Overview of Trade License

A trade license is a legal document that permits an applicant to start a specific trade or business in a designated locality. It ensures that the business operates in compliance with safety regulations set by the State Municipal Corporation, protecting residents from potential health hazards. However, the license strictly limits business activities to those specified within its scope and does not grant property ownership to the license holder.

Objective of Trade License

The Trade License, established over four decades ago, is governed by the Municipal Corporation Act. Its primary objectives are to promote fair trade practices and protect the public from health hazards associated with various trades. It is a mandatory requirement for conducting any business or trade in a specific locality, ensuring businesses operate ethically. The license encourages compliance with safety guidelines, contributing to societal harmony and ensuring that business owners follow the necessary safety measures.

Benefits of Trade License

• Protects Workers: Ensures protection for workers by averting exploitation in the workplace.
• Safety Measures: Ensures businesses have the necessary safety measures, especially regarding fire-related accidents.
• Fair Trade Practices: Compels businesses to adopt fair trade practices, preserving the interests of all stakeholders.
• Consumer Protection: Safeguards consumers from illicit trade activities, enhancing business goodwill over time.
• Business Growth: Supports business growth and boosts credibility, contributing to long-term success.

Who Needs to Obtain a Trade License?

The following entities are required to obtain a trade license from the respective Municipal Corporation before starting operations:

• Metropolitan city centers
• Local commercial areas
• Local Shopping Complexes (LSC)
• Commercial Shopping Complexes (CSC)
• Community centers
• District centers
• Service markets/centers
• Pedestrian shopping streets
• Commercial areas
• Mixed Land Use (MLU) areas

Which Authority Confers Trade License in Respective State?

A trade license is granted by the licensing department of the municipal corporation. The departments involved may include engineering, industries, health, and others, depending on the nature of the business. The government of India authorizes the license to regulate businesses in cities across the country. The trade license is granted state-wise, according to the regulations set by the respective Municipal Corporation.

Eligibility Criteria for Securing Trade License

The eligibility conditions for obtaining a trade license in a particular state are as follows:

• The applicant must not be a minor; they must be at least 18 years old.
• The applicant should have a clean criminal record.
• The business must have legal status.
• The eligibility criteria are applied based on state-specific regulations set out by the Municipal Corporation.

Common Documents Required for Obtaining a Trade License

Here is the list of mandatory documents needed for securing a trade license:

• Business address proof
• Applicant's identity proof
• Aadhaar card
• Permanent Account Number (PAN) of the applicant (for proprietorship) or PAN of the firm
• Memorandum of Association (MoA) in case of companies
• Incorporation certificate in case of companies
• Property tax receipt (latest) if the business place is owned; otherwise, lease agreement or permission letter issued by the property owner where the business is registered
• No Objection Certificate (NOC) issued by the nearby property owners
• Certified site or floor plan

Steps to Secure Trade License Online

1. Head over to the Municipal Corporation Website: Visit the respective Municipal Corporation website and select the "Citizen Service" option.

2. Sign Up: Register your details (name, email ID, mobile number, etc.). Once registered, the system will generate a User ID and password.

3. Form Filing: After logging in using the generated User ID and password, fill out the application form by providing all the requested information.

4. Documents: Prepare all the relevant documents in the prescribed manner and ensure they are duly signed by the concerned authority.

5. Upload Documents: Upload the documents and application form online. These will be verified by the Urban Local Bodies officials.

6. Unique Application Number: After verification, a unique application number will be automatically generated.

7. Fees Payment: Once the paperwork is completed, proceed to the "Make Payment" option. Various payment modes are available for fee payment.

8. Issue of License Number: Upon successful completion of the online process, a trade license number will be issued.

Note: The licensing process may involve an on-site inspection. If required, the concerned authority will appoint an official to inspect the business premises to ensure compliance with the applicable conditions.

Trade License
Dealing with registration legalities can leave any applicant feeling baffled and overwhelmed. Our experts are here to mitigate those challenges by providing unparalleled support. We play a pivotal role in strengthening the licensing space by offering end-to-end assistance to our valued clients across India.