Learn how to open a foreign company branch in the UAE, including requirements, registration steps, document attestation, costs, tax obligations and key differences from a new UAE entity.
How to Open a Branch of a Foreign Company 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 the parent company to operate in the UAE under its existing name and brand while remaining legally and financially connected to the foreign parent entity.
What Is a Branch Office, Exactly?
A branch office is not a separate legal entity. Instead, 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 parent company, and liability generally rests with the foreign parent company.
Branch Office vs New UAE Company: Key Differences
| Factor | Branch Office | New UAE Company |
|---|---|---|
| Legal identity | Extension of the foreign parent company | Independent legal entity |
| Liability | Rests with the parent company | Generally limited to the UAE entity |
| Permitted activities | Generally aligned with the parent company’s existing activities | Defined independently during setup |
| Brand continuity | Can operate under the parent company’s existing name | Can use a new or different trade name |
| Ownership | Owned and controlled by the foreign parent company | Has its own ownership structure |
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.
- International companies looking to service UAE and regional clients under their existing global brand
- Professional services firms extending an established international practice into the UAE
- Companies bidding for UAE contracts where the parent company’s track record and credentials are important
- Businesses that want their UAE operations to remain closely connected to their existing foreign company
Step-by-Step: Registering a Branch Office in the UAE
1. Confirm the Branch’s Permitted Activities
The first step is to determine the activities that the branch will conduct in the UAE. The permitted activities generally need to be consistent with the activities that the foreign 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 need to appoint a local service agent. A local service agent generally assists with government liaison and administrative procedures but does not become a shareholder or owner of the branch.
3. Prepare and Attest Parent Company Documents
Foreign parent company documents are an important part of the registration process. These may include the company’s certificate of incorporation, constitutional documents, board resolution approving the UAE branch and financial statements.
Depending on the country of origin and the UAE authority involved, documents may need to be notarised, legalised and attested through the relevant authorities and the UAE diplomatic mission before being submitted in the UAE.
4. Reserve a Trade Name
The branch generally operates under the name of the foreign parent company, 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 proceed to the relevant UAE authority for initial approval and registration. Additional documents or approvals may be required depending on the branch’s proposed activities.
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.
Companies from jurisdictions such as the UK and US should plan the document preparation process well in advance of their intended UAE launch date, as international document formalities can take longer than the UAE-side registration itself.
Costs to Consider When Opening a Foreign Company Branch in the UAE
The total cost of establishing a branch depends on factors such as the jurisdiction, business activity, licensing authority, office requirements and the origin of the parent company.
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 other compliance costs
Document attestation can represent an additional cost compared with establishing a new UAE entity 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 business 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.
