How to Open a Foreign Company Branch in the UAE

For established international companies looking to enter the UAE market without setting up an entirely new local entity, registering a branch office can be a natural route. A foreign company branch in the UAE allows a foreign parent company to operate in the UAE under its existing name and brand while remaining legally and financially connected to the parent entity.

What Is a Branch Office, Exactly?

A branch is not a separate legal entity. It is an extension of the foreign parent company that is permitted to conduct business activities in the UAE that are consistent with the parent company’s existing activities.

Unlike a subsidiary, a branch does not have independent shareholders or its own share capital. The branch remains connected to the foreign parent company, and liability generally rests with the parent company.

Branch Office vs New UAE Company: Key Differences

Who Should Consider a Branch Office?

A branch office can be suitable for established international companies that want to maintain their existing corporate identity while expanding into the UAE.

• Established international companies wanting to service UAE and regional clients under their existing global brand
• Professional services firms extending an existing international practice into the UAE
• Companies bidding on UAE contracts where the parent company’s track record and credentials matter to the client
• International businesses that want their UAE operations to remain connected to the foreign parent company

Step-by-Step: Registering a Branch Office

1. Confirm the Branch’s Permitted Activities

The first step is confirming which business activities the UAE branch will conduct. The relevant authority will generally require the branch activities to be consistent with the activities the parent company is authorised to conduct in its home jurisdiction.

2. Appoint a Local Service Agent Where Required

Depending on the jurisdiction and applicable requirements, a mainland branch may require a local service agent. The agent generally facilitates government liaison and administrative procedures and does not hold ownership or equity in the branch.

3. Prepare and Attest Parent Company Documents

Foreign corporate documents are an important part of the registration process. These may include the parent company’s certificate of incorporation, constitutional documents, board resolution approving the UAE branch and financial statements.

Depending on the country of origin and the relevant UAE authority, documents may need to be notarised, legalised and attested through the appropriate authorities and UAE diplomatic mission before submission in the UAE.

4. Reserve a Trade Name

The branch generally operates under the foreign parent company’s existing name, subject to approval by the relevant UAE authority and applicable naming requirements.

5. Obtain Initial Approval and Submit the Full Application

Once the required documents have been prepared and attested, the application can be submitted to the relevant UAE authority for initial approval and registration. Additional approvals may be required depending on the proposed business activity.

6. Secure Office Space and Receive Your Licence

After receiving the required approvals, the branch must satisfy applicable office and tenancy requirements. For mainland operations, an approved physical office and Ejari registration may be required depending on the activity and licensing authority.

7. Register for Corporate Tax and Apply for Visas

Once the branch is licensed, it may need to complete its corporate tax registration and other applicable tax registrations. VAT registration may also apply depending on the business’s activities and taxable supplies.

A licensed branch may also be able to sponsor employee and manager visas, subject to the applicable immigration and establishment requirements.

Document Attestation: The Step That Takes Longest

For many foreign companies, document preparation and attestation can be one of the most time-consuming parts of the UAE branch registration process.

Corporate documents may require notarisation and legalisation in the parent company’s home country, followed by attestation through the relevant UAE diplomatic mission and UAE authorities.

For UK, US and other international parent companies, it is advisable to begin document preparation well before the intended UAE launch date. International document formalities can take longer than the UAE-side registration process.

Costs to Consider

The total cost of establishing a foreign company branch in the UAE depends on factors such as the emirate, licensing authority, business activity, office requirements and the parent company’s country of origin.

Common costs can include:

• Branch registration and licence fees
• Local service agent fees, where applicable
• Notarisation and document attestation costs
• Office and tenancy costs
• Immigration and visa-related costs
• Corporate tax and compliance costs

Document attestation can represent an additional expense because corporate documents originate from another jurisdiction and may require multiple stages of legalisation and certification.

Ongoing Obligations for Branch Offices

After registration, a foreign company branch in the UAE must continue to meet applicable licensing, tax and corporate compliance requirements.

• Annual licence renewal
• Corporate tax registration and compliance, where applicable
• VAT registration and filing, where applicable
• Maintaining alignment between the branch’s UAE activities and the parent company’s authorised activities
• Maintaining valid office and tenancy arrangements where required
• Providing updated parent company documents to the relevant authority when required

Frequently Asked Questions

Can a branch office have its own shareholders in the UAE?

No. A branch does not have an independent shareholding structure of its own. It remains an extension of the foreign parent company and is controlled by that parent company.

Is a local service agent the same as a local shareholder?

No. A local service agent and a shareholder have different roles. Where a local service agent is required, the agent generally provides administrative and government liaison services for a fee and does not hold equity ownership in the branch.

Can a branch office conduct activities that the parent company does not already do?

Generally, branch activities need to be aligned with the foreign parent company’s existing authorised business activities. The exact requirements depend on the proposed activity and the relevant UAE licensing authority.

Does a foreign company branch need an office in the UAE?

Office requirements depend on the jurisdiction, activity and licensing authority. Mainland branches generally need to satisfy applicable physical office and tenancy requirements.

Can a UAE branch sponsor employee visas?

A properly licensed branch may be able to sponsor employee and manager visas, subject to the applicable immigration, establishment and labour requirements.

Expanding Your Company Into the UAE?

Opening a branch of a foreign company in the UAE involves more than obtaining a business licence. From selecting the appropriate activities and preparing corporate documents to handling attestation, office requirements and ongoing compliance, each stage needs to be managed carefully.

Klay Consultants can assist international companies with the UAE branch registration process, including document attestation coordination, local service agent arrangements and other business setup requirements.

Planning to expand your company into the UAE? Contact Klay Consultants to discuss your branch registration and UAE market-entry requirements.