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What Is Business Licensing?
Business licenses are permits issued by government agencies that allow individuals or companies to conduct business within the government's geographical jurisdiction. It is the authorization to start a business issued by the local government. A single jurisdiction often requires multiple licenses that are issued by multiple government departments and agencies. Business licenses vary between countries, states, and local municipalities. There are often many licenses, registrations and certifications required to conduct a business in a single location.
Business registration is required by most jurisdictions. A business license can be a business registration, but many jurisdictions require further licenses beyond registration.
The business activity and physical location (address) determines most license requirements. Other determining factors may include the number of employees and the form of business ownership, such as sole proprietor or corporation. Incorporation is not the same legal process as being licensed to do business. Government agencies can fine or close a business operating without the required business licenses.
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