Selling on social media is no different than trading on land. Both are economic activities that require a government-issued trade license. Social media has provided small businesses and independent entrepreneurs a simple and cost-effective platform for their business ventures. Not only do social media platforms have a wide reach but they also require minimum effort and investment. However, it has also become a playground for fraudulent and illegal activities. To safeguard, online consumers and entrepreneurs, the UAE government has made it mandatory to have a trade license in Dubai.
In 2018, the UAE Ministry of Economy along with the Telecommunications Regulatory Authority shut down many unauthorised commercial websites and social media pages without a valid trade license in Dubai. The same year, the Department of Economic Development (DED) had ordered over 13,000 social media accounts to close for conducting unlicensed trade. Some social media accounts also sold huge numbers of counterfeit goods because of which the DED and the Department of Consumer Protection took necessary action against such social media pages.
Owing to the increasing number of unauthorised selling and online frauds, the Electronic Media Regulations law was launched in March 2019. The law stated that online activities carried out for commercial purposes must have a trade license in Dubai. The trade license in Dubai must be sanctioned by the Department of Economic Development (DED) and the National Media Council (NMC). The activities include selling of commodities and services or otherwise commercial use of any other online platform. The law also includes commercial use of social media by sellers, vloggers, as well as influencers.
What is the penalty for selling on social media without a license?
Facebook, Instagram, and WhatsApp are the most popular channels used to sell products and services. The UAE commercial law is applicable on these as well as other social media channels. As a result, UAE citizens and residents may be penalised up to AED 500,000 for selling products or services online without a trade license. In the UAE, social media channels are monitored and regulated by UAE authorities. Their aim is to promote the practice of fair trade and protect consumers from online frauds.
How to get a social media license in Dubai?
The Department of Economic Development (DED) issues business licenses in Dubai for companies willing to do business in the region. Any type of business, be it online or offline must get a license from the DED.
To sell on social media, an entity must have a trade license issued by the DED and the NMC. The license will allow you to freely post and promote content related to products and services. It will also allow you creative freedom to run a full-fledged business.
If you would like to start a social media business or would like to get your trade license in Dubai to sell on social media, contact Shuraa Business Setup and book your FREE consultation today! For more information, speak with our company formation experts on +97144081900 or WhatsApp us on +971507775554. You can also drop us an email at [email protected]