Business Setup UAE: How to Register a Foreign Company Branch in the UAE
Planning business setup UAE as a foreign entrepreneur involves exploring government regulations, legal documentation, and licensing procedures. If you’re opening a branch of your existing overseas company in the United Arab Emirates, understanding this structured yet investor-friendly process is vital for success.
Why Open a Foreign Company Branch in the UAE?
The UAE is globally recognized for its tax benefits, strategic location, and thriving business environment. Many global companies choose to launch their operations here due to:
- 100% foreign ownership in many free zones and sectors
- No corporate or income tax in most cases
- Access to global markets through a prime location
- Robust infrastructure and digital governance
Opening a branch in the UAE allows foreign companies to tap into regional markets without undergoing full incorporations.
Types of Foreign Business Setup Options in UAE
Before choosing the registration path, it’s essential to understand the main types:
- Branch Office: Fully dependent on the parent company. It can conduct commercial activities similar to the parent.
- Representative Office: Limited to marketing and promoting the parent company’s products or services.
- Subsidiary: Considered a separate legal entity. Requires its business license and can operate independently from the parent company.
Key Requirements for Business Setup UAE as a Foreign Branch
Establishing a foreign branch requires submitting specific legal documents and satisfying regulatory conditions. Here’s what you’ll need:
- Commercial registration certificate from the parent company
- Board resolution allowing branch setup
- Memorandum & Articles of Association (MOA)
- Power of attorney appointing the branch manager
- Manager’s passport copy and CV
- Bank reference letter and audited financial reports (past 2 years)
- Approval from the Ministry of Economy (MOE)
All foreign documents must be notarized and attested by the UAE Embassy in the country of origin and the UAE Ministry of Foreign Affairs.
Steps Involved in the Registration Process
Here’s a clear step-by-step guide for business setup UAE when launching a foreign company branch:
1. Determine the Business Activity
The activity should closely match the parent company, particularly for branches and representative offices. This determines the type of license issued by the Department of Economic Development (DED).
2. Appoint a Local Service Agent (If Required)
The UAE previously mandated local agents for foreign branches; however, recent reforms in ownership laws have eliminated this requirement in several sectors. Always consult updated rules depending on your industry.
3. Obtain MOE Approval
Submit the initial application to the Ministry of Economy. Include foreign documents and business details. This is essential before approaching DED for licensing.
4. Apply for Trade Name Reservation
Reserve a unique trade name with DED that reflects your branch’s intended business operations.
5. Submit License Application to DED
After MOE approval and trade name reservation, you can submit the application to DED. Ensure all documentation is properly typed, translated, and attested.
6. Lease Office Space
Commercial office space is mandatory for most types of licenses. You can opt for virtual, shared, or dedicated spaces.
7. Receive Business License
Once the DED review is complete, the license will be issued, allowing your branch to officially operate in the UAE.
8. Post-License Steps
- Open a corporate bank account
- Register with the UAE Federal Tax Authority (if applicable)
- Apply for employee visas under the branch name
How Long Does the Process Take?
Generally, the process takes between 2 to 4 weeks, assuming all documents are correct and approvals are obtained on time. Delays may occur if documentation is incomplete or notarization is pending.
Free Zones vs Mainland for a Foreign Branch
When considering business setup UAE options, you’ll need to decide between a free zone or mainland branch. Both have merits:
| Criteria | Free Zone | Mainland |
|---|---|---|
| Market Access | Restricted to free zones & abroad | Full UAE market |
| Ownership | Can hold 100% ownership | 100% allowed in many sectors |
| Office Requirement | Flexible packages | Mandatory physical office |
Costs of Setting Up a Foreign Branch
The estimated total cost ranges between AED 30,000 to AED 60,000, depending on the jurisdiction and business sector. Typical expenses include:
- Registration & licensing fees
- Legal documentation and translation costs
- Visa processing
- Rent for office space
It’s essential to conduct proper feasibility analysis before committing investment capital.
Benefits of Business Setup UAE for Foreign Companies
Opening a branch brings many advantages, such as:
- Quick market entry without full incorporation
- Retain control over operations and branding
- Low tax burden and financial incentives
- Wide visa quota for scaling your team
Common Mistakes to Avoid
To protect your investment and accelerate your company setup, avoid these pitfalls:
- Submitting incomplete or mistranslated documents
- Choosing a license without aligning it with business activity
- Missing attestation steps for overseas paperwork
- Failing to comply with labor quotas and visa restrictions
We recommend reading our guide on common mistakes when obtaining a trade license in Dubai.
Conclusion
Registering a foreign company branch in the UAE is a streamlined process, especially when following the proper regulations and documentation checks. With a strategic approach, your business setup UAE journey can lead to long-term financial growth and market credibility in the Middle East.
For more helpful resources, refer to the UAE Government Portal or check out our guide on how to get a business license in Dubai.
