If you already own a business elsewhere in the UAE? Dou you want to start a branch office in Dubai, UAE? Looking for a easy and quick branch setup in Dubai. With a branch office in Dubai, UAE is easy when done with the help of the experts. It is also the easiest way a foreign company can enter the market in the UAE.
If you already have a fully functional company in another country and you want to enter the Middle Eastern market, then a branch office in Dubai UAE is the way to go. Dubai is like the gateway to the Middle East. Its strategic geographic location allows foreign companies to connect itself to the whole region.
With a branch office in UAE, your company can perform business activities such as marketing products, selling goods and services, entering agreements, carrying out transactions, etc.
However, if the parent company is not allowed to perform a certain business activity, then the branch office in Dubai, UAE cannot perform that business activity as well.
What is a Branch Office in Dubai, UAE?
A Branch Office is a secondary setup that a main company creates in another area, like a Freezone or Dubai Mainland. This is done to save costs, get tax advantages, or explore new markets. If you’re planning a to setup a branch in Dubai, you have two choices: setting up business in Dubai Mainland or Freezone. The rules can differ based on where you go.
Here are the characteristics of a branch office in Dubai, UAE:
- It perform the same activities as the parent company.
- The branch office must apply for the respective trade license that allows those business activities.
- It is not considered a separate legal entity from the parent company.
- The parent company will be liable for the debts and obligations of the branch office.
- The branch office will be taxed based on their income in the UAE.
- The branch office will have the same name as the parent company.
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Steps to Start a Branch Office in Dubai, UAE
You can either setting up a branch office in Dubai, UAE by yourself or with the help of the experts. However, if it is your first time starting any kind of company in the UAE, it is highly suggested that you seek help from professionals.
Any mistakes in the company formation process will cause some expensive backs that will cost you both time and money. As the result, the total cost will exceed the cost of hiring the professionals to start the company for you.
Here are the steps you need to follow in order to branch setup in Dubai, UAE:
1. Appoint an LSA (Local Service Agent)
The local service agent needs to be a UAE national (Emirati), and they will act as the intermediary between the relevant governing authority and you. They will obtain licenses, visas, permits, approvals, etc. for you.
Since a lot of the documents and official processes are conducted in the Arabic language, it is necessary for foreign companies to appoint a Local Service Agent.
If required, the Local Service Agent will share ownership of the company but will not take part in any operational or management activities of the company. They will not take a portion of the profit and will only require a minimal yearly fee.
2. File your branch office formation application
To get started, you need to file an application to the Ministry of Economy in Dubai. You need to obtain the initial approval from them to move on to the next steps. That is why you need to fill the application form carefully with authentic information that is free from any error.
Your local service agent will help you fill-up the application form to ensure that are no errors. A service agent agreement is also required to officially declare that the local service agent will be acting on your behalf to start the company.
3. Get Required approvals from the Ministry of Economy and Federal Foreign Companies Committee
You will need to submit the required documents to the Ministry of Economy to get their approval. You will also need approval from the Federal Foreign Companies Committee to start performing your business activities in the UAE.
The Ministry of Economy will forward the application to the Federal Foreign Companies Committee, so you do not need to worry about it. If everything turns out ok, then a permit letter will be sent, and you will get the approval for your branch setup in Dubai, UAE.
4. Obtain the Business Trade License from the DED
The Department of Economic Development in the UAE is responsible for providing business license to new businesses in Dubai. After you have received your approvals from the Ministry of Economy and Federal Foreign Companies Committee, you can apply for the business trade license from the DED.
Remember that you can only perform the business activities that you registered for when applying for the business trade license. So, it is suggested to select all the relevant business activities carefully when applying for the trade license. The business trade license needs to be renewed annually.
5. Register with the Commercial Authorities
After you have successfully registered your branch office and obtained your business license, the last step is to register with the commercial authorities.
For example, if your foreign branch company setup in Dubai then you need to register with the Dubai Chamber of Commerce and Industry and the Ministry of Economic Companies Register.
Required Documents to Open Branch Office in Dubai, UAE
Here are the Documents you need to procure to start your branch office in Dubai UAE:
- Filled up application forms for the registration of the branch office.
- The trade name reservation certificate.
- The Memorandum and Articles of Association (MAA) of the parent company.
- A copy of the Certificate of Incorporation of the parent company.
- The passport copies of the Company’s Director.
- A no-objection letter from the parent company.
- A power of attorney for the director of the Branch Office.
- The board resolution of the Parent Company for opening a Branch Office in Dubai UAE.
How much does it cost to set up a branch office in Dubai?
The cost of setting up a branch office in Dubai can vary based on different factors. On average, the initial cost for opening a branch office is around AED 100,000, and this amount includes a refundable startup payment of AED 50,000. However, it’s important to note that these costs are subject to change as per the laws and regulations of the UAE. It is advisable to stay updated with the latest requirements and guidelines to accurately determine the cost of setting up a branch office in Dubai.
Frequently Asked Questions on Branch Setup in Dubai
How to set up branch in UAE?
Set up branch company in UAE involves submitting an application to the Ministry of Economic and Commerce. Approval is required. A service agent agreement is crucial for business setup.
How can I open a branch office in Dubai?
If you already own a business elsewhere in the UAE or in other countries, then the best way to start your endeavor in the city is to open a branch office in Dubai. To do so, you can contact the Business Setup Consultants who have the necessary expertise and connections required to give you a head start.
As a result, starting a branch office in Dubai has never been easier. Additionally, you can get various corporate services and office spaces as well.
The process of starting a branch office in Dubai is very easy. However, if this is your first time taking a project anywhere in the UAE, then it is highly suggested that you seek the assistance of Company Setup Consultants. Here are the steps you need to follow in order to open a branch office in Dubai:
- File an application to the Ministry of Economy.
- Obtain consent from the Ministry of Economy.
- Get the required approvals from the UAE Federal Foreign Companies Committee.
- Get the license from the Ministry of Economy.
- Obtain your business trade license from the Department of Economic Development in Dubai.
- Get registered with the relevant commercial authorities.
What is a branch company in the UAE?
In the UAE, a branch company is an offshoot of an existing business that operates separately from its main headquarters. It allows companies to expand their operations to different cities or countries, tapping into new markets. For instance, global brands like Apple have branch companies in the UAE while their main base is elsewhere. If you have a company elsewhere, you can establish a branch in the UAE with the guidance of experts to access new opportunities.
What is the difference between branch and LLC in Dubai?
In Dubai, an LLC requires a UAE National (individual or company) owning at least 51% of shares, leaving Foreign Investors with a maximum of 49%. A Foreign Branch is an extension of the Mother Company with no independent legal standing.
What is the difference between branch and representative office?
A representative office is an office in the UAE that can perform promotional activities for the parent company that is located in another country. For example, a representative office can promote the parent company’s product and the customers can order their products directly from the parent company that is located elsewhere.
However, they cannot perform other business activities like holding products in the country or importing raw materials and producing the product in the UAE.
A branch office on the other is an extension of the parent company in the UAE. As a result, it can perform all the business activities like an independent legal entity. This means that with a branch office, the company can effectively move its operation of the company to the UAE.
For example, they can import raw materials, produce, assemble, package, and sell their products in the country. Additionally, they can perform promotional activities as well.
Can I open a branch office in Dubai?
For foreign companies seeking full ownership, setting up a Dubai branch offers the advantage of engaging in profitable activities, unlike representative offices. Dubai branches allow business operations and profit generation, making them a more practical choice.
How can we help you to Branch Setup in Dubai, UAE?
Our experts have years of experience starting various businesses all over the UAE, including branch offices for foreign companies. We also provide some of the best office spaces in Dubai.
Are you are Planning to foreign branch company setup in Dubai, UAE? then you are at the right place. We are located in the prestigious Conrad Hotel – Business Tower, Sheikh Zayed Road, Dubai.
For further information and assistance on How to Setup a Branch Office in Dubai UAE. To Speak with our Experienced Business Consultants for further information and assistance, call us at +971582595164. Send a WhatsApp Message for Chat Query on +971 582595164 or email us at info@companysetup.ae.
