Finding a reliable local sponsor for business setup?

[VonDutch]

Hello everybody,

Just new at the forum, first of all I wanna say Hi to you all! It's nice to see so many people helping each other out.

I am 29 years old, male and thinking about leaving The Netherlands and starting a (internet)company in the UAE. Problem in setting up a business in the UAE is finding a local sponsor which will have 51 percent of the shares on paper. My question is how or where can I find a reliable local sponsor to help me setting up the business? I did some inquiry with the Dutch embassy but it didn't help me much and found some companies in local papers which advertise they can help finding a local sponsor, but all they ask for is money before helping me out/and give some global information.

Another question about local sponsorship I have is, does anyone know more about changing the rules about sponsorship/ownership to attract more foreign investors? I've read in Gulf News and Arabian Business that the Government wants to change the rules in favor of the foreign investor and change the shares of the local sponsor from 51 percent to 20 percent. So the new rule (propably before the end of 2009) would be that the foreign investor will have 80 percent of the shares. Does anybody know more about this?

I hope you can help me. Right now I am in Dubai for more information, but as it seems right now I'm getting more attracted in setting up a business in a free zone, because this is more transparant (and relatively more safe, 100 percent ownership but less possibilities in doing business within the UAE).

Again, nice to meet you all and I hope you can help me.

Greetings, VonDutch

[boyinblue]

apparently its not a good way an investor should advertise him/herself.. The reason is you'll receive lots of offers and stuff and I bet, there are more scammers in dubai than in Nigeria

starting a (internet)company in the UAE

What kinda company would that be? I mean you are looking to establish an internet cafe or something like a web development, software firm? It all depends on this one question.

1) Internet Cafe.. (You need to hit main Dubai market place, and you need a sponsor definitely)

2) Software/webdevelopment company (forget about everything and invest in freezone and be 100% owner their)

I know what you going through cause i am into IT industry and was in the same situation few months back.. I call it "investor's influenza".. lol. But I found myself too weak on finances to open a company. Anyways if you need some more free info or discuss about internet industry in middle east, you can befriend by visiting my profile so that you can get intouch.

[dizzyizzy]

If you set up your company in one of the free zones (Media City or Jebel Ali for example) you can have 100% ownership and therefore will not need a local investor. This is more expensive to set up but I think would be the best option for you in the long run as you will not have anyone interfering in your business, raising their demands every time you need them to sign a document for you, or taking away your profits earned by your hard work.

[Mr Rossi]

Definately look at setting up something in Internet City. Not only will you retain ownership of your company and avoid a meddling sponsor you will save endless costs and hassles with regards to hiring staff, exporting/importing, opening a bank account, getting an isp and other inefficiencies that'll drive you insane on a daily basis.

It may seem an expensive outlay now but you can't go to toilet here these days without a letter from your sponsor and company stamp.

[Sumair]

Dear Von,

Your post has many queries , I will try to provide brief answers one by one:

1) Q: starting an internet company
Suggested reply:You can not establish internet company in UAE. ( assumption is person who can establish internet company will not ask these question)

2) Q: Finding a local sponsor
Suggested reply: You can find it only through links , the local sponsor also will not become your sponsor only because of money he is also liable for some extent. This is mutual agreement. It involve cost the more you pay the more benefit you receive.

3) change of rule, everything is in paper , but you can check RAK they already changed the rules and for some businesses you do not need sponsor


Best of Luck!

Originally Posted by VonDutch

Hello everybody,

Just new at the forum, first of all I wanna say Hi to you all! It's nice to see so many people helping each other out.

I am 29 years old, male and thinking about leaving The Netherlands and starting a (internet)company in the UAE. Problem in setting up a business in the UAE is finding a local sponsor which will have 51 percent of the shares on paper. My question is how or where can I find a reliable local sponsor to help me setting up the business? I did some inquiry with the Dutch embassy but it didn't help me much and found some companies in local papers which advertise they can help finding a local sponsor, but all they ask for is money before helping me out/and give some global information.

Another question about local sponsorship I have is, does anyone know more about changing the rules about sponsorship/ownership to attract more foreign investors? I've read in Gulf News and Arabian Business that the Government wants to change the rules in favor of the foreign investor and change the shares of the local sponsor from 51 percent to 20 percent. So the new rule (propably before the end of 2009) would be that the foreign investor will have 80 percent of the shares. Does anybody know more about this?

I hope you can help me. Right now I am in Dubai for more information, but as it seems right now I'm getting more attracted in setting up a business in a free zone, because this is more transparant (and relatively more safe, 100 percent ownership but less possibilities in doing business within the UAE).

Again, nice to meet you all and I hope you can help me.

Greetings, VonDutch

[Acacia32]

I highly recommend looking into setting up an offshore company in this case. There are only certain business types that would benefit from having a local sponser and in your case I dont think their is one. Like someone else said the cash outlay is higher and you also have to rent office space so you can get a liscence. The process is actually more stringent than opening a regular company with a local sponser. But the benefits outway the price and hassle. check it out DubaiInternetcity.ae

[boyinblue]

well as I said.. the term is very vague.. "Internet Company" What that would be doing? if you thinking of providing internet to public, forget about it.. its not allowed as sumair said !

[Xpat]

von i have been researching on how to get reliable sponsor for past few days and I am in process of verifying it. I have a non-freezone licence and my sponsor is one god damn busy man who took two months to sign an important paper. I am kinda not happy with him so I researched ways to overcome that. will update you over time.

[Sumair]

Dear XPAT , in my opinion you are blessed by God for having such a sponsor, think in opposite way the sponsor who come everyday to your office and satrt nose pocking or who has so much time to read and redraft hundred times the papers/letters/contracts you send him for signature?

dear here expats are in search of those sponsors who doesnt have time ....

Originally Posted by Xpat

von i have been researching on how to get reliable sponsor for past few days and I am in process of verifying it. I have a non-freezone licence and my sponsor is one god damn busy man who took two months to sign an important paper. I am kinda not happy with him so I researched ways to overcome that. will update you over time.

[boyinblue]

Originally Posted by Sumair

Dear XPAT , in my opinion you are blessed by God for having such a sponsor, think in opposite way the sponsor who come everyday to your office and satrt nose pocking or who has so much time to read and redraft hundred times the papers/letters/contracts you send him for signature?

dear here expats are in search of those sponsors who doesnt have time ....

well at least they show you a face unlike the ones who aren't available when you need