How to Setup a Foreign Company Branch/Subsidiary in UAE?

Foreign companies have the option to establish a branch or subsidiary in the UAE, enabling seamless coordination of business operations with their parent company in the home country. However, it is important to note that the branch or subsidiary of a foreign company in the UAE must be duly registered with the relevant government authorities.

Branch Office Vs. Subsidiary

A branch office serves as an extension of an existing business, remaining intrinsically linked to the parent company without being a distinct legal entity. In the UAE, branch offices have the privilege of engaging in the same business activities as their parent company.

How to Setup a Branch Office/Subsidiary in UAE?

A subsidiary company in UAE is responsible for its actions, business activities, and management, with full liability. It can establish a Branch Office/Subsidiary in two business jurisdictions of UAE – The Free Zones and Mainland.

Setting Up a Branch/Subsidiary in UAE – Steps to Follow

Establishing a branch office or subsidiary is a seamless and straightforward process. Our dedicated team will guide you through company formation, ensuring proper documentation, liaising with government authorities for approvals, facilitating bank account opening, and more. Experience a hassle-free setup and embark on your business journey with confidence.

Document Attestation For Setting Up Branch / Subsidiary Office in UAE

To register a Branch Office or Subsidiary Office, the four key company documents need to be attested by the UAE Embassy in the parent company’s home country and counter-attested by the Ministry of Foreign Affairs in the UAE.

The Ministry of Foreign Affairs charges an attestation fee of approximately AED 2000 (USD 545) per document in the UAE. This fee applies to each individual document.

To attest the parent company documents from the UAE Embassy in the home country of the Parent Company, an equal amount would be necessary. Let’s ensure the writing quality is improved by optimizing word choice, structure, readability, and eloquence while preserving the original meaning.

Documents Required for Setting Up Branch Office in UAE

Documents that must be Attested by the Government Authorities in the Home Country and UAE

• Certificate of incorporation/ Memorandum of Association (MOA), Article of Association (AOA)
• Board Resolution stating the formation of a Branch Office/Subsidiary
• Parent Company Good Standing Certificate
• Power of Attorney in Favour of General Manager giving him the rights to open/operate/Management Bank Accounts on behalf of the Parent Company

Supporting Documents Required for Branch/Subsidiary in UAE

There are a few more mandatory documents required to set up a Branch Office in UAE which are:

• Trade Name Reservation Application Form
• Director/Investor/Manager Passport Copy
• Audited Accounts of the parent company for the last two years
• A statement listing out the company’s business objectives, plan, major operation activities
• Attested agreements with the Local Service Agent (LSA)
• Required Government Approvals (if any)

Benefits of Establishing a Branch/ Subsidiary in UAE

• 100% ownership to foreign investors Tax savings as there is no corporate/income tax in UAE
• UAE Resident Visa and corporate/personal bank account
• Confidentiality in business
• Very low import duty (5%) in the mainland of UAE
• Reduce the administrative burden of managing a large multi-national company
• Separate auditing, bookkeeping, and decentralize global offices for enhanced management
• Cost-effectively enter new market territories.
  There is no share capital requirement for a Branch Company in UAE. hence,
  investors can grow their business with a minimum upfront cost.

How to set up a Foreign Company Branch in UAE? – Steps Explained

1. Choose the Right Business Jurisdiction

The foreign company must choose the respective business jurisdiction – Where the Branch Office needs to be setup – Mainland, Free Zone, Offshore.

To establish a presence in the UAE mainland, it is mandatory to appoint a Local Service Agent who will handle administrative tasks and liaise with Government Authorities. This ensures smooth operations and compliance with regulations.

2. Identify the Local Service Agent

The Local Service Agent is appointed for a duration of one year, in exchange for an annual fee. The contract can be renewed each year, with the option to replace the agent in the event of any disagreements. This arrangement ensures both continuity and flexibility in the engagement.

In Free Zones and Offshore locations, there is no need to engage a Local Sponsor. The Manager/Director assumes the role of the authorized person responsible for conducting the business activities of the Branch Office. This arrangement provides flexibility and streamlined operations.

An experienced Business Consultants such as Pro Consultancy UAE will assist you with the documentation approvals, visa processing, bank account opening assistance, and more.

3. Reserve a Trade Name

The Branch Office should bear the identical name as the Parent Company in the Home Country, ensuring consistency and cohesion. To get the name approved, the application has to be submitted to the Department of Economic Development (DED) in the case of Mainland Company.

If an investor decides to establish their business in these jurisdictions, the application must be submitted to the appropriate Free Zone or Offshore authority.

4. Document Attestation from UAE Government Authorities

The company documents need to be authenticated by the UAE embassy in the home country and subsequently counter-authenticated by the Ministry of Foreign Affairs in the UAE.

The UAE Authorities require the following documents to be attested both in the home country and in the UAE for legal validity.

• Certificate of incorporation/ Memorandum of Association (MOA), Article of Association (AOA)
• Board Resolution stating the formation of a Branch Office/Subsidiary
• Parent Company Good Standing Certificate
• Power of Attorney in Favor of General Manager giving him the rights to open/operate/Management Bank Accounts on behalf of the Parent Company

5. Obtain License from Respective Government Authority

To obtain the Branch Office License, it is necessary to submit the attested documents along with the supporting documents to the relevant Government Authority. A fee must be paid to the authorities when submitting the documents. After a thorough assessment of the documents, the investor will be issued the Branch Office License.

6. Fulfill Administrative Requirements

Now, the investor can apply for a UAE residence visa, open a corporate bank account, appoint Director/General Manager, recruit employees, process immigration cards, Labour contracts, expand office space, and conduct business in the UAE.

For comprehensive information on establishing a branch office or subsidiary in the UAE, reach out to our trusted consultants at Pro Consultancy UAE today!