The United Arab Emirates – Dubai and other Emirates in UAE are of different interest for starting a branch company and branches of foreign companies.
There are a number of ins and outs for it. Amongst these are: new chances for business, geographical advantages, favorable taxation, convenient and reliable tax system etc.
Also, if you choose to make your business activity in the Emirates, opening of a branch company or branch of your existing company becomes completely unavoidable for working in Dubai, UAE.
When Opening a branch company in Dubai or a representative office, a number of questions stand up. It is particularly related to the facts of the commercial law in UAE, specifying the opportunity of forming different types of firms in different Emirates often having separate statuses and options for allowable business activity.
Today, there are a massive number of companies existing in Dubai, UAE from different states each and every with its own specialty. A major number of those firms are branches and child businesses of foreign companies, whereby their number continues to grow year by year.
Often, there is a delusion about the condition of a local partner with 51% shares involved in a company in Dubai, UAE that is listed as a legal body or a branch. That is not the case, since a substantial number of companies can be listed with a full 100% ownership by foreign shareholders. The local sponsor is required only in barely particular areas and cases. These areas are typically explicitly controlled businesses such as tourism or real estate in the country.
When setting up a branch company in UAE as a branch office or a representative office, a number of questions stand up; for example, the choice of company’s type, its incorporation location (a particular Emirate), it’s Free Trade Zone. Also, the essential documents preparation is essential for company setup, the incorporation itself, gaining of license, application for residency visas for employees and business owners etc.
Our company has a strong knowledge in legal sustenance when starting a branch for different companies with dissimilar business activity such as trade, consulting, industrial, telecommunications, tourism, holding etc. We also offer assistance in market study of various business parts of UAE, which is unavoidable when taking a decision of starting a branch of your company abroad.
There are a lot of company formation types in UAE. One of the most vital ones is the setup of branch office in Dubai. To open a branch is a very popular way for foreign companies to extend their business into other markets as it provides numerous benefits.
HOLD 100 % FOREIGN OWNERSHIP
The branch office is not considered a distinct legal unit; but an extension of the mother company. Thus, a branch office formation in Dubai lets 100 % foreign ownership and licenses to perform all actions similar to the mother company.
A branch office setup in Dubai does not need a 51 % Local Ownership, but only a Local Service Agent (LSA). This so called Local Service Agent is a UAE local National or a company wholly owned by a UAE National. He does not get any rights in the branch and only provides services related to authorities, for example visa applications. The Local Service Agent charges a fixed annual fee for his administrative support, but he does not hold any company shares or receive profit. Therefore, the branch office in Dubai is 100 % foreign owned.
TRADE WITH MAINLAND COMPANIES
In general, branch offices set up in free zones are only permitted to trade with other free zone companies or outside the UAE. Thus, free zone businesses are not allowed to straight trade with the local market. However, it turns out to be possible with the care of a local distributor, who will charge a sure fee for his assistance. However, if you plan a business setup in Dubai to trade with the local market, you could benefit from opening a branch office in Dubai mainland.
RENT AN OFFICE ANYWHERE
A branch company formation in Dubai can be done in one of the various free zones or within Dubai mainland. Whereas a branch in one of the several free zones in Dubai needs to rent an office within the free zone area, a branch formed in Dubai mainland can rent an office anywhere in Dubai.
Opening a branch office in sharjah mainland allows you to open an office at the exact location that suits your needs. You can profit from great infrastructure, get more walk-in clients at prime locations or save expenses as rents decrease outside the city center. Therefore, to open a branch office in Dubai mainland provides you with the advantage to rent an office anywhere in Dubai.
To start the company formation in Dubai, several documents from the parent company will be needed, for example a Memorandum of Association, a Certificate of Incorporation and a Shareholders Resolution authorizing the branch office setup in Dubai. All the corporate documents of the parent company need to be fully legalized up to the UAE embassy. Our PRO Service in Dubai can assist you with the legalization process. Business Link UAE, your experienced Business Setup Consultants in Dubai, is looking forward to assisting you with your branch office formation in Dubai
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