Branch Office Setup for Foreign Companies in UAE

Resolution 138 of 2024, Attestation, Fees & Corporate Tax — 2026 Guide

🏢 Introduction to UAE Branch Office Setup

A branch is the fastest way for an established foreign company to start trading in the UAE under its own name — no new company to incorporate, no separate share capital, and the parent keeps 100% control. But a branch is not a separate legal entity, and that shapes everything that follows: the parent carries unlimited liability for what the branch does, and the branch is generally treated as a permanent establishment for Corporate Tax.

The setup rules have also changed in a way many guides haven't caught up with. Ministerial Resolution No. 138 of 2024 replaced the 2010 framework and removed two long-standing requirements for foreign company branches — the local service agent and the AED 50,000 bank guarantee. Plenty of providers and older articles still list both, so budgets and timelines built on them are often wrong. What hasn't changed is the part that actually slows people down: the parent company's documents have to be notarised, attested through the embassy and foreign ministry chain, and translated into Arabic before the Ministry of Economy and Tourism will move.

This guide covers how a foreign company opens a UAE branch in 2026 — branch vs LLC vs representative office, the registration sequence, document attestation, government fees, Corporate Tax treatment, and ongoing compliance. If you'd rather have specialists run the process end to end, our business setup team works with foreign companies entering the UAE every year.

📖 What a Foreign Company Branch Is (and Isn't)

• A branch is an extension of the foreign parent company, operating under the parent's name — the branch name must be the parent's name followed by "Dubai Branch" or "UAE Branch".
• It has no separate legal personality: the parent bears full legal and financial responsibility for the branch's contracts, debts, and liabilities.
• Ownership is automatically 100% foreign, since the branch is simply part of the parent.
• There is no minimum share capital requirement for a foreign branch office.
• The branch's activities must align with what the parent company already does — the ministry checks this before approving registration.

⚖️ Branch vs LLC vs Representative Office

🆕 What Changed in 2024: Resolution No. 138

• Ministerial Resolution No. 138 of 2024 was issued by the Ministry of Economy on 30 July 2024 and replaced the earlier Ministerial Resolution No. 377 of 2010 on registering branches and representative offices of foreign companies.
• It removed the AED 50,000 bank guarantee previously deposited at the time of establishing a branch — and existing branches that had lodged one were told to approach their banks to cancel it.
• It removed the local service agent requirement and the need to submit a service agent agreement.
• Applications for registration, renewal, amendment, suspension, deletion, or re-registration of a branch are filed through an online electronic platform.
• The Resolution covers all types of representative offices too, including regional liaison offices, management offices, and representative offices of foreign banks.

🗺️ Mainland vs Free Zone Branch

Free zones also set their own ongoing obligations — for example, JAFZA requires audited financial statements as a condition of licence renewal; see our JAFZA company compliance guide. For how qualifying income rules shape the choice, read our guide to free zone vs mainland tax differences. Manufacturers weighing an Abu Dhabi industrial zone can also see our KIZAD industrial free zone setup guide.

🧭 The Three-Step Registration Sequence

📄 Parent Company Documents & the Attestation Chain

• Certificate of Incorporation of the parent company
• Memorandum and Articles of Association
• Board resolution approving the establishment of the UAE branch
• Power of attorney appointing the branch manager
• Proof of the parent's good standing or financial standing, where requested
• Passport copies and details of the branch manager

• Exact steps vary by home country — some jurisdictions use apostille-style routes or have their own foreign ministry stage — so confirm the chain for your country before notarising anything.
• Documents that are not correctly attested are rejected, and re-doing the chain is the single most common cause of branch setup delays.
• Start attestation first and run the rest of the process in parallel wherever possible. Our documents required for business setup guide covers the wider checklist.

🧭 Step-by-Step Setup Process

1. Confirm Eligibility and Activity Alignment

   Check that the activities you want the branch to carry out match what the parent already does.

2. Choose the Branch Name

   The parent company's name followed by "Dubai Branch" or "UAE Branch".

3. Prepare the Parent Company Documents

   Certificate of incorporation, MOA/AOA, board resolution, and power of attorney.

4. Notarise and Attest in the Home Country

   Follow the notarisation, foreign ministry (where applicable), and UAE embassy chain.

5. Attest at UAE MOFA and Translate into Arabic

   Complete the UAE-side attestation and obtain certified Arabic translations.

6. Obtain MoET Initial Approval

   Apply through the ministry's online platform; the ministry reviews the parent's documents and proposed activities.

7. Secure Premises

   Lease suitable premises and register the tenancy (Ejari in Dubai) as required for the licence.

8. Obtain the Local Branch Licence

   DET in Dubai issues the trade licence for the branch.

9. Complete MoET Registration Within One Month

   Finalise registration with the ministry after receiving the local licence.

10. Establishment Card, Visas and Emirates ID

    Open the immigration file and process residence visas for the branch manager and staff.

11. Open the Corporate Bank Account

    Use the parent documents and branch licence to open the branch account.

12. Register for Corporate Tax (and VAT When Required)

    Register with the FTA and set up bookkeeping before trading begins.

⏱️ Realistic Timeline

• A mainland branch typically takes 3–6 weeks end to end, depending mostly on document attestation speed, authority approvals, and arranging premises.
• Ministry of Economy and Tourism initial approval often takes roughly 10–15 days once documents are submitted correctly.
• Delays almost always trace back to attestation errors rather than anything on the UAE side — so the fastest route is getting the chain right the first time.

💰 Government Fees & Costs

Fee levels are as reported by the authorities and practitioners at the time of writing and can change — always confirm current fees before budgeting.

🧾 Corporate Tax: Your Branch Is a Permanent Establishment

• A branch of a foreign company generally constitutes a permanent establishment (PE) in the UAE, bringing UAE-attributable income into Corporate Tax even though the head office stays overseas.
• The PE is taxed at 9% on attributable income above AED 375,000, and must register for Corporate Tax and file within nine months of the tax period end.
• Attributable income is calculated as if the branch were a separate and independent person: revenue earned through the branch, less directly and reasonably allocable expenses, including a fair share of head office overheads.
• Dealings between the branch and head office — charges for services, support, or goods — need to be on an arm's length basis and documented, which is also a 2026–2027 FTA audit focus; see our guide on how to handle an FTA tax audit.
• The UAE does not impose a separate branch profits tax on remitting after-tax profits to the head office; withholding tax rates are currently set at 0% (see our withholding tax guide).
• The parent usually remains taxable in its home country on worldwide income, including branch profits — relief typically comes through exemption or a foreign tax credit under a double tax agreement, so check the home-country position before deciding.
• For the wider rules on when a presence creates a taxable PE, see our permanent establishment rules guide.

⚠️ Free Zone Parent with a Mainland Branch

This is the trap for groups using a free zone company as the parent of a mainland branch: the branch's income is outside the 0% regime even if the free zone entity itself qualifies. The domestic PE does not by itself disqualify the free zone entity's separate qualifying income, but the mainland profits are taxed at 9%.

👥 VAT, Employees & Banking

• VAT: registration becomes mandatory once taxable supplies exceed AED 375,000 over the previous 12 months (voluntary from AED 187,500). If you're unsure whether DIY filing is realistic, see our guide on whether you can file VAT returns yourself in Dubai.
• Employees: once the establishment card is in place the branch can sponsor visas — see our guide to the business visa process after company formation. Branch staff are covered by UAE labour law, so build leave and end-of-service costs into the budget; our guide to calculating annual leave encashment shows how entitlements are worked out.
• Emiratisation: a mainland branch with 50 or more employees in skilled roles falls within the federal Emiratisation target.
• Banking: expect the bank to review the parent's documents, branch licence, and activity profile — attested parent documents prepared early also speed up account opening.

🔁 Ongoing Compliance & Renewals

• Renew the local trade licence annually and keep the branch's ministry registration current through the online platform.
• File amendments through the platform when something changes — for example, the parent's name or the branch's activities — and expect to supply freshly attested parent documents where the change originates overseas.
• File Corporate Tax returns within nine months of the end of each tax period, and VAT returns on the registered schedule once registered.
• Keep records: five years for VAT and seven years for Corporate Tax; audited financial statements are required where revenue exceeds AED 50 million.
• Maintain a clear branch ledger and documentation for head-office charges so the permanent establishment computation can be supported on request.

🚪 Closing or Converting a Branch

• Suspension, deletion, and re-registration of a branch are handled through the same ministry online platform.
• Closure typically involves cancelling the local licence, cancelling visas, settling employee entitlements and liabilities, and deregistering for Corporate Tax and VAT.
• Because the parent is fully liable, obligations incurred by the branch remain the parent's responsibility even after the branch closes.
• If liability exposure or the need for a standalone UAE entity grows, a branch can be replaced by a mainland LLC subsidiary — the decision usually turns on risk appetite, customer contracting needs, and group tax planning.

⚠️ Common Mistakes to Avoid

• Budgeting for a local service agent or AED 50,000 bank guarantee that no longer applies — or, the reverse, assuming the document attestation chain has also been simplified.
• Attesting documents before confirming the exact chain required for the parent's home country, then redoing everything.
• Missing the one-month ministry registration deadline after receiving the local licence.
• Proposing branch activities that go beyond what the parent company already does.
• Ignoring Corporate Tax registration because "the profit is booked overseas" — the branch is a permanent establishment with its own filing obligations.
• Using a free zone company as the parent of a mainland branch and assuming the branch income enjoys a 0% rate.
• Setting head-office charges without arm's length documentation, which weakens the position in an FTA review.

💼 How One Desk Solution Can Help

A branch looks simple on paper, but the sequencing, attestation chain, and tax treatment are where applications stall and exposures arise. Our business setup team manages the full registration — attestation planning, ministry approvals, DET licensing, and establishment card — supported by our tax services team for Corporate Tax registration, permanent establishment computations, and VAT, our accounting & bookkeeping services for a clean branch ledger, our audit & assurance services when audited financials are required, and our advisory & consultancy services for choosing between a branch, LLC, or free zone structure. Explore our full range on the services page.

❓ Frequently Asked Questions

🔗 Related Resources