The UAE’s position as a global trading hub is stronger than ever in 2025, thanks to its world-class infrastructure and forward-thinking policies. But as trade grows more complex, so do the rules. Navigating these evolving rules is critical for businesses to ensure compliance, avoid costly delays, and capitalize on the UAE’s dynamic trade environment.
Trade regulation in the UAE is governed by a combination of federal laws, ministerial decisions, and international treaties. At the core is the Common Customs Law of the Gulf Cooperation Council (GCC), which establishes the baseline for customs practices across the region, including the UAE. Supplementing this are domestic regulations issued by:
- The Federal Authority for Identity, Citizenship, Customs and Port Security
- The Ministry of Economy
- The Ministry of Climate Change and Environment
- The Ministry of Health and Prevention
- And local customs departments
In free zones, separate procedures apply, yet these zones still operate under the umbrella of federal customs and security oversight, particularly when trading beyond the zone.
Licensing, Registration, and Custom Codes: Initial Requirements
Before engaging in cross-border trade, businesses must fulfil several legal prerequisites, including:
- Commercial/Trade License: Issued by either the Department of Economic Development or the relevant freezone authority.
- Custom Registration Number: Mandatory for customs clearance with the respective local customs authority.
- Chamber of Commerce Membership: Required for the issuance of certificates of origin and other trade-related documentation.
- VAT Registration: As mandated by Federal Decree Law No. 8 of 2017, businesses whose taxable turnover exceeds the statutory threshold must register for VAT.
- Special Permits: Applicable to controlled goods such as medical devices, agricultural products, telecom equipment, and more.
Companies operating from within free zones such as JAFZA, RAKEZ, or KIZAD benefit from customs exemptions within the zone, but must comply with full customs procedures when moving goods to the mainland.
Permitted vs Prohibited: What Can Be Traded?
The UAE maintains strict controls over the movement of goods to protect public health, safety, and national security. Prohibited items are banned from entering the UAE by federal law, and when found, will be seized by the Customs Authorities.
Such as all kinds of narcotic drugs and substances, counterfeit currency or goods, gambling tools or devices, and items offensive to Islamic morals or public order.
Restricted goods are those items that are not categorically banned from entering the UAE but may only be imported under specific conditions or approvals. Their entry maybe permitted upon meeting certain procedural requirements or obtaining approval from the relevant authorities.
For instance, medicines and medical equipment, food and livestock products, communication and broadcasting equipment, etc.
Importers and exporters must ensure that they hold the correct licenses and permits before initiating shipments, particularly in relation to restricted categories, as violations may result in detention of goods or legal penalties.
A significant precedent in this regard, Case No. 1149 of 2019, in which the UAE Federal Supreme Court upheld a ten-year prison sentence and AED 50,000 fine for an individual who imported the Datura plant, classified as a narcotic, allegedly for religious use. The defendant claimed he was unaware of its legal status. The Court rejected this defence, affirming that ignorance of the law is not an excuse under UAE narcotics legislation.
It also confirmed that courts may reclassify charges if the change benefits the accused, even without prior notice. This ruling reiterates that the UAE’s zero-tolerance policy in importing any banned substance constitutes a serious offence, regardless of intent or awareness.
Legal and Procedural Updates
Abu Dhabi Customs Restructuring: Law No. 1 of 2025
Abu Dhabi enacted Law No. 1 of 2025, granting the General Administration of Abu Dhabi Customs independent legal status under the Abu Dhabi Department of Economic Development. This restructuring modernizes customs governance by empowering the administration to propose policies, manage customs offices, and oversee trade facilitation and regulatory compliance within the emirate.
The administration now plays a central role in regulating the import, export, and transit of goods, managing customs warehouses and free zones, and collecting duties and taxes. It also enhances enforcement capabilities against smuggling and customs violations, including investigation, legal action, and management of seized goods.
Digitalization and the UAE Single Window
The customs clearance process in the UAE is now highly digitalized. All customs declarations must be submitted via the UAE Single Window platform, which is compulsory for all importers and exporters. Manual submissions are phased out, and integration with ports and inspection systems allows for real-time updates and streamlined compliance.
Customs De Minimis Thresholds
As of 2025, the customs de minimis threshold, the value below which shipments are exempt from import duties, differs between Dubai and Abu Dhabi. In Dubai, any shipment valued above AED 300 is now subject to customs duties and VAT. In Abu Dhabi, the threshold remains higher at AED 1,000; only shipments exceeding this value attract customs duties and VAT.
This means that if you import goods into Dubai and the total declared value (including shipping and insurance) is AED 300 or less, you will not pay customs duties, though VAT may still apply. For Abu Dhabi, this exemption applies up to AED 1,000. Shipments above these thresholds are assessed a standard 5% customs duty (based on the CIF value) and 5% VAT, with exceptions for certain categories such as alcohol and tobacco, which are always dutiable regardless of value.
Customs Clearance: Step by Step
The customs clearance process in the UAE has become highly digitalized, but the core steps remain familiar. Importers must submit an electronic declaration via the UAE Single Window, provide all required documentation, including commercial invoice, packing lists, bill of lading, certificate of origin, and any necessary permits, pay applicable duties and VAT through the electronic system.
Each item should be classified with the correct eight-digit HS code. Most goods are subject to a 5% customs duty based on the CIF value, with higher rates for specific categories and exemptions for qualifying GCC-origin products. Shipments may be flagged for risk-based inspection. Once all requirements are satisfied, goods are cleared and released.
In Case Nos. Article 1429 and 1443 of 2023, the UAE Federal Supreme Court upheld the conviction of individuals who had exported goods from a free zone without obtaining the required customs clearance. The defendants argued that the criminal proceedings were procedurally defective; however, the Court determined that all legal protocols, including prior approval from the Director of Customs, had been properly observed.
The judgment reaffirmed that the movement of goods from a free zone is subject to strict
customs regulations. Non-compliance can result in serious legal consequences, including criminal liability, imprisonment, and confiscation of the goods involved.
Exporting from the UAE: Compliance Still Matters
While exporting is often perceived as less complex than importing, it is still subject to rigorous compliance checks. Goods must be accurately classified under the Harmonized System (HS) code, and export declarations must be filed digitally, accompanied by all necessary permits. A certificate of origin from the relevant Chambers of Commerce is usually required, and exporters must be mindful of regulations in the destination country, including any applicable sanctions.
Conclusion
In today’s fast-evolving trade landscape, staying compliant with the UAE’s import and export regulations is more than just a legal requirement; it’s a key factor in building trust and long-term success. By staying informed, maintaining proper documentation, and adapting to new digital requirements, companies can not only avoid costly setbacks but also gain a competitive edge.
The UAE’s commitment to transparency and innovation creates an environment where well-prepared businesses can truly thrive. As the UAE continues to modernize its trade landscape, those who invest in understanding and meeting these evolving standards will be best positioned for sustainable growth and success.
Legal Disclaimer: This blog is provided for informational purposes only and does not constitute legal advice. For personalized advice and regulatory updates, reach out to Khairallah Advocates & Legal Consultants. Our team is ready to assist you with tailored solutions for your legal needs.
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