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A trade licence is the official permit that lets a business operate legally in the UAE, issued by the economic department of the relevant emirate for mainland companies or by a free zone authority for free zone entities. It states the licensee, the legal form, the licensed activities, and the address, and it must be renewed periodically — operating with an expired licence exposes the business to fines and blocks on visas, banking and government services. The licensed activity list matters more than founders expect: conducting an activity not on the licence can invalidate insurance positions and create regulatory exposure, and certain activities need extra approvals from sector regulators. Practically, the licence is the company's identity card: banks, landlords, MOHRE, customs and counterparties all ask for it. You meet it at incorporation, every renewal cycle, when adding activities or changing premises, and in any due diligence on a UAE counterparty.