Expanding your business into Dubai can be a strategic move. The city offers access to a dynamic market and a favorable business environment.
Establishing a branch of a foreign company in Dubai allows it to operate under the parent company’s name while engaging directly in commercial activities within the UAE.
This article provides an overview of setting up a foreign company branch in Dubai, highlighting the legal framework as of 2024, and outlines the specialized legal services our firm offers to assist in this process.
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Considerations for Opening a Branch of a Foreign Company in Dubai
As of 2024, foreign companies can establish branches in Dubai to conduct business activities similar to those of the parent company. In this context, learning about Types of Company Formation in Dubai may be helpful.
A branch is not a separate legal entity; it operates under the parent company’s name and is fully owned by it.
This structure allows the branch to engage in commercial activities, generate profits, and enter contracts within the UAE.
Key considerations for establishing a branch in Dubai:
- Licensing: The branch must obtain a commercial license from the Dubai Department of Economic Development (DED). The licensing process involves submitting the parent company’s incorporation documents, a board resolution approving the branch establishment, and appointing a general manager. All documents must be notarized and legalized.
- Local Service Agent: While branches can be 100% foreign-owned, they must appoint a Local Service Agent (LSA), a UAE national or a company wholly owned by UAE nationals. The LSA facilitates administrative procedures but holds no ownership stake or liability in the branch.
- Bank Guarantee: A refundable bank guarantee of AED 50,000 must be obtained and deposited with the Ministry of Economy. This guarantee cannot be used as working capital.
- Permitted Activities: The branch can conduct activities identical to those of the parent company. However, certain sectors may have restrictions or require additional approvals. Verifying that the intended activities are permissible under UAE law is essential.
Learn about the UAE foreign investment law in Dubai.
Legal Services for Opening Branches of Foreign Firms in Dubai
Our law firm in UAE specializes in providing comprehensive legal services to assist foreign companies in establishing branches in Dubai. Our services include:
- Legal Consultation: We offer expert advice on the legal framework governing foreign branch establishments in Dubai, ensuring compliance with current laws and regulations.
- Document Preparation and Review: Our team assists in preparing and reviewing all necessary documentation, including the parent company’s incorporation documents, board resolutions, and power of attorney for the general manager.
- Local Service Agent Arrangement: We facilitate the appointment of a reliable Local Service Agent, ensuring all legal requirements are met without compromising the foreign company’s control over the branch.
- License Application Support: We manage the entire licensing process with the DED, from application submission to obtaining the commercial license, ensuring a smooth and efficient setup.
- Compliance and Regulatory Guidance: Our firm provides ongoing support to ensure the branch complies with UAE laws, including assistance with annual renewals and any required reporting.
Find more services from the Best Company Formation Lawyer In Dubai, UAE.
FAQs about Establishing Foreign Companies Branches in Dubai
Establishing a branch of a foreign company in Dubai offers significant opportunities for international businesses looking to expand in the UAE and the Middle East.
The process involves navigating specific legal and regulatory requirements to ensure compliance and successful operation.
With the right guidance, setting up a branch in Dubai can be a streamlined and efficient way to access a vibrant market.
Our law firm specializes in handling each step of this process, from licensing to ongoing compliance, ensuring your branch operates smoothly and successfully. Let us help make your expansion into Dubai seamless and effective.
Contact our law firm in UAE for expert help. Click the Whatsapp icon below.
A law graduate and legal writer focusing on UAE law, he became known for his ability to clarify complex legal concepts through his writings. His work simplifies the intricacies of the legal landscape in the Emirates, helping both locals and expatriates navigate their legal concerns.
