Why do you need a local sponsor?

Are you an entrepreneur or investor planning to form a company in mainland UAE? The UAE offers a strategic hub for accessing GCC and global markets. While forming a company in the mainland, you may need a local sponsor for certain activities.  UAE Commercial Companies Law, specifies that a Limited Liability Company (LLC) must have a local UAE partner who holds a minimum of 51% of the company shares.

However, it is not a compulsory condition for a foreign investor who wishes to start up a business venture or make an investment in Dubai mainland. Now, it strictly adheres to the UAE government’s sanctioned shareholding structure, which allows for 100% foreign ownership. 

However, for certain business activities, local sponsors act as silent or dormant partners, not participating in the administration or management of the business operations, and receiving a yearly income from the foreign investor as per the profit-sharing rules laid out in the contract. 

The 51% sharing requirement does not apply to companies set up in the free zones, where 100% ownership is granted to the investor.

At Fasttrack, we have helped business owners from all over the world successfully set up their companies in Dubai and the UAE. We thoroughly assess your company’s needs to meet your specific organizational requirements. Regardless of your company’s size, we provide expert advice and solutions to ensure you maintain control. Whether you are a startup, SME, entrepreneur, or multinational company, our team of experts has the skills and experience to set up your company successfully in Dubai and the UAE.

Contact Fasttrack Consultancy via email at info@fasttrackconsultancy.ae email or call +97165225808 for a free consultation today.