How to Setup a Representative Office in the UAE?
Dubai is a place where one can face many challenges to setup a new business. But there are also many options in UAE, such as free zones and mainland LLCs, which have pros as well as cons. Free zones offer foreign ownership and tax benefits. But the mainland provides limited business activities and trade. The Representative office setup in UAE is different from the branch office.
Simple Setup: For starting a representative office in the UAE, first you have to find out the local service agent (LSA). LSA will help to deal with the UAE authorities and it will act as your representative in UAE market. Then the next step is to choose the company name and business activity to start and apply to the department of economic development for approval. After the DED approval then apply to the Ministry of Economy (MOE) for approval.
Then the next step is to know the documents required to setup a representative office in UAE. For approval, your application should have proofs of permission to set up a representative office, business activities detail, certificate of incorporation, memorandum, and articles of association.
Simple pricing structure: The pricing structure to set up a representative office in UAE is simple and transparent. Due to the more steps included in this, it may be expensive to start a representative business than to start a standalone business. The location to start a business and nature of your business exactly describe the cost included for business.
Multiple Visas requirements: Setting up a representative office in Dubai allows you to apply for multiple visas, and it should be linked to the size and structure of your office. And you can also establish your office with multiple shareholders.
Representative Office vs Branch Office
An existing business in the UAE can be a representative office, and there are certain differences between the representative office and branch office. The characteristics that define branch vs representative office can be described related to business activity. A branch office turns a profit while doing business in the UAE, but a representative company would be established for marketing or promoting your foreign company in the UAE.
Benefits of Representative Office Setup in Dubai
If anyone wants to grow the existing business, then starting a representative office setup in UAE act as an influential marketing and promotional tool. It allows us to setup the business in the ever-growing Dubai market, with lesser cost and favorable tax conditions.
Cost-effective and no share capital requirement: As the basic and most of the business resources remain with the parent company, and the operations are not so big, so the representative office set up cost is not so high. There is no share capital requirement to set up a representative office with smaller operations.
0 % corporate tax rate: As per the rules and jurisdiction in Dubai, Parent companies can take advantage of free zones set up, with 0% corporate tax rate.
To have more information about the representative office setup in UAE, contact our experts at Business Link UAE.