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Branch and Representative Office in Dubai - regnantconsultancy.com


Branch of A Foreign Company - Dubai

Branch and Representative Office in Dubai    Dubai
   Type of Government: Constitutional Monarchy
   Name of Emir: Mohammed bin Rashid Al Maktoum
   Area: 4,116 sq km (1,589 sq mi)
   Population: 21,00,000 + (2013)
   Major Sectors: Retail, Tourism

Intro: The second largest city of United Arab Emirates ranks itself as one of the busiest cities internationally. Dubai welcomed over 10 million tourists during 2013 with a surge of over 10%. Mostly travelling here were tourist and business travellers.

This place has it all (read the best) - Malls, Museums, Hotels, Theatres, Stadiums, Restaurant. Dubai’s love with Sports and Movies has been well known but this emirate has adopted this craze as its culture and this reflects clearly in the type of lifestyle one enjoys here.

Dotted amid sky scrapers and hi-risers this place has gradually and largely reduced it dependency over Oil & Gas and even Abu Dhabi and has become a self driven economy with real estate and finance as the backbone of economy. Retail industry has been performing exceptionally well and tourism is on all time high.

Dubai Ownership:
The glamour capital of UAE; Dubai lets the companies opening its foreign branch here to withhold complete control over ownership (100%) given a condition they run their business and operations under the same name that of their parent company.

Further this international trade capital allows its investors to channelize their activities and acquire permissions from the relevant authorities with hassle free norms.

Once the permissions have been obtained the foreign office company is expected to carry out the business activities similarly on the lines of their main corporation.

Dubai Economy: Over the last three decades Dubai has emerged as the international trade capital of the world with a well defined economy spread across various horizons. With ‘centrally-planned free-market capitalism’ policy this city has evolved as the re-exporting capital of Asia and World.

Dubai is the most populous city and emirate in the United Arab Emirates (UAE), and the second largest emirate by territorial size after the capital, Dubai. Dubai and Dubai are the only two emirates to have veto power over critical matters of national importance in the country's legislature. Dubai got its name from the word “locust”. The Population Of this Rich City is 20,16,177 in 2012 end in which 53% is Indian Population. Today, Dubai has emerged as a cosmopolitan metropolis that has grown steadily to become a global city and a business and cultural hub of the Middle East and the Persian Gulf region. It is also a major transport hub for passengers and cargo. The city has become symbolic for its skyscrapers and high-rise buildings, in particular the world's tallest building, the Burj Khalifa.
As per consulting firm Mercer, Dubai was rated as one of the best places to live in the Middle East. As of 2012, Dubai is the 22nd most expensive city in the world and the most expensive city in the Middle East. .
Setting up Branch – Base Dubai The branch will be considered the company’s headquarters in Dubai, and its business shall be subject to the provisions of the laws of Dubai and the UAE.

Dubai Ownership:
The glamour capital of UAE; Dubai lets the companies opening its foreign branch here to withhold complete control over ownership (100%) given a condition they run their business and operations under the same name that of their parent company.

Further this international trade capital allows its investors to channelize their activities and acquire permissions from the relevant authorities with hassle free norms.

Once the permissions have been obtained the foreign office company is expected to carry out the business activities similarly on the lines of their main corporation.

Dubai Economy: Over the last three decades Dubai has emerged as the international trade capital of the world with a well defined economy spread across various horizons. With ‘centrally-planned free-market capitalism’ policy this city has evolved as the re-exporting capital of Asia and World.

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 Dubai 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 Dubai by registering first with the UAE Ministry of the Economy (MOE), then with the Dubai 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 Dubai 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 Dubai, 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 Dubai 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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