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Difference between Trade License and Shops and Establishment License

Trade License – This is a license that is issued by the Municipal Corporation which gives permission to carry out a particular trade in a particular address.Shop Establishment License – Shops & establishment registration is mandatory for all business entities. It not only includes shops and commercial establishments but also, work from home jobs. Once you register your shop or establishment you will get a shop and establishment certificate.

Read through a few points that highlight the difference between Trade license and Shop and establishment licence

  • The commencement of any business that falls under the shops and establishment Act will need to get the business registered with the local government and trade licence is a permission given to a person to carry out a particular trade.
  • Shops and Establishment licence can be obtained for a shop or establishment even in residential premises. A trade licence can be obtained only for commercial premises.
  • Trade license is made mandatory to make sure that unethical business practices are not carried out. A trade licence also ensures that all rules and safety guidelines issued by the government are being followed. Shop and Establishment is required by the small trader and shop owner who is doing any commercial activity.
  • Establishments like hotels, restaurants, food stalls, cyber cafes etc require a trade license. Shops and establishment licence is required by any commercial establishment or shop that is providing any kind of service.
  • The fee for obtaining a Shops and establishment license and trade license may vary from state


The shop act license and trade license has to be obtained within 30 days of commencement of the business. If the conditions of the licenses are violated, then the license will be revoked or cancelled. The Shops and Establishment Act governs the working conditions and the rights of workers including wage payments, leaves, work hours etc.

Contact Details

For more details regarding online shop registration, call us at +91-9900328729, +91-80-40909797

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