Overview
The local sponsors in the UAE are also known as local service agents, sleeping partners or nominee shareholders. The local partner is an Emirati national who has all the necessary qualifications required to start a business activity. Local sponsorship provides guidance and assistance to foreign entrepreneurs who want to establish or operate a business in the UAE.
In this blog, we are going to discuss the types and roles of a local sponsor for successful business setups in the thriving business landscape of the UAE.
What are Local Sponsors in the UAE?
In the United Arab Emirates (UAE), a local sponsor refers to a UAE national or company that provides various support and guidance in the efficient business setup of a foreign investor. UAE local sponsorship is the most common requirement for new entrepreneurs to engage in business activity and deal with all kinds of legal processes.
The local sponsor is required to have a certain percentage of ownership in the business that depends on the legal structure of the company. Article 10 (1) of Federal Law No. 2 of 2015, states that a UAE national who agrees to local sponsorship with a foreign investor should hold at least 51 % of the shares in the business. It does not mean that you have to share the profit and income incurred from the business.
A foreign investor needs to work with reputable local sponsors in the UAE who have updated knowledge of the laws and regulations of the country to navigate the entire process of business setup in country.
Types of Local Sponsors in the UAE
If you are looking for a local sponsorship you need to know the differences between the types of local sponsors in the UAE.
Corporate Local Sponsor
Corporate sponsors in the UAE can be government or local body that holds a minimum of 51% equity from the business. The finalization of a corporate sponsor depends on the type of venture and business you want to start in the UAE.
Individual Local Sponsor
Most entrepreneurs who want to establish a commercial business in the UAE prefer to partner with an individual local sponsor. Usually, they are not involved in any kind of business activity. Individual sponsorship also holds a minimum of 51% shareholding in a foreign business.
Local Service Agent as a Sponsor
A local service agent is a UAE national who can be a representative of your business to deal with government departments to navigate all kinds of documentation and approval processes. This local sponsorship in Dubai can be a passive partner for your business to support and assist in all local laws, rules and regulations.
Role of a Local Sponsor for Business Setup
The local sponsors in the UAE has a lot of roles and responsibilities to set up your business efficiently:
Legal Representation: Assists in legal matters and government dealings.
Visa Sponsorship: Get sponsorship for work permits and visas for foreign company employees.
Compliance and Licensing: Provide step-by-step support in obtaining the permits, licences and approvals required to operate the business in compliance with local laws and regulations.
Local Knowledge and Connections: Offers valuable insights into local market conditions and business practices to build new connections in the country.
Business Setup Assistance: Facilities various processes to set up your business in the UAE such as business registration, office space leasing and other administrative tasks.
Conclusion
Approaching local sponsors in the UAE offers foreign investors to leverage local expertise, access new markets, and navigate the regulatory landscape more effectively. Corporate sponsors, individual sponsors and local service agents are the three kinds of sponsorship options for starting a business in the UAE. Choosing the right local sponsor is important to ensure a smooth legal and business setup process. Here we have discussed everything you need to know about local sponsorship UAE including their types, roles and responsibilities. Hope it will help you find the best local sponsor services for your business setup in the thriving business landscape of the UAE.
Find the Best Local Sponsor with Arab Business Consultant
Are you searching for local sponsorship in the UAE? The best way to find the right local sponsor for your business is by connecting with Arab Business Consultant. We have years of experience in providing various business setup services including business consulting, PRO services, VAT services and Local sponsor services.
FAQ
How to find a sponsor in UAE for business setup?
You can connect with the best business setup consultancy such as Arab Business Consultant to find the best local sponsor for your business. Based on the nature of your business we will help you to connect with the right local sponsor and navigate all legal work efficiently.
What kind of businesses need a local sponsor in the UAE?
Businesses such as trading, real estate, technical services, contracting, advertising, textile, manufacturing, cargo and logistics industries, electronic industries, jeweler business, fuel and petrochemical industries and more require local sponsorship in the UAE.
How can we change a local sponsor for business setup in the UAE?
For changing your local sponsor firstly you need to discuss it with your current sponsor, then involve other stockholders, prepare all documents, approach the court and select a new local sponsor for your business.
