Registration of a Foreign Company in Dubai
Key steps to set-up a Branch or Representative Office in UAE
Speak with one of Sovereign’s consultants who will advise on the correct legal structure based on the activities that a business intends to undertake in the UAE and its intended markets. A client may further choose to obtain a legal opinion to confirm Sovereign’s advice.
Appoint a National Service Agent (NSA), which must be either a UAE national or a company wholly owned by UAE nationals. Sovereign Corporate Services has created a number of 100% UAE-owned LLCs that it fully manages and controls through power of attorneys and other legal agreements. These companies can act as the NSA.
The required documentation for registration and approval will include but is not necessarily limited to:
- Certificate of incorporation (or equivalent), memorandum and articles of association, and a certificate of good standing (where one can be obtained) from the parent company’s home jurisdiction;
- A board resolution to authorise the opening of the Branch or RO, to appoint a general manager and to grant a power of attorney to the general manager; and to confirm that the company accepts responsibility for the liabilities of the office when established in the UAE;
- Audited accounts of the parent company for the last 2 years;
- A statement setting out the company’s main operations and activities;
- Certified passport copy for the General Manager;
- 2 x Certified proofs of address for the General Manager;
- 1 x CV for the General Manager;
- 1 x Professional / bank reference letter for the General Manager.
All documents are required to be notarised and attested in both the applicant’s home country and at the relevant UAE consulate. The notarisation process should be commenced as early as possible because it can take a significant time.
All documents must also be translated into Arabic by an official translator before they can be presented to the authorities in the UAE.
All requested documents to be submitted to Sovereign, which will then manage the application process from start to finish. The licensing authority will be the Department of Economic Development, with the approval of Ministry of Economy.
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Advantages of a Foreign Company office in Dubai/UAE
Foreign companies can retain 100% foreign ownership in the UAE;
Foreign company is not required to show more than 2 years of incorporation and business experience in its home country (some Free Zones require longer);
The company may legally conduct the approved activity in its licence anywhere in the UAE, including Free Zones;
No restrictions on the location where the company can rent/buy office premises;
The government has permanently waived any paid up capital requirements.
As the NSA, Sovereign has multiple signatories who are available all year round, unlike individual local partners who frequently travel in the summer months.
Disadvantages of a Branch or Representative Office in UAE
A Branch is restricted in respect of its business activities, especially to trading in the UAE mainland. If the parent company conducts any activity that involves trading, it can only incorporate an RO for the purpose of marketing or promoting its products and services, or to facilitate commercial agreements between the parent and its customers. However most service activities can be conducted through a branch.
Longer time to establish than a Free Zone company, typically 8 to 10 weeks;
External approvals are often required from UAE government ministries and a bank guarantee of AED 50,000 (approx. US$15,000) will be required by the Ministry of Economy.
Branch of a foreign company in Dubai - FAQs
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