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In today’s fast-paced world of development and technological growth, there’s always more space for entrepreneurial opportunities to make it big in the economic market. In that aspect, Dubai stands out as a vital avenue for providing growth and economic security to growing businesses. With an economic market booming with umpteen possibilities and forever on the rise. It comes forth as an optimistic idea to set up one’s own business in the United Arab Emirates or Dubai, considering there is a presence of a local sponsor in Dubai.
UAE and Local Sponsor
The government of Dubai has a positive outlook on facilitating upcoming business entrepreneurs and businesses. This is coupled with the city’s strategic geographical location, state-of-the-art infrastructure, exemplary business facilities, and a highly investment-friendly market. And benefits of foreign direct investment (FDI) make it by far the best place on earth to do business. As of today- an opportunity that is being increasingly realized by investors and entrepreneurs worldwide.
But, for foreign nationals looking to set roots in Dubai setting up a business might become tedious and appear intricate, due to the lack of knowledge about the place, its policies, norms, and regulatory functions.
Therefore, the administrative authorities realizing the gravity of this issue and facilitating ease of business have made it mandatory for foreign businessmen to have a local sponsor for their business. This means that any business set up and functional in mainland Dubai must invest its efforts and capital in finding a local sponsor in Dubai.
Finding a Suitable Local Sponsor
The legislative network in the United Arab Emirates makes it mandatory for foreign business owners to have a local sponsor in Dubai. Appointed for representative dealings with the ministries and the government for getting the paperwork done. Therefore, finding a suitable local sponsor in Dubai becomes a huge challenge for foreign businessmen.
After all, it is the question of the company’s image representation and most importantly trust, to take the company forward. Therefore, companies looking to find a local sponsor in Dubai should be aware of the various types of sponsorship that have been made available to foreign businessmen, entrepreneurs, and/or investors.
Local Service Agent
It is a setup wherein professionals like artists, doctors, or engineers capitalize on a business opportunity by offering viable services. A local service agent is required to represent the company in all administrative matters. The local service agent, in this case, does not hold 51% of the business.
But is paid an annual sum of money as decided between the agent and the foreign investor and is appointed for the sole purpose of liaising with the government departments and authorities to obtain a visa, labor card, and immigration approvals and complete other necessary paperwork.
The remuneration received by the local service agent is a matter of commercial agreement. And also depends on the social standing of the family of the local service agent.
Corporate Sponsorship
As per Article 10 (1) of the Federal Law No. 2 of 2015. This type of sponsorship occurs when a UAE company is owned by Emirati or personnel from the UAE. The United Arab Emirates holds 51% of the shares of an organization owned by a group of individuals of foreign origin.
Individual Sponsorship
This is the most common form of sponsorship which is available in Dubai. An Emirati or a UAE national becomes a sponsor and may or may not be part of the operating business. An Emirati will hold 51% of the share of the firm. And can hand over a power of attorney to the foreign partner for a fixed fee.
Now that we have talked at length about the various benefits that a local sponsor can provide to your business and make it scale new heights. While you relax and enjoy the capital back home, then what is it that you are waiting for?