You may already have a successful business in another country, but you want to take advantage of the lucrative UAE market. You might want to do so because the UAE offers multiple benefits to foreign investors. These include 100% ownership and a permit for commercial activities.
A branch in the UAE can be done for any reason. All you need is to appoint an agent in the UAE, submit a request, get initial approvals, and then you can apply for your license.
In today’s guide, we will discuss the ultimate requirements and cost to open a branch business or office in UAE, followed by a step-by-step guide on how to do so.
Let’s get started!
What is a branch business in the UAE?
You may want to expand your business outside of your home country if you are a foreigner. Dubai or UAE is the ideal place to do so, and this is where a branch business or office comes in to help.
It is a branch of your parent company abroad. It is a branch that operates under the name of its parent company, where the parent is responsible for the liabilities and obligations incurred by the branch.
Still, branch businesses require licenses to set up a business on the Dubai mainland or in a free zone. With that, like any other company, it is also required to submit necessary documents like power of attorney, memorandum of association, and more.
Let’s dig deeper to find out what the requirements are for opening a branch in Dubai.
Requirements for opening a branch office in Dubai, UAE
Documents required to obtain a business license in Dubai, UAE, can vary based on your type of business and which emirate you plan to establish.
Here are some general guidelines on documents that you may need to submit.
Parent Company Documents
- Certificate of Incorporation
- MAA also known as Memorandum and Articles of Association.
- Board Resolution authorizing the establishment of a Dubai branch
- No Objection Certificates (NOCs) from the parent companies
- The passport copies of the directors of the parent company
Branch Office Documents
- Forms for registering a branch office
- Trade name reservation certificate
- Power of attorney for the Branch Manager
- Lease agreement for office premises
- Branch manager passport copies
Local Service Agent Documents
- Copy of passport and Emirates ID for the Local Service Agent
- If applicable, a trade license for the LSA
- The LSA will also need a power of attorney to act in your place.
Additional Documents
- Business Plan (may be required)
- Financial statements from the parent company may be required
- Other documents specified by the Department of Economic Development or other relevant authorities.
How to open a branch office in Dubai?
Find a local service agent
So, you are a foreigner and you already have a business in your home country. The first thing you should do to set up your branch business in Dubai is find and hire a local service agent, or LSA.
A LSA is essential because it will represent you in the UAE and handle all the legal complications of licensing and registration, including trade name registration.
A Local service agent is also needed because most documents are in Arabic and it is important to have someone who understands the complexities of such documents. They cannot take part in management decisions, and they only charge a fee yearly instead of capital gains.
Fill out your Branch Office Application
You can now apply for initial approvals after you have appointed an LSA to perform the necessary legal tasks, such as registering your company name and gathering the required documents.
Your local agent will assist you with this. He will make sure that the application is error-free and act on your behalf to secure your branch license.
Get Initial Approvals
After you’ve submitted your application, you will need to wait for the initial approval.
Initially, you will get approval from the Ministry of Economic Development (MED), which will be a formal agreement. Later, MED will forward the application to the next authority, which is the Federal Foreign Companies Committee.
You don’t need to worry because MED will take care of applying to the Federal or Local Foreign Companies Committee. If all goes smoothly, you’ll get the license you need to start your branch in Dubai.
MED can issue you a license
MED will then issue you a permit or license once the Federal Foreign Companies Committee has approved your application. This will also be a permit to engage in commercial activities within the UAE. It may also define the types of commercial activities that you can engage in, depending on what you choose when you apply. So, be careful.
Branch Business License
Business licenses are usually issued by the Department of Economic Development. Once you have received your initial approvals, from MED and Federal Foreign Companies Committee, it is time to apply to DED for the final licensing.
The DED will review both of your initial approvals. If everything goes well, they will grant you a final business license.
Register with Commercial Authorities
The game is not over!
After obtaining a DED license, the final step is to register with the commercial authorities. This includes registering with the local department.
For instance, you have to register your branch company with the Dubai, Chamber of Commerce, if planning to operate in Dubai.
What is the cost of opening a branch in Dubai?
It is difficult to estimate the exact cost of opening a Branch in Dubai. It can cost around 100,000 dirhams. The general startup costs of AED 50,000 are also included.
Any change to UAE regulations and rules can affect the costs associated with opening a brand office.
Need Help?
We will conclude by stating that the process of obtaining a license for a branch is crucial and requires an in-depth knowledge of UAE laws. You can lose time and money if you make a mistake.
Don’t worry, HM Corporate can help you with their most experienced team. They understand these complexities well and will guide you at every step.
Contact us now!
