Q: I will be running a website. That provides services and posting ads. Since it requires a free subscription, I want to ask if I am obliged to register it… A: You will be accepting payments. This will be classified as a commercial interest, resulting in the requirement of a business license…

Dubai, UAE

2651

Requirements of starting a platform for posting ads in Dubai

Greetings!

I will be running a website (blog-post + classified ads) from home, that provides services and posting ads, and it will accept membership in some countries that speak English.

I am located in Dubai. Since it requires a free subscription, I want to ask if I am obliged to register it as business anywhere to be legal, or if I do not register, I will be asked or arrested for running this website.

The website is under maintenance at the moment, it will be broadcasting after it is completed. Some points I am really concerned with:

1- Do I need a legal registration of the website as a business? If yes, can you help me find out how? If I register in one country - let's say UAE - will it be legal in other countries e.g UK, US?

2- GDPR is really critical point that we have to consider especially for websites that collect info from visitors if required. What are the major points that we have to focus on GDPR?

Kindly help me optimize my website to get rid of any unsuspected legal issue.

Regards

Hayyan Khan

Avrio Legal Group

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12 May 2020, 20:19

Hello,

I trust you are well.

Any individual who operates a commercial aspect of a business must be legally licensed to carry out such operations.

Since you will be accepting payments, in the form of subscriptions, this will be classified as a commercial interest, resulting in the requirement of a business license.

The options for business licenses in the UAE are numerous. You can opt to set-up a company on the mainland (Abu Dhabi, Dubai...etc.) or you can opt for one of the many free zones located in the UAE.

A factor to consider is the differences between mainland versus free zone companies. The most vital difference is the requirement of a local sponsor for mainland companies (this individual will legally own 51% shares in the company).

Whereas, for free zone companies, you will retain 100% ownership of shares. We have assisted and continue to assist numerous clients with company formation within the UAE.

Should you proceed with obtaining a business license, an e-commerce license will serve as the most appropriate option. Of course, these things can be further discussed at a later stage.

With regard to your query about GDPR, we have assisted clients in the past by drafting Terms and Conditions and Privacy Policies that are GDPR compliant.

The main points that need to be covered for GDPR can be discussed further as well.

We will be delighted to provide assistance and help your business with an all-around legal safety network. Should you wish to obtain additional information, please contact us by email.

12 May 2020, 20:46

Thanks a lot for the fast reply.

One point I want to add, the website will be running for free for about 2 years or more.

In that case, payment and membership will be implemented later on after I have audience and website name awareness though there is subscription only to post totally free ads.

However, this website will be accepting ads in a number of countries lets say 30 countries that speak English. Will it be still ok?

The website will be operated from home only since I am not ready to have whole business settings in other words under budget.

The income of this business will be only from affiliate networks such as AdSense or AdThrive, through the number of traffic audience.

I really need your advice if there is a chance to do such home business for classified ads and thanks so much for that.

12 May 2020, 21:45

Hi,

Thank you for the clarification.

While you will be running the platform free of charge for a certain timeframe, you will be generating income through your platform's traffic.

This, in turn, will fall into a commercial category and will require a license.

Accepting ads from various countries is permissible, so long as the content of the ads and the way in which the ads are displayed are in line with relevant UAE laws.

Of course, how and when the ads will be displayed are subject to a mutual agreement between your company and your clients.

Moreover, for individuals involved in online services, e-commerce platforms and other social media platforms, we recommend compliance with the UAE's commercial license requirements.

As per the law, companies failing to obtain the relevant license may be subject to penalties of up to AED 500,000.

The main aspect here does not refer to the requirements associated with a business (office space, employees, etc.). The focal point here is to be a licensed entity.

Therefore, while the business set-up may be costly, the business license does not prove to be an overwhelming expense.

Lastly, building on your concern of having the opportunity to a home business, e-commerce license is the way to go.

It serves to be a flexible option with the adaptability of being operational from anywhere.

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Mazen Y. Ajjour

Al Bahar & Associates Advocates and Legal Consultancy

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13 May 2020, 08:13

For registration, you should approach the Dubai Economic Department as they have new registration for similar websites.

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Dr Amira Al Bastaki

Dr Amira Al Bastaki Advocates and Legal Consultants

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14 May 2020, 08:20

It is best to follow up with the Department of Economic Development regarding registering your activity in order to avoid any legal effects against you.

14 May 2020, 08:38

DED requires AED 1070 trade licence beside National Media Council permit that costs AED 15000 even in any case.

I would like to draft a GDPR.

15 May 2020, 07:55

We can help you. Please contact us on email.

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