Sometimes your business needs to take a break and in such instances, you can freeze a trade license for upto 3 years. Find out how to freeze your UAE mainland license.
If you are in the UAE and you plan to temporarily stop your business, the best option would be to freeze the business license. Business licenses can be frozen for upto a period of three years, by paying a freezing fee. In the case of sole establishments registered in DED, freezing is allowed for a period of one year.
A company cannot carry on with any of its operations, once the license is frozen as it is illegal. But the owner of a frozen license or a shareholder can start a new business by applying for a new license under his name.
License freezing lets a business temporarily suspend its operations while keeping its trade licence and trade name registered, without cancelling the company. You apply to the issuing authority, the Department of Economy and Tourism (DET) for mainland companies or your free zone, pay a freezing fee, and the licence is marked inactive.
It's the middle ground between renewing and cancelling. You keep the entity and can reactivate it later, while pausing renewal and operating costs during the break. We manage the full process for you.
Freezing suits a temporary pause rather than a permanent exit, such as a seasonal slowdown, restructuring, financial difficulty, relocating, or reassessing the business before deciding its future.
It's often smarter than simply letting the licence lapse, which accrues monthly fines and can lead to blacklisting, or cancelling outright, which is permanent. Freezing protects your trade name and licence for when you're ready to return. We can advise whether freezing or another option fits your situation.
The typical steps are:
• Ensure the business is inactive with no sponsored employees
• Issue a formal request letter on company letterhead stating the reasons for freezing
• Cancel all employee visas and the establishment card
• Obtain a confirmation letter from MOHRE that no sponsored employees remain and no labour restrictions apply
• Submit the freeze application to DET and pay the fee, along with an inspection report where required
Once approved, the licence is marked inactive on official records. We handle the letters, visa cancellations, and liaison with the authorities.
Mainland companies can freeze a trade licence for up to three years. For sole establishments registered with DED, the maximum period is one year. Free zone authorities set their own limits, often shorter.
You must reactivate the licence before the freeze period ends, otherwise it can lapse or be cancelled. We can track the deadline and manage reactivation when you're ready.
The core documents include:
• A copy of your current trade licence
• A freeze request letter on company letterhead with justification
• Proof that all employee visas have been cancelled
• A MOHRE confirmation letter that no sponsored employees remain
• An inspection report where the authority requires one
Any outstanding fines must be cleared before the freeze is approved. We prepare the full file so the application isn't held up.
No. While a licence is frozen, it is illegal to conduct any business activity, issue invoices, sign contracts, or receive payments. The company is officially inactive.
Two things to note: the freeze does not exempt you from tax, so VAT and corporate tax filings with the Federal Tax Authority must continue where they apply. However, the owner or a shareholder can still start a new business under a separate licence during the freeze.
Yes. You can unfreeze and reactivate the licence at any time before the freeze period ends, with no obligation to wait for the full term. You submit a reactivation request to DET, provide a valid Ejari tenancy contract and any required approvals, and clear any pending fees.
Once reactivated, the licence regains active status and you can resume operations legally. We can manage the reactivation so you're trading again without delay.
