Setting Up a Foreign Company Branch in Dubai, UAE

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October 5, 2023

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If you’re considering establishing a branch of your foreign company in Dubai, you’ve come to the right place. This guide will walk you through the essential steps for opening your business in Dubai, one of the UAE’s most dynamic and prosperous cities. We’ll cover everything, from understanding legal requirements to selecting a suitable location, ensuring you have the information needed to successfully establish your company.

Many foreign businesses are drawn to the United Arab Emirates, notably Dubai, because of its business-friendly environment. If you find yourself in the category of entrepreneurs looking to establish a branch of your parent company from another country, this guide is meticulously designed to lend you a helping hand. Moreover, it will offer you valuable insights and step-by-step instructions on navigating the process successfully

How to Open a Branch of a Foreign Company

Opening a foreign branch office in Dubai involves incorporating a branch of a foreign company in the UAE’s economic capital. This allows your foreign company to establish a physical presence in Dubai and expand its operations within the UAE and the broader Middle East region. To achieve this, your foreign company must comply with the UAE’s legal and regulatory requirements. This entails registering your branch within the chosen jurisdiction and obtaining a commercial license from the relevant authority.

Setting up a branch in Dubai is cost-effective and efficient, as it doesn’t require a share capital investment upfront. This makes it an attractive option for businesses seeking to expand their operations without significant initial capital outlay.

Advantages of Setting Up a Branch Office in Dubai:

Setting up a branch office in Dubai offers several advantages. it serves as a valuable tool for companies of all sizes looking to establish a presence while retaining full ownership.

  • Favorable tax system
  • Strategic business location
  • 100% ownership of the business
  • Gateway to the MENA region
  • Streamlined administrative processes and auditing

The choice between establishing a branch in the mainland or a free zone depends on your business’s specific needs. Mainland branches offer more flexibility to conduct business across the UAE and access a broader market but come with additional regulatory requirements. In contrast, free zone branches offer favorable tax and ownership regulations but are typically restricted to operating within the free zone.

Process of Setting up a Foreign Branch

Now, let’s dive into the step-by-step process of setting up a foreign branch office in mainland Dubai:

  1. Application Filing
    • Submit an application for approval to the Ministry of Economic and Commerce for establishing a branch firm in the UAE.
    • Include a service agent agreement, which is essential for the establishment of the business.
    • Furthermore, appoint a UAE agent to act on your behalf during the establishment of the representative office.
  2. Secure Approval from Appropriate Authorities
    • The UAE Ministry of Economy and Commerce will grant approval after clearance from the local Economic Department.
    • The Ministry will forward the application for approval to the local government.
  3. Obtain the necessary approval from the UAE Federal Foreign Companies Committee
    • The application is forwarded by the Economics Department to the UAE Federal Foreign Companies Committee.
    • Include a letter of authorization from the Ministry of Economy and Commerce specifying the commercial activities of your company.
  4. Obtain a License from the Ministry of Economic Affairs and Commerce
    • Following approval from the authorities, your branch office will receive a ministerial license detailing the authorized commercial operations.
  5. Obtain a Business License
    • Register the branch office as a foreign company under Foreign Company Registration with the Dubai Economic Department.
    • To attain the DED’s license, complete the trade license application and provide the necessary documents.
    • This involves determining the legal entity, selecting an office location, naming the branch, leasing office space, obtaining permits, securing visas for employees and family members, opening a bank account, hiring staff, and complying with local regulations.
  6. Register with Commercial Authorities
    • Register your branch office with the Chamber of Commerce and Industry and the Ministry of Economic and Commerce Companies Register in Dubai.

Ensure you have the required documents ready for opening a foreign branch company in Dubai, including:

  • Shareholder’s passport copy
  • Manager’s resume and passport copy
  • Individual bios for shareholders and managers
  • Evidence of a trade name reservation
  • Memorandum of Association (MoA) notarized by a UAE notary public
  • Notarization of articles of association
  • Resolution from the board authorizing the establishment of a new branch
  • Authorization for the primary branch issued by the Chamber of Commerce
  • Authorization for shareholders’ rights
  • Lease agreement for the new branch’s address
  • Company profile for the main branch

By following these steps and ensuring you meet all regulatory requirements, you can successfully establish a branch of your foreign company in Dubai, tapping into the city’s thriving business environment. Contact us today to setup foreign branch in Dubai.

Also read: 13 Reasons Why Dubai Free Zones Are So Appealing to Entrepreneurs?

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