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Do You Still Need a Local Sponsor for Dubai Mainland Setup in 2024?

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Though having a local sponsor (UAE national) is no longer required for foreign investors to setup a mainland company in Dubai, this does not apply to all businesses as there are some exceptions, mainly for those seeking to open commercial or industrial companies in Dubai mainland. 

Who is a Local Sponsor in Dubai?

According to UAE regulations (Federal Law No. 18 of 1981), a local sponsor is a UAE national who must hold a majority stake (51% or more) of a foreign-owned company in Dubai mainland, though not involved in the affairs of the company.

In the past, every company registered in Dubai mainland by the Department of Economy and Tourism (DET) was obligated to have a local sponsor. Though having a majority share of the company, the local sponsor may give Power of Attorney to the foreign investor for a fixed annual fee through a Memorandum of Understanding (MOU).

Want to know more about how to setup a company in UAE?

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Types of Local Sponsors in Dubai

There are three types of local sponsors in Dubai, UAE. Corporate Business Services (CBS), an Emirati-owned business consultancy company in Dubai, UAE, can assist you in securing a local sponsor of your choice in UAE.

  1. Individual Sponsor: This is an Emirati national (at least 21 years of age) who owns a local company or government employee who holds a 51% share of a foreign company in Dubai mainland. 
  2. Corporate Sponsors/Nominees: A corporate nominee is a local-based corporate entity or government-registered business in UAE with an authorized government permit to operate as a local sponsor for a foreign entity in Dubai mainland. 
  3. Local Service Agent (LSA): Local service agents are employed by foreign entities in Dubai mainland who want to operate professional services requiring a local sponsor in Dubai. Their main purpose is to facilitate interactions with government authorities in the UAE. 

Who Needs a Local Sponsor in Dubai in 2024

As mentioned earlier, the need for a local sponsor to register a company in Dubai mainland as a foreign investor is limited to a few business activities as per Article 10 of the UAE Commercial Companies Law (CCL) 2021.

Planning to setup a business in Dubai mainland? you may need a local sponsor if your business goal involves:

  • Consulting: Management Consulting, Business Advisory Services, and HR consulting.
  • Trading: Importing and Exporting Goods, Distribution, and Retail Businesses (with some exceptions).
  • Tourism and Hospitality: Travel Agencies, Tour Operators, Hotels, and Restaurants (exceptions may exist for free zones).
  • Professional Services: Engineering Firms, Law Firms, and Architectural Practices.
  • Education and Training: Private Schools, Training Institutes, and Vocational

Partner with Corporate Business Services (CBS)

Whether you are looking for a reputable and well connected and experienced local sponsor in UAE or where and how to start a business in Dubai, UAE without one? CBS is here to be your perfect partner. We can advise you on everything you need to know about business setup and consultancy in UAE.

You can start now by booking a free consultation with our experts.

Address

Office: Office #1601, 48 Burj Gate Tower, Downtown Dubai – UAE

Tel: +971 4 404 8787

Email: ask@cbs-uae.ae

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