Why should you setup a branch company in the UAE
27 July 2020
Dubai, United Arab Emirates
Setting up a branch company in the UAE will help entities established in other jurisdictions gain exposure to a growing business hub within the UAE. A branch office as per company law is an extension of the “mother company”, hence the mother company is liable and takes responsibility for all the operations by the branch company. A branch company can only conduct activities similar to the parent company.
In order to establish a branch, you will need to provide the parent company documents that are certified and, in some cases, attested up to the UAE Ministry of Foreign Affairs. Documents include the certificate of incumbency, Board of Resolution of the parent company along with the passport copies of each owner up to the ultimate beneficiaries. If the parent company documents are in a language other than English or Arabic, they will require legal translation. If the parent company documents are from a UAE licensing jurisdiction it is not required to certify or attest documents as they are already recognized locally.
Key benefits of establishing a branch company in the UAE are:
- Location: Having a branch company in the UAE means meeting your clients in just a few hours due to the strategic location in the Gulf. The UAE is also home to the region’s largest airports and trading ports in the Middle East. UAE is known for its safety and stability, and UAE’s economy is expected to grow rapidly in the near future.
- No share capital: Yup, that’s right. As it is a branch setup, the company liabilities go to the parent company and hence share capital is not required.
- 100% ownership: Setting up a Branch in Dubai would simply require you to have a local service agent allowing you the freedom to run the operations. Only an annual fee is contributed to your local service agent which means he or she does not hold any of the company shares or profit.
It is not uncommon for existing Licenses in The UAE to establish a branch in other Emirates or jurisdictions to expand their reach and tap into new markets. The formalities and process to Setting up Your Company Branch can be simple and straight forward with the right business setup partner.
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