Law No. (13) of 2011
Regulating the Conduct of
Economic Activities in the Emirate of Dubai[1]
ـــــــــــــــــــــــــــــــــــــــــ
We, Mohammed bin Rashid Al Maktoum, Ruler of Dubai,
After perusal of:
Federal Law No. (5) of
1975 Concerning the Commercial Register;
Federal Law No. (1) of
1979 Regulating Industrial Affairs;
Federal Law No. (4) of
1979 Concerning Suppression of Fraud and Deception in Commercial Transactions;
Federal Law No. (18)
of 1981 Regulating Commercial Agencies and its amendments;
Federal Law No. (8) of
1984 Concerning Commercial Companies and its amendments;
Federal Law No. (5) of
1985 Issuing the Civil Code and its amendments;
Federal Law No. (3) of
1987 Issuing the Penal Code and its amendments;
Federal Law No. (37)
of 1992 Concerning Trademarks and its amendments;
Federal Law No. (10)
of 1992 Issuing the Law of Evidence Governing Civil Obligations and Commercial
Transactions and its amendments;
Federal Law No. (35)
of 1992 Issuing the Criminal Procedures Law and its amendments;
Federal Law No. (18)
of 1993 Concerning Commercial Transactions and its amendments;
Federal Law No. (7) of
2002 Concerning Copyright and Related Rights;
Federal Law No. (17)
of 2002 Concerning Regulation and Protection of Industrial Property Rights of
Patents, Drawings, and Industrial Designs and its amendments;
Federal Law No. (1) of
2006 Concerning Electronic Transactions and e-Commerce;
Cabinet Resolution No.
(6) of 2004 Authorising Nationals of the Gulf Cooperation Council States to Conduct
Economic Activities and Practice Professions in the UAE;
Law No. (1) of 2001
Establishing the Ports, Customs, and Free Zone Corporation and its amendments;
Law No. (3) of 2003 Establishing
the Executive Council of the Emirate of Dubai;
Law No. (25) of 2008
Concerning the Department of Economic Development;
Decree No. (22) of
2009 Concerning Special Development Zones in the Emirate of Dubai; and
Local Order No. (63)
of 1991 Concerning Licensing Professionals and Artisans in the Emirate of
Dubai,
This Law will be cited
as “Law No. (13) of 2011 Regulating the Conduct of Economic Activities in the
Emirate of Dubai”.
The following words
and expressions, wherever mentioned in this Law, will have the meaning
indicated opposite each of them unless the context implies otherwise:
|
UAE: |
The United Arab Emirates. |
|
Emirate: |
The Emirate of Dubai. |
|
Executive Council: |
The Executive Council of the
Emirate of Dubai. |
|
DED: |
The Department of Economic
Development. |
|
Director General: |
The director general of the DED. |
|
Economic Activity: |
Any commercial, industrial,
artisan, occupational, agricultural, service, or other for-profit activity authorised
in the Emirate in accordance with the legislation in force. |
|
Competent Entity: |
Any local or federal
authority responsible for regulating one or more Economic Activities pursuant
to the legislation in force. |
|
Business: |
Any company or sole
proprietorship licensed to conduct an Economic Activity in the Emirate, excluding
businesses licensed in free zones. |
|
Establishment: |
A Business owned by a
natural person for the purpose of conducting an Economic
Activity in the Emirate, whose legal personality is not distinct from its
owner and whose financial liability is associated with such owner, being the
person responsible for all its financial obligations towards third parties. |
|
Licence: |
A document authorising a Business
to conduct an Economic Activity. |
|
Commercial Authorisation: |
A document issued by the DED
authorising a Business to conduct a Marketing Activity. |
|
Marketing Activity: |
An activity conducted by a
Business to market its products and services through commercials, advertising
boards, clearance offers, sale, promotional campaigns, exhibitions,
conferences, or other marketing activities. |
|
Occupational or Artisan
Activity: |
An activity conducted by one
or more natural persons who rely on their physical or intellectual efforts or
use certain tools and equipment to perform such activity with a limited
capital. |
|
Business Incubators: |
A range of services and
facilities, and technical, administrative, and advisory support provided by a
Competent Entity for a specific period with a view to encouraging the
establishment and development of small and medium-size enterprises. |
This Law aims to:
1.
regulate the conduct of Economic Activities in the
Emirate and create a pro-investment environment in various economic areas in
the Emirate;
2.
create a “single window” for coordinating between
Competent Entities to fulfil the requirements for licensing Economic Activities
in the Emirate;
3.
create the optimum environment for the conduct of
business in the Emirate, and boost the economic growth of the Emirate;
4.
develop the economic environment of the Emirate by relying
upon accurate and transparent information and providing such information
through latest technology to enable various Businesses to benefit from the
same; and
5.
contribute to marketing and promotional plans, raise
economic and investment awareness, and identify the investment opportunities
available in the Emirate.
For the purpose of
achieving the objectives of this Law, the DED will regulate the conduct of
Economic Activities in the Emirate, and may in particular:
1.
establish the necessary rules to regulate granting the
Licences required to conduct Economic Activities in the Emirate, and determine
the details and validity of these Licences and the method to modify such details,
in accordance with the legislation in force and in coordination with the
Competent Entities;
2.
regulate the registration of Businesses in the Commercial
Register;
3.
register and maintain the trade names of Businesses;
4.
in coordination with the Competent Entities, license
Economic Activities in the Emirate in accordance with applicable laws,
regulations, and bylaws;
5.
determine and classify the Economic Activities authorised
in the Emirate in line with the latest internationally recognised standards,
and regularly develop and update the same in accordance with the Economic
Activity needs and economic development requirements of the Emirate;
6.
issue Commercial Authorisations to conduct Marketing
Activities in accordance with the conditions and rules adopted by the DED in
this respect;
7.
regulate and determine working hours for Businesses
operating in the Emirate in accordance with the rules adopted by the DED in
this respect;
8.
perform intellectual property audit and inspection, combat
commercial fraud, and manage commercial protection and consumer protection processes
in the Emirate; and
9.
perform audit and inspection of Businesses licensed to
conduct Economic Activities in the Emirate to verify compliance with the terms
of their Licences.
Licences to conduct
Economic Activities in the fields of commerce, industry, agriculture, fishing,
mining, and services, or any other fields, will be granted in accordance with
the relevant Economic Activities classification directory of the Emirate of
Dubai issued by the DED.
A natural or legal
person may conduct an Economic Activity in the Emirate only through a Business
licensed by the DED. The DED will determine the conditions and requirements that
must be met and the documents and approvals that must be submitted in order to
issue Licences.
a.
A Business will be licensed in the Emirate in
accordance with the following procedures:
1.
An application for a
Licence will be submitted to the DED on the relevant form prescribed by the
DED.
2.
The DED will, in
coordination with the Competent Entities,
consider the application to verify that it complies with all provisions and
conditions regulating the Economic Activity applied for and the legal form of
the Business to be licensed.
3.
The DED will determine the application for
Licence in accordance with the rules and conditions adopted in this respect,
the legislation in force in the Emirate, and the exigencies of public interest.
b.
The DED will issue the bylaws required to regulate the
procedures for submitting and determining Licence applications,
including the documents to be submitted, the approvals to be obtained from
Competent Entities, and the time frames prescribed for determining
applications.
a.
The Licence of a Business will be valid for a term of one
(1) year renewable for the same period. At the request of the Business and
subject to approval of the DED in coordination with the Competent Entity, the
validity of the Licence may be more than one (1) year, up to four (4) years.
b.
A Business must renew its Licence within the last
month prior to its expiry.
Companies will be
registered in the Commercial Register maintained by the DED for this purpose, in
accordance with the conditions and requirements adopted in this respect.
a.
A Business owner may not change the legal form of a
Business, modify the Licence details, or dispose of the Licence in any legal manner
without first obtaining the approval of the DED and Competent Entities.
b.
The DED will, in any of the following cases, publish
any modifications related to the Licence at the expense of the Business owner in
at least one daily newspaper published in the Emirate:
1.
change of
the legal form of the company;
2.
withdrawal
of a general partner from a General Partnership, Simple Limited Partnership, or
Business Partnership;
3.
modification
of the trade name of a Business;
4.
revocation
of the Licence of a Business; and
5.
any other
cases determined by the DED.
c.
A third party who has an objection to any modification
or change related to a Business must file such objection with the competent
court.
Without prejudice to
the conditions for conducting certain Economic Activities, if the ownership of
a Business is devolved by inheritance or legacy to several heirs or legatees,
they must nominate from amongst themselves one person to represent them in the
Business, failing which a representative will be appointed pursuant to a court
order.
a.
In accordance with the exigencies of public interest
and in coordination with the Competent Entities, the DED may, pursuant to a
reasoned decision, suspend the Licence of certain commercial, industrial,
agricultural, service, or any other activities for a specific period, or modify
the terms and restrictions imposed on such Licences.
b.
Upon approval or request of the Competent Entity, the DED
may suspend or alter the terms of the Licences it issues for Occupational or
Artisan Activities.
a.
A Business owner may request the DED to suspend the
Licence granted to his Business for a specific period due to cessation of its
activities, and such application will be determined in accordance with the relevant rules and conditions
adopted by the DED.
b.
A Business will not be subject to the licensing fees
or the fines resulting from non-renewal of its Licence where the Licence
expires and the Business ceases to conduct Economic Activities, or where the
Business submits an application for cessation of its activities in accordance
with paragraph (a) of this Article.
Economic Activities in
the Emirate must be conducted through a Business having one of the following
legal forms:
a.
sole proprietorship;
b.
civil works company;
c.
commercial company; or
d.
branch of a national or foreign company or of a
company operating in a free zone.
a.
UAE natural persons and other natural persons may
enter into partnerships to personally conduct Occupational or Artisan Activities
in the Emirate by establishing a partnership (“Business Partnership”) in
accordance with the provisions of the legislation and bylaws issued by the DED
in this respect. A legal person may become a shareholder in a Business
Partnership provided that the nature of his activity is similar to the nature
of the activity conducted by such Business Partnership.
b.
Non-UAE nationals will be authorised to conduct
Occupational or Artisan Activities provided that they have an agent (“Local
Service Agent”) who may be a natural person holding the UAE nationality or
a legal person whose partners are all holders of the UAE nationality.
A Local Service Agent will
be responsible to the Business and to third parties for
exercising due diligence to enable the Business to conduct its Occupational and
Artisan Activities in the Emirate, and will bear no civil or financial
liabilities in relation to the work or activity of the Business. The
relationship between the Business and the Local Service Agent must be governed
by a notarised agency agreement based on the template prescribed by the DED.
An applicant for a
Licence must specify the premises in the Emirate through which its Economic
Activities will be conducted. The premises must be suitable for the activities
to be licensed, and must satisfy the procedures and requirements adopted by the
DED and Competent Entities in this respect. The premises may not be used for
purposes other than those determined in the Licence
issued by the DED.
Notwithstanding the
provisions of Article (17) of this Law, the DED may issue Licences authorising
UAE nationals to conduct certain Economic Activities determined by the DED from
home or through Business Incubators in accordance with the rules and conditions
adopted by the DED in this respect.
A Business must:
1.
comply with the legislation and laws in force in the
Emirate;
2.
observe the conditions and rules for conducting its
licensed Economic Activities;
3.
notify the DED of any change in the information and
documents based on which the Licence has been granted, within ten (10) working
days from the date of such change, and ensure that the change is in accordance
with the legislation in force in the UAE;
4.
use the trade name specified in the Licence granted to
it in all dealings with third parties;
5.
enable the DED authorised employees to access the
premises of the Business and review its information and records as required to
perform their duties;
6.
provide the DED with any information, data, or
statistics it may require; and
7.
comply with the instructions, bylaws, and resolutions
issued by the DED and Competent Entities.
The DED will, in
coordination with the Competent Entities, create a “single window” for Business licensing
services to receive applications for Business Licences and deal with investors,
professionals, and artisans.
Competent Entities must provide the DED
with the requirements and conditions governing the conduct of Economic
Activities falling within their jurisdiction, and must notify the DED of any modification
of such requirements and conditions.
At the request of a free
zone authority, the DED may authorise it to use the Business licensing software
and Electronic systems to enable such authority to license Businesses operating
in that free zone in accordance with its applicable legislation and procedures.
a.
The DED may, in coordination with a free zone authority,
authorise a Business licensed in that free zone to conduct its activities in
the Emirate in accordance with the relevant rules and conditions issued upon
the recommendation of the DED by the Executive Council, provided that such
Business complies with the laws
and legislation in force in the Emirate.
b.
A Business licensed in a free zone may open branches
within the Emirate in accordance with the procedures adopted by the DED in this
respect.
The DED may delegate
any of the powers stipulated in this Law and related to the licensing of Businesses
to any public or private entity in order to facilitate and expedite the
licensing process.
No Business may
conduct any Marketing Activity of its products or services without first obtaining
the relevant Commercial Authorisation from the DED.
a.
A Commercial Authorisation to conduct Marketing
Activities in the Emirate will be granted to a Business in accordance with the
following procedures:
1.
An
application for a Commercial Authorisation will be submitted on the relevant
form prescribed by the DED.
2.
The DED will, in coordination with Competent Entities,
review the application to verify that it complies with all provisions and
conditions regulating the relevant Marketing Activity.
3.
The Commercial Authorisation application will
be determined by the DED in accordance with the rules and conditions adopted in
this respect, the legislation in force in the Emirate, and the exigencies of
public interest.
b.
The validity of a Commercial Authorisation granted to
a Business to conduct Marketing Activities will be determined in accordance
with the rules adopted by the DED in this respect.
c.
The DED will issue the bylaws required to regulate the
procedures for submitting and determining applications for
Commercial Authorisations, including the documents to be submitted, approvals
to be obtained, and time frames prescribed for determining applications.
Unless otherwise
established, all Electronic Documents and Records generated by the software and
Electronic systems of the DED will have the same probative force as official
documents.
In return for issuing
Licences and authorisations and providing other services under this Law and the
resolutions and bylaws issued in pursuance hereof, the DED will collect the fees
prescribed by a resolution of the Chairman of the Executive Council.
a.
Without prejudice to any stricter penalty stipulated
in any other law, a person who commits a violation of this Law or the resolutions
issued in pursuance hereof will be punished by a fine of no less than one
hundred Dirhams (AED 100.00) and no more than one hundred thousand Dirhams (AED
100,000.00).
b.
The Chairman of the Executive Council will issue a
resolution determining the acts that constitute violations of this Law and the
relevant fines prescribed for each violation.
a.
In addition to the penalty of a fine stipulated in
Article (29) of this Law, the DED may order closure of a Business or revocation
of its Licence in the following cases:
1.
failure to
renew the Licence and cessation of the activity, where a public notice is
published in a daily widely circulated local newspaper, and no objections are
raised within two (2) weeks from the date of publication; or
2.
where the
Business commits a violation of this Law or the legislation in force in the
Emirate which is punishable by closure of the Business or revocation of the
Licence, or in case the Licence is issued based on false information or
documents.
b.
Revocation of the Licence under paragraph (a) of this
Article will not prejudice the rights and obligations of a Business or its
owner towards third parties.
a.
At the request of a violating entity, the DED may
conclude amicable settlement with that entity subject to the following
conditions:
1.
submission
of an application for settlement within two (2) months from the date of
committing the violation;
2.
payment of no less than fifty percent (50%) of
the fine prescribed for the violation;
3.
no similar violations are committed by a
violating Business within one (1) year preceding the commission of the
violation in respect of which amicable settlement is requested; and
4.
any other conditions determined by the DED.
b. A Business must
implement the conditions of the amicable settlement within the period prescribed
by the DED, failing which the settlement will be deemed null and void.
DED employees
nominated pursuant to a resolution of the Director General will have the
capacity of law enforcement officers
to record the acts committed in breach of the provisions of this Law and the
resolutions issued in pursuance hereof. For this purpose, they may issue the
relevant violation reports and seek, in the course of performing their duties,
the assistance of concerned Government entities including police personnel.
Any affected party may
submit a written grievance to the Director General against any decision or measure
taken against him within thirty (30) days from the date on which he becomes
aware of this decision or measure.
Pursuant to a
resolution of the Director General, a committee will be formed to consider the
grievances submitted in accordance with Article (33) of this Law. The committee
must determine the grievance within a period not exceeding thirty (30) days
from the date of its referral to it, and its decision in this respect will be
final.
a.
Businesses licensed before the issuance of this Law must
comply with its provisions within a period not exceeding one (1) year from its
effective date. The Director General may extend this grace period once for the
same period.
b.
Businesses licensed pursuant to orders and
instructions of His Highness the Ruler of Dubai will be exempt from compliance
with the provisions of this Law, and will be governed by the relevant rules
issued by the DED.
Any provision in any
other local legislation will be repealed to the extent that it contradicts the
provisions of this Law.
This Law will be
published in the Official Gazette and will come into force on the day on which
it is published.
Mohammed bin Rashid Al
Maktoum
Ruler of Dubai
Issued in Dubai on 24
August 2011
Corresponding to 24 Ramadan
1432 A.H.
©2016 The Supreme Legislation Committee in the
Emirate of Dubai
[1] Every effort has been made to
produce an accurate and complete English version of this legislation. However,
for the purpose of its interpretation and application, reference must be made
to the original Arabic text. In case of conflict the Arabic text will prevail.