If you currently run a company in the UAE? Do you intend to open a branch in Dubai, United Arab Emirates? Trying to find a quick and simple branch establishment in Dubai. With the aid of professionals, opening a branch office in Dubai, United Arab Emirates is simple. Additionally, it is the simplest option for a foreign business to access the UAE market.
A branch office in Dubai, United Arab Emirates, is the best option if you already operate a fully operational business in another nation and wish to break into the Middle Eastern market. Dubai resembles the Middle Eastern entryway. Due to its advantageous location, foreign businesses can connect to the entire region.
Your business can conduct operations including product promotion, sales of goods and services, agreement-making, transaction-making, etc. through a branch office in the UAE.
However, if the parent firm is prohibited from engaging in a particular commercial activity, neither can the branch office in Dubai, United Arab Emirates.
What is a Branch Office in Dubai, UAE?
In Dubai, United Arab Emirates, a branch office must meet a number of requirements. Foreign businesses looking to open up shops in the UAE have three options: branch offices, subsidiaries, and representative offices. These three different firm forms each have unique traits and advantages.
In Dubai, United Arab Emirates, a branch office has the following features:
- It carries out the same tasks as the parent organization.
- For each trade license required to conduct certain commercial activities, the branch office must submit an application.
- It is not regarded as a distinct legal entity from the parent business.
- The branch office’s debts and responsibilities will be the responsibility of the main firm.
- Based on their income in the UAE, the branch office will be taxed.
- The parent company’s name will appear on the branch office as well.
How to Open a Branch Office in Dubai: Step-by-Step Guide
Either on your own or with professional assistance, you can set up a branch office in Dubai, United Arab Emirates. However, it is strongly advised that you obtain professional assistance if this is your first time launching any form of business in the UAE.
You will lose time and money if you make any costly blunders throughout the company formation procedure. As a result, the overall cost will be higher than what it would have cost to hire experts to launch your company.
Appoint a Local Service Agent
- A branch office of a foreign firm established in the UAE might be 100% foreign owned if a local service agent is appointed.
- The international business must choose a local service agent who is either an Emirati or works for a company that is 100% owned by Emiratis.
- The trade name registration with the Department of Economic Development will thereafter be finished by the local service agent (DED).
Obtain the MOE’s approval
The information of the firm, such as the head office, the type of business, the share capital, the name of the general manager in the United Arab Emirates, etc. are included in the application for permission from the Ministry of Economy (MOE), together with the mandatory papers, such as:
- Memorandum of Association (MOA)
- Article of Association (AOA)
- Certificate of Incorporation
- Parent Company’s Good Legal Standing Certificate
- A Branch Office was established, according to a Board Resolution.
- A power of attorney granting the general manager access to and authority over bank accounts on the parent company’s behalf.
Obtain a business license from DED.
Either the Abu Dhabi Department of Economic Development (DED) or the Dubai Department of Economic Development will receive the initial permission letter from the MOE (DDED). The necessary records consist of:
- First approval from MOE.
- Copies of the paperwork that MOE received.
- Copies of proposed leases in the United Arab Emirates (referred to as “Tawtheeq” in Abu Dhabi and “Ejari” in Dubai).
- Engagement letter from a UAE auditor with local registration certifying the parent company’s two-year financial statements and the existence of the company.
- The DED’s business license has an annual renewal option and is only good for one year.
Obtain an office, visas, and bank accounts
- The business can invest in office space and purchase visas and labor cards for staff members once the commercial license has been received from the DED.
- Additionally, you must open bank accounts in Dubai. The parent business, as well as any other corporate and shareholder structures inside the parent company, will need to provide complete UBO information to the banks.
- For use in the UAE, all foreign documents must be translated, legalized, and authenticated.
Registration with the Ministry of Economy (MOE):
Setting up a foreign branch office in the UAE requires MOE registration. You must finish the entire registration process, pay the relevant registration fees, and acquire the MOE License within one month of receiving the Foreign Branch Trade License from the DED. You will be required to pay a fee of AED 1,000 per month, up to an annual cap of AED 10,000, if the MOE registration process is not finished within one month.
Online registration is available for the MOE. The business must sign up, get a username and password, and use the portal to upload the required papers. Some of the essential criteria for the MOE registration process include the following:
- Bank Guarantee: Through a regional UAE bank, each Foreign Branch must submit a refundable AED 50,000 Bank Guarantee deposit to the Ministry of Economy. This deposit is maintained for the life of the license and cannot be withdrawn or used as operating capital.
- To produce a balance sheet and present annual final accounts of branches when renewing admission at the Ministry of Economy, you must choose a certified accountant with a base in the UAE. The auditor must produce a unified balance sheet if the foreign company has multiple branches.
Start Branch Office in Dubai with UAE Expansion
Businesses may find it appealing to open a foreign branch office in the UAE, but doing so can be difficult, time-consuming, and complex. Leaving the process unfinished can also be an expensive mistake. For this reason, consulting with reputable business setup specialists like UAE Expansion is recommended.
We provide a hassle-free option by handling the procedures and paperwork necessary to establish your overseas branch office in the UAE. We can also serve as the international branch office’s local service agent. If you need any help, please let us know.
