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When foreign entrepreneurs set up companies or branches in UAE free zones, they can have 100% ownership of their enterprise. To obtain a commercial license when setting up outside a free zone, however, UAE law states that an Emirati national must sponsor the company and be a 51% shareholder. Also, it can be set up only as a Limited Liability Company (LLC). This puts foreign entrepreneurs in a pickle.
Luckily, there are scores of companies in the UAE that provide reliable and genuine sponsorship services for a fee. Business setup companies conduct a thorough background check on each potential sponsor before adding him to their database. They act as guarantors to ensure that the sponsor does not get involved in the day-to-day functioning, finances or any decision making relating to the company.
These matchmakers of sorts seek out the most suitable local sponsors for their clients according to the type of commercial license they require, the scope of business, or the area of setup. They also expedite the process by completing the paperwork and advising on the legalities.
But the local sponsor does not always have to be an individual; it can be a local company. Many local companies act as service agents and provide sponsorships to foreign companies for an annual fee. They also facilitate the entire process with their know-how of the rules, regulations and requirements. In both situations, sponsors are paid an annual pre-decided fee.
• Setup firms match businesses with right sponsors
• Some local companies sponsor foreign companies
• Conduct due diligence when hiring a setup firm
See this other option for business setup in UAE from this post: Joining hands to grow business