8 Simple Steps to Set up a Foreign Company Branch Office in Dubai UAE
This article provides a simplified plan-of-action for setting up a branch office in Dubai, drawing on our expertise to help you make an informed decision. However, before delving into the details, it is crucial to comprehend the reasons why your business should consider establishing an office in Dubai.
Why Should I Setup my Foreign Company Branch Office in Dubai?
Dubai's flourishing economy, highly-skilled workforce, diverse population, and excellent quality of life make it a prime location for businesses seeking to expand their operations. The government's pro-business approach, coupled with a strong infrastructure and relatively low taxes, make it even more enticing for companies. As a result, Dubai has become a preferred choice for companies looking to establish a foothold in the Middle East and access the growing markets across the UAE and the broader MENA region.
How to Set up a Foreign Company Branch Office in Dubai?
To establish a foreign company branch office in Dubai, which is essentially a new business setup in Dubai, you must adhere to the following steps:
- It's important to make an informed decision on the legal structure of your business in Dubai, whether to establish a branch office or a representative office, based on your business objectives and local regulations.
- Select an appropriate site for your office, either in a free zone or on the mainland.
- Ensure that you acquire the essential authorizations from the pertinent governmental bodies, which may include the Department of Economic Development (DED) and the Dubai Chamber of Commerce, before proceeding with your plans.
- Complete the process of registering your business with the DED and securing all required licenses and permits to operate legally.
- Ensure that you obtain the appropriate visas and work permits for both executives and employees who will be working for your company.
While the process of establishing a foreign company branch office in Dubai may appear straightforward in 8 steps, there are intricate aspects involved in each phase that necessitate the assistance of knowledgeable business consultants, such as the team at NSRM Taxation & Accounting, to ensure a successful setup.
One example of complexity in the process of setting up a foreign company branch office in Dubai is the need to make strategic decisions regarding the appropriate legal structure. Additionally, each of the 8 steps involved in this process presents multiple activities and decisions that must be carefully considered.
6 Other Factors Impacting Your Future Business Costs and Operations
Choosing the appropriate legal structure for a foreign company branch office in Dubai is not only crucial but also a complex process that depends on various factors. Despite the seemingly simple 8-step process, there are intricacies involved in each stage that necessitate the involvement of experienced business consultants, such as those at Horizon, to ensure a successful setup.
An example of this complexity is the need to make strategic decisions regarding legal structure, which requires careful consideration of multiple activities and decisions at each step.
6 Other Factors Impacting Your Future Business Costs and Operations
Choosing the appropriate legal structure for establishing a foreign company branch office in Dubai is not only critical but also intricate and influenced by various factors.
Your Industry, Nature of Business and Lines of Business
Considering the industry, type of business, and intended lines of business is crucial when selecting the appropriate legal structure for your company. This necessitates a clear understanding of your overall vision and business goals. Furthermore, various legal structures are better suited to specific industries and lines of business.
Local Regulations
Occasionally, specific business operations may not be authorized to be carried out by a branch office operating in Dubai, necessitating careful consideration of local regulations when selecting the appropriate legal structure.
Tax Implications
One of the main reasons for establishing a branch office in Dubai is to take advantage of the relatively low corporate tax rates. Therefore, it is essential to carefully evaluate various options and typical scenarios for your business and industry when selecting the appropriate legal structure. Furthermore, it is important to have a clear understanding of the potential tax consequences associated with each legal structure, allowing you to choose a structure that minimizes your tax liability.
Liability
It is important to take into account the liability associated with each legal structure since a branch office may have unlimited liability for the actions of its parent company.
Compliance
It is crucial to ensure compliance with all legal requirements and regulations, including the mandate to designate a local sponsor for a branch office.
Cost
When selecting the appropriate legal structure, it is essential to take into account the expenses associated with its establishment and upkeep, such as license fees, visa expenses, and office rental charges. Additionally, obtaining a realistic estimate of various miscellaneous ongoing fees is critical to optimizing your CAPEX.