required in (4), (5), (6) & (7) of the Sole Proprietorships given above.
  • A copy of the certificate of formation for the establishments and companies incorporated in the Free Zone.
  • A copy of the trade license and the Chamber certificate for the branches of companies incorporated in other Emirates.

C - Documents Required for Registering Branches of Foreign Companies:
  • All the documents shown in (1), (2) & (5) of ‘Companies’ above.
  • An official certificate from the competent authorities in the country with whom the foreign company is registered, showing that it is registered in that country in accordance with its laws, and stating the legal status of the company.
  • Resolutions of the foreign company’s board of directors, with regard to opening a branch or representative office in Dubai, and passport copy of the company’s representative.
  • Identical copy of the foreign company’s memorandum of association and articles of association if it is a public or private joint stock company.
  • The agency contract signed by the foreign company and the local agent. If the agent is a juridical personality and registered as member of the Chamber of Commerce, provided that all partners are nationals.
  • A copy of certificate of registration in the foreign companies register at the Ministry of Economy and Commerce.

Submission of the Inscription Application:

The owner of the project should fill in the application for inscription in the Industrial Register, attached with the following document:
  • Photocopy of the industrial license issued by the Economic Development Department.
  • Photocopy of the partnership agreement attested by the court.
  • Photocopy of the Registration Certificate of the industrial project with the Dubai Chamber of Commerce and Industry.
Issuing the license of industrial production: 
After entering the project in the Industrial Register, it shall be granted a license for industrial production. The license is issued in the name of the owner of the project who shall be entitled to obtain any benefits, incentives, exemptions, or financing programs provided by the government to the industrial projects.

Annual Reports and Amendment of Data: 
The owner of the industrial project should provide the Department with annual reports on the activity of the factory; extend of manufacturing development, cost of production, and the products according to the form prepared for this purpose. He should also notify the Department of every change or amendment occurring to the data mentioned in the application for registration. All the data submitted by the owner of the project shall be considered confidential and restricted to only the concerned government officials. 

Selection Criteria 

The industrial economics categorizes the optimum project amongst the conditional terms. Evaluating any project proposal has to be taken into consideration with the investor’s career background and financial state. Meanwhile, all surrounding economic and social circumstances need to be evaluated and assessed. That is why the optimum project for a certain investor may hardly prove viable for another.

The distinctive characteristics of the industrial investment are obviously unlike those of other economic sectors, as will be detailed later. The misconception of this fact caused the collapse of many local industrial projects that had been managed according to the commercial way of thinking.
Broadly, it could be stated that the investor’s approach of determining his optimum industrial project involves three phases:

First phase: Sources of Identifying Proposals for Industrial Projects
  • Marketing surveys and local demand.
  • Scanning local on-going industries.
  • Analyzing the structure of imports.
  • Appraising the natural resources and local raw materials.
  • Using the lists of Industrial Classification.
  • Inquiring the views of professionals and specialists.
  • Studying mutual co-operation agreements and requirements of regional co-operation.
  • Exportation facilities and government policy.
  • Studying the new laws and legislations.

Second Phase: Criteria of Selecting the Optimum Project
  • Restrictions on the proposed industry.
  • Evaluating the absorptive capacity of the market.
  • The financial requirements for the project.
  • The adequacy of manpower.
  • The Project Forward, Backward Linkages with other sectors.
  • Future developments expected to affect the project.
  • Profitability.
  • The Feasibility and pre-feasibility studies.

Third Phase: Comprehending the Particularities of Industrial Projects
  • The significance of industrial investment for the National Economy.
  • The nature of industrial profitability.
  • The industrial project contribution to Human Development.
  • Prominence of planning in the industrial project.
  • The prevailing misconception of industrial competition.
  • The importance of feasibility studies.

 Vithul V Murali 
Dubai Mobile : +971 50 55 73 538
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Skype : Vithul.murali