Branch Office Setup in Dubai: Requirements and Cost

Because a branch is the same legal entity as its parent rather than a new company, it is licensed on the parent's standing. That makes the requirements different from an LLC setup — you are proving things about a company that sits outside the UAE.

For the sequence of steps, see how to open a branch office in Dubai. This page covers what you need and what it costs.

The activity must sit within the parent's business

A branch cannot do things the parent does not do. The activity applied for has to be within the parent's own objects, and where it clearly is not, the file goes back — this is one of the most common causes of rejection.

Some activities are also closed to branches, and certain regulated sectors bring their own approvals on top of the licence. Confirm the activity is available to a branch before you begin attesting documents.

Documents from the parent

Expect to provide, each notarised at home, legalised through to the UAE embassy, attested by the UAE Ministry of Foreign Affairs, and legally translated into Arabic:

• certificate of incorporation and the memorandum and articles of association;
• a board resolution approving the branch and appointing its manager;
• a power of attorney in favour of that manager;
• the parent's audited financial statements, where requested;
• passport copy and photograph of the appointed manager.

Attestation is the long pole. Begin it before anything else.

The manager

A branch is run by a manager appointed under the board resolution and power of attorney, and that person is the branch's responsible party in the UAE. They will hold the residence visa attached to the branch and sign on its behalf.

Premises

A branch needs real, registered premises — in Dubai, a tenancy registered through Ejari. Visa allocation is tied to the space, so the office decision is also the headcount decision.

Do you need a Local Service Agent?

A foreign company's mainland branch historically required a Local Service Agent: a UAE national, or a company wholly owned by UAE nationals, holding no shareholding and no share of profits and paid an annual fee for an administrative role.

It is worth being clear what the role never was. An LSA is not a partner and not a sponsor in the ownership sense. They do not own part of the branch, do not share its profits, and have no say in how it is run. The arrangement is contractual and administrative, and the fee is fixed by agreement rather than tied to performance.

The 2020–21 foreign ownership reforms removed the 51% local shareholding requirement for many mainland companies, and that change is often misread as having removed the agent requirement for branches too. It did not. A foreign company’s mainland branch still requires a Local Service Agent. The two rules are separate: one governs who owns a company’s shares, the other governs how a foreign entity operates a branch on the mainland.

Practical consequences worth planning for: the annual fee is a recurring cost, not a one-off, so it belongs in the year-two model as much as the first-year budget; the agreement should be properly documented rather than left informal; and the agent must be in place before the licence issues, which makes finding one an early task rather than a late one.

A free-zone branch is the exception — the free-zone model does not involve a Local Service Agent at all, which is one reason it appeals to foreign companies whose customers do not require a mainland presence.

Branch, subsidiary or representative office

Most of the cost and complexity below follows from choosing a branch in the first place, so it is worth confirming that is the right vehicle.

Branch

• Legal identity: the same entity as the parent — not a new company.
• Liability: sits with the parent directly.
• Activities: must fall within the parent's own objects.
• Can invoice UAE clients: yes.
• Parent's track record: carries across directly, which is often the whole point.
• Setup effort: high — document attestation abroad plus the federal registration step.

Subsidiary (LLC)

• Legal identity: a separate UAE company.
• Liability: ring-fenced inside the subsidiary.
• Activities: its own activity list, not limited to the parent's.
• Can invoice UAE clients: yes.
• Parent's track record: does not transfer automatically — the new entity builds its own.
• Setup effort: moderate, and usually the cheaper route.

Representative office

• Legal identity: the same entity as the parent.
• Liability: sits with the parent directly.
• Activities: promotion, marketing and liaison only.
• Can invoice UAE clients: no — this is the defining limit.
• Setup effort: high relative to what it actually permits.

The pattern in practice: choose a branch when contracting in the parent's name matters — tenders, framework agreements, or a client base that knows the parent. Choose a subsidiary when you want liability separation or activities the parent does not carry. Choose a representative office only when you genuinely will not invoice from the UAE.

Which activities are open to a branch

Not every activity can be carried out through a branch. Two filters apply, and both must pass:

• The parent's own objects. If the parent does not do it, the branch cannot.
• The licensing authority's list. Some activities are restricted to particular legal forms, and certain regulated sectors — financial services, healthcare, education, legal services among them — bring a sector regulator's approval on top of the trade licence.

Trading activities deserve particular care. Where a branch will import goods, the customs position and any required approvals need checking alongside the licence — the mechanics are covered in running a general trading company in Dubai.

What drives the cost

We are not publishing a fee table, because branch costs move and a stale table is worse than none. What matters is knowing which levers set the number:

• Government fees — initial approval, trade name, the federal Ministry of Economy registration, and the emirate licence itself. The federal element is the one people forget.
• Attestation and translation — charged per document, in the home country, and driven by how many documents and which country.
• Premises — usually the largest single line, and it sets the visa quota.
• Local Service Agent fee, where one is required — annual, not one-off.
• Visas — per person, including medical and Emirates ID.
• Professional fees for handling the filings.

A branch is generally not the cheapest route into the UAE — the attestation chain and federal registration add cost an LLC does not carry. It is chosen for legal and commercial reasons: contracting in the parent's name, and the parent's track record travelling with it.

One further point on budgeting: the recurring cost matters more than the setup cost. Licence renewal, tenancy, any agent fee and visa renewals repeat annually, and a branch that was affordable to open can be uncomfortable to maintain if only the first-year figure was modelled.

Visas and headcount

A branch can sponsor residence visas, and the allocation is tied to the registered premises rather than to the licence alone. A flexi-desk supports a small number; a larger office supports more. Because the premises decision sets the ceiling, decide headcount before signing the tenancy rather than after.

The branch manager named in the power of attorney normally holds the first visa. Additional staff follow the standard route — entry permit, medical, Emirates ID, visa stamping — and each carries its own cost and processing time.

Opening the bank account

This is consistently the slowest and least predictable step, and it is worth planning for rather than discovering.

The reason is structural: a branch has no separate legal personality, so the bank's diligence runs on the parent group — its ownership, its financials, its jurisdictions of operation, its ultimate beneficial owners. That is a broader review than for a UAE-incorporated LLC with local shareholders.

What helps, in rough order of effect: audited parent accounts, a clear and documented ownership chain up to named individuals, a coherent explanation of what the branch will actually do and with whom, and expected transaction flows that match that explanation. What hurts: opaque intermediate holding layers, activity described in vague terms, and expected counterparties in higher-risk jurisdictions.

Free zone branches are a different route

A foreign company can also register a branch inside a UAE free zone. The trade-offs differ from a mainland branch:

• the free zone authority licenses it, so the federal and DET route above does not apply in the same way;
• a Local Service Agent is not part of the free-zone model;
• the branch operates within the zone's activity list and its customs position follows the zone, not the mainland;
• direct trading into the UAE mainland market is restricted in the usual way.

Which is right depends on where your customers are. If you are selling to UAE government entities and local corporates, mainland usually wins. If you are servicing international clients or holding assets, a free-zone branch may be simpler and cheaper — see our mainland versus free zone comparison.

Why branch applications get rejected

Rejections are rarely mysterious. The recurring causes:

• Activity outside the parent's objects. The single most common cause, and entirely avoidable by checking first.
• A break in the attestation chain. One missing step and the document is returned, costing weeks.
• A board resolution that does not say enough — it needs to approve the branch, name the manager and grant the authority being relied on.
• Power of attorney too narrow for the acts the manager must actually perform.
• Translation quality. Legal translation is not general translation, and inconsistent terminology between documents raises questions.
• Premises mismatch — the tenancy does not support the activity or the visa count applied for.

Tax and ongoing compliance

A UAE branch of a foreign company is a taxable presence — a permanent establishment for Corporate Tax. Profits attributable to the branch are taxed at 9% above AED 375,000, with 0% below, and attribution has to be supportable rather than assumed.

Register for VAT once taxable supplies exceed AED 375,000. Where the parent is in a treaty country, the double taxation treaty and the branch's UAE tax interact, so look at both together.

Ongoing: annual licence renewal, tenancy renewal, accounting records, and the Ministry of Economy registration maintained alongside the local licence.

How Avyanco helps

We check the activity is open to a branch before you spend on attestation, manage the document chain, run both the federal and emirate filings, and give you a written cost breakdown against your actual activity, premises and headcount — current at the time of quoting rather than lifted from an article.