If you’re planning to start a branch office in Dubai, is basically a fatherly strategic step towards evolving a global class presence in one of the world’s most dynamic business environments. Dubai boasts a good business system; great infrastructure, and is one of the best places to have laws friendly to foreign investors so that foreign firms can open a branch of a foreign company in Dubai.
This guide by CompanySetup.ae provides a step-by-step overview of how to open a branch of a foreign company in Dubai, its benefits, cost, and the necessary legal requirements to help you make informed decisions.
Table of Contents
Understanding What a Branch Office Is
A branch office is like a parent office in a different place. It is not a separate business, but a reflection of the parent company business operations.
The branch office in the UAE is allowed to conduct the same type of business as its parent company, but only with the permission of the Department of Economic Development (DED).
The parent company is absolute owner and the branch should operate under the same trade name, brand consistency and corporate alignment.
Why Start a Branch Office in Dubai?
As the place of connections between Africa, Asia and Europe, Dubai is the commercial center of the Middle East. The following are the main reasons why opening a branch of a foreign firm in Dubai would be a lucrative decision:
- Strategic location: Good with companies that are targeting the GCC markets as well as the international markets.
- Tax benefits: There is no corporate or personal income tax (with a few exceptions in certain industries).
- 100% foreign ownership: Foreign branch offices are available.
- Ease of operations: Smooth business registration and visa treatments.
- Strong global reputation: Dubai increases its credibility and presence at the global market.
When you establish a branch, you not only increase your business but also enjoy the desirable economic climate of Dubai.
Mainland vs. Free Zone Branch – Which Is Right for You?
- Is able to directly operate in the UAE market.
- It needs a UAE national Local Service Agent (LSA).
- Under the Department of Economic Development (DED) license.
Best suited to the businesses that intend to serve domestic customers and work on governmental projects.
- Free Zone Branch Office
- 100% foreign ownership.
- It is situated in one of the numerous special free zones of Dubai.
- Only allowed to work within the free zone or out of the UAE.
- Under the care of the corresponding free zone authority.
There are benefits associated with both. Setups in the mainland provide more expanded business entity operations, whereas Free Zone branches provide more ownership latitude and industry-related advantages.
Step-by-Step Process: How to Open a Branch of a Foreign Company in Dubai
There are a number of identified steps that should be adhered to in order to open up a branch in Dubai. This is made easy and effective with the help of professional advice of CompanySetup.ae.
Step 1: Appoint a Local Service Agent (LSA)
Local Service Agent is compulsory in the mainland branch offices. The LSA is a representative between your company and the government of the UAE, doing approvals and documentation and renewals.
Note: The agent does not own any equity or intervene into the company operations.
Step 2: Apply to the Ministry of Economy (MOE)
You have to place a preliminary acceptance application to the Ministry of Economy in which you declare your desire to establish a branch office in Dubai. This application should be accompanied by the incorporation documents of the parent company, memorandum of association and resolution of the board.
Step 3: Obtain Approvals from Authorities
After MOE reviews and accepts your application, it sends it to the Federal Foreign Companies Committee so that they can validate it. On approval, you will be given consent to continue with your registration of the branch.
Step 4: Secure a Trade License
Upon approval, obtain a trade license at the Department of Economic Development (DED). Such a license gives your branch a legal right to operate in the name of your parent company in Dubai.
Step 5: Register with the Dubai Chamber of Commerce
The last thing is to register your business at Dubai Chamber of Commerce and Industry (DCCI) to register formal presence and start business operations.
Are you Planning to Setup a Branch Office in Dubai, UAE? Send Us Your Inquiry
Documents Required to Start a Branch Office in Dubai
In order to simplify the registration, you should prepare the following documents beforehand:
- The Certificate of Incorporation of Parent company.
- Memorandum & Articles of Association (attested).
- Approval of Dubai branch formation on board level.
- Branch manager power of attorney.
- Copies of directors and shareholder passports.
- No Objection Certificate (NOC) parent company.
- The certificate on the reservation of trade names.
- Local Service Agent contract (mainland division branches).
All papers should also be signed and translated to Arabic when necessary
Cost of Setting Up Branch Office in Dubai
The cost of setting up branch office in Dubai is also subject to additional factors such as business operation, the type of license, and location of the office.
On average, the initial cost is between AED 100,000 and AED 150,000 that encompasses:
- Licensing and government approvals.
- Local Service Agent fee
- Translation and attestation expenses.
- Visa and immigration fees
In Company Setup Consultants, we have open pricing and cost tables that are specific to your business requirements and will make the set up experience cost effective.
Benefits of Setting Up a Branch of Foreign Company in Dubai
The strategic benefits of establishing a branch of foreign company in Dubai are many:
- Complete parent company ownership.
- Direct access in the market to UAE and GCC market.
- Expansion of the brand under a globally known name.
- Reduced establishment costs as compared to the creation of a new firm.
- Availability of both local and foreign talent.
- Repatriation of capital and profits permit able.
The advantages make Dubai one of the best places to expand business internationally.
Taxation and Compliance for Branch Offices
The tax-efficient environment is one of the greatest opportunities of establishing a branch office in Dubai. Majority of industries have 0% corporate tax but the foreign company branch which deals with oil, gas or banks is subject to UAE tax regulations.
The branches are required to keep good accounting books, trade licensing is recommended to be renewed every year, and the divisions should meet UAE labor and visa regulations as well as commercial laws.
Company Setup Consultants is found to keep your branch in line with all the UAE requirements in order to concentrate on your business activity.
How CompanySetup.ae Helps You Open a Branch Office in Dubai
CompanySetup.ae is the company that helps international firms to enter Dubai with ease. Our seasoned consultants will do it all, including approvals and licensing, processing of visas and office setups.
We provide:
- E2E business setup support.
- Legal preparation and translation.
- Cost transparency and strategic planning.
- Help with locating office space.
- Continuing compliance and renewal services.
Through our experience, establishing a branch of an international firm in Dubai is an easy and stress-free experience.
Frequently Asked Questions on Branch Setup in Dubai
- How much does it cost to set up a branch office in Dubai?
AED 100,000 to AED 150,000 is the average cost of establishing a branch office in Dubai, based on the licencing needs, location and other administrative charges.
- Can a foreigner open a bank in Dubai?
Yes, however, one must get the UAE Central Bank and other regulators to give approvals in order to establish a bank. It is a professional and strictly controlled process.
- Can an Indian company open a branch office abroad?
Yes, it is possible to expand internationally with Indian companies because it is possible to comply with the guidelines of RBI and receive the right approvals to invest in foreign countries.
- How to establish a branch office?
You can start a branch office in Dubai by obtaining initial approvals from the Ministry of Economy, securing a trade license from DED, and registering with local authorities.
- How much does it cost to open a branch?
The overall price is changing but it usually begins with approximately AED 100,000, which covers government expenses, expenses of the service agent, and the documentation expenses.
Final Thoughts
Dubai provides unparalleled business opportunities to companies with international expansion. It is through opening up a branch of a foreign firm in Dubai that you direct access to a booming economy, policies that are tax friendly and a state of the art infrastructure.
Company Setup Consultants makes it easy and stress-free to set up operations, venture into new markets, or build global credibility through seamless and legal proceedings throughout the registration.
📞 Ready to expand your business into Dubai?
Contact CompanySetup.ae today to learn how to open a branch of a foreign company in Dubai with expert guidance.
Contact us at +971 582595164 or write to info@companysetup.ae to have a consultation with us one-on-one.
