Setting up a representative office in the UAE for a foreign company is a significant move, serving various purposes. However, certain requirements and conditions must be met. Understanding the procedures, costs, and prerequisites for establishing a representative office in Dubai or elsewhere in the UAE is crucial.
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Establishing a Dubai Representative Office: Step-by-Step Guide
To establish a Dubai Representative Office:
Step 1. Find a Reliable Local Agent:
Registering a branch or representative office for a foreign company in Dubai or anywhere in the UAE necessitates engaging a local agent. This initial step is mandatory when establishing a representative office in the UAE, requiring the involvement of a UAE national to serve as your local service agent in Dubai, UAE.
Step 2. Reserve Trade Name:
The Department of Economic Development (DED) reserves the trade name for the foreign or parent company.
Step 3. Obtain Initial Approval:
Submit investors’ passport copies, parent company papers, and preliminary documentation to DED for initial approval.
Step 4. Obtain Ministry of Economy (MOE) Approval:
Apply to MOE with details about the parent company, including address, nature of business, and share allocation. Additional paperwork concerning the parent company may be required.
Step 5. Obtain DED License:
Submit MOE approval to DED along with additional documentation depending on the nature of the representative office. DED issues the commercial license thereafter.
Documentation is essential at each step, including investors’ passports, parent company details, and paperwork for approvals from DED and MOE.
Required Documents for Establishing a Representative Office in UAE
- Certificate of Incorporation or Trade License
- Attested Board of Resolution
- Attested Power of Attorney
- Memorandum of Association (MOA)
- Articles of Association (AOA)
- Notarized Local Agent Agreement
- Additional Government Approval
- Copies of Investors’ Passports
Advantages of Setting Up a Representative Office in Dubai
Here’s the information presented in a table format:
Advantages | Description |
---|---|
Tax Advantages | Enjoy tax benefits and limited tax liabilities, with a 0% corporate tax rate. |
Cost-Effective Setup | Establishing a representative office incurs comparatively low setup costs. |
Flexibility in Shareholders | Benefit from the freedom to have multiple shareholders, unlike traditional company setups. |
No Minimum Share Capital | There’s no requirement for a minimum share capital to establish a representative office in UAE. |
International Expansion | Gain access to global connections and experience significant international expansion opportunities. |
Quick Setup Process | Establishing a representative office in UAE is swift, with a streamlined administrative process. |
Cost Breakdown for Establishing a Representative Office in UAE
Certainly, here’s the breakdown of business setup fees for a representative office in Dubai presented in a table format:
No. | Charges | Type of Fees | Period Covered | Amount |
---|---|---|---|---|
1 | Initial Approval | Gov’t Fees | One time | AED 235 |
2 | Name Approval | Gov’t Fees | One time | AED 735 |
3 | Typing of MOA / LSA | Typing Centre | One time | AED 500 |
4 | Notarization of MOA / LSA | Gov’t Fees | One time | AED 875 |
5 | Service Agent Fees + PRO services (due on the day of court agreement) | Sponsor or Service Agent | Every Year | AED 20,000 |
6 | License Fee | Gov’t. Fees | Every year | AED 6,600 |
7 | Rented Office | Depends on requirements | Depends on requirements | Depends on requirements |
8 | Market fees 2.5% of Premises annual rent to be paid to Economic Department | Gov’t. Fees | Every Year | Varies |
9 | Arabic name free – Foreign name charges AED 2,000 | Gov’t. Fees | Every Year | AED 2,000 |
10 | Ministry of Economy fees | One Time | Every Year | AED 15,000 |
11 | Ministry of Economy REFUNDABLE DEPOSIT | One Time | Every Year | AED 50,000 |
12 | Immigration card fees | Gov’t Fees | Every 3 years | AED 760 |
13 | Labour Card fees | Gov’t Fees | One time | AED 2,700 |
14 | Telephone + P.O. Box Update (Economic Dept.) | Gov’t. Fees | One time | AED 560 |
15 | Company Rubber Stamp | Stationery Fee | One time | AED 100 |
Please note that the “Rented Office” cost varies depending on specific requirements and is not provided in a fixed amount. Similarly, the “Market fees” also vary depending on the annual rent of the premises.
What is the role of a representative office?
The role of a representative office involves serving as a crucial intermediary between the company’s headquarters and its branch offices across various countries. Additionally, these offices function as quality control centers for the company’s products. They actively seek out trade information and relay it to the parent company or headquarters.
What is a representative office of a foreign company in Dubai?
A representative office of a foreign company in Dubai is a branch established by the parent company, authorized solely to conduct promotional activities within the UAE for the products and services offered by the parent company. It is restricted from engaging in export, import, or any business transactions within the UAE.