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Legal Corporate Structure in Oman for Business Setup

Legal-Corporate-Structure---in-Oman-for-Business-Setup

Various company structures have been offered in Oman. You must understand the difference of structure types and models of Oman and make informed decisions based on ownership conditions, needs and requirements.

Helpline Group can guide you in this process and you can choose the best company structure for Oman Company Formation.

Oman’s Company Formation is based on the Laws of Foreign Business and Investment of 1974, Commercial Companies Code and the Commercial Register Law of 1974.

  • Commercial Agencies
  • Limited Liability Company
  • Branch Office
  • Offices of Representative Trade
  • Company of Limited Partnership
  • Holding Company
  • Joint Venture
  • Joint Stock Company / Shareholding Company

Oman’s Limited Liability Company Formation (WLL)

WLL or a Limited Liability Company can be the basic form of Oman’s business formation. It is used for the small businesses of the country if fixed capital gets divided into equal shares and is registered with the Ministry of Commerce and Industry of a Commercial Register.

Below conditions can be followed for Oman’s LLC

  • The minimum of 2 shareholders and maximum of 40 shareholders
  • Liability can be limited for investments
  • Non-specified minimum share capital
  • GCC citizenship is granted for foreign investors and can have the complete ownership of Oman’s LLC
  • A minimum of 30% ownership can be mandatory for local partners
  • 100% tax exemptions are allowed for free zone companies
  • LLC’s are more suited for Oman’s small businesses
  • Minimum of 20000 OMR capital requirements are needed for US, Oman or GCC owned companies
  • Foreign investment companies can hold 150000 OMR

Oman Company’s General Partnership

All conditions of LLC are applicable in the general partnership. But partners in a general partnership can have an unlimited business liability that extends partners’ wealth which seems risky for the business structure in Oman.

It can be easy to register under the Commercial Register, but the general partnership company includes a written agreement of partnership detailing the partner’s responsibilities and activities in business.

Besides these:

  • Company name should have the name of a partner or partners.
  • General partnership ends if a new partner is added or an existing partner comes out from it.
  • General partnership company concludes if the partnership period gets over.

Oman Company’s Limited Share Partnership

Another form of LLC is the Limited Share Partnership in Oman. Besides LLC’s conditions and norms, LSPs have few provisions and limitations.

  • There are no limitations to add maximum partners.
  • Limited Share Partnership are registered through the commercial registrar.
  • A minimum of one general partner and one limited partner is needed.
  • General partners can have unlimited liability and responsibility to manage the business.
  • Limited liability is provided for limited partners for their capital contribution and are prohibited to engage in managerial responsibilities and activities.

Oman’s Holding Company Formation

Oman’s holding company manages and owns other businesses of Oman. This company can own any kind of company in Oman that have limited liability companies and joint-stock companies. The holding companies have 50% ownership or more in companies. The company name should have “Holding Company” at the end name. You must have 2 Million OMR or more in capital for your holding company in Oman. Get in touch with the Helpline Group for information on the set-up of a holding company in Oman.

Joint Stock Company or Shareholding Company in Oman

The shareholding company or joint-stock company in Oman has a system where the fixed amount of capital is distributed from the number of shares of public subscription.

Oman’s Joint Stock Company needs at least OMR five hundred thousand for capital investment for not intending on offering public subscription of shares. Moreover, if the public subscription gets involved, the capital needs exceed up to 2 million OMR.

Shareholders get preemptive rights and they have different needs for companies to follow while setting a joint-stock company in Oman.

Their requirements are mandatory like:

  • At least 3 shareholders
  • Maximum 12 and minimum 3 Board of directors
  • Register for Commercial Registrar
  • Get approval from Oman’s Ministry of Commerce and Industry
  • Adhere and follow the Muscat Securities Market Law

Oman’s Joint Venture Formation

Joint ventures can be formed between businesses of Oman that comprises foreign entrepreneurs and businesses. Though it is legally recognized as a contract form, it won’t have legal recognition as their entity. The responsibilities and roles of a joint venture are good as the agreement or contract also their Memorandum of Association. Their beginning and end activities depend on the agreement of involved parties or the Memorandum of Association that have duties and obligations. Contact Helpline Group for getting information on setting up an Oman’s Joint Venture.

Oman’s Representative Trade Offices

Foreign investors and companies can open representative trade offices in Oman for carrying out their company activities. But such offices are not permitted for the activities of profit-making.

The local person must represent their company in Oman. These businesses are suited for business support and customer relationships. You have to present a copy of the Article of Association and the undertaking letter to set up a representative trade office in Oman. The Helpline Group manages these requirements and can set up the representative trade office in Oman.

Oman’s Commercial Agents

Commercial agencies represent the parent company in Oman. It is mandatory to have a commercial agent for such businesses. Any foreign business can appoint a local agent to distribute goods and engage with local customers. Local commercial agents must have an Omani company or can be Omani citizens. The commercial agent business needs to get registered with the Ministry of Commerce and Industry and the member of Oman Chamber of Commerce and Industry.

Helpline Group assists you to set up a commercial agency in Oman to carry out the business activities.

Oman’s Branch Offices

Oman must have their entire owned branches of foreign companies if there is a contract with a government entity in Oman. It is one way to have 100% ownership in Oman that is not suited for government-controlled entities, although branch offices don’t need sponsors, local partners or share capital. The branch office setup is valid until the registration period of the contract and permitted to set up the branch office in Oman from the Ministry of Commerce and Industry.

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