Presence

Branch & representative office

The choice is not cosmetic. A branch is the same legal entity as its parent. It can trade and invoice, but the parent bears unlimited liability, and the branch almost always becomes a locally taxed permanent establishment. A representative or liaison office is different. It exists for marketing and coordination, and by law it may not sell, contract or invoice. We map that trade-off against the specific jurisdiction, then arrange the filing through vetted local counsel. We are a two-principal advisory firm, not a licensed registration agent in any of these countries.

Last verified July 2026

What this covers

We establish at the outset whether the mandate actually needs a trading presence, a branch or subsidiary, or only a liaison one, a representative or liaison office. That single answer usually decides the local tax exposure.
We explain the liability point plainly. A branch is not a separate legal person, so the foreign parent stands behind every branch contract, debt and regulatory obligation. A subsidiary ring-fences that risk instead.
We model the permanent-establishment consequence. Under OECD Model Article 5, a trading branch creates a taxable presence on the profit attributable to it. Some states add a branch-profits tax on earnings remitted to the parent.
We compare a branch against a subsidiary using the specific facts at hand. Early-year losses that a home jurisdiction may allow to flow up to the parent can favour a branch. Limited liability and dividend planning often favour a subsidiary instead.
We assemble and route the corporate document pack. That means the parent charter, board resolution, power of attorney and audited accounts, prepared for apostille or consular legalisation and certified translation. This step is the one that most often delays a filing.
We coordinate the registration itself through vetted local counsel. That covers the Ministry of Economy plus the emirate authority in the UAE, GAFI in Egypt, the APR in Serbia, MISA in Saudi Arabia, the Ministry of Industry and Technology in Turkey, and SAMR in China.
We flag where a branch simply is not available and a subsidiary is the only trading route. The clearest case is China, where foreign companies generally trade through a WFOE, and the representative office is confined to non-revenue liaison work.
We hand over to qualified local tax and legal counsel before anyone signs. We scope, coordinate and quality-check the process. We do not give the binding tax or legal opinion ourselves.

Scope & conditions

UAE — branch: A mainland branch registers with the Ministry of Economy & Tourism and takes a licence from the emirate authority (DET in Dubai, ADDED in Abu Dhabi). Ministerial Resolution No. 138 of 2024 removed the local-service-agent and AED 50,000 bank-guarantee requirements. The branch registers with the Federal Tax Authority; UAE corporate tax is 9%. Confirm current fees with the MoET as of 2026.
China — rep office vs WFOE: A representative office registers with SAMR and may only liaise — no fapiao invoicing, no revenue contracts, no income; the parent must have legally existed at least two years and appoints a chief representative plus up to three others. To trade you need a WFOE (a subsidiary); China does not offer an ordinary trading branch to most foreign companies.
Turkey — liaison office: A liaison (representative) office is permitted by the Ministry of Industry and Technology and may not engage in any commercial activity. Permitted remits are representation and hospitality, quality control and sourcing, technical support, communication and information transfer, or regional management. Permits are typically time-limited and renewable.
Serbia — branch vs rep office: A branch has no separate legal personality but is a tax resident, so branch profits face Serbian corporate tax; a representative office may perform only preliminary and preparatory work and is treated as a non-resident. Both register with the APR (a representative office typically in about ten days).
Egypt — rep office vs branch: A GAFI-registered representative office may conduct market research and promotion only — no invoicing, no trading — and is expected to convert to a company or branch, typically within three years. A branch may trade and invoice; branch registration usually runs about four to eight weeks once documents are legalised.
Saudi Arabia — branch: Foreign investors must register with MISA before operating (New Investment Law in force from February 2025). A direct branch is a common route for a single-parent group. Confirm the minimum-capital figure and any sector conditions directly with MISA for 2026 before relying on them.
Permanent establishment: Under OECD Model Article 5, a branch, office or place of management is a permanent establishment; genuinely preparatory or auxiliary activity (Article 5(4)) is not. A construction or installation project becomes a PE only after 12 months. The Model Tax Convention Commentary was last updated in November 2025.

How it works

You need a clear picture of what the office will actually do on the ground. Will it sign contracts and issue invoices, or only market and gather information. That one fact drives both the entity choice and the tax result.
The parent company's constitutional documents and recent audited financial statements. These need to be ready for apostille or consular legalisation, along with a certified translation into the local language.
A named local representative or chief representative, where the jurisdiction requires one. Turkey and China in particular ask for this, along with the person's passport and appointment papers.
You will need qualified local tax and legal counsel in the target jurisdiction. We will not move forward with a filing without them in place.
Set your timetable realistically. Plan on roughly 8–10 weeks for a UAE mainland branch and about 4–8 weeks for an Egyptian branch once your documents are legalised. Bank-account opening is the least predictable step, wherever you are.

What can go wrong

A representative office that quietly starts selling, invoicing or signing revenue contracts breaches its own registration terms. That can trigger back-taxes, penalties and a forced conversion or closure. The non-commercial limit is real, not a formality.
A branch does not shield the parent company. Local claims, tax debts and regulatory fines reach straight back to the foreign company and its shareholders.
Fees and minimum-capital figures move over time. Every number here is indicative and dated as of 2026. Confirm the current schedule with the relevant registry or regulator before you budget.
China is the common trap. A representative office cannot be converted into a trading vehicle. Even a non-earning RO is generally taxed on a deemed-profit (cost-plus) basis.
We are a small advisory firm working through vetted local counsel. We hold no registry, legal or tax licence in these jurisdictions, and we do not issue the binding opinion. Our role is to scope, coordinate and quality-check.

Frequently asked

What is the difference between a branch and a representative office?

A branch is the foreign parent operating directly abroad. It is the same legal entity, so it can trade, invoice and sign contracts. But the parent carries full liability, and the branch is usually taxed locally as a permanent establishment. A representative office, also called a liaison office, is a non-trading presence. It may market, research and coordinate, but by law it may not sell, invoice or earn revenue.

Does a branch create a permanent establishment and local tax?

Almost always. Under OECD Model Article 5 a branch or office is a textbook permanent establishment, so the host country taxes the profit attributable to it, and several countries add a branch-profits tax on earnings remitted to the parent. Only genuinely preparatory or auxiliary activity (Article 5(4)) escapes — the narrow lane a true representative office is designed to occupy.

Can a representative office in China trade or invoice?

No. A China representative office registers with SAMR and is confined to liaison work: market research, quality control, supplier management and business development. It cannot issue fapiao invoices, sign revenue contracts or earn income. The parent company must also have existed at least two years. To actually trade in China you need a WFOE, which is a subsidiary, not a branch. Even a non-earning RO is typically taxed on a deemed-profit basis.

Is a branch cheaper or better than a subsidiary?

Sometimes. A branch avoids forming a new company. In some home jurisdictions, its early-year losses can flow up to offset parent profits, which can be useful for a loss-making launch or for a regulated activity that must be run in branch form. But it exposes the parent to unlimited liability and full local PE tax. A subsidiary, by contrast, gives limited liability and cleaner dividend planning. The right answer is fact-specific, which is why we model both before recommending one.

What documents does a foreign company need to register a branch?

Typically that means the parent company's certificate of incorporation and constitution, a board resolution approving the branch, a power of attorney to the local manager, recent audited financial statements, and passport copies of directors. All of it needs to be apostilled or consular-legalised and translated into the local language. This legalisation-and-translation step, not the registry filing itself, is the usual source of delay.

How long does registration take?

It varies by country and by how quickly documents get legalised. A UAE mainland branch typically runs about 8–10 weeks end to end. An Egyptian branch takes about 4–8 weeks. A Serbian representative office takes roughly ten days at the APR once the papers are in order. Bank-account opening is the least predictable element everywhere, so we flag it early so it does not stall the launch.

Need branch & representative office done properly?

One named person on your file, and an honest answer on scope, timeline and cost.