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Branch and Representative Office in Ajman - regnantconsultancy.com


Branch of A Foreign Company - Ajman

Branch and Representative Office in Ajman    Ajman
    Type of Government: Constitutional Monarchy
    Name of Emir: Humaid bin Rashid Al Nuaimi
    Area: 260 km2 (100 sq mi)
    Population: 2,65,000+ (2012)
    Major Sectors: Real estate, Industrial Units

Intro: This tiny city is the smallest of the Emirates spread across 101 sq mi it has a population of 2,65,000 out of which over a lakh are expatriate. It was the second emirate to put forward the freehold property concept after the profitable attempt from Dubai.

During the late 80’s it had quite a few industrial zones mostly to foster the local population here. It was during the mid 90’s that there was a sudden rise in the demand and citing the spur the government decided to built trade specific industrial zones. Although in recent years many of the development plans are put on hold including the Ajman International Airport which was scheduled to operate full-fledged from 2013 this place remains one of the favourite destinations for business houses due to its capital centric policies and excellent returns on the real estate sector.

Ajman Ownership:
Opening a foreign company branch in the emirate of Ajman provides the main company a leverage to possess 100% rights with a clause that it functions under the same brand name and conduct the same nature of business as the parent company

Established firm benefits in a way they get a freehand to execute their work and other relevant activities after the process of documentation is completed.

These types of companies can only endorse business module as that of their head companies internationally and in local market.

Ajman Economy: Ajman worked its way towards the development and stabilizing phase with a step-by-step approach. One of the most dynamic cities in the Arab world this place is known sustained financial structure which survived the financial crises.

Ajman is one of the seven emirates constituting the United Arab Emirates (UAE). With an area of just 260 Km2, Ajman is the smallest emirate by area. The Population Of Ajman is about 3,61,160 in 2008. Ajman has experienced massive development and a construction boom in recent years
After the success of freehold property in Dubai, Ajman was the second emirate to offer freehold property. Ajman is currently the only emirate in the UAE offering investors of any nationality fully transparent true 100% freehold ownership on real estate, which in turn has attracted a huge number of investors (local and international) to this emirate. One can find mineral springs in this region
Setting up Branch – Base Ajman The branch will be considered the company’s headquarters in Ajman, and its business shall be subject to the provisions of the laws of Ajman and the UAE.

Ajman Ownership:

Opening a foreign company branch in the emirate of Ajman provides the main company a leverage to possess 100% rights with a clause that it functions under the same brand name and conduct the same nature of business as the parent company

Established firm benefits in a way they get a freehand to execute their work and other relevant activities after the process of documentation is completed.

These types of companies can only endorse business module as that of their head companies internationally and in local market.

Ajman Economy: Ajman worked its way towards the development and stabilizing phase with a step-by-step approach. One of the most dynamic cities in the Arab world this place is known sustained financial structure which survived the financial crises.

1. Ownership
The parent company retains 100% ownership of the branch or representative office, which must operate under the same name and conduct the same business as the managing firm. There is no separate legal identity. A branch or representative office needs to appoint a local services agent, who has no rights, interests or financial involvement in the business. This can be a UAE National, or a company owned by one or more UAE Nationals, who will manage the necessary government procedures and administration. The branch office must have an independent budget, its own profit/loss statements and must appoint a UAE-accredited auditor.

2. Activities
The requirements for registering a branch office in Ajman differ, depending on whether the parent company and the branch are involved in commercial and industrial activities or professional Activities

3. Commercial and Industrial Activities
A foreign company can conduct trade, commercial or industrial activities in Ajman by registering first with the UAE Ministry of the Economy (MOE), then with the Ajman Department of Economic Development (DED). For indirect commercial activities such as construction contracting, registration must first be done with DED then with the MOE. After obtaining MOE and DED approval, the company must engage a UAE National Local Service Agent before the business license can be issued. The Local Service Agent can be an individual or a company. If it is a company, it must be a UAE-based company licensed by the Ajman Department of Economic Development and 100% owned by UAE Nationals. The appointed Local Service Agent is subject to the approval of the MOE. The obligations of the Local Service Agent towards the parent company, the branch office and third parties are limited to rendering the services required for the company, for example dealing with government requirements. The Local Service Agent has no responsibility or financial commitment in respect of the company's business or activities inside the Emirate or abroad.

4. Branch Imports
A branch can conduct all the business of the company apart from importing its goods into Ajman, which will be managed by a local trade or commercial agency. The registered agencies must be UAE Nationals, or companies 100% owned by UAE Nationals and will receive a commission or profit on sales.

5. Professional Activities
The Local Service Agent for a branch of foreign company undertaking professional activities must be an individual UAE National and not be a corporate body (a person, not a business). For professional activities, the branch office does not need to be registered with the Ministry of Economy. The registration and licensing process can be completed directly with the DED.

Summary of setting up of a branch, representative or liaison office:
• Foreign investors may establish a branch, representative or liaison office in Ajman after obtaining license from DED;
• The branch shall merely represent the parent company and carry out business only under the name of the parent company;
• A branch office is permitted only to promote and market the products and services of the parent company;
• A representative or liaison office shall only promote its parent company by gathering information, soliciting orders and works projected to be executed by the head office;
• Prerequisite to set up a branch, representative or liaison office, the parent company must appoint an UAE national as a local sponsor or agent under a written agreement; and
• Agent’s liabilities shall be limited to the rendering of services like obtaining licenses, visas and permits necessary for operation of a branch, representative or liaison office
• Foreign company’s branch or representative offices are required to submit a bank guarantee of AED 50,000/- favouring to the Ministry being part of the licence application documentations. The licence of the foreign company’s branch/representative office shall be cancelled if it is not renewed within two years after the expiry date and the fee due to the Ministry shall be deducted from the guarantee.

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