A company registered in any part of the world can have a branch office of the same in UAE. Foreign companies are permitted to establish wholly owned branches and representative offices in the U.A.E. however, these offices are limited in the activities they may conduct. The branch is obligated to engage only in the same or similar activities undertaken by its parent company. The branch office is the extension of the parent company, and there for the parent company remains responsible for any liabilities of the branch office.
Foreign investor may consider different forms of ownership, including branch of a foreign company, free zone branch of a foreign company, Limited Liability Company (LLC). If the investor is interested in a different business activity, he shall register his venture in a different legal form such as a Limited Liability Company where he can hold up to 49% of equity ownership.
In order to open a business branch several legal requirements must be fulfilled.
Find a Local service agent
Depending on the legal form of ownership, the UAE jurisdiction requires a UAE local service agent. For foreign companies that open a branch in Abu Dhabi, this sponsor is called a service agent. The agent is only responsible for facilitating the necessary licences for the branch or office without contribution to its capital or management or bearing liability in case of losses. The agreement with the service agent should be authenticated by a Notary Public.
- For licensing a foreign company, investors first need to obtain a trade name certificate. To assist companies in finding the available trade names, the Trade Name Search service on the Abu Dhabi eGovernment Gateway provides a list of all registered trade names with Department of Economic Development (DED).
- Once the trade name is issued, individual investors need the approval of the General Directorate of Residence and Foreigners Affairs - Abu Dhabi (GDRFA) prior to obtaining the initial approval.
- The next step is to fill up the licence application form. Details on the required documents and special conditions for different forms of ventures can be found on the DED website.
- A No Objection Letter from the competent authority is necessary in case of engaging in an activity that may only be practiced with the authorisation of the authority. Investors also need to make sure that all the documents are translated into Arabic by a legal translator.
- The licence application must be submitted by the owner of the establishment (sole proprietorship), a partner of the foreign company or by a legally authorised representative.