Trade License Certificate: Meaning, Benefits and Its Types

Preface: This post was originally published in 2019 and has been updated on September 27, 2025, to provide you with the most current and accurate information.

The trade license is an essential document for operating a business in India. This license is issued by the local municipal corporation. In this blog post, we shall explain to our readers what is the trading license in India, documents required to obtain it and the process that needs to be followed to obtain this license.

What is Trade License?

The Trade License is a legal document issued by the local municipal corporation. It serves as a permit that allows individuals or parties to commence and perform business operations within a specific area. 

By obtaining the trading license, compliance with local regulations and safety standards is ensured. This certification shows that the organization is dedicated to ethical business practices and protection of the community in its operational area.

The procedure to obtain this license begins with submitting an application to the authorized commissioner before or within 30 days of commencing operations. During this timeframe, the applicant is required to provide all mandated documents to the municipal corporation.

Benefits of Trade License Registration

Following are benefits of trade licence registration in India:

• The trading license ensures that the business owner is doing business ethically.

• It ensures compliance with guidelines set up by the local municipality.

• It makes the business more credible and also provides quality assurances to the customers.

• This license verifies that businesses meet the established and protects the public health as well as safety.

Types of Trade License

If you want to move forward and apply for trade licence online, you should have an idea about the types of licenses that are available to you:

• Industry Trade Licenses: These licenses are issued to small, medium and large scale industries.

• Shop Licenses: Shop Licenses are issued to specific niche of traders that are considered a bit dangerous like Firecracker sellers, candle sellers, Barber shops etc.

• Health trade licenses: It is issued to businesses that provide goods and services that have a direct impact on the general public's health, including spas, gyms and medical clinics. It is also required by food establishments like canteen, slaughterhouses, bakeries, movie theatres serving food, restaurants, hotels, food stalls, etc. Want to learn more about health trade license? Read Here

Eligibility for Obtaining Trade Licence

For obtaining trading licence, you must ensure you meet the following eligibility requirements:

• The person must not be less than 18 years of age.

• The person must not have a criminal record.

• They must run a legally permissible business.

If you meet the above-mentioned requirements, you can consider trade license apply online or offline, depending on your jurisdiction.

What Documents are Required for Trade License?

There are multiple types of trade licenses and as such, there are different documents required to acquire them. That said, the common trading license documents that are required are as follows:

• Application of the trading licence

• PAN card of the applicant

• Aadhar Card of the applicant

• Certificate of Incorporation in case of company

• Partnership Deed in case of Partnership Firm

• LLP Agreement in case of Limited Liability Partnership

• Memorandum of Association in case of company

• Articles of Association in case of company

• No Objection Certificate (NOC) of Neighbour

• Details of power sources, equipment and machinery of the business

• A layout plan of the office space

• Certificate of occupancy

• Building permits for the business

• Other documents requested by the authority.

How to Get Trade License

To get trade licence in India, you need to follow the process applicable in your state. Mentioned below are the general steps you to need to follow to obtain this license:

• Prepare all the necessary documents.

• After preparing the documents, you have to file the prescribed application form with the municipal authority of your jurisdiction. While filing the application, don’t forget to attach all the required documents.

• After the authority receives your application, it’ll review it carefully and verify all the documents. 

• If the application aligns with all the necessary requirements and all the documents are verified, the authority will approve the application and issue the trade licence to you.

Conclusion

To operate a business in India, it is essential to obtain a trade licence. This licence is issued by the municipal corporation. Generally, you need to obtain it before or within 30 days of commencing business operations. Need assistance in company registration? Connect with our company incorporation experts at Registrationwala. We’ll help you to incorporate a company from scratch and also help you ensure post-registration compliance requirements!

Frequently Asked Questions (FAQs)

Q1. How can I get trade license?

A. To get a trading license, you must file an application with the municipal authority.

Q2. Which authority issues trading license in Delhi?

A. Trading license, also known as trade licence, is issued in Delhi by the Municipal Corporation of Delhi (MCD). 

Q3. Which authority issues BBMP trade license in Bangalore? 

A. BBMP license for trade is issued by Bruhat Bengaluru Mahanagara Palike (BBMP) - the Municipal Corporation of Bangalore.

Q4. Is a trade licence required to start a restaurant?

A. Yes, a trade licence is required to start a restaurant. Apart from this, you’ll also need to obtain other licenses and registrations like FSSAI license, GST registration, shop and establishment license, etc.

Author: Dushyant Sharma

Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.