A With Limited Liability (WLL) company is a company in which the partners are responsible for the debts and liabilities of the company only to the extent of their shareholding in the capital. The number of shareholders in such a company can range between 2 and 50. There is a provision in law in Bahrain that if the number of partners falls below two, the company must introduce new shareholders within a period of 30 days, or by force of the law, be converted to a single person company, or proceed to dissolution. A With Limited Liability company cannot issue public shares, negotiable warrants, or debentures.
A WLL is the most commonly used business entity by foreign entrepreneurs looking for setting up a business in Bahrain. The main reason being- fewer requirements to pass resolutions than any other business structures in Bahrain and no requirement to invite and obtain the approval of the Ministry of Industry and Commerce to hold annual meetings. Also, you can start a business in Bahrain with a capital as low as BD1,000 or BD2,000 depending upon the nature of your business.
Features of a WLL in Bahrain
- No requirement of a local sponsor which means 100% foreign ownership is allowed
- Minimum 2 directors and 2 shareholders are mandatory
- A WLL is not permitted to engage in banking or insurance business activities or investing funds on behalf of third parties
- A WLL is required to submit annual audited financial statements
- Requirement of an external auditor
- Presence of a local office
How to Set Up a WLL in Bahrain?
The process includes primary steps like choosing the business activity, business name, shareholding pattern (the value of each share must not be less than BD 50), and partners designation. Once the above formalities are done, the next steps for company formation in Bahrain are as follows:
An application form filled with all the above details must be submitted to the Ministry of Industry, Commerce and Tourism (MOICT). In the application, all the details like capital, passport copies (if expats), shareholding pattern, type of company, etc. are chosen.
2. Commercial Registration without a License
If the application is allowed by the Ministry, then Commercial Registration (CR) without a license is issued. If the application is not allowed due to security reasons then the application will be rejected. When the application is approved, a payment must be made to get the CR without a license.
3. Getting the License
The next step is to get the license after following all the requirements of that particular business activity. MOICT from time-to-time will ask you to rectify the mistakes if any and then submit all the necessary documents.
4. MOA and AOA
The Memorandum of Association (MOA) and Articles of Association (AOA) of a WLL company in Bahrain is the key document and governs all the terms and conditions of the partnership. Once accepted, the MOA and AOA have to be signed by the notary and the notarized copy should be submitted online.
5. Bank Deposit Certificate
When all the above process is done the bank deposit certificate has to be brought from a bank in which the company opens the account. The bank deposit certificate is also submitted online to the MOICT.
Documents Required to Set Up a WLL in Bahrain
- Application form of the company registration
- Draft if Memorandum and Articles of Association
- External entities pre-approval (depending upon the activity)
- Certificate of capital deposit (after preliminary approval)
- Copy of Bahraini ID of each shareholder
- Copy of Passport if the investor is not a local
- Proposed commercial address, under which the business is to be operated
- Power of Attorney issued in behalf the consultant representing the applicant before the Ministry – duly notarized
- Copy of the applicant’s educational qualification – for all commercial activities requiring such
Why Set Up a WLL in Bahrain?
Bahrain provides many incentives to not only the budding entrepreneurs who want to start a business in Bahrain but also to the foreign investors who want to open a company. And making use of this opportunity and establishing a company in Bahrain is an ideal option for an investor looking to invest in a foreign land. But, starting a small business in Bahrain and going through the process and to understand local know-how, you need experienced people who can cut through the bureaucracy to quickly establish the company. We at Business Setup Worldwide are here to provide you end-to-end solutions for your business setup ideas. If you are willing to start a business in Bahrain contact us and we will leave no stone unturned to ensure that your process of company registration in Bahrain is hassle-free and delightful.