Oman has always been an ideal location for an individual to invest and earn profits out of it. When it comes to business setup in Oman, it is always a necessity for anyone to comply with the laws governing foreign business activity, in particular, the Foreign Capital Investment Law. There are several options available for an investor looking to make a presence in Oman through a business. The most appropriate entity will generally depend on the size of the business, the parties involved, and the desired shareholder base for the business.
A Limited Liability Company (LLC) is the most popular form of business incorporation in Oman. Here, each partner is liable only to the extent of his share in the business. Under an LLC company in Oman, public subscription for raising capital is not permitted. The LLC structure suits a small operation with a limited number of promoters.
Features of a Limited Liability Company in Oman
- It must have a minimum of 2 shareholders and a maximum of 40 shareholders
- The minimum capital requirement is OR 150,000
- A foreign shareholder can have up to 70% of the shares in the company except for any individual from the GCC countries or the USA who can own 100% of the shareholding
- It is mandatory to appoint an advisor who must be accredited to Oman
- Appointment of one director is also necessary. He/she can be a director as well as a shareholder of the LLC
How to Set Up an LLC in Oman?
An Omani LLC is the most commonly used business entity for foreigners that wish to do business in Oman for various trading and manufacturing business activities. To start a business in Oman, you will be required to go through a process as set by the Omani authorities. The Oman company registration process is as follows:
1. Name Reservation
The Ministry of Commerce and Industry (MCI) will approve the name for your company. You must keep in mind that, under Omani law, a new company cannot have the same name as the existing company. The MCI also requires a higher starting share capital for companies with certain words, such as “Oman”, in their name.
2. MCI Application
This involves preparing and submitting the following documents:
- Foreign Shareholder Documents: Each shareholder (if a corporate entity) must provide its constitutional documents, certificate of incorporation, board resolution and power of attorney
- Omani Shareholder Documents: Each shareholder must provide an MCI computer printout, certificate of registration, authorized signatory form and Oman Chamber of Commerce and Industry (OCCI) certificate and shareholders’ resolution
- A constitutive contract and an authorized signatory form, which forms a part of the constitutional documents of an LLC
- Bank Certificate: This is obtained from a bank in Oman and is used as evidence of compliance with the LLC’s capital requirements
3. OCCI Registration
This is the most important step in the registration process and is obtained immediately after the MCI completes the registration examination of your company and approves the certificate.
4. Other Approvals
Approvals depending on the LLC’s intended business activities, further governmental approvals may be required.
Once the LLC registration is approved, and you get all the necessary Certificates from the Ministry, you will then need to organize and obtain:
- A municipality license
- Tax registration
- Registration with the Royal Oman police
- Registration with the Ministry of Manpower, to apply for labor clearances and visas
- Import/export license, depending on the nature of the business
- Industrial, Environmental and other permits and licenses, depending on the nature of the business
Documents Required to Set Up an LLC in Oman
For the Application Form that Must be Submitted to the MCI
- Copy of passport or identity cards of shareholders
- Copy of passport or identity cards of all intended authorized signatories
- Approved authorized signatory form, with names and sample signatures of each authorized signatory reproduced
- Standard company registration forms, including constitutive contract and Articles of Association
- Application for specific licenses depending on the company’s activities
- Certificate of initial capital deposit from the bank
For Lease Agreement
- Company lease agreement
- Company statutes including memorandum and articles of incorporation
- Chamber of Commerce and Industry affiliation certificate
- Agency Certification, if applicable
We at Business Setup Worldwide are here to help you get started with your business in Oman. Our advisors in Oman have experience and expertise and can advise you on the suitable company type taking into account the laws of Oman and your unique business needs. We understand the legal framework required for an LLC company formation in Oman and make this process hassle-free. Contact us for more information.