Branch of Foreign Company Formation

Those foreign companies that are interested in setting up a base in the commercial hub of the oil country can think about opening a branch of their company in the Dubai free zone. It is easy to start a branch and carry out businesses that are done by the parent company. A branch is not a separate legal entity. It represents the parent company and carries out trading activities under its name. Most of the foreign companies have started opening a branch office in the commercial hub so as to do marketing activities as well as distribution of products / services to clients across the globe. You can choose Dubai as the main marketing and distribution hub on its close connectivity with different countries through air, land and water ways. A new branch office in Dubai free zone is able to enter into new agreements and carry out transactions in the name of the parent company.

To open a branch office of the foreign company in any of the Dubai free zones you should have a valid trading license from the Ministry of Economy and Commerce. In the license there should be specifications regarding the type of activity or activities that you are planning to do in the country in the name of the parent company. To get a valid license you must appoint a UAE national or a corporate body in the country as an agent of the company. You can also appoint partners or shareholders of UAE origin as an agent of the company. Such agents are able to offer services that are required for the branch without undertaking any financial liability. Moreover, the agent is not entitled to claim any right or authority in any of the businesses of the company. Rights of agents will be included in the business agreement signed with the company.

To start a branch in the UAE you should submit various types of documents. Documents required for initial approval:

• Registration and licensing application
• Proof of trade name reservation in the legal form of registration
• Address of the headquarters of the foreign company where it carries its activities
• Nature of activity intended to be exercised in the UAE
• Name of the national agent
• Names of partners, their nationality, and addresses in appropriate forms
• Memorandum and Articles of Association of parent company duly translated into Arabic and attested and notarized by the U.A.E Embassy.
• Copy of Board of resolution of Parent company expressing their intent for establishing a new branch office in the UAE
• Copy of the parent company’s certificate of Incorporation duly translated into Arabic and attested and notarized by the U.A.E Embassy
• Lease agreement of physical address and feasibility study, if required

The initially documents will be checked by the authorities and if satisfied, will send a letter of initial approval to the applicant. After receiving the initial approval letter the applicant has to submit the following documents for final approval.

Documents for final approval:-

• Initial approval letter
• All documents that are submitted in the initial stage
• Copy of office space leasing agreement, including the plot number
• The original of the contract signed with the national agent duly signed by the public notary

After getting final approval the parent company can open an office in any of the free zones in the UAE and retains 100% ownership of it. A branch office should have its own independent financial budget. There should be separate profit/loss statements. All the financial statements should be audited by a UAE government accredited auditor. Those who are facing difficulties in the registration process can approach a good business consultant. We are able the offer all types of assistance for registering a new branch in the UAE. Other than lending a hand for registration services, we are able to provide services that can help in running the branch fruitfully.