Answered on October 22,2023
Commercial brokerage is a business activity in which a business entity (or broker) acts as a middleman between people (principals) who are buying and selling goods or providing services. They assist during negotiations and signing of contracts for the sale and purchase of goods or the provision of services and are entitled to payment under a brokerage contract.
Difference between a broker and a brokerage
A brokerage is a mediator for its clients in various transactions, including investments, loans, and property sales. A broker acts as a middleman, connecting a buyer and a seller to enable the completion of a transaction.
A broker’s primary duty is to solve the client’s problems for a fee. However, there are now alternative brokerage functionalities available. As a brokerage, you can:
Carry out transactions on the financial markets for the client using the customer’s funds and acting on the customer’s behalf.
Help traders by informing them of market conditions and delivering updates on price changes and other relevant information about trading platforms.
Give information about other people on the market so that the client can make the right choice about how to handle the transaction.
Funding customer margin trades.
Safekeeping of sensitive client information.
Putting in place the necessary technological infrastructure to enable trading on the exchange.
Brokers can be either people or legal entities. The broker acts on the client’s directions. The broker is subsequently paid, usually in the form of a set fee or a percentage of the total sale price. Some of the different kinds of brokers are:
Real Estate Broker: An individual that provides or offers market analyses of, lists, and negotiates the rental or sale of a property on behalf of the owner, tenant, or buyer.
Financial Investment Broker: Offers advice on investing, buying, or selling stocks, mutual funds, and other investment plans. They provide statistical and other factual information such as economic factors and trends and offer investment management services.
Insurance Broker: They assist the customer in sourcing the best insurance plans based on price and benefits. They also act as the customer’s representative when dealing with insurance claims.
Steps to start a commercial brokerage business in Dubai
If you want to start a commercial brokerage business, consider the following steps:
Step 1 – Select your business activity
Meydan Free Zone offers a vast range of commercial, industrial, and professional business activities. You may only engage in the activities specified on your license. You may easily add more later on if you decide to broaden or diversify your product offering.
Step 2 – Choosing your business name
Choosing a business name is crucial to starting a business in the UAE. It is essential to keep a few things in mind while you decide. Adherence to the strict naming rules in the United Arab Emirates is necessary. As a general rule, you should not use words that may be considered blasphemous or disrespectful. You must also ensure that the name you want is available and not already in use.
Step 3 – Applying for your trade license
Your next step should be to apply for a business license. The licensing procedure in Meydan Free Zone is digital, saving time and effort. The platform combines licensing with compliance and regulation, including UBO, ESR, and AML. As part of this procedure, you will need to provide the following documents:
A digital passport size photo
Emirates ID copy (if applicable)
Residence visa copy (if applicable)
Step 4 – Applying for your visa
To live in the country, you will require a resident visa. The visa application procedure is as follows:
Getting an entry permit
Changing your status
Taking a medical exam
Getting your Emirates ID and visa stamp
You may submit visa applications for your employees and family members simultaneously with your visa application.
Contact one of Meydan Free Zone’s business setup managers if you have any questions about the prerequisites. We can assist you in setting up your company as quickly as possible while keeping you completely compliant.
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