The economic situation across the world has suffered gravely owing to the Covid-19 pandemic. However, Oman has emerged as a clear winner among the different nations with its business-friendly laws and environment. From accounting and taxation to real estate, the business opportunities in Oman are endless.
Oman has been the favourite of tons of foreign investors over the years. The second-largest country in the Gulf Cooperation Council or GCC after Saudi Arabia, Oman’s long history as a trading port and its extensive range of natural resources makes it the perfect pick for your business endeavours.
Are you wondering about how to start a business in Oman?
Before setting up a base in the country, one of the first things you will need to do is get your hands on an Investor’s VISA. Read on to arm yourself with all the knowledge you will need to run a business in the country successfully.
Why Should You Invest in Oman?
The New FCIL 2020 paved the way for the Foreign Capital Investment Law or FCIL, benefiting both the country and foreign investors. Thanks to the FCIL, the latter can now set up 100% foreign-owned companies in the country. In addition, the new law does away with minimum share capital as expats no longer need to set forth a minimum of OMR 150,000.
●Liberal Tax Regime
The country is well-known for possessing an investor-friendly tax regime. There are no personal income taxes which makes the prospect of doing business in Oman so much easier. In the past months, the country has come up with an ESP or an Economic Stimulus Plan to counter the harsh effects of the pandemic on the country’s economy. Measures include:
- Income Tax Exemption for entrepreneurs or businesses which are playing a role in economic diversification
- Payment of taxes based on instalments minus any additional taxes
- Suspension of the withholding tax on dividends and interest for extra five years following the tax year of 2020
- Reduction of tax rates from 15% to 12% for small and medium-sized companies for 2020 and 2021
- And so forth
●Existence of Economic Zones
Like many other GCC countries, Oman also enjoys a stronghold in the gas and oil sector. However, the country has always strived to go above and beyond with its economic diversification endeavours.
Over the past years, several free trade zones, industrial parks, and special economic zones have existed. These free zones and special economic zones can be used by foreign companies dealing in export and import.
Free zones include:
Key Details about the Investor’s VISA
If you are willing to go forward with company registration in Oman, you should keep the following details in mind:
- The foreign investor or entrepreneur should not be less than 21 years of age.
- The VISA stays valid for two years and must be used within six months of its issuance.
- The VISA can help investors who boast shares in local companies.
- The investor must get approval from the Ministry of Commerce and Industry. The former should also have a Work Permit from the Ministry of Manpower in addition to a Residency VISA from the Directorate of Passport and Residence.
- The potential investor should keep the following documents handy: passport, a copy of the partnership certificate, labour permit from the Ministry of Manpower, a Certificate of Membership of Oman Chamber of Commerce and Industry.
- Investors should lease a property and possess a Municipality certificate before setting up a bank account. The property can be in the form of an office, warehouse, etc.
Ownership by Foreign Investors
- The current business climate in Oman warrants that foreign investors can own 100% legal shareholding in most business sectors.
- The foreign company should not be less than three years old.
- There should be one shareholder from the International Investor.
What Is the Financial Process Concerning an Investor’s VISA?
- The new FCIL guarantees that investors will no longer need to pay a minimum capital amount.
- The MOCI or the Ministry of Commerce and Industry can ask for the accounts and balance sheets from the parent company. It depends on the business sector that the company is involved in, the LLC grade, and the reasons behind setting up a local LLC.
- Investors will need to present three years worth of audited financial statements and relevant bank statements for at least six months.
- After completing company registration and receiving a lease and municipality lease, it is mandated to set up a bank account.
- Investors planning to go forward with company registration in Oman must employ a minimum number of Omanis based on the business sector.
- Once the company has registered with the Ministry of Manpower of MOMP, it can successfully recruit employees.
The World Bank has confirmed Oman’s position as a business hub on par with other high-income economies. The government realizes the importance of going beyond the oil and gas sectors, which has led to the introduction of business-friendly laws and regulations. Get in touch with us today if you want to realize your goals and invest in business endeavours in Oman.