Iran and the UAE are gradually increasing the mutual trade over the years. The UAE is easing restrictions on corporate registrations and visas for Iranian companies, which are still under US sanctions. So, they can register a branch of an Iranian company in the UAE to make the most of the opportunities.
The United Arab Emirates is embracing the Iranian investors in all sectors. Nowadays, it is favorable for the Iranian nationals to expand their business to the UAE. Opening a branch office for an Iranian firm is better for the entrepreneurs who can not relocate all business operations.
Key takeaways of the Iranian branch offices in the UAE
These are the notable findings and insights about the incorporation of the branch of Iranian company in the UAE.
- The UAE is focusing regional de-escalation and business growth, despite a decade of interventionism following the 2011 Arab Spring uprisings.
- Diplomatic and economic relations between the UAE and Iran are strengthen over the last decade.
- Since 2019, an initiative by China, and the resultant breakthrough is easing tensions between the UAE and Iran.
Process to get license for branch of Iranian business in UAE
This is the process of the registration of a branch of an Iranian company in the UAE.
- Reserve company and trade name: The company name of the branch office in the UAE, matches the parent Iranian firm as its extension. Also, its trade name in the UAE matches the Iranian parent company. Get approval from both from the Department of Economic Development (DED).
- Select corporate jurisdiction: Choose between the mainland UAE or free zones for Iranian branch office setup. Free zones in the UAE offer easy setup, simpler regulations, and tax exemptions. Whereas, the UAE mainland provides the broader market access, but comes with more regulatory oversight.
- Get initial approval: Take preliminary approval for your Iranian branch office in the UAE from DED or the chosen free zone authority.
- Secure office space: To operate your Iranian branch in the UAE, you must rent/lease a suitable office space. Legally draft a tenancy contract, that serves as proof of your business address. Accordingly, it legitimizes the presence of the Iranian branch office in the UAE.
- Obtain business license: Submit application for relevant license for the Iranian branch in the UAE to the DED or free zone authority. Attach all necessary legal documents and pay the licensing fee. Receive the license after the regulatory approval, and start the branch office operations.
- Copy of valid UAE visa of directors
- Photocopy of passports of directors
- Certificate of Incorporation
- Trade name reservation certificate
- Memorandum of Association (MOA)
- Articles of Association (AOA)
- Power of Attorney (POA) for appointed representative
- Board resolution authorizing branch establishment
- Register corporate banking account: Open business bank account in the UAE to perform financial transactions for your Iranian branch office.
- Acquire additional approvals: Iranian investors may require to take extra approvals from other specific regulatory bodies in the UAE. For example, the UAE Central Bank, RERA, Health Authority, etc. These additional approvals are dependent on the business nature of the Iranian branch office in the UAE.
Notarized, sign, and stamp documents for the parent company in Iran, and get attestation from the UAE Embassy in Iran.
Conclusion
A number of opportunities and challenges can influence the future of the Iranian companies. Geopolitical factors and regional dynamics are set to keep playing a significant role in this regard. Sanctions on Iran make it beneficial to transfer at least some business operations to other countries.
Now is the time for Iranian businesses to branch out in the UAE. On the whole, It is highly lucrative to form a branch of an Iranian business in the UAE. Iranian investors make your entrepreneurial transition to the UAE with the help of KWS Middle East right away.
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FAQs about branch office operations of Iranian businesses in UAE
These are the answers to the common questions about the branch office operations of Iranian businesses in the UAE.
Is a branch same like a franchise?
A branch is a separate entity from a franchise. Essentially, a branch is run by a third party, with some oversight by the parent company. Whereas, a franchise is fully managed by the company itself.
How much does it cost to open an Iranian branch in the UAE?
The cost of opening the branch of Iranian company in the UAE ranges between AED 30,000 to AED 50,000. The licensing expenditure is dependent on factors like the license type and registration with the local UAE government. Also, its depends on application to the Economy ministry, registration with the ministry, and bank guarantee deposited to the ministry.
Can Iranians open a bank account in the UAE?
Iranians can open various bank accounts in Dubai, including personal savings, current, fixed deposit, business accounts, and specialized expatriate accounts.
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