All About Setting Up a Branch Office in Dubai

All About Setting Up a Branch Office in Dubai

A foreign entity planning to start their business in Dubai must decide on whether they wish to do a new business registration Dubai or a branch office.

A foreign entity can open an 100% owned branch office in Dubai or the UAE but must have a service agent who is a UAE National or sponsor who will be paid every year and who will help in communications with the government directly to sign the relevant documents.

Steps Involved in Setting up A Branch Office in Dubai

  1. An application must be filed by the foreign entity with the Ministry of Economy and Commerce in order to get the license. Along with the application, the foreign company must submit a Service Agent Agreement that they have made with a 100% UAE-owned Company or a UAE national.
  2. The application will be forwarded by Ministry of Economy and Commerce to the Dubai Economic Department (DED) in order to secure local government approval.
  3. The Economic Department will then forward the application to the Federal Foreign Companies Committee for approval along with the note from the Ministry of Economy and Commerce describing the specific activity or activities that branch office is allowed to undertake in Dubai.
  4. After Federal foreign Companies Committee gives the approval, the required Ministerial License will be issued by the Ministry of Economy and Commerce. In the said license, the specific activity or activities to be undertaken by the foreign branch office is mentioned.
  5. The branch office is then entered in the Commercial Register of the Dubai Economic Department. After that, the required license is issued.
  6. Once DED issues the required license, the foreign branch office is entered in the Ministry of Economy and Commerce’s Foreign Companies Register.
  7. Last step is at the Dubai Chamber of Commerce and Industry, where the branch office is registered.

Business setup in Dubai: Documents Required

From the Parent Company

  • Proof of trade name reservation
  • Application forms for registration
  • Certificate of Incorporation
  • Memorandum and Articles of Association
  • Parent company’s management board resolution for opening a branch office in Dubai
  • Director’s passport copy
  • Copies of the passport and naturalization book of the local service agent
  • A ‘Service Agent’ agreement with a UAE national or UAE company
  • Audited Financial Accounts
  • Power of Attorney (issued in favor of the company-appointed General Manager)
  • Bank Guarantee issued in favor of the Minister of Economy and Planning

Note: The location proposed to be utilized by the foreign company’s branch office must also be approved. Moreover, certain fees have to be paid prior to the issuance of a license. After the license has been issued, branch office can open a corporate bank account and arrange for visas and labor cards for the employees.

While going for business setup in UAE, a major aspect i.e. difference between branch office and representative office must be known.

According to Article 314 of the Commercial Companies Law, a representative office of a foreign company set up in Dubai is restricted in the activities it can carry out within the emirate.

A representative office operating on behalf of a foreign company is limited to the functions of a marketing and administrative center in Dubai. Also, another factor that you must take into consideration while going for Dubai business setup is that a representative office may have only four employees.

Also Read: Five risks to consider when starting a business in UAE

Our branch office setup services at Business Registration Dubai are a cumulative offering derived from years of professional experience and liaison with UAE government departments. Our business consultants in Dubai render end-to-end procedural solutions for foreign companies.

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