Author: Hanoof Al Naama
Published: May 8, 2024
Establishing a business as a commercial broker in the UAE provides excellent prospects for entrepreneurs who seek to leverage the booming economy. By setting up this type of business, there is a sea of various opportunities and advantages, such as the UAE's geographical location, strong economy, and business-friendly regulations.
For entrepreneurs to have a successful venture, it is important to have a deep insight into the market, possess a vast network that can help them master the local market dynamics, and, more importantly, navigate through the regulatory environment. Setting up a business as a commercial broker requires a specific license, which can easily be obtained from SPC Free Zone, where you gain several advantages and the opportunity to choose from seven categories of business activities.
SPC Free Zone offers seven different business activity categories for commercial brokers. Each category has specific requirements, approval processes, and compliance obligations.
This activity relates to the role of a business or agents in bringing buyers and sellers together and undertaking a commercial transaction for a specified product or service. These types of agents, as well as all other wholesalers, conduct deals on behalf of other entities. These transactions commonly take place through face-to-face meetings or by legally authorizing a representative to oversee the deals. An increasing number of these transactions are currently taking place on online platforms.
The services usually involve:
A commercial broker conducts services through expertise, usually covering certain aspects that can include:
This category also includes wholesale auctioneering houses, which enable buyers to sell various goods and commodities through competitive bidding processes.
This category does not include:
| Requirement | Status |
|---|---|
| Third-party Approval | Not required |
| Filing of Economic Substance Returns | Not applicable |
| Anti-Money Laundering Compliance | Not applicable |
This category covers the activity of a services broker who provides a seamless process for conducting a business transaction between a consumer and a provider. Commission agents and wholesalers, acting as intermediaries between buyers and sellers, typically facilitate this indispensable service online or in a traditional setting.
Service brokers can deal in a wide variety of products:
They mediate transactions, utilizing their expertise and connections to ensure that the transaction process goes smoothly for everyone involved. To further broaden their horizons in the world of commercial trade, service brokers can also participate in wholesale auctioneering.
This category does not include:
| Requirement | Status |
|---|---|
| Third-party Approval | Not required |
| Filing of Economic Substance Returns | Not applicable to business activity 4610.11 |
| Anti-Money Laundering Compliance | Not applicable to business activity 4610.11 |
This category includes activities for brokerage in the ship and aircraft space. These types of brokers mediate between shippers and carriers by using their professional expertise and market awareness to provide the best possible transportation solutions. They ensure commodities are transported safely, efficiently, and affordably by negotiating contracts and agreements for chartering ships and aircrafts.
Brokers licensed in this category provide:
This category includes a range of services to maximize the efficiency of commodity transit via air and sea routes:
This category does not include:
| Requirement | Status |
|---|---|
| Third-party Approval | Required from Civil Aviation/Ports & Customs Department (Sharjah) after acquiring business license |
| Filing of Economic Substance Returns | Required |
| Anti-Money Laundering Compliance | Not applicable |
This category covers the activities of setting up an aviation business brokerage that enables clients to navigate through the complex processes involved in the aviation market of buying and selling aircrafts. Brokers who provide this type of service have a deep understanding of the aviation market, keeping track of industry trends, price variations, and demands involved in aircraft transactions.
Researching, choosing, or selling aircraft can be a complex process, and professionals need to be well-informed, especially for clients who seek guidance for market information. This knowledge is essential for clients to navigate and make informed decisions about transactions. Furthermore, aviation brokers should have the ability to conduct smooth negotiations and have a broad network that can meet clients' specific budgets and preferences.
Due to the dynamic scope of the market, this category offers services such as:
This category excludes:
| Requirement | Status |
|---|---|
| Third-party Approval | Required from Civil Aviation Sharjah before acquiring business license |
| Filing of Economic Substance Returns | Exempt |
| Anti-Money Laundering Compliance | Exempt |
This category covers the activities of real estate agents and brokers. They form an integral part of the real estate industry, offering a comprehensive array of services on a fee or contract basis. Businesses set up under this license mediate transactions between buyers and sellers, helping to facilitate transactions and make deals that work for every party involved.
Real estate agents and brokers provide:
As an agent and a commercial real estate broker, they play an essential role in the real estate market to help clients manoeuvre through its complexities using their expert knowledge and advice. Their management experience efficiently operates and maintains real estate assets, while their intermediary services simplify the process of purchasing, selling, and renting properties. The real estate market as a whole relies on agents and brokers to drive transactions, maintain property values, and keep the market running smoothly.
This category excludes:
| Requirement | Status |
|---|---|
| Third-party Approval | Required from Real Estate Registration Department after acquiring business license |
| Filing of Economic Substance Returns | Exempt |
| Anti-Money Laundering Compliance | Exempt |
In this category, the acquisition and sale of businesses (small and medium-sized enterprises) is facilitated through business brokerage activities. The provision of this type of service entails expertise in mediating between buyers and sellers, using specialized knowledge about market trends and demands, and carrying out successful negotiations to complete deals.
Business brokerage, as opposed to real estate, is primarily focused on businesses and assets. These brokers:
This category also includes:
This type of brokerage service helps businesses and investors take advantage of opportunities and make the most of their assets, which in turn helps the commercial marketplace run smoothly.
This category does not include:
| Requirement | Status |
|---|---|
| Third-party Approval | Not required |
| Filing of Economic Substance Returns | Exempt |
| Anti-Money Laundering Compliance | Exempt |
For more information on business setup in the UAE: