UAE Local Sponsors are required to set up a limited liability company (LLC) in the mainland of Dubai, UAE. For an LLC company in the UAE, a UAE national must act as the sponsor with a minimum shareholding of 51 %. The rest, 49 %, can be held by foreign investors. The LLC appoints a UAE national sponsor on a yearly contract basis by paying a sponsorship fee.
Foreign nationals wishing to start a business in the UAE mainland still need to have a sponsor – it is not possible otherwise. However, there are many industries in which 100% foreign ownership of an entity is permitted. This can be granted by law or through individual permissions. Even where 100% foreign ownership is allowed, it can be denied if the business subject is considered sensitive and there is no law stating that such type of businesses can be registered by non-GCC people.
First and foremost, you must be aware of the law in your area that regulates the sponsorship process. Next, research the best local sponsor, find out what they can do for you, and then start running all of your options past them to see how they compare. Finally, make sure that the agreement you put together with your sponsor is going to benefit both parties and be long-term
The local UAE national will assist and liaison with Government departments to obtain approvals for business licenses, employee visas, and other administrative services. They have no role in the day-to-day business operations, which are looked after by the foreign partner. Local sponsors can be of two types. They can be individuals of UAE nationality or corporate entities owned by UAE nationals. If you’re interested in doing business in the UAE, you may be wondering whether you can set up a shop on your own. The answer is no. In order to do business, you need a local sponsor. With a local sponsor, you will have access to the local market, protected international trade agreements, and the ultimate peace of mind that comes with making sure everything goes smoothly when opening your business in the UAE.
A local sponsor acts as a silent partner, allowing you to get started with your business and start generating revenue straight away. The process involves having a 51% stake in your business held by a local sponsor, who is a UAE national or international company. This is the only option for 100% foreign-owned companies, which must have access to local funding and expertise
Who needs a local sponsor?
If you are setting up a business in Dubai or any of the other Emirates of the UAE, you may need a sponsor. The UAE law requires all companies to have a local sponsor to register as a legal entity in the Emirate. However, this requirement only applies to some industries and businesses. Here are the businesses that require a local sponsor:
In the UAE, a sponsor is an individual or group of individuals who are legally responsible for an expat (they need to be above the age of 21). This means they must ensure that everything related to the residency permit is in order and cannot be used by anyone other than the appointed expat. A sponsor can also have various roles including providing financial support and housing. To avoid scammers, always make sure you base your decision on a reputable source and deal with a consulting company
Finding a local sponsor in Dubai, Abu Dhabi or any other emirate should be taken very seriously as you will need to have a strong and trusting relationship with them. Absher business consultancy can help you find the right match for your business and give you peace of mind that your business is always in safe hands.
Types of local sponsors-UAE National Sponsorship Services
For a foreign investor, it is imperative to choose the right local sponsor in the UAE. Without the assistance of a business setup consultant in UAE, it would be challenging to get access to a local sponsor. Business consultants like Absher help their clients find the right local sponsor after assessing their business set plans. Many local sponsors are ready to be a part of the mainland business set up of the foreign investor in return for a fixed fee. They have no role in business operations.
However, a few things are essential that a consultant can help with.
✔️Build rapport with the sponsor
The local sponsor's help is required from time to time. For setting up the business, Liasoning with Government Services is crucial. Getting license approvals, applying for new employee visas, immigration, expansion, diversification of business, and new territories are required. Therefore, building a rapport with the UAE national Sponsor is essential.
There must be no miscommunication between the foreign investor and the local sponsor. The business consultants act as a mediator to ensure that shareholder agreement, fees, and responsibilities are well-communicated between the two shareholders.
Before signing up with a UAE national for a local sponsor, the documentations need to be perfect to avoid any dispute late. The agreements, Power of Attorney, clarity on shareholding and assets, and other terms and conditions must be agreed upon and documented. Business setup consultants play a vital role here for their clients.
A local sponsor is the official representative of your company in the UAE. They act on behalf of you and your company and carry out various administrative functions including filing paperwork and translating documents. Pakistan. A local sponsor can provide valuable assistance if you need help with opening a bank account, getting an initial salary certificate or canceling your work visa when you leave the country (be sure to take extra copies of each document with you).
Ensuring you have the right sponsor is crucial to getting up and running in Dubai. Choosing the right person can make all the difference to your experience, as it will be their responsibility to ensure your business is successful – as well as ensure that they keep it in line with all local regulations.
You may feel the need to change your local sponsor, this could be due to a lack of business agreement or a more serious issue. Whatever may be the cause you can change your UAE sponsor. Changing your sponsor is a process that requires careful consideration. New sponsors need to be chosen carefully, as they will be responsible for making sure all of your company’s paperwork is in order throughout the lifetime of your business.
However, with expert help, it can be a straightforward process. The first thing you will be asked to do is to approach your current sponsor and mention your intentions to them. Next, pull together your sponsorship documents such as your Memorandum of Association, proof of annual payments, and proof of an attorney. Finally, you need to attend court with your current sponsor, and if all goes well the new documents can be issued soon to begin the new sponsorship. Absher can guide you through this entire process
If your business offer is in one of the regulated industries in Dubai, you'll need to obtain a trade license from the DED. This is because foreign companies are required by law to have a domestic partner who can act as a sponsor for their business. But there are several options available if you wish to obtain a trade license in Dubai without a local sponsor. Also, if you are looking for a way to not deal with a local sponsor, you can consider opening your business outside the regulated sectors and services. But if you're mind is set on a specific business idea that falls under the regulated industry then there is no escape from needing a sponsor.
For some company structures as described within the UAE law, a local service agent is required instead of a local Sponsor. Civil Work Companies or a branch of a Free Zone Foreign company, Representative Office of Free Zone Foreign company has to appoint a Local Service Agent while registering the company with the authorities in the UAE.
The Local Service Agent is not entitled to any profit-sharing but is paid a fixed fee for acting as a company's local representative when dealing with Government authorities for Visa and Administrative Services.
If you are looking to launch your business anywhere in the Emirates, there's different sectors or areas that you might need to consider as well. The top 10 cities to start a business in Dubai, Abu Dhabi and Ajman - according to the World Bank's Research Department. No matter what type of business you are looking to launch, our marketing consultants work with you to develop a strategy that delivers results. We recommend the most suitable sector and location as well as appropriate market research before developing a line-up of services according to your needs.
Services to include for the success of your business: