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Wholesale on a fee or contract basis businesses are typically intermediaries that facilitate the buying and selling of goods between manufacturers or wholesalers and retailers or other businesses. These types of businesses do not take ownership of the goods themselves but instead earn fees or commissions for their services.
The activity Wholesale on a Fee or Contract Basis with Meydan Free Zone covers the operations of commission agents and other wholesalers who engage in trading on behalf and for the account of others. This encompasses the tasks of those involved in facilitating transactions between sellers and buyers or carrying out commercial activities for a principal, including through online platforms. Among these are agents with expertise in selling agricultural raw materials, live animals, textile raw materials, semi-finished goods, fuels, ores, metals, and industrial chemicals, such as fertilizers, food, beverages, tobacco, textiles, clothing, fur, footwear, leather goods, timber, building materials, machinery, including office machinery and computers, industrial equipment, ships, and aircraft, furniture, household goods, and hardware. Wholesale auctioneering houses’ activities are also included in this. You can choose the following activity when applying for your Wholesale on a Fee or Contract Basis business license with Meydan Free Zone:
Apply for your trade license under Wholesale trade, except for motor vehicles and motorcycles, and choose the business activity Wholesale on a Fee or Contract Basis with code 4610.00.
With this license, you can set up a pharmaceutical facility to sell and distribute pharmaceutical products and medical supplies and register and import these goods. You can also represent companies, pharmaceutical factories, and international medical supplies that are registered in the country and export or re-export pharmaceutical products and medical supplies. Additionally, you have the authorization to manufacture pharmaceutical products and medical supplies.
The activity Wholesale on a Fee or Contract Basis excludes ‘wholesale’ trade in its own name. This means you are not allowed to conduct wholesale of various goods without any particular specialization, such as grains and seeds, oily fruits, flowers and plants, unmanufactured tobacco, live animals, hides and skins, leather, agricultural material, waste, residues and by-products used for animal feed.
Additionally, you are excluded from engaging in commission agent activities for motor vehicles, including wholesale and retail sales of new and used vehicles, wholesale and retail sale of off-road vehicles (Jeeps, etc.), wholesale and retail sale by commission agents, and car auctions.
Your Wholesale on a Fee or Contract Basis license also excludes auctions of motor vehicles, retail sales by non-store commission agents, activities of insurance agents, and activities of real estate agents.
The Wholesale on a Fee or Contract Basis business activity does not require third-party approval.
Ultimate Beneficial Ownership (UBO) refers to the individuals or entities that ultimately own or control a company or business. It is important for regulatory and compliance purposes to identify the UBO of a business, as they may have an influence on the company’s operations, finances, and decision-making.
However, wholesale businesses on a fee or contract basis do not typically have UBOs, as they do not take ownership of the goods they facilitate the sale of. Therefore, you are not subject to UBO regulations.
Similarly, Economic Substance Regulations (ESR) are laws in many jurisdictions that require certain companies to demonstrate that they have sufficient economic activity and substance in the jurisdiction in which they operate. This is to prevent companies from artificially shifting profits to low-tax jurisdictions without conducting any real business activity there.
Wholesale businesses on a fee or contract basis are not subject to ESR because they are not engaged in significant economic activity themselves. Instead, they act as intermediaries between other businesses involved in real economic activity.
Anti-Money Laundering (AML) regulations are put in place to prevent the illegal practice of disguising the proceeds of illicit activities as legitimate funds. These regulations aim to ensure that businesses are not involved in money laundering activities and that they have adequate measures to prevent such activities.
However, businesses that operate in the wholesale industry on a fee or contract basis are not required to adhere to AML regulations. This means they are not subject to the same scrutiny and oversight as other types of businesses explicitly included in AML regulations.