There are many options available for foreign investors to enter into the UAE business market. One of the popular ways is to open a branch/representative office of their already established foreign company. This method allows the foreign investors to gain 100% ownership of the company. The usual scenario to set up a company in UAE requires 51% ownership by the UAE national, except for in Freezones. But with a branch or a representative office, it allows full control over the ownership. The local sponsor will remain as a Local Service Agent and will not be involved in the day to day business activities.
The company can open the branch office with different business activities such as trading, consulting, tourism etc. To open a branch company, the parent company has to register as a Limited Liability Company because Sole Proprietorship/ Civil Company is not allowed to open a branch/rep office.
Difference Between Branch and Representative Office
A branch company can carry out all the activities of its parent company. It can keep its same trade name and market, promote and conduct business activities in the UAE. The branch company can promote the products and services of the parent company.
A representative office can only do the advertising and marketing of the parent company. It cannot conduct any business in the UAE market.
Steps to open a Branch/Rep Office
- Identify a UAE national who will act as Local Service Agent
- All parent company documents must be in Arabic and legally attested from UAE Embassy of the home country and Ministry of Foreign Affairs.
- Apply for initial and trade name approval from DED
- Must register with the Ministry of Economy by paying a refundable deposit of AED 50,000
For more information on how to set up a branch or Representative office, feel free to drop a message.