How to Get a Local Sponsor for Your Abu Dhabi Business in the UAE?
The United Arab Emirates (UAE) has been one of the fastest-growing economies in the world, attracting entrepreneurs and investors from across the globe. Abu Dhabi, the capital city of the UAE, has emerged as a leading business hub with a vibrant and diverse economy. However, a New business setup in Abu Dhabi requires a local sponsor, who holds 51% of the shares in the company and serves as a liaison between the business and the government. In this essay, we will discuss the process of finding a local sponsor for your Abu Dhabi business and the steps you need to follow to ensure a successful partnership.
In Abu Dhabi, there are two types of local sponsors for foreign businesses:
✔️ Individual Sponsor: An individual sponsor is a UAE national who holds 51% of the shares in the company. This kind of sponsor is good for small businesses or new businesses that need a local partner who isn't too involved in how the business works.
✔️ Corporate Sponsor: A corporate sponsor is a UAE-based company that acts as a local partner and holds 51% of the shares in the company. This kind of sponsor is good for bigger businesses that need a local partner with a bigger role in running the business, such as in management and making decisions.
Here are some steps to follow to get a local sponsor for your Abu Dhabi business:
✔️ Identify potential local sponsors: You can start by asking for referrals from your business contacts in Abu Dhabi or by conducting online research. You can also ask a business consultant for help. They can help you find a local sponsor.
✔️ Set up a meeting: Once you have identified potential local sponsors, you can set up a meeting with them to discuss the details of the sponsorship agreement. During the meeting, you should present your business plan and explain your business objectives.
✔️ Talk about the terms: It is important to talk about the terms of the sponsorship agreement to make sure that everyone is happy. You should talk about how much of the company the local sponsor will own and how much they will be paid.
✔️ Sign a contract: Once you have agreed to the terms of the sponsorship agreement, you should sign a contract with the local sponsor. The contract should have all the details of the agreement, like what each person's rights and responsibilities are.
✔️ Finish the legal paperwork: After signing the contract, you should finish the legal paperwork by registering your business with the Abu Dhabi Department of Economic Development (DED) and getting the necessary licenses.
Getting a local sponsor for your Abu Dhabi business is a crucial step in the process of starting and running a successful business in the UAE. Here are some of the reasons why having a local sponsor is important:
✔️ Legal requirement: As per UAE law, foreign investors are required to have a local sponsor to establish a business in the country. The local sponsor holds 51% of the shares in the company, and this requirement is mandatory for all types of businesses.
✔️ Local knowledge and connections: A local sponsor can give you valuable information about the business climate, culture, and rules in the area. They can help you navigate the legal and administrative procedures involved in setting up and running a business in Abu Dhabi. Also, they can put you in touch with possible customers, suppliers, and business partners, which can be good for your business.
✔️ Government liaison: A local sponsor can act as a liaison between your business and the government. They can help you get the permits and licenses you need and deal with government agencies and officials. This can be particularly helpful in situations where you do not have a good understanding of the local language, culture, or bureaucracy.
✔️ Protection of your interests: A reliable and trustworthy local sponsor can protect your interests and make sure that your business follows the local rules and laws. They can also help you resolve any legal or commercial disputes that may arise.
Getting a local sponsor for your Abu Dhabi business is a crucial step in the process of establishing and running a successful business in the UAE. A local sponsor can provide you with valuable insights into the local business environment, help you navigate the legal and administrative procedures, act as a liaison between your business and the government, and protect your interests. You need to provide some important certificate attestation. Therefore, it is essential to choose a reliable and trustworthy local sponsor who has experience in the local business environment. By following the steps outlined in this essay, you can find a local sponsor who can assist you in achieving your business goals in Abu Dhabi.