Branch of Foreign Company

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Registration of a Foreign Company in UAE

The branch of a foreign company in UAE is a separate legal entity from the parent company, and as such, it must comply with all the relevant legislation and regulations in the UAE. This includes registering the branch with the relevant authorities and obtaining the necessary licenses and permits. The branch of a foreign company in UAE also needs to ensure that it meets the requirements for corporate governance, accounting, and reporting.

A common way for foreign companies to retain foreign ownership under the Commercial Company Law in the UAE is to incorporate a Branch or Representative Office (RO), which permits 100% ownership by the parent company. These forms do not have a separate legal identity and are therefore treated as an extension of the foreign company, which remains liable for their activities.

A Branch is permitted to engage in commercial activity in the UAE and to earn profits. It is licensed for the purposes set out in its commercial license, and may only engage in activities similar to those carried on by the foreign company in its home jurisdiction.

An RO is not permitted to earn profits within the UAE, and its activities are limited to marketing or promoting the products and services of its foreign parent company in the UAE.

Both Branches and RO's must operate under the authority of a commercial registration and licence in the name of the foreign company, and both are required to appoint a National Service Agent (NSA), which has to be a UAE national individual or a 100% UAE national-owned corporate entity.

Benefits of a Foreign Company in the UAE

Foreign companies can retain 100% foreign ownership in the UAE;

A 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.

The required documentation for registration

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 authorize 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;

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.

  • 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