Commercial Broker.
Commercial Broker is one of the ten most-licensed activities at IFZA. This page covers what the licence permits, the QFZP / Corporate Tax position, VAT treatment, indicative cost in USD, and the home countries from which the most applications for this activity originate.
At a glance
| Feature | Position |
|---|---|
| IFZA activity classification | 4690.06 — Commercial Broker |
| Year-1 all-in cost (USD) | USD 10,120 |
| Time to licence issuance | 5–7 business days |
| Visa quota (standard) | Up to 9 investor/employee visas under flexi-desk package |
| QFZP 0% qualifying status | Qualifying for QFZP 0% on intermediation commission from non-UAE-mainland transactions |
| UAE VAT (5%) | 5% on UAE-resident principal commissions; zero-rated for export of intermediation services |
| UAE Corporate Tax | 9% above AED 375,000 profit; 0% under QFZP if conditions met |
| Audit requirement | Not required for non-regulated activity; recommended for QFZP claims |
What this licence covers
The IFZA Commercial Broker activity authorises the provision of intermediation services between commercial counterparties — connecting buyers and sellers, arranging introductions in exchange for a commission, acting as a manufacturer's representative, sales-agent or distribution-agent for third-party principals. It is the appropriate licence for B2B introduction agents, manufacturer representatives, deal-finders, sourcing intermediaries and procurement agents. It does NOT cover regulated brokerage activities (insurance brokerage, real-estate brokerage, securities/financial-instrument brokerage, customs brokerage) — each of those is separately regulated.
QFZP and Corporate Tax
Commercial brokerage qualifies for QFZP 0% on commission income from intermediation between non-UAE-mainland counterparties (where neither the buyer nor the seller is UAE-mainland-located). UAE-mainland intermediation commission is non-qualifying; the de minimis test (5% / AED 5m) applies.
For a Dubai-based broker introducing European manufacturers to Saudi distributors, QFZP applies cleanly. For a broker primarily serving UAE-mainland buyer-supplier pairs, the standard 9% CT applies above AED 375,000 profit (Small Business Relief may apply at smaller scale).
Banking and operational notes
Commercial brokers face moderately higher banking scrutiny than pure services entities because commission-based revenue patterns can resemble flow-of-funds intermediation that triggers AML concerns. Standard preparation:
- Contract clarity — broker engagement letters with principals should clearly identify the broker as principal-agent (not pass-through), with commission separately defined.
- No client funds handling — brokers should not hold client funds in transit; if you need to (escrow, deposit handling), separate authorisation applies.
- Transparent source-of-introduction documentation — banks want to see that the broker has genuine commercial relationships, not pass-through-payment structures.
Banking: Wio Business / Mashreq Neo Biz onboard within 5-10 days. Tier 1 banks within 3-6 weeks but may apply EDD given the commission-flow profile.
Common client profile
- Manufacturer representative — UAE-based agent for a European or Asian manufacturer; introduces the manufacturer to GCC buyers; commission on closed deals.
- Sourcing agent — UAE-based intermediary helping GCC buyers source products from Asian / European suppliers; commission from buyer side.
- Industrial / commodities deal-finder — connecting commodity buyers and sellers in cross-border transactions; commission negotiated per deal.
- Channel-development consultant — for technology / SaaS companies entering the GCC; commission on signed deals plus retainer.
When this licence is not the right answer
- Real-estate brokerage. Requires Dubai Land Department RERA registration in addition to (or instead of) IFZA.
- Insurance brokerage. Requires UAE Insurance Authority licence; IFZA does not cover this.
- Securities / financial-instruments brokerage. Requires DIFC DFSA or ADGM FSRA authorisation.
- Customs brokerage. Requires Dubai Customs Authority registration.
- Buying and reselling goods in own name. Use Trading activity instead — broker is intermediary on commission, not principal on margin.
Indicative year-1 cost in USD
| Component | Year 1 | Year 2+ |
|---|---|---|
| IFZA government licence fee (this activity bundle, up to 3 activities) | USD 4,200 | USD 4,200 |
| Establishment card & immigration file | USD 800 | USD 400 |
| Investor visa (1 visa) | USD 1,300 | USD 400 (renewal) |
| Emirates ID + medical + biometrics | USD 320 | USD 120 |
| ArxSetup professional fee + KYC + bank introduction | USD 3,500 | USD 2,000 |
| All-in total | USD 10,120 | USD 7,120 |
Add-ons: VAT registration (USD 950), Corporate Tax registration (USD 550), additional visas (USD 1,300 each), bespoke shareholders' agreement (from USD 3,500), trademark registration (from USD 5,500).
Top countries applying for this activity
Applications for this activity most commonly originate from the following countries (drawn from IFZA application data and our own client mix):
Common questions
Can a commercial broker hold buyer funds in transit?
Generally no. Holding client funds in transit (escrow, deposit holding) is a regulated activity in most jurisdictions and is not within the standard Commercial Broker scope. For deals requiring escrow, use a UAE-licensed escrow agent or bank service; the broker introduces and earns commission but does not hold the funds.
How does VAT work on commission?
Commission paid by a UAE-resident principal is subject to 5% UAE VAT. Commission paid by a non-UAE-resident principal for non-UAE-resident introductions is zero-rated as export of services. The location of the underlying buyer-seller transaction does not control VAT treatment — the broker's principal-counterparty location controls.
Can I take a commission AND a retainer from the same principal?
Yes. Retainer-plus-commission models are common in channel-development and manufacturer-representative arrangements. Both are within the Commercial Broker activity scope; VAT treatment is consistent (place-of-supply controls).
Will I qualify for QFZP 0% on commission income?
Yes, where the underlying transactions and counterparties are non-UAE-mainland. The standard QFZP conditions (substance, audit, qualifying activity, de minimis on UAE-mainland) all apply. For brokers serving primarily international principals introducing into GCC export markets, QFZP applies cleanly.
Can I act as a sub-distributor on this licence?
If you act as a true principal taking title to goods, Trading activity applies (not Commercial Broker). If you act as a sales-agent introducing buyers to the principal in exchange for commission without taking title, Commercial Broker applies. The legal-title question controls the classification.