Branch of a Foreign Company in Bahrain

Companies which have been incorporated and registered outside Bahrain can open their branch office in Bahrain to carry out particular activities. The name of the Foreign Company Branch in Bahrain must be identical to the original name of the company and shall be followed by the phrase “a branch of a foreign company”.  The company is also allowed to open a representative office of the parent company in Bahrain, with the objective of following up and supervising its interests in Bahrain.

The Ministry of Bahrain allows a foreign company to have its branch in Bahrain only if it abides by the following conditions:

  1. The foreign company must obtain a license to incorporate its branch in Bahrain from the Ministry of Commerce and Industry
  2. The branch of the foreign company must have a Bahraini sponsor who must be a businessman or a company. However, the Ministry of Commerce and Industry may exempt the company from this provision if the company's branch or office shall use Bahrain as a regional center or a representative office for the company's activities
  3. The branch has to register itself in the Commercial Registry with accordance to the laws
  4. If the branch, agency, or office undertakes its activities before the completion of the procedures provided for in the foregoing paragraph, the persons who have undertaken such activities shall be liable personally and jointly

Features of a Foreign Company Branch in Bahrain

  • The parent company must bear all the liabilities of its branch in Bahrain
  • Presence of local office is mandatory
  • The branch must have a local sponsor for an operational office
  • No minimum share capital requirement
  • A branch manager is required
  • Banking, insurance, and investment activities are allowed
  • The parent company is required to issue a bank guarantee in favour of the Ministry of Finance and National Economy
  • A branch is permitted to secure an office, invoice the Bahraini customers, sign local sales contracts and receive income from the clients

How to Set Up a Foreign Company Branch in Bahrain?

The overall process for registration starts with an application to commercial registration after selection of company name which has to be unique and not allotted to others earlier. The step by step guide for registering a branch of a foreign company is as follows:

  1. Fill out the application to form the branch of a foreign company with all the necessary details
  2. Draft standard Memorandum of Association (MOA) and obtain preliminary approval from the Ministry of Commerce at the Bahrain Investment Centre. It takes one daytime and no cost is associated with it
  3. Obtain a lease approval from the Municipality to set an office
  4. Notarize and send a copy online to the Ministry
  5. Open a bank account and obtain proof of deposit of the capital
  6. Deposit a guarantee to the bank in the name of the branch, the agent or an official representative, and to the order of the Minister of Commerce and Industry
  7. Obtain a certificate of registration from the Ministry of Commerce
  8. Publish the incorporation notice in the official gazette
  9. Register the company and employees with the General Organization for social insurance

Documents Required to Set Up a Foreign Company Branch in Bahrain

  • Completely filled application form of company registration
  • Pre-approval from the external entities
  • Sponsorship agreement signed with a Bahraini trader for operational branches
  • Copy of Commercial Registration Certificate
  • Copy of Memorandum and Articles of Association and its amendments
  • Board of Directors resolution to establish the branch in Bahrain
  • Guarantee letter from the parent company taking full responsibility for the Bahrain branch
  • Authenticated power of attorney

Why Set Up a Foreign Company Branch in Bahrain?

Bahrain is a country open to creating a unique economy which is growing by leaps and bounds. It has been welcoming investors to invest into the region for a long time. It has established itself to be the principal banking and financial center of the Gulf region. Bahrain offers several advantages to foreign investors, including a no personal or corporate taxation regime, no restriction on capital and profit repatriation, a developed infrastructure with excellent transportation and communication facilities, and duty-free access to Gulf Cooperation Council (GCC) member states for products manufactured in Bahrain. Hence, registering a company in Bahrain, even a branch office, can be profitable for an investor. If you are looking to set up a branch office in Bahrain and are on a lookout for an advisor, then we at Business Setup Worldwide are here to help you with all the monetary and non-monetary obligations. We offer services right from company registration, incorporation, accounting and bookkeeping, to company secretarial services. Contact us, even if it is just for a friendly advice.