A general trading business, also known as a trading company, is a type of business that buys and sells a wide variety of products. It typically acts as a middleman between manufacturers or wholesalers and retailers or end consumers. The company may also provide various services, such as logistics, warehousing, and distribution, to facilitate the movement of goods from the manufacturer to the end consumer.
The term ‘general trading’ pertains to the import, export, and trading activities of a diverse range of physical goods and merchandise in the United Arab Emirates. This encompasses a broad spectrum of items, including furniture, electronics, clothing, toys, and various types of industrial and manufacturing equipment. However, there are certain goods that require a specific license for their import or export, such as cars, alcohol, medical items, or weaponry.
It’s worth noting that a ‘general trading license’ differs from a ‘trading license’. The latter permits trading within a single product category in a particular industry, whereas the former is required to trade in multiple products across diverse industries. With a general trading license, you can trade in a diverse array of products from varying industries, regardless of their dissimilarity. For instance, you can trade in furniture, home appliances, and apparel, among other things, under this license.
Overall, the goal of a general trading business is to earn a profit by buying products at a lower price and selling them at a higher price, while providing value-added services to their customers.
4690.97 – General Trading
General trading is a type of business that buys and sells lots of different products without focusing on one specific type of thing. These businesses might buy things from lots of different places like factories or other stores, and then sell them to other stores or people who want to buy them.
Some of these businesses are also called general trading wholesalers. These are companies that purchase products in bulk from manufacturers or other suppliers and sell them to retailers, businesses, or end consumers. General trading wholesalers typically have a large inventory of products and sell them at a lower price than retailers to make a profit. They can operate in various industries, such as food, electronics, textiles, and machinery.
The flexibility of general trading businesses allows them to adjust their product range and sourcing strategies to respond to changes in market demand and supply. As such, they can diversify their business offerings and minimise the risks of relying on a particular product or industry.
General trading companies can also benefit from economies of scale by buying products in bulk and negotiating better prices with manufacturers and suppliers. They can then sell these products to retailers, businesses, or end consumers at a lower price than specialised stores. This can attract more customers and increase sales volumes, leading to higher profits. Being able to operate in various industries makes it possible to tap into different markets and customer segments.
Exclusions
There are no activities excluded under this business activity.
<H3> Third-party Approvals
No third-party approvals are required for this business activity.
ESR
Companies that operate in the UAE are able to take advantage of the country’s low-tax jurisdiction to reduce their tax payments. However, this has led to new laws that aim to prevent tax evasion. To prove that they are genuinely operating in the UAE, certain companies need to submit an Economic Substance Notification and Return to demonstrate their business activities. Meydan Free Zone is committed to promoting a transparent and efficient business environment and supports efforts to prevent illegal activities such as money laundering and terrorism financing.
For example, companies that started their financial year on or after January 1st, 2019, and ended on or before December 31st, 2019, must file a notification to comply with the law. Additionally, newly established companies must also submit their Economic Substance Return in the following year. This process needs to be completed each year and submitted within 12 months after the end of the financial year.
Business activity 4690.97 is not subject to ESR.
AML
Meydan Free Zone is dedicated to establishing a fair, efficient, and transparent environment. To prevent illegal activities such as money laundering and terrorism financing, the free zone works together with both local and international initiatives and measures. To avoid penalties, Designated Non-Financial Businesses and Professions must comply with anti-money laundering and counter-terrorism financing regulations by meeting the requirements of the Ministry of Economy.
Existing licensees automatically registered for goAML after the awareness campaign ended on April 30th, 2021. New licensees must comply with the requirements after obtaining their license to avoid potential fines.
Business activity 4690.97 is not subject to AML.
Why Apply for Your Business License With Meydan Free Zone?
- A bank account is guaranteed.
- The business license is recognized by the Ministry of Foreign Affairs (MoFA) and the Dubai Chamber of Commerce.
- An online shop can be opened, with a choice of over 30 marketplaces.
- Apply for unlimited visas.
- Clearing, forwarding, shipping, storage, and warehouse facilities are provided.
- An import/export code can be applied directly to Meydan Free Zone.
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