UAE Business Sponsor

UAE Business Sponsor Services

The involvement of UAE business sponsors is paramount to mainland business setup as mandated by law. Business sponsors are either UAE nationals or a company with UAE nationals as shareholders. A local business sponsor can act as a local service agent for an annual fee for services rendered. For mainland limited liability company (LLC) formation, it's mandatory for a business sponsor to own at least 51% of the shares.

Although it is compulsory for businesses to partner with a UAE national, there are economic advantages that can be derived from the transaction, including tax exemption and freedom to repatriate all capital, income, and profits, as needed.

What's more, companies with local partners can open an unlimited number of branches throughout the country and pitch for numerous private and public projects not available for free zone and offshore companies. From the partnership, foreign entrepreneurs are also given an 'investor status,' making them and their dependents entitled for the issuance of residence visas.

At FAR Consulting Middle East, we can assist you in partnering with a credible local sponsor whom you have mutual business interests, direct communication, and a strong connection. Our assistance can help you mitigate challenges in acquiring a silent partner, including the following:

Verbal Contract

Under UAE law, verbal agreements are valid along with electronic and written documents. Although they are perfectly legal, there’s a chance for such agreements to not stand in the court of law. To be considered as a valid contract, a verbal agreement requires sufficient evidence supporting its authenticity and existence, whether in paper or electronic records.

Here at FAR Consulting Middle East, we’ll draw up a comprehensive contract as soon as you’re matched with a UAE business sponsor. That way, you’ll be able to rest assured agreements between the business and the local sponsor are legally binding.

Hidden Costs

When writing a legal contract, a business and a local sponsor agree on a specific system of fees. This fee structure should be easy to read and transparent, but that’s not always the case. Businesses often find themselves in hot water when they don’t take time in understanding the fine print.

The initial fee a local sponsor asks for may only be for a single aspect of the service e.g. cost for acquiring a government license. If the quote doesn’t include other costs e.g. investor deposit and investor visa, you might be put in a situation wherein you can’t complete the business setup due to financial constraint. Our experts will help ensure you are given a breakdown of fees before you agree to a contract’s terms.

Death or Retirement

Early retirement or unexpected death of your local business sponsor may cause a wide array of issues. Company shares may then be the legal property of heir/s of the sponsor. If an heir in question doesn’t want to be part of the business or carry out a standing agreement, the company may have to cease its operations until a viable solution is presented.

Let our business setup specialists help you obtain an assurance up front on where the company shares will be transferred should the worst happens. We’ll also draw up a contract stating the heir of the shares agrees to the contractual terms signed by all concerned parties.

Types of Partnership with a UAE Business Sponsor

The qualified business setup specialist of FAR Consulting Middle East can guide you in forming the right kind of partnership with a local sponsor.

  • No interference – with corporate sponsorship, you will be able to maintain complete control over your business despite your local sponsor holding majority of the shares. Our experts will setup a contract stipulating that the corporate sponsor won’t get involved in the operations of the business to allow company management to have full authority over service offerings, clients, and staff.
  • Financial benefits – with this partnership, the local sponsor still has 51% ownership of the business but the business owner has the discretion to retain all the financial benefits from the business. We have first-tier legal counsel that can draft detailed contracts to ensure rights of all shareholders receive full protection.

The selection of the right UAE business sponsor is key in the successful launch of a mainland business. With the help of our team’s expertise and experience in mainland company formation, you will be able to explore all of your options and familiarize all associated benefits and risks of partnering with local sponsors. You can expect proficient handling of requirements related to the partnership with a UAE national/company, so you can direct your full attention on the launch, growth, and/or expansion of your business.

Call us today for expert advice on the best option in relation to your specific needs and requirements for mainland company formation.

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