Answered plainly
Dubai’s car rental permit is written about every car in the fleet
A Dubai car rental company is licensed car by car as much as company by company.
Where a car was bought, its age and its exit date are permit conditions
A Dubai rental company is licensed car by car as much as company by company. The activity permit from the Roads and Transport Authority (RTA) decides where each vehicle may be bought, how old it may be when it joins the fleet, the tracker and insurance it carries, and the date it must leave. Executive Council Resolution No. 47 of 2017, as amended in 2022, requires that permit across the emirate, free zones included, government entities apart.
The trade licence that creates the company comes from the Department of Economy and Tourism (DET) or a free zone authority. Everything after it belongs to the permit: the office, the car park, the tracking hardware, the system each contract is issued in, and the cars, one by one.
The permit covers a self-drive car for a day or longer, and nothing on either side of it
RTA's activity card defines car rental as renting vehicles without drivers for at least one day, and both limits bind: the card forbids hourly renting, and forbids adding hourly rental or luxury passenger transport to the permit. The resolution's 2022 schedule lists other rental activities separately, from buses and motorcycles to caravans and race cars.
Each neighbour is a different project:
- Hourly rental and car sharing have their own resolution and card under RTA's Public Transport Agency: a minimum fleet, a single-activity trade licence, and entry through RTA's supplier qualification process and an auction.
- A chauffeured car is passenger transport, not rental: chauffeured hire is RTA's passenger transport by luxury vehicles activity, under a separate resolution, requiring a feasibility study, a cash or bank guarantee under a concession contract and a tariff above the taxi tariff.
- Chauffeured hire of a rental company's luxury cars runs through RTA's Takamul permit, announced in March 2025, where the luxury transport company and the rental company share a member named on both licences.
one permit, and the card forbids adding either of the others to it
| Judged on | Car rental, daily | Hourly rental and car sharing | Passenger transport by luxury vehicles |
|---|---|---|---|
| What the customer is given | A car without a driver, for a day or longer | A car by the hour | A driver with the car |
| Can it ride on the car rental permit | It is the permit | No | No |
| Whose resolution and card it sits under | The 2017 resolution, as amended in 2022 | Its own, under RTA's Public Transport Agency | Its own, separate resolution |
| What the door asks for beyond a trade licence | RTA's no-objection first, then the activity permit | A minimum fleet, a single-activity licence, supplier qualification, an auction | A feasibility study, a cash or bank guarantee, a tariff above the taxi tariff |
RTA's no-objection has to exist before the trade licence does
Car rental is one of the activities where the body issuing the licence is not the body deciding the question, and the sector authority's approval comes before the licence rather than after it. The general pattern, and how to find out whether your own activity sits inside it, is on choosing a sector is choosing which second authority has to approve you.
RTA's service page sets out the order:
- Initial approval from DET or the free zone authority. RTA's file asks who the partners are, not whether they may own the company, so confirm now that the activity is open to full foreign ownership, and in which legal form.
- RTA's no-objection certificate, applied for on that approval through RTA's website or Invest in Dubai, with the owner's and partners' passports or identity cards, residence documents for non-Emirati partners and a sponsor's no-objection letter for partners from outside the GCC. RTA's card adds an undertaking to meet the activity's conditions.
- The trade licence, issued with the certificate in hand. The certificate is time-limited, so have the licence file ready to close.
- The traffic file and the activity permit, issued by RTA once the company exists.
- Each car, brought under the permit: licensed in Dubai, fitted with an approved tracker, inspected, insured for rental use and licensed for leasing. The card's annual fee, counted on cars licensed for leasing, suggests this follows the permit; confirm with RTA before buying, since the order decides how long the fleet's capital sits idle.
- Initial approvalConfirm here that the activity is open to full foreign ownership, and in which legal form
- RTA's no-objection certificatePartners' identity and residence papers, plus an undertaking to meet the conditions
- The trade licenceRTA warns that a licence issued without its approval exposes the company to a violation
- The traffic file and the activity permitThe permit runs for a year, renewable on a timely application once RTA is paid
- Each car, brought under the permitA Dubai licence, an approved tracker, inspection, rental-use insurance, a leasing licence
RTA warns that a trade licence issued without its approval exposes the company to a violation; the mainland company page covers what an outside approval adds to DET's timetable.
The permit runs for a year, renewable on a timely application once the company has settled what it owes RTA. Operating without one is a listed violation; fines double if the same violation recurs within a year, and RTA can suspend the activity or revoke the permit.
The card and the 2022 fee schedule print RTA's charges: AED 1,000 to issue or renew the permit and AED 100 for training, to which the card adds an annual fee banded by vehicles licensed for leasing (AED 2,000 up to 100, AED 4,000 for 101 to 500, AED 5,000 for 501 to 1,000 and AED 6,000 above that). Beside the price of one car they are small; the budget is the fleet.
- Up to 1002,000
- 101 to 5004,000
- 501 to 1,0005,000
- Above 1,0006,000
Each car joins, works and leaves the fleet on RTA's terms
Market and budget shape the fleet only inside the card's limits. Every car, owned or leased, holds a Dubai vehicle licence (mulkiya), is inspected at an RTA-specified centre, carries a tracker the Security Industry Regulatory Agency has approved, and is insured comprehensively with a UAE-licensed insurer. The age rules are where fleet choice is really made:
Read the used rows twice. A used or imported car gets a new one's working life, but its clock started at the factory, so every year it spent elsewhere is rental income lost: cheap older stock is not a cheap fleet. The clock also fixes, before the first booking, the window in which each car must earn back its cost, and a lender reads the same date, since the cars are what a young rental company can offer as security for a loan.
Then the file recurs until each car's exit date: its tracker certificate every year, inspection and insurance at every licence renewal, and for the company the permit's renewal and annual fee.
Where the cars sleep is a permit condition, and we have found no published minimum
The card requires an office, vehicles and parking commensurate with the activity, meeting the standards of RTA's Licensing Agency, which the bylaw says RTA publishes online; we have not yet read them. Neither the card nor the bylaw, as far as we have read, sets a minimum fleet, office size, number of bays, bank guarantee or minimum capital for daily rental; ask anyone quoting such a figure for its source. The written rules still shape the property search:
- The cars must use parking approved by RTA and the relevant bodies. The car park is part of the permit.
- Moving the office needs the Licensing Agency's approval first, so a cheaper unit found mid-lease is a permit application before it is a removal.
- The public car parks rules, as we have read them, bar rental companies from keeping stock in public car parks on season cards, and prohibit displaying vehicles for rent there without RTA's authorisation. The resolution has since been amended; check the current wording.
- A counter is a separately permitted location, with its own permit in the 2022 fee schedule; opening one without it is a listed violation.
The rental contract is written inside RTA's system
The permit obliges the company to subscribe to the systems RTA designates, including the electronic information system for car rental offices under a 2005 decree, and to work through TARS, the Transport Activities Rental System RTA launched in October 2021 to issue smart rental contracts. The card adds staff training, records kept for the periods the Agency sets, and a duty to report a system failure within hours. Someone must own TARS from the first day of trading.
Before drafting terms and conditions, ask RTA whether a standard contract now governs daily rental, and Dubai's consumer protection authority what rules cover deposits and card holds.
Fines and tolls start with the car's licence holder, and recovery mostly rests on the contract
Every car carries a Dubai vehicle licence, and the state starts with its holder: the company for its own cars, and for a leased or borrowed car whoever the licence names.
Salik. Dubai's toll law defines the vehicle owner as the person in whose name the vehicle is licensed, including the person who drives it, and RTA charges the toll to owners. It reaches renter and company alike; who bears it is for the contract.
Crimes and accidents. Article 38 of the federal traffic law punishes a vehicle owner who deliberately fails to give information revealing the circumstances of a crime or accident involving its vehicle, or who was responsible. Poor records are not that offence, but a company without them cannot answer the police either; keep every contract, licence copy and handover time.
Insurance. The unified motor policies direct the insurer's recourse against the renter, not the company, where a rental car's driver caused an accident under the influence of alcohol or drugs. The Central Bank's rulebook text of the loss and damage policy lifts its unlicensed-driver exclusion for a rental car leased to a valid licence holder, so the counter's licence check is part of the own-damage cover. Standard comprehensive terms bar leasing without the insurer's written consent, so buy rental-use cover and set the renter's excess and deposit against its rental deductible terms.
Seizure. The federal traffic law lets the traffic authorities seize a vehicle in listed cases, among them a car driven by someone without a licence, released then only to its owner or someone legally authorised to receive it, and a car related to an accident involving a crime. Each seizure costs earning days; whether Dubai adds release charges, and whether the contract can pass them on, is for counsel before the deposit is sized.
We found no clause in the rental, parking or federal traffic legislation that transfers traffic or parking fines to a renter by operation of law; recovery, as far as we have found, rests on the contract and on records proving who had the car.
who the state comes to first, before any contract
- A Salik toll on a rented carThe toll law defines the owner as the person the vehicle is licensed to
- A traffic or parking fineNo clause found transferring it to the renter by operation of law
- Information about a crime or accident involving the carArticle 38 punishes an owner who deliberately withholds it
- A car seized after being driven by someone without a licenceReleased only to its owner or someone legally authorised to receive it
The company, as the car's licence holder
- An accident caused under the influence of alcohol or drugsThe unified policies direct the insurer's recourse against the renter
The renter
The federal law also requires rental companies to check that the renter's licence is valid and approved or recognised in the UAE; which licences qualify is set out below.
Recharged tolls are not a VAT pass-through: the Federal Tax Authority's automotive guide treats car rental as standard-rated and a recharged Salik charge as part of its taxable value. VAT and corporate tax covers enrolment and filing.
A free zone company can hold the permit; where it hands over cars is a separate question
Settled: the 2017 resolution applies inside free zones, and its bylaw, RTA's card and RTA's no-objection service all accept a free zone authority's licence or initial approval as the basis for the permit.
Not settled: where the company may trade. Under Executive Council Resolution No. 11 of 2025, a free zone company conducting activity in Dubai outside its zone needs one of two DET branch licences or a temporary DET permit, each with the supervising authority's approval where required: for rental, RTA's. DET was to publish a list assigning each activity a route; we have not confirmed from a published source whether car rental is on it, or by which route.
The questions are physical: where is the office, where do the cars park, where does the customer collect one? If any answer lies outside the zone, expect that resolution to add a DET branch licence or permit to the free zone price, and confirm the route with DET and RTA in writing. The only UAE customer a free zone licence already reaches covers the general case.
The rules, not arrival figures, decide which renters a fleet can serve
The market is whoever may lawfully take a car:
- Visitors, tourists and business travellers alike, count only if RTA accepts their licence: on a visit visa, a GCC or exception-country licence for light vehicles. RTA's FAQ raises the international licence and answers restrictively, without dealing with international driving permits directly.
- Residents need a UAE licence, obtained by exchange only where RTA's list allows it, and rent between cars or with their own off the road.
- Insurance replacement hire has a published basis: the unified third-party policy gives a private motorist whose car is under repair after another driver's accident a loss-of-use allowance at local rental rates for a similar car, within a daily cap and a maximum period, only where the car is repaired rather than cashed out, and the insurer may supply a substitute car instead.
- Corporate monthly hire carries a VAT cost for the customer: input tax on renting a car available for an employee's personal use is blocked.
Supply is the other half. Launching TARS in 2021, RTA said it had enrolled every Dubai rental company on the system and trained 989 of them. Count the licensed competition before sizing the fleet; Dubai publishes your competitors, not your customers shows where.
The business plan's core lines follow from these rules: each car's clock, per-car insurance and tracking, parking, RTA's charges, and fine and toll recovery. The arithmetic those lines feed — utilisation, the residual value fixed on the day a car is bought, deposits and the channel mix — is worked through on a rent-a-car company makes its margin the day a car leaves the fleet.
Marketing has licensing edges too. A hotel desk may be a counter in RTA's sense; ask before signing. Bookings for your own fleet on your own website read as the rental activity delivered online, though RTA should confirm it; running a rental platform is separately listed. An aggregator's bookings should still end as your own contract in TARS; ask the aggregator, and RTA, whether it holds the platform activity before you list. Promotional material stuck or hung on a car's body needs RTA's prior approval.
Where a car rental licence is the wrong purchase
An early exit is paid for in cars: a fleet sold before its replacement dates goes at used-car prices, while the permit and tracker certificates stay on their annual cycle until RTA approves the stop. These plans end there.
If you want to rent cars by the hour. That is a separate activity with a minimum fleet, a single-activity licence and an auction at the door, and the daily permit forbids it.
If what you are really selling is a driver. That is passenger transport, with a guarantee and a tariff floor on the luxury route, and the rental card bars the company from carrying passengers in its rental cars other than its own staff. A rental permit with drivers added is not a legal version of it.
If the fleet is cars you already own, or cheap older stock. Entry ages, agent sourcing, inspection, the approved list and a clock that may already be running decide what qualifies. Price the fleet the card will admit, not the one in the garage.
If the budget covers the licence and not the fleet. RTA's charges are the small line; rental-use insurance, tracking, approved parking and the replacement clock are the business.
If the counter cannot carry its daily work. Licence and visa checks, the TARS contract, condition photographs at handover, fine and toll recovery and deposit refunds come with every rental; they are the operation, not paperwork around it.
Six questions a quote built around the trade licence alone cannot answer
Put them to us too.
- Which activity line will the licence carry, and has RTA confirmed it maps to the car rental permit? Codes in circulation, RTA's own included, need checking against DET's current list.
- Is that line open to full foreign ownership, and in which legal form? DET or the zone answers that; RTA's file does not ask.
- Which RTA charges are in the quote? The card prints them; itemise them apart from professional fees.
- For a free zone quote, by which route will customers collect cars outside the zone, and who confirmed it in writing? Until DET's list is read for this activity, only DET and RTA can answer.
- Which insurer will cover rental use, which approved tracker has been priced, and where will the cars park? Standard comprehensive terms do not allow leasing without the insurer's consent, and the parking needs RTA's approval.
- When must each of the first cars be replaced, and at what cost? A quote that cannot answer has not read the card.
A rental quote starts from the cars and the handover point
Before quoting we need the starting fleet car by car: class, new or used, the year it was first licensed or made, owned or leased, where it will park and where customers will collect it. Add the renters you expect, rental lengths, any driver or hourly element, and whether a free zone licence is already in hand. The list gives each car's exit date, and so the window in which it must pay for itself: the figure a rental quote should start from.
Sometimes the answer is not to buy this licence: the arithmetic points to an hourly rental file, a chauffeur operator, or nothing at all. The cheapest moment to hear that is before the first car is bought; after it, every car's replacement clock is running.
Frequently asked questions
Does a rental company need a tourism department permit?
Not according to RTA's card, which names only the licensing authority and RTA's Commercial Transport Activities Department before the permit, and no authority after it. DET's name includes tourism, which is where the confusion starts; the permit is a transport approval and not a tourism one. A hotel desk, however, may count as a counter in RTA's sense, so ask before signing an arrangement with one.
Is choosing the vehicles a commercial decision?
Only inside the card: where a car was bought, its age, whether its model is on RTA's approved list and when its clock started decide whether it can join. Leased cars can qualify, but on the card's wording a car the company does not own must belong to a licensed Dubai rental company, which also rules out a marketplace of private cars; confirm with RTA before leasing fleet from a bank or leasing company.
Can the fleet be laid up for the summer, or the permit sold with the business?
Not on the company's word alone. The card requires RTA's prior approval before the activity stops and before the permit is assigned or disposed of, so a shutdown, a sale that moves the permit or a wind-down starts as an application; ask whether a parked fleet counts as stopped. Exit dates and tracker certificates keep coming either way.
Does the Dubai permit cover counters in other emirates?
No. A counter in Sharjah or Abu Dhabi needs that emirate's own licence and approvals; Sharjah's economic department, for one, lists car rental among activities needing its traffic committee's approval. We have not found either emirate's rules on a Dubai company delivering or collecting cars there; confirm them first.
Begin with a clear conversation
Tell us what you intend to build.
A consultant will map the structure, jurisdiction, approvals and likely cost against what you actually described — not against a package.
