A Foreign Branch/ Representative Office, is as an extension of your parent company, whether registered in an existing UAE Freezone or internationally. It is not considered as a new legal entity, and therefore, the liability of the company relays back to the mother company.

Activities

• A foreign branch is permitted to provide similar business activities, furthermore, the business will be registered with the Department of Economic Development with the existing trade name.

• A Representative Office is not permitted to trade or provide services. The primary purpose of a representative office is to promote the parents companies’ services. 

Requirements

A foreign branch is required to appoint a local service agent. A Local Service Agent, does not hold any shares in the company, nor can the LSA acquire control on the day to day business operations. The primary purpose of the LSA is to act as a representative – without any civil responsibility or monetary compulsions. 

Notes

As the Foreign branch is an extension of the parent company, this means that foreign entity will be liable to pay tax – in line with the parent companies location and jurisdiction.

A foreign branch/ Representative Office is required to register with the Ministry of Economy (MoE). As part of the registration, the branch office must provide a refundable bank guarantee of AED 50,000 – which is held during the time of the licence. This amount, cannot be used as working capital.

What are the steps to register a Foreign Branch/ Representative Office?

1. Identify and appoint a Local Service Agent

2. Reserve the foreign Branch trade name*

3. Obtaining the initial approval

4. Drafting & Preparation of the Board Resolution & Power of Attorney

5. Drafting & Preparation of the Local Service Agent agreement

6. Scheduling Notary Public signing – Parent company must identify the authorised signatory

7. Obtaining approval from Ministry of Economy and Federal Foreign Companies Committee

8. Secure an Office space – Companies registered address

9. Issuance of the Trade Licence

How can Rosemont Partners help?

Rosemont Partners can assist with the preparation of documents required. This includes the support with employee visas, registration with immigration and labour, and opening a corporate bank account.