Dubai is one of the go-to destinations for entrepreneurs to set up a business. The city has advantages like modern facilities, a stable economy, and investor-friendly laws, that give a business setup in Dubai all the possibilities to become successful. The one question many foreigners ask is: Can I start a business in Dubai without a local sponsor? The answer is yes, depending on the type of Dubai business setup you choose. Over the last few years, new rules have made business setup in Dubai easier and foreign investors have more freedom than before in their business setup in Dubai.
Earlier, foreigners starting a business setup in Dubai mainland always needed a local sponsor—usually a UAE national who held 51% ownership while the foreign investor held 49%. But the rules changed. Today, many business setups in Dubai can have 100% foreign ownership, meaning you can open a company without needing a local sponsor.
However, not all Dubai business setups qualify for this. Some activities still require a UAE national as a service agent or partner. This is why understanding the difference between mainland and free zone Dubai business setup is very important.
One of the easiest ways for foreigners to start a new business setup in Dubai without a local sponsor is by choosing a free zone.
Free zones are special areas that support international investors and offer many benefits:
There are more than 40 free zones in Dubai. Popular ones are Dubai Multi Commodities Centre, Dubai Internet City, Dubai Media City and Dubai Airport Free Zone. Now if you are planning on a Dubai business setup in global trade, e-commerce, consulting, marketing, IT, media or professional services, then a free zone is the best choice.
A big change came in 2021 when the UAE allowed many business setups in Dubai on the mainland to be owned fully by foreigners. This means you can now start a Dubai business setup on the mainland without a local sponsor, as long as your activity is on the approved list.
Some of these activities include:
However, a few business setups in Dubai—especially related to security, oil & gas, and strategic sectors—still need a UAE national partner or service agent. A business setup company in Dubai can check which category your business activity belongs to, so you do not make mistakes.
While many Dubai business setups now allow full foreign ownership, some still require local involvement.
You may need a sponsor or service agent if your business deals with:
In such cases, a local sponsor does not control your business setup in Dubai, but they help you meet UAE regulations. Their role depends on the structure of the Dubai business setup you choose.
The new 100% ownership rule has made the mainland very attractive for international entrepreneurs for a business setup in Dubai.
Mainland Dubai business setups offer several advantages:
This is one major reason why many people planning a new business setup in Dubai choose the mainland today.
The rules may sound simple, but choosing the right structure for your business setup in Dubai is not always easy.
A business setup company in Dubai helps you:
A trusted business setup company in Dubai simplifies the entire process and helps you avoid delays. For any new business setup in Dubai, this support can save money, time, and effort.
If your business setup in Dubai allows 100% foreign ownership, the setup process is straightforward.
Here’s how it usually works:
A business setup company in Dubai can guide you through each of these steps easily.
Even without sponsor-related rules, Dubai gives foreigners a strong advantage of business setup in Dubai:
These reasons make Dubai one of the best places in the world for foreign-owned businesses.
CONCLUSION
So, can foreigners start a business in Dubai without a local sponsor? The answer is a confident yes. The UAE’s updated business laws now give foreign investors full ownership in many sectors, especially in Dubai’s mainland. This major change has opened the doors to endless opportunities for international entrepreneurs who want to expand their business in the Middle East.
Whether you choose to set up in a free zone or on the mainland, business setup in Dubai has never been easier or more rewarding. With the help of a professional business setup company in Dubai, you can navigate the process smoothly and start operating in one of the world’s most dynamic business cities.