How to Open a Branch of a Foreign Company in the UAE in 2025

Open a branch of a foreign company in the UAE in 2025 is an increasingly popular strategy for international businesses seeking to enter the Gulf market. Unlike establishing a new legal entity, a branch is not independent—it acts on behalf of the parent company. This allows for centralized control, reduced administrative burden, and stronger alignment with global operations. It also signals serious intent to the market and builds trust among partners and regulators.

This article provides a detailed guide on how to open a branch of a foreign company in the UAE, step-by-step instructions, licensing requirements, and a comparison of Free Zone vs Mainland registration.

What is a Branch of a Foreign Company in the UAE?

A branch is a legally registered extension of a foreign company in the UAE. While it does not have its own legal identity, it can conduct business under the name of the parent company. The parent company bears full liability for the branch’s operations. Branches are allowed to invoice clients, lease office space, hire staff, open corporate bank accounts, and sign contracts—making this structure ideal for firms expanding into the region while maintaining centralized control.

Key Advantages of Opening a Branch

• No capital requirement. Most Free Zones and Mainland jurisdictions do not require share capital for branches.
• 100% foreign ownership. The parent company retains full ownership with no need for a local shareholder.
• Centralized management. The branch operates strictly under the control of the parent company, ensuring strategic alignment.
• Simplified tax reporting. Branch revenues can be included in global reports, and double taxation treaties may apply.
• Reputation and credibility. An officially registered branch enhances market perception and simplifies access to B2B and government opportunities.

Main Steps to Register a Branch

1. Choose the jurisdiction. Decide whether to register in a Free Zone (e.g., DMCC, IFZA, RAKEZ) or under Mainland jurisdiction through a relevant Department of Economic Development (DED). Your choice depends on your activity and client base (local or global).
2. Obtain initial approval. For Mainland branches, pre-approval is required from the Ministry of Economy (MOEC), authorizing the foreign company to operate in the UAE. More details are available on the MOEC official site.
3. Prepare the documents:
   • Certificate of incorporation and articles of association of the parent company
   • Board resolution approving the branch establishment
   • Appointment of a General Manager with a notarized Power of Attorney
   • Audited financial statements for the last 1–2 years
   • Certified translations into English and/or Arabic with notarization and apostille
4. Submit application. Once prepared, the application is filed with the DED or Free Zone authority. Some jurisdictions allow online submissions, others require physical presence at licensing centers.
5. Obtain license. The type of license depends on your activity: commercial, professional, or industrial. The branch’s activities must align with those of the parent company.
6. Office lease and visa processing. Activation of the license requires leasing a physical office (or Flexi Desk in a Free Zone). You must also apply for a UAE residence visa for the appointed General Manager and other employees, if applicable.

Free Zone or Mainland: Where to Register?

The best choice depends on your business model and operational needs. Here’s how the two compare:

Free Zone registration:

• Ideal for international trade, consulting, IT, or logistics
• Setup within 3–5 business days
• No need for a local UAE national as an agent
• Simplified procedures and fewer inspections
• 100% remote management possible
• Affordable office packages available in many zones

Mainland registration:

• Requires a Local Service Agent (UAE national), who has no ownership or control rights
• MOEC approval is mandatory
• Enables work with government clients and local tenders
• Suitable for B2C businesses, construction, or offline trading
• Requires a full office lease

You can find more details in the Dubai DED official guide.

Important: Corporate Tax and Reporting

Since 2023, the UAE has introduced a federal corporate tax of 9% on profits exceeding AED 375,000. Foreign company branches are considered resident entities and are subject to corporate tax obligations, including maintaining accounting records, filing annual tax returns, and making timely payments.

It is crucial to check if there is a double taxation treaty between the UAE and the parent company’s home country.

For updated corporate tax guidance, refer to the UAE Ministry of Finance portal.

Opening a branch of a foreign company in the UAE is a strategic move toward expanding into the Middle East. It allows companies to operate under a global brand, while complying with local laws. The regulatory reforms of 2025 make the branch setup process more transparent and business-friendly than ever. When planning your expansion, carefully consider your legal structure, management model, and growth trajectory to choose the optimal jurisdiction.