How to set up a 100% foreign owned company in Oman?
How to set up a fully foreign owned company in Oman?
Oman’s Ministry of Commerce and Industry (MOCI) has brought in a new Foreign Capital Investment Law (FCIL) by Royal Decree No: 50/2019, effective as of 2 January 2020, which aims to make Oman an attractive investment environment. The introduction of this law comes as a move to ensure the stability of foreign investment in the country. The new Law has several incentives and advantages for foreign investments to encourage business flow and stability in the Sultanate, as they have an impact on economic development.
What are the requirements for full foreign ownership in Oman?
As from January 2020, foreign citizens, companies and investors in Oman are now able to own 100% of their businesses in many industries in mainland Oman. Some activities in the mainland are still reserved for Omanis, and other activities still require a local Omani partner with a minority shareholding.
There are number of Oman Freezone areas as well – see our pages on Oman Freezones for further information.
The list of activities reserved for Omanis include around 40 activities in different sectors – such as manpower recruitment, translation services and tailoring to name a few. The current list may be amended by the executive regulations that are expected to be out by 30 July 2020.
Consultancy Activities in Oman
All types of Consultancy activities will still require a Local Omani shareholder and these requirements remain the same – a foreign company or investor can only set up a consultancy office in a partnership with an Omani company or individual. The Omani partner is required to hold a minimum of 35% of the shares in the new company. The minimum share capital requirement – OMR 150,000 is not required to be deposited, however part of this amount has to be available as a proof of funds.
What are the required documents and the process of setting up a 100% foreign owned Oman LLC?
For Individual shareholders
The individual will need to provide their Passport copy
For Corporate shareholders
The Company’s incorporation documents - Certificate of Incorporation / Trade Licence, Memorandum of Association, Certificate of Incumbency or equivalent and a Board Resolution & Power of Attorney to incorporate the company in Oman.
These documents will need to be Notarised, Legalised and Attested from the country of origin and sent to PPG in Oman for Legal Translation and stamping in Country.
Business Plan – this is new requirement by MOCI – the Business plan is in 3 sections
- Project description
- Investment costs
- Date to start project
CR application form – This form contains the following requirements
- Proposed Company Name
- Shareholding structure with nationality and % holdings – individual or corporate shareholders
- The proposed Company Grade - The Company Grade is on a scale from 4 - 1 (with an ‘excellent grade’ above grade 1) Share Capital requirements for Grade 4 is OMR 20,000, going up to OR 150,000 for Grade 1, and OR 250,000 for excellent grade. Note that Share Capital is no longer required to be deposited prior to opening the company. The Grade of company will directly affect the Omanisation requirements and the activity types that the company can obtain.
- The confirmation of the Financial Year of the company
- The proposed activities of the company
- The authorised signatures and manager of the company with level of control in the business from admin to full manager
- The form is signed and authorised by the shareholders
What are the steps to set up a fully Foreign Owned LLC Company in Oman?
- Step 1 – Prepare the documents, send the originals to PRO Partner Group PPG in Oman (see above document requirements)
- Step 2 – Commercial Registration (CR) with MOCI - trade name and initial approval, Business Plan and CR Application form
- Step 3 – Chamber of Commerce (CC) Registration – Completed CR required
- Step 4 – Office/Warehouse Lease Arrangement
- Step 5 – Municipality License Application – Completed CR required plus Lease Agreement. At this stage the Company is fully registered
- Step 6 – Ministry of Finance (MOF) registration – mandatory registration with MOF for the tax department and annual audit requirements
- Step 7 – Ministry of Manpower (MOM) – mandatory requirement and essential if the company wishes to apply for labour quota and to obtain staff visas
- Step 8 - PRO registration on the CR – the company is required to have a PRO named on the CR to be able to apply for visas with Royal Oman Police (ROP). This must be an individually named Omani PRO. Note that PPG can act as your registered PRO in this regard to assist.
- Step 9 – Any additional External Approvals depending on the company’s activities – for example Oman Customs registration for trading of goods and import of goods
What are the fees to set up a 100% Foreign Owned Company in Oman?
- Overall Government Registration Fee have increased recently in January 2020 – the new fees are OMR 3500, covering MOCI, CC, MOF & MOM
- Municipality Licence cost based is based on the lease value and the activities of the company
- Oman Customs Government registration fee is OR 20
How can PRO Partner Group help?
For assistance with queries on setting up a 100% Foreign Owned Company in Oman or share transfers of restructuring existing companies to allow 100% Foreign ownership please contact a member of the team at PRO Partner Group by completing the contact form below or call us on +971 (0)4 456 1761 in Dubai or +971 (0) 2 448 5120 in Abu Dhabi.
How to set up a 100% foreign owned #company in #Oman? Find more details below https://t.co/wAxhqqJLYk— PRO Partner Group (@PROPartnerGroup) February 24, 2020