Qatar, in the last few years, has shown incredible growth both economically and financially. More and more business people are now opting to set up their business in Qatar as the country is dedicated to encouraging foreign investment. Company formation in Qatar requires planning, knowledge, and commitment. An entrepreneur can start his business in Qatar through various business entities, one of them being a Public Shareholding Company. It is a company whose capital is divided into shares of equal value which are transferable.
Also known as the Joint Stock Company or a Qatari Shareholding Company, the Public Shareholding Company is established in accordance with Qatari Commercial Company law and by the Virtue Ministerial Decree. There are certain rules established by the Ministry if an individual decides to incorporate a Public Shareholding Company in Qatar. Generally, only Qataris may be shareholders, but there are 3 exceptions to this rule:
- A national of another Arab country that has a relevant reciprocal agreement with Qatar
- Where foreign investment or experience is required, so long as the necessary license has been granted by the Ministry of Economy and Commerce
- Where the company has been incorporated under a special decree that allows for foreign shareholding
Features of a Public Shareholding Company in Qatar
- A minimum of 5 shareholders are required to start a PSC in Qatar
- A Public Shareholding Company in Qatar can be Open (i.e. Public) or Closed (i.e. Private)
- The minimum capital requirement for an open PSC is QAR10m, with a nominal value for each share of QAR10; for a closed PSC, this is reduced to QAR2m
- Foreigners may own up to 100% of a Qatari company in certain sectors
- Shareholders are not liable for the company’s obligations, except to the extent of the total nominal value of their respective shareholding
How to Set Up a Public Shareholding Company in Qatar?
Qatar can be a great place to start a business but you need to do your homework and talk to an expert in the region who has in-depth knowledge on how to set up a business. They can give you a realistic perspective on setup up a business in the Gulf, after which you can start with all the steps required for company formation in Qatar. The steps required are as follows:
1. Trade Name Registration
Check the availability of the trade name you want and register the trade name at the official company registry in Qatar. It is important to note that the desired name should have a meaning in Arabic.
2. Memorandum of Association
A Public Shareholding Company should have a Memorandum and Articles of Association which contains the following information:
- The company name and principal place of business
- The objective for which the company has been established
- The names of the founders, their nationalities, place of residence, occupations, and the number of shares subscribed by each of them
- The amount of company capital, the number of shares into which the capital is divided, their type and value
- The duration of the company
- A statement of every non-monetary share, the name of the person contributing this share, all the conditions relating to its subscription, and the specific rights in kind attached to this share
- A statement of the estimated amount of formation expenses, remuneration and costs paid or undertaken to be paid by the company during its incorporation. The founding members from among them shall elect a committee of not less than three and not more than five who shall take over the incorporation procedures before the authorized administration
3. Issue the Commercial Residence (CR)
Once you have your trade name and Memorandum of Association, you can then submit them for your enterprise to be issued a CR. You can tell the officials regarding the business activities since every action has its own specific charges. So, tell your business activities, pay the respective fees for each of them, pay the processing fees, and have all your shareholders there in person to verify their identity, and you will be issued with the CR.
4. Get a Trade License
After receiving your CR, you need to get a trade license, in order to have an office space that’s approved by the MEC for conducting your business activities.
Once you get the trade license, you are good to start a business. The set-up process can take anywhere between a month to four months, depending on how quick you were able to assemble all of the paperwork and how busy the MEC is. So be aware that this will take time, and be patient. You can also take help of a consultant who is well aware of the regulations regarding the setup process and eventually saves your time. We at Business Setup Worldwide has a specialized team of professionals having extensive knowledge of all company formation rules and regulations in Qatar and can help you with the business setup in Qatar with ease in less time. Contact us for more information.