Fortunum Investments Ltd.

Incorporate a Dubai Branch of a Foreign Company in stead of a Dubai LLC.

When you incorporate a Dubai Branch of a Foreign Company – the Dubai Branch is the 100% fully-owned subsidiary of the Foreign Parent. You still have to appoint a local sponsor as your UAE National Service Agent. However in the role of the National Service Agent, the local sponsor will not own any shares in either the foreign parent or the Dubai Branch.

Are there any other advantages of using this structure?

There is a one major advantage of using this structure. Your Dubai Branch can carry the same name as your parent company. Many clients incorporate a Foreign Parent and then set up a Dubai Branch just so that they have a wider choice in naming their company beyond the naming rules followed by the Dubai Licensing Authorities. You can read all about it in this post.

What are the disadvantages of using this structure?

There are no disadvantages as such, but you have to fulfill certain requirements to set up a branch of a foreign company;
• The Parent Company should have been in operation for two years or more – you cannot incorporate a company today and expect to register a branch in Dubai tomorrow. We overcome this problem by buying a company that has been incorporated for over two years or more and changing the name to the name that you want.
• The Dubai Licensing Authority will also request to see audited statements for these two years. Therefore we have to look for a company that is more than two years old WITH audited statements – or at least accounts for two years or more that can be audited.
• The Dubai Licensing Authority may or may not wish to see at least 6 – 12 months bank statements of the parent company along with a reference letter or letter of introduction from your banker.
• Ministry of Economy Approval: If you are going to conduct any commercial activities (as opposed to Professional Activities) The Dubai Licensing Authorities will request that you first register your company with the Ministry of Economy. This registration requires a deposit of AED 50,000 to be placed with the Ministry and the payment of an annual fee of around AED 15,000.

If you would like to receive a proposal from us on how to incorporate your company in Dubai, please fill in our Obligation Free Questionnaire.