Textile and Fabric Trading Company Setup in Dubai (2026): Licence Codes, Imports, Duties and Cost

A textile trading licence in Dubai starts with a seven-digit number, and most of the numbers published online are wrong. The Dubai Department of Economy and Tourism (DET) registers Textile Trading as activity 4751001, a commercial activity covering the resale of fabrics used for sewing, fashion wear and garment making [1]. When BusinessDubai.ae reviewed the pages ranking for textile trading licences in September 2026, every page that named a code used a dotted format, such as "4751.94", that appears in no DET, JAFZA or DMCC register.

The code is the first of several choices that decide what a textile shipment costs. Fabric entering the Dubai market pays 5% duty on its CIF value unless it is GCC-made [2] or qualifies under the UAE-India trade agreement [3]. Textile products carry identification labels under the GCC standard GSO 863:1997 [4]. And the free zone you pick decides whether your stock sits outside VAT and whether a 0% corporate tax claim is even possible.

Since 2013, BusinessDubai.ae has set up trading companies on the Dubai mainland and across the UAE's free zones. This guide covers the real activity codes, labelling and conformity rules, customs duty, the India CEPA, the anti-dumping position, Dubai Textile City's lost tax status, the mainland against JAFZA, DMCC, Meydan and IFZA, VAT, corporate tax and an itemised cost table.

Which licence and activity codes does a textile trading company need in Dubai?

A textile trading company in Dubai needs a commercial licence carrying DET activity 4751001, Textile Trading, which covers reselling fabrics used for sewing, fashion wear and garment making. Ready-made garments, yarn, trims, curtain fabric, used clothing and textile waste each have their own code, so list every product line before you apply.

Every code below carries the commercial licence type in DET's register, the category for buying and selling goods [1]. The table gives the official activity name, what DET's own description covers, and the matching number at JAFZA and DMCC, which license the same activities under their own lists [5][6].

The split that matters most is between the first two rows. Code 4751001 is a fabric code and 4771201 is a finished-garment code, so a wholesaler selling cloth by the metre to tailors and a trader importing boxed shirts are, in DET's register, doing two different things.

Common Mistake: Copying an activity code from a web page. Every ranking page reviewed for this guide that named a textile code used a dotted format, such as "4751.94" or "4771.82", that matches nothing in the DET, JAFZA or DMCC registers [1][5][6]. A number that does not exist on a business plan, a bank form or a quote invites questions you do not need. Use the seven-digit DET code, or the free zone's own number, and check it against the licence document when it is issued.

Can Textile Trading and Ready-made Garments Trading sit on one licence?

Both codes sit in DET's ready-made garments group [1], which is why many traders assume one licence carries both. DET's published descriptions do not say whether the two combine on a single licence, and no official source found for this guide answers it. If you intend to sell both fabric and finished garments, list both activities in the application, ask DET at initial approval, and get the answer in writing before you pay.

The same caution applies to adjacent codes in other groups. Curtains & Upholstery Fabrics Trading (4753004) sits in DET's furniture trading group, Used Cloth & Personal Items Trading (4774009) in used articles trading, and Textiles & Fabrics Waste Trading (4669114) in waste trading [1]. Adding any of them to a fabric licence is a question for DET, not an assumption.

How JAFZA and DMCC number the same activities

Free zones keep their own lists. JAFZA numbers Textile Trading 513101 in its "017 Readymade Garments Group" [5], a six-digit series that does not follow DET's. DMCC reuses the seven-digit federal code 4751001 and files it under Personal & Household Goods, in a group for textiles, clothing, footwear, bags and accessories [6]. Quote the number of the authority that issues your licence, never a DET number on a JAFZA form.

Pro Tip: Write the product list before you choose codes. Put down every line you expect to sell in the first two years, such as grey fabric, printed polyester, ready-made shirts, uniforms, buttons and zips, then map each one to a row in the table above. A uniform supplier who also sells fire-resistant vests needs 4771109 and 4771108, because DET describes them separately [1]. If your range spreads well beyond textiles, our general trading company setup guide explains when the wider licence earns its cost.

How much does it cost to set up a textile trading company in Dubai?

A Dubai mainland textile trading licence costs from AED 18,200 in year one without a visa, or about AED 26,355 with one visa, on BusinessDubai.ae's mainland package. Dubai free zone packages start at AED 12,500 licence only at Meydan Free Zone. Duty, stock, warehousing and labelling are separate and usually larger.

The table itemises a first year and the basis of each figure. Free zone prices come from BusinessDubai.ae's 2026 package table [18], the JAFZA line from JAFZA's own site [7], and the duty lines from Dubai Customs [2].

The licence is the smallest line that decides whether the first year works. Duty, the deposit on re-exported goods, stock and the warehouse are the numbers to model before you choose a base.

Quick Math: Take a container of Indian cotton shirts with a CIF value of AED 200,000 entering the Dubai market. At the standard 5% rate, duty is AED 10,000 [2]. If the shirts' tariff line is one the UAE eliminated under the CEPA and the shipment carries a valid certificate of origin, duty is nil [3]. An Import for Re-Export deposit on the same container ties up about the same AED 10,000 until exit is proven. One certificate, prepared correctly, is worth far more than the AED 350 between Meydan and IFZA with one visa [18].

For a quote that prices the licence, the zone and your first shipment together, get an itemised setup quote→

Should a textile trading company be on the mainland or in a free zone?

A Dubai mainland licence fits a textile trader who sells to the Deira and Bur Dubai wholesale trade, tailors, garment makers and UAE retailers, because it can invoice any buyer in Dubai directly. JAFZA fits import, stockholding and re-export to Africa, the CIS and the GCC. DMCC, Meydan and IFZA suit a trading desk rather than a warehouse.

The deciding question is who buys from you. Dubai's textile wholesale trade grew up in Deira and Bur Dubai, and the buyers there, along with tailors, garment makers and UAE retailers, are mainland businesses. A mainland company sells to them directly. A free zone company needs a mainland branch, a permit or a mainland distributor who buys and resells, and our best free zones for trading guide sets out each route. Textile trading on the mainland can be 100% foreign-owned, with no local partner [8].

Whether you base the company on the mainland or in a free zone decides who you can invoice, where your stock sits and how your profit is taxed. Our mainland company setup page itemises the DET route, and our free zone company setup page compares the zones, including the year-two renewal that a headline price leaves out.

The comparison uses BusinessDubai.ae's mainland figures, its 2026 free zone package prices [18], JAFZA's published floor [7] and the FTA's Designated Zone list [9].

The table says the mainland is simpler for local sales and JAFZA is stronger for holding stock and re-exporting. A trader who does both often runs a JAFZA stockholding company with a mainland route on top.

Real Talk: Meydan and IFZA look like the cheapest way into a Dubai textile licence, and with one visa they are AED 350 apart [18]. Two things change the picture. Neither is a VAT Designated Zone, so stock gets no out-of-scope treatment and the Designated Zone tax route is closed [9]. And both now require an investor visa holder to show capital of at least AED 75,000 in a bank account, in the UAE or at home [18]. Price the zone on what you will actually do there, not on the headline.

Which free zone suits textile import, stockholding and re-export?

JAFZA is the natural free zone for a textile importer and re-exporter: it sits beside Jebel Ali Port, leases warehouses and is a VAT Designated Zone under Cabinet Decision No. 59 of 2017 as amended. DMCC has the stronger trading brand and community but is not a Designated Zone, so it gives stock no VAT or tax privilege.

Designated Zone status does two things for a fabric stockholder. Goods held inside the zone sit outside the scope of UAE VAT until they are released to the mainland or consumed, and customs duty stays suspended until the goods enter the mainland or another GCC market [9][2]. For a trader shipping fabric onward to buyers in Africa, the CIS and the GCC, that is the whole model. JAFZA publishes only a licence floor of AED 5,000 and prices warehouse space on application [7], so budget from the facility rather than the licence. Our JAFZA free zone setup guide covers the facilities and the process.

DMCC licenses Textile Trading under the same code, 4751001 [6], and its brand and member community carry weight with trading counterparties. It is not on the FTA's Designated Zone list [9]. If your model is a trading desk that invoices while goods ship direct from the mill to the buyer, DMCC can work. If you hold stock, the zone gives that stock nothing. Our DMCC free zone setup guide covers the zone itself.

Our Designated Zone VAT guide explains the mechanics in full. If you want duty suspended on stock without a free zone company, our bonded warehouse guide explains when customs-bonded storage is the cheaper answer.

Common Mistake: Choosing DMCC for a re-export business because it is Dubai's best-known trading zone. The brand is real; the goods privilege is not. DMCC is not a Designated Zone [9], so stock it holds sits inside the UAE VAT net, and the Designated Zone distribution route to 0% corporate tax is closed to it. Ask any zone to name its entry on the FTA's Designated Zone list in writing before you sign a warehouse lease.

What happened to Dubai Textile City's tax status?

Dubai Textile City was on the Federal Tax Authority's list of VAT Designated Zones from 1 January 2018 and was removed with effect from 4 April 2021, under Cabinet Decision No. 34 of 2021. Since then it carries no Designated Zone VAT treatment, and the Designated Zone distribution route to 0% corporate tax does not run from it.

The FTA's consolidated list shows the row plainly: Dubai Textile City, from 01/01/2018, to 04/04/2021 [9]. Several pages ranking for textile setup still describe it as a privileged home for textile companies without mentioning the removal. Its current operating status as a licensing location, including who issues licences there today and on what terms, could not be confirmed from an official source for this guide. If Dubai Textile City is on your shortlist, ask the operator in writing what licence it issues, under which authority, and whether any tax or customs treatment attaches, then check the answer against the FTA list before you sign.

Real Talk: A textile address is not a tax status. Dubai Textile City's name still suggests a special regime for the trade, and it did have one for VAT between 2018 and 2021 [9]. It has not had one since. If a package is sold to you on the strength of a textile-cluster address, ask what the address does for your stock, your VAT and your corporate tax, and get each answer in writing before you pay a deposit.

Should a textile trader base in Dubai, Sharjah or Ajman?

Dubai is the right base when your buyers are Dubai wholesalers and retailers or you need Jebel Ali Port. Sharjah and Ajman are cheaper non-Dubai alternatives: on BusinessDubai.ae's 2026 pricing, Ajman Free Zone costs AED 13,131 with one visa, ANC Free Zone AED 10,800, and SHAMS or SPC Free Zone AED 14,255.

The table compares the bases a textile trader usually shortlists, on BusinessDubai.ae's package prices [18] and the FTA's Designated Zone list [9].

Sharjah's Designated Zones are Hamriyah Free Zone and Sharjah Airport International Free Zone [9], which price space on application rather than as packages. If a Sharjah base suits your buyers, our business setup in Sharjah page compares the emirate's zones. If price matters more than a Dubai address, our business setup in Ajman page shows what each Ajman package buys. These are not Dubai prices, and a Sharjah or Ajman company reaches Dubai buyers through a distributor or a Dubai mainland presence.

Quick Math: For a trader planning two visas, the Dubai choice between Meydan and IFZA turns on the second visa. Meydan costs AED 27,600 with two visas and IFZA AED 24,600 [18], so IFZA is AED 3,000 cheaper, because its second visa adds AED 3,200 against Meydan's AED 6,550. At licence-only or one visa the two are within AED 400 of each other, which is noise rather than a reason to choose.

What labelling and conformity rules apply to imported textiles?

Imported textiles in the UAE carry an identification label under GCC standard GSO 863:1997, which covers yarns, ropes, fabrics, floor coverings, household textiles, ready-made garments, netting and medical textiles. Conformity bodies also list textiles among the categories regulated by the Ministry of Industry and Advanced Technology (MoIAT), and Dubai Customs classifies every line by a 12-digit HS code.

GSO 863:1997, the textile identification label

GSO 863:1997, "Identification Label for Textile Products", was approved by the GCC Standardization Organization on 15 October 1997 and is listed as the current edition [4]. Its scope is the general requirements for identification labels on yarns, ropes, fabrics, textile floor coverings, household textiles, ready-made garments, netting and medical textiles [4]. That scope matters for a fabric trader: the standard reaches rolls of cloth and cones of yarn, not only finished garments.

Compliance firms summarise the typical label as carrying the fibre content, the country of origin and the importer's identity, with Arabic text. Those details come from secondary summaries rather than the standard's own clauses, so buy the standard from the GSO store or ask your conformity body for the exact wording before you print labels or approve a supplier's.

MoIAT conformity

MoIAT runs the Emirates Conformity Assessment Scheme (ECAS), which issues a Certificate of Conformity or the Emirates Quality Mark for regulated products [10]. Conformity bodies, Cotecna among them, list textiles among the regulated categories alongside electronics, cosmetics and construction materials [10]. That is a conformity body's description rather than a MoIAT list, so check each product against MoIAT's regulated list before the first order. A certificate is far easier to arrange before shipment than with the goods waiting at the port.

HS codes and Dubai Municipality

Dubai Customs moved to a 12-digit HS code system in January 2025, and small differences, such as whether a fabric or garment is knitted or woven, change the code and can change the duty [2]. Our clothing and fashion business guide covers the HS system and garment labelling from a brand's side, and the same classification rules apply to a wholesaler.

Whether Dubai Municipality's Montaji consumer product registration applies to a given textile or apparel line could not be confirmed from Dubai Municipality's own guidance for this guide. Confirm with Dubai Municipality before your first shipment, and keep the answer on file.

Pro Tip: Approve the label before the goods are made. Send your supplier the label text, including fibre content and origin, as part of the purchase order, and ask your conformity body to check it against GSO 863:1997 first [4]. Relabelling a container of garments in a Dubai warehouse costs labour and days that a correct label at the factory does not. For baby wear, ask the conformity body whether any further product rules apply before you order.

Real Talk: Clean sourcing papers protect a legitimate trader as much as a correct label does. Khaleej Times reported that Dubai Customs made 68 seizures of counterfeit goods worth AED 42.195 million in the first quarter of 2025, with clothing, fabrics, bags and shoes among the categories [11]. Keep brand authorisations and supplier invoices on file for any branded stock, and do not buy branded goods from a seller who cannot show where they came from.

What customs duty do textile imports pay in Dubai?

Textiles imported into the Dubai market pay customs duty of 5% of CIF value, meaning cost, insurance and freight. GCC-made goods are exempt with a valid certificate of origin, and Indian goods on lines eliminated under the UAE-India CEPA enter at 0%. Goods for re-export can move under a refundable deposit of about 5% of CIF.

The table sets out the duty position for each way a textile shipment can enter, as of September 2026.

The deposit is the line most often mis-modelled. Our Dubai Customs registration guide explains the Import for Re-Export declaration, the refund, and why the widely repeated "1% refund" could not be verified. You also need a Dubai Customs client code before the first container clears, which the same guide covers, and our import-export business guide covers the wider trade mechanics.

Does the UAE-India CEPA remove duty on Indian textiles and garments?

For most lines, yes. Under the UAE-India Comprehensive Economic Partnership Agreement, the UAE eliminated the 5% duty on Indian ready-made garments and most textile tariff lines from 1 May 2022, as reported consistently by three law and advisory firms. Confirm your exact HS line on the tariff schedule, and ship with a valid certificate of origin.

The same firms report that about 80.3% of all UAE tariff lines, more than 6,090 products, went duty-free when the agreement took effect, with the rest phased over five to ten years [3]. Those figures are the firms' summaries of the agreement, not the UAE tariff schedule itself, and the schedule is the document to check for your line. A trader importing Indian cotton fabric or shirts should look up each product's HS code before quoting a landed price.

The zero rate reaches only goods that qualify as Indian-origin under the agreement and arrive with the certificate to prove it [3]. A customs broker can confirm both before you order. Our Dubai business setup for Indian entrepreneurs guide covers the wider CEPA benefits for founders moving a business from India.

Common Mistake: Pricing every Indian line at zero duty. The CEPA eliminated duty on most textile lines, not on every line, and the zero rate applies only when the shipment carries a valid certificate of origin [3]. A line still being phased, or a shipment whose certificate is missing or wrong, pays the standard 5% of CIF [2]. On an AED 200,000 container, that is AED 10,000 you did not price into the sale.

Is there an anti-dumping duty on textiles imported into the UAE?

No UAE or GCC anti-dumping, countervailing or safeguard duty on textiles, yarn or fabric was found in force, as of a check on 29 September 2026. The UAE has the legal framework, Federal Law No. 1 of 2017, but the most recent GCC anti-dumping action found targets semi-finished aluminium products from China, not textiles.

The law and its implementing rules, Council of Ministers Decision No. 8 of 2018, are administered by the Ministry of Economy and were notified to the World Trade Organization [12]. That notification contains the legal texts only, with no list of measures, and names no textile, yarn, fabric, garment or clothing product [12]. The 2025 GCC action reported by PwC covers semi-finished aluminium from China [13]. The Ministry's live list of measures in force sits behind a login and could not be checked directly, so confirm current measures with the Ministry of Economy before pricing a large shipment.

How is VAT charged on fabric and garments in the UAE?

Fabric and garments are standard-rated for UAE VAT at 5%, and registration is mandatory once taxable supplies pass AED 375,000 a year, voluntary from AED 187,500. A registered importer accounts for import VAT under the reverse charge on its return, and exports are zero-rated only with evidence that the goods left the UAE.

No textile-specific VAT relief was found: fabric sold to a tailor and a dress sold to a shopper both carry 5% [14]. The reverse charge on imports works only when the Tax Registration Number is linked to the Dubai Customs client code. Linked, import VAT is declared and recovered on the same return; unlinked, you pay 5% in cash to release each shipment and wait to recover it [14].

Exports can be zero-rated when the goods leave the UAE within 90 days of supply and you keep the export declaration, the bill of lading and proof of delivery [14]. Goods held inside a Designated Zone such as JAFZA sit outside the scope of VAT until they are released to the mainland or consumed [14], which is why a re-exporter's choice of zone is also a VAT decision.

Common Mistake: Registering for VAT and never linking the TRN to the customs code. Every container then clears only after you pay 5% import VAT in cash, and the money comes back a return later [14]. For a fabric importer bringing in a container a month, that is working capital tied up for no reason. Link the two as soon as the TRN is issued; the customs registration guide linked above walks through the steps.

Can a textile trading company pay 0% corporate tax?

A textile trading company in Dubai usually pays ordinary corporate tax: 0% on taxable income up to AED 375,000 and 9% above, or nothing under Small Business Relief while revenue stays at or under AED 3,000,000. The free zone 0% rate is open only through distribution in or from a Designated Zone, with conditions.

Trading fabric, yarn or garments as such is not one of the Qualifying Activities listed in Ministerial Decision No. 229 of 2025 [15]. The item that comes closest is Article 2(1)(l), "distribution of goods or materials in or from a Designated Zone". It requires the activity to be conducted in or from a Designated Zone, the goods to enter the UAE through that zone, and the goods to be supplied to a customer who resells, processes or alters them, or parts of them, for the purposes of sale or resale, or to a public benefit entity [15]. Transactions with natural persons are an Excluded Activity under Article 2(2)(a), so consumer and retail sales do not qualify [15].

That text fits a textile distributor better than most trades. A JAFZA company selling fabric to garment makers who cut and sew it, or to sub-dealers in the GCC, Africa or the CIS who resell it, is supplying customers who process or resell. The same company selling from a retail counter is not. DMCC, Meydan and IFZA are not Designated Zones, and Dubai Textile City lost the status in 2021 [9], so the route does not run from any of them.

What the conditions and a failure cost

A Qualifying Free Zone Person must also keep non-qualifying revenue within the de minimis limit, the lower of 5% of total revenue or AED 5,000,000, and prepare audited financial statements [15][16]. A company that fails a condition is taxed at the ordinary rates, 0% on the first AED 375,000 of taxable income and 9% above, from the start of that tax period, and cannot return to Qualifying Free Zone Person status for the following four tax periods [16][15]. While it remains a Qualifying Free Zone Person, it gets no AED 375,000 band on non-qualifying income and cannot claim Small Business Relief [18].

Small Business Relief is the realistic plan for most new traders. A resident person with revenue at or under AED 3,000,000 can elect to be treated as having no taxable income for tax periods ending on or before 31 December 2029, under Ministerial Decision No. 73 of 2023 as amended by Ministerial Decision No. 131 of 2026 [17]. Our Small Business Relief guide covers the election, and our Qualifying Free Zone Person guide covers the full conditions.

Real Talk: For most textile traders the honest plan is ordinary rates, with Small Business Relief while revenue is under AED 3,000,000. The 0% rate is worth pursuing only if you run a JAFZA business whose buyers are garment makers or resellers, and you can keep retail and walk-in sales inside the de minimis limit [15]. Anything else is a claim that puts the company on ordinary rates and outside the regime for five tax periods if it fails.

Pro Tip: Tag every customer by type when the account is opened: garment maker, reseller, retailer or individual. The Designated Zone route turns on what each buyer does with the goods, so recording it from day one makes the de minimis test a report rather than a year-end reconstruction. Flag tailors trading as sole establishments separately, because whether a sole establishment counts as a natural person under Article 2(2)(a) is a point to take tax advice on.

If you want your customer mix tested against these routes before you choose a zone, model your tax position→

Can you trade used clothing or textile waste from Dubai?

Yes, under codes of their own. DET activity 4774009, Used Cloth & Personal Items Trading, covers reselling used clothes, shoes, leather items, hats and belts sorted by quality and type and packed in bulk. Textiles & Fabrics Waste Trading, 4669114, covers damaged clothes, curtains and bed sheets sold for recycling or recovery.

The wording of 4774009 describes the bale trade: used clothing sorted, graded and packed in bulk [1]. It is a named sub-trade in Dubai's re-export corridor to Africa, and JAFZA lists the same activity as 524007 while DMCC uses 4774009 [5][6]. Because it sits in DET's used articles group rather than the ready-made garments group, adding it to a fabric or garment licence is a question for DET at initial approval. Check the destination country's import rules for used clothing before you buy stock for a new market.

Textile waste is a different product. Code 4669114 sits in DET's waste trading group and covers textile and fabric waste resold for recycling or recovery [1]. A trader selling damaged returns or rejected fabric to a recycler, rather than to a buyer who will wear or resell them, needs this code rather than a garment code.

What are the steps to set up a textile trading company in Dubai?

Setting up a textile trading company in Dubai runs in eight steps: map products to activity codes, choose the base, reserve the trade name and get initial approval, secure premises, issue the licence, register with Dubai Customs, build the labelling and conformity file, then register for VAT and open a bank account.

1. Map the codes. Match every product line to a DET code, or the free zone's own number, and put any combination question to the authority.
2. Choose the base. The mainland for local wholesale and retail buyers, JAFZA for stock and re-export, a desk licence for a trading desk.
3. Trade name and initial approval. Reserve the name and obtain DET's initial approval, or the free zone's equivalent.
4. Premises. Sign the office, shop or warehouse lease, registered to the company on the mainland or leased from the zone.
5. Licence issue. The licence is issued against the approved activities and premises; check the codes on it.
6. Dubai Customs client code. Register as an importer so consignments clear in the company's name.
7. Labels and conformity. GSO 863:1997 label text, MoIAT checks where a product is regulated, and Dubai Municipality's answer on registration.
8. VAT and banking. Register once taxable supplies pass AED 375,000, or earlier voluntarily, link the TRN to the customs code, and open the corporate account.

Steps 6 and 7 run on your suppliers' and the authorities' timelines, so start the label and conformity file while the licence is being issued. On banking, WIO and Mashreq Neo open readily for free zone companies [18]. Every bank will still ask a trading company about its suppliers, its buyers and its goods, and our general trading guide linked above explains why trading draws heavier scrutiny.

Year two brings the licence renewal, visa renewals, VAT returns, the corporate tax return and, for a JAFZA company claiming 0%, the audit. Our post-setup services team keeps that calendar and the renewals moving, so none of it lands in the week a container arrives.

Which setup fits your textile business?

The right setup for a textile business depends on the product and the buyer. A fabric wholesaler supplying tailors fits the Dubai mainland, a re-exporter to Africa fits JAFZA, an Indian-origin importer needs a CEPA certificate of origin on every shipment, and a small souk trader fits the mainland with Small Business Relief.

The table maps six common textile models to a base, codes, the rules that matter and the likely tax position.

If your business straddles two rows, the buyers decide which row wins. Check which setup fits your range→

Real Client Stories

These are composite examples built from the situations textile traders most often face. Names and details are illustrative, and the only figures used are published rules and duties and BusinessDubai.ae's package prices.

The fabric wholesaler with a code from a web page (Dubai mainland)

Karim planned to sell cotton and polyester fabric to tailors in Bur Dubai and drafted his business plan around a code copied from a free zone marketing page: "4751.94". DET's register has no such number. The activity he needed was 4751001, Textile Trading, and because he also planned to sell ready-made shirts, he listed 4771201 as well and asked DET at initial approval whether both could sit on one licence. Every buyer he named was a mainland business, so he chose BusinessDubai.ae's mainland package at AED 18,200 without a visa. Lesson: take the code from the register, and put combination questions to DET before you pay.

The CEPA importer without a certificate (Dubai mainland)

Priya set up on the Dubai mainland to import Indian cotton shirts for UAE retailers and priced every container at zero duty under the UAE-India CEPA. Her first shipment arrived with an invoice and packing list but no valid certificate of origin under the agreement, so it was treated as a standard import and cleared at 5% of CIF value. The duty was paid and the goods released, but the margin on that container went with it. For later shipments she checked each product's HS line against the schedule and made the certificate a condition of the supplier's payment. Lesson: the zero rate is a document, not an assumption.

The re-exporter who chose the brand (DMCC)

Samuel set up in DMCC to ship fabric to wholesale buyers in East Africa, drawn by the zone's trading reputation, and planned his tax on the Designated Zone distribution route to 0%. Before the first order, the plan met the FTA list: DMCC is not a Designated Zone, so stock held there would get no out-of-scope VAT treatment and Article 2(1)(l) of Ministerial Decision No. 229 of 2025 did not apply. He kept DMCC as a trading desk, with goods shipping direct from the mill to the buyer, and priced a JAFZA company for the day he starts holding stock. Lesson: check the Designated Zone list before the brand.

Start your textile trading company the right way

For a textile trader the licence is the quick part. What decides whether the business works is three choices made before the first container: activity codes that match what you actually sell, with fabric and garments on different codes; paperwork that lets each shipment clear at the right duty, from GSO 863:1997 labels to a CEPA certificate of origin; and a base that matches your buyers, the mainland for Deira and Bur Dubai wholesale and JAFZA for stock and re-export. Get those right and the tax position follows from them rather than from a hopeful claim.

BusinessDubai.ae has completed 700+ company registrations across the UAE, with itemised pricing and no hidden fees. We will price a mainland company setup against a free zone company setup on the things that actually differ for a textile trader, which are who you can invoice, where your stock can sit and whether any 0% claim would survive a review. After launch, our post-setup services team handles the renewals, visas and filings that follow. Talk to a setup expert→

Frequently Asked Questions

What licence do I need to trade textiles in Dubai?

You need a commercial trade licence carrying DET activity 4751001, Textile Trading, which covers reselling fabrics used for sewing, fashion wear and garment making. Add the specific codes for any other lines you sell, such as 4771201 for ready-made garments or 4751015 for threads and yarns, and confirm the set with DET at initial approval.

What is the DET activity code for textile trading?

The DET code for Textile Trading is 4751001, a commercial activity in DET's ready-made garments group. DMCC uses the same seven-digit code, while JAFZA numbers the same activity 513101 in its own list. Quote the code of the authority that issues your licence.

Is 4751.94 a valid textile trading activity code?

No DET, JAFZA or DMCC register checked in September 2026 contains a code in that dotted format. The DET code for Textile Trading is 4751001. If a web page or a quote gives you a dotted number, ask for the seven-digit DET code or the free zone's own number before you apply.

Is textile trading the same as ready-made garments trading?

No. DET's Textile Trading activity, 4751001, covers fabrics and textiles used for sewing and garment making, while Ready-made Garments Trading, 4771201, covers finished outerwear and underwear for men, women and children. A trader who sells both fabric and finished clothing should raise both activities at application.

Can textile trading and ready-made garments trading be on one licence?

Confirm it with DET. Both codes sit in DET's ready-made garments group, but no official source found for this guide states whether 4751001 and 4771201 combine on a single licence. List both in the application if you intend to trade both, and get DET's answer in writing at initial approval.

Can a foreigner own 100% of a textile trading company in Dubai?

Yes. Since the 2021 amendments to the Commercial Companies Law, most mainland commercial activities, including textile trading, can be 100% foreign-owned without a local partner. Free zone companies have always allowed full foreign ownership.

How much does it cost to set up a textile trading company in Dubai?

On BusinessDubai.ae's 2026 pricing, a Dubai mainland licence costs from AED 18,200 without a visa and about AED 26,355 with one. Dubai free zone packages start at AED 12,500 licence only at Meydan Free Zone, or AED 21,050 with one visa. Duty, stock, warehousing and labelling are extra.

Is a free zone or the mainland better for textile trading?

The mainland is better if your buyers are Deira and Bur Dubai wholesalers, tailors and UAE retailers, because a mainland company invoices them directly. JAFZA is better for importing, holding stock and re-exporting. DMCC, Meydan and IFZA suit a trading desk rather than a warehouse.

Which free zone is best for textile re-export from Dubai?

JAFZA is the strongest fit for textile re-export. It sits beside Jebel Ali Port, leases warehouses and is a VAT Designated Zone, so goods held there are outside the scope of VAT and duty stays suspended until they enter the mainland or another GCC market.

Is DMCC a VAT Designated Zone?

No. DMCC does not appear on the Federal Tax Authority's list of Designated Zones, although it is Dubai's best-known trading free zone. Stock held by a DMCC company gets no out-of-scope VAT treatment, and the Designated Zone distribution route to 0% corporate tax is closed to it.

Is Dubai Textile City still a VAT Designated Zone?

No. The FTA's list shows Dubai Textile City as a Designated Zone from 1 January 2018 to 4 April 2021, when it was removed under Cabinet Decision No. 34 of 2021. Its current licensing terms were not confirmed for this guide, so check directly with the operator before relying on any privilege.

What is the customs duty on textile imports into Dubai?

Textiles imported into the Dubai market pay 5% of CIF value, meaning cost, insurance and freight. GCC-origin goods are exempt with a valid certificate of origin, and Indian goods on lines eliminated under the UAE-India CEPA enter at 0%. Confirm the rate on your 12-digit HS line.

Does CEPA make Indian garments duty-free in the UAE?

For most lines, yes. Under the UAE-India CEPA, the UAE eliminated duty on Indian ready-made garments and most textile tariff lines from 1 May 2022, as reported by several law and advisory firms. The zero rate needs a valid certificate of origin, and each HS line should be checked on the tariff schedule.

Is there an anti-dumping duty on textiles imported into the UAE?

None was found in force as of a check on 29 September 2026. The UAE's framework is Federal Law No. 1 of 2017, and the most recent GCC anti-dumping action found targets semi-finished aluminium from China. Confirm current measures with the Ministry of Economy before pricing a large shipment.

What labelling standard applies to textiles in the UAE?

The GCC standard GSO 863:1997, Identification Label for Textile Products, covers yarns, ropes, fabrics, floor coverings, household textiles, ready-made garments, netting and medical textiles. Compliance firms summarise the label as carrying fibre content, origin and importer identity, with Arabic text, so confirm the exact wording with a conformity body.

Do imported garments need a certificate of conformity in Dubai?

It depends on the product. Conformity bodies list textiles among the categories regulated under MoIAT's Emirates Conformity Assessment Scheme, which issues a Certificate of Conformity or the Emirates Quality Mark. Check each product against MoIAT's regulated list before your first order.

Does textile trading need Dubai Municipality Montaji registration?

That could not be confirmed from Dubai Municipality's own guidance. Ask Dubai Municipality whether your specific textile or apparel line needs Montaji registration before your first shipment, and keep the answer on file.

What HS code system does Dubai Customs use for textiles?

Dubai Customs has used a 12-digit HS code system since January 2025. Small differences, such as whether a fabric or garment is knitted or woven, change the code and can change the duty, so classify each product line before quoting a landed price.

How does the re-export deposit work for textiles?

Goods declared for import and re-export through the mainland move with duty suspended against a deposit or guarantee of about 5% of CIF value. The deposit is refunded once exit is confirmed, within 6 months of the original declaration. Importing into a Designated Zone such as JAFZA avoids the cycle.

Can a free zone textile company sell to Deira wholesalers?

Not directly. A Dubai free zone company needs a mainland route, such as a mainland branch or a permit, or it sells through a mainland distributor who buys and resells. A trader whose buyers are mostly Dubai wholesalers usually starts on the mainland.

Where is Dubai's wholesale textile market?

Dubai's textile wholesale trade grew up in Deira and Bur Dubai, around the Textile Souk, Naif Souk and Murshid Bazaar. Reference sources describe the historic Textile Souk as largely a heritage and tourist market today, with the wholesale business continuing through established trading companies.

Can a textile trading company get 0% corporate tax?

Only in narrow cases. Textile trading is not a Qualifying Activity under Ministerial Decision No. 229 of 2025, but distribution in or from a Designated Zone such as JAFZA can qualify when goods enter through that zone and go to customers who resell, process or alter them. Retail sales to individuals are excluded.

What happens if a free zone textile company fails a QFZP condition?

It is taxed at the ordinary rates, 0% on the first AED 375,000 of taxable income and 9% above, from the start of that tax period. It also cannot be a Qualifying Free Zone Person for the following four tax periods.

Does Small Business Relief apply to textile traders?

Yes, if revenue is at or under AED 3,000,000. Under Ministerial Decision No. 73 of 2023, as amended by Ministerial Decision No. 131 of 2026, the relief applies to tax periods ending on or before 31 December 2029. It is not available to a company claiming Qualifying Free Zone Person status.

How much VAT is charged on fabric sold in Dubai?

Fabric and garments sold in the UAE are standard-rated at 5% VAT. Registration is mandatory once taxable supplies pass AED 375,000 a year and voluntary from AED 187,500, and no textile-specific VAT relief was found.

Are textile exports from Dubai zero-rated for VAT?

Yes, when the goods leave the UAE within 90 days of supply and you keep the evidence, including the export declaration, the bill of lading and proof of delivery. Without that evidence the sale falls back to the standard 5% rate.

Can I trade used clothing from Dubai?

Yes, under DET activity 4774009, Used Cloth & Personal Items Trading, which covers used clothes, shoes, leather items, hats and belts sorted and packed in bulk. JAFZA lists the same activity as 524007 and DMCC as 4774009. Check the destination country's import rules before you buy stock.

Which activity code covers textile waste?

Textiles & Fabrics Waste Trading, DET code 4669114, covers reselling textile and fabric waste such as damaged clothes, curtains and bed sheets for recycling or recovery. It sits in DET's waste trading group, not the ready-made garments group.

Which activity code covers curtain and upholstery fabric?

Curtains & Upholstery Fabrics Trading, DET code 4753004, sits in DET's furniture trading group. JAFZA lists it as 514937 and DMCC as 4753004. A fabric trader who also sells furnishing fabric should raise it with DET at initial approval.

Is Ajman or Sharjah cheaper for a textile trading company?

Yes, as non-Dubai alternatives. On BusinessDubai.ae's 2026 pricing, Ajman Free Zone costs AED 13,131 with one visa and ANC Free Zone AED 10,800, while SHAMS and SPC Free Zone cost AED 14,255. Ajman Free Zone is a VAT Designated Zone; SHAMS and SPC Free Zone are not.

What happens to counterfeit clothing at Dubai Customs?

Dubai Customs seizes counterfeit goods. Khaleej Times reported 68 seizures worth AED 42.195 million in the first quarter of 2025, with clothing, fabrics, bags and shoes among the categories. Keep brand authorisations and supplier invoices for any branded stock you import.

Do Meydan and IFZA require capital for an investor visa?

Yes. Both now require an investor visa holder to show capital of at least AED 75,000 in a bank account, in the UAE or in the home country. The rule is not widely published, so plan the funds before you apply.

References

[1] Dubai Department of Economy and Tourism (DET). Business activity register: Textile Trading (4751001) and the related garment, yarn, trims, curtain fabric, tents, used clothing and textile waste activities, with licence type, group and official descriptions (DET records last updated 25 October 2023), as compiled in BusinessDubai.ae's normalized copy of the DET list, July 2026. app.invest.dubai.ae

[2] Dubai Customs. Customs duty at 5% of CIF value on import to the local market, the GCC-origin exemption with a certificate of origin, duty suspension for goods in a Designated Zone, and the 12-digit HS code classification in force from January 2025. dubaicustoms.gov.ae

[3] ATB Legal, LEA Global and India Law Offices. Reports on the UAE-India Comprehensive Economic Partnership Agreement, effective 1 May 2022: elimination of UAE duty on Indian ready-made garments and most textile lines, about 80.3% of tariff lines duty-free on entry into force, and the certificate of origin requirement. These are the firms' summaries, not the UAE tariff schedule. atblegal.com

[4] GCC Standardization Organization (GSO). Standards Store listing for GSO 863:1997, Identification Label for Textile Products: title, approval date of 15 October 1997 and scope, checked 29 September 2026. Label contents described in this guide are summarised from secondary compliance sources, not from the standard's text. gso.org.sa

[5] Jebel Ali Free Zone (JAFZA). Licence Activity List: Textile Trading 513101 in the 017 Readymade Garments Group, and the matching garment, yarn, trims, curtain fabric and used clothing codes, as normalized on 22 August 2026. jafza.ae

[6] DMCC. Business Activities 2026: Textile Trading 4751001 under Personal & Household Goods, and the matching garment, yarn, trims, curtain fabric, tents and used clothing codes, as normalized on 22 August 2026. dmcc.ae

[7] Jebel Ali Free Zone (JAFZA). Business licence in Dubai with Jafza: licences from AED 5,000, the licence line only, with land, warehouse and office space priced separately. jafza.ae

[8] Dubai Department of Economy and Tourism. Business registration guidance: 100% foreign ownership of mainland commercial activities, including textile trading, following the 2021 Commercial Companies Law amendments. invest.dubai.ae

[9] Federal Tax Authority. List of Designated Zones under Cabinet Decision No. 59 of 2017 as amended: Dubai Textile City listed from 1 January 2018 to 4 April 2021 (Cabinet Decision No. 34 of 2021); JAFZA, Ajman Free Zone, Hamriyah Free Zone and Sharjah Airport International Free Zone listed; DMCC, Meydan Free Zone, IFZA, SHAMS and SPC Free Zone absent. tax.gov.ae

[10] Ministry of Industry and Advanced Technology (MoIAT). Emirates Conformity Assessment Scheme: Certificate of Conformity and Emirates Quality Mark for regulated products; read with Cotecna's Dubai conformity scope note (referenced August 2026), which lists textiles among regulated categories. That listing is a conformity body's description, not a MoIAT list. moiat.gov.ae

[11] Khaleej Times. Dubai Customs seizures of counterfeit goods in the first quarter of 2025: 68 seizures worth AED 42.195 million, including clothing, fabrics, bags and shoes. khaleejtimes.com

[12] UAE Federal Law No. 1 of 2017 on Anti-Dumping, Countervailing and Safeguard Measures, and Council of Ministers Decision No. 8 of 2018 on its implementing rules, as notified to the World Trade Organization (G/ADP/N/1/ARE/2/Suppl.1), read in full on 29 September 2026: legal texts only, no product measures list, no textile products named. uaelegislation.gov.ae and wto.org

[13] PwC Middle East. GCC countries announce anti-dumping measures on imports of semi-finished aluminium products, 2025. pwc.com

[14] Federal Tax Authority. VAT under Federal Decree-Law No. 8 of 2017: the 5% standard rate, the AED 375,000 mandatory and AED 187,500 voluntary registration thresholds, the reverse charge on imports by registered persons, export zero-rating conditions and the treatment of goods in Designated Zones. tax.gov.ae

[15] UAE Ministry of Finance. Ministerial Decision No. 229 of 2025 Regarding Qualifying Activities and Excluded Activities, issued 28 August 2025: Article 2(1)(l) distribution in or from a Designated Zone and its conditions, Article 2(2)(a) transactions with natural persons, Article 3 de minimis and Article 5 on loss of status. mof.gov.ae

[16] UAE Ministry of Finance. Corporate tax under Federal Decree-Law No. 47 of 2022: rates of 0% up to AED 375,000 and 9% above, and Article 18 on Qualifying Free Zone Persons, including the audited financial statements condition and loss of status for the tax period and the following four. mof.gov.ae

[17] UAE Ministry of Finance. Ministerial Decision No. 73 of 2023 on Small Business Relief, as amended by Ministerial Decision No. 131 of 2026 issued 29 July 2026: the AED 3,000,000 revenue threshold and tax periods ending on or before 31 December 2029. mof.gov.ae

[18] BusinessDubai.ae. Internal pricing data: 2026 free zone package prices by visa count for Meydan Free Zone, IFZA (partner price), SHAMS, SPC Free Zone, Ajman Free Zone and ANC Free Zone, owner-confirmed 24 September 2026, with the investor visa capital rule at IFZA and Meydan, the renewal rule of thumb, bank notes and the corporate tax figures that accompany those prices. businessdubai.ae