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Foreign Company Registration Bahrain

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Foreign company registration Bahrain

The company formation or registration procedure varies from country to country. Each and every country has their own set of rules and requirements that one has to follow in order to get their companies registered. The rules may vary even more if it is owned by a foreign entity or a foreign investor. The same thing applies in Bahrain. If you have decided to operate in Bahrain then you will be required to register your company as limited liability Company (LLC), joint venture, branch office. But before that one has to find out what kind of company they are running and based on that the registration process may differ.

Limited Liability Company

This is the most popular type of company among all foreign investors in Bahrain. The basic requirements for limited liability companies in Bahrain are very simple; there should be two to fifty shareholders in the company and these shares should not be sold to the public. In other words, the shares cannot be put on the public stock market. On the other hand, before you register your limited liability company in Bahrain, you need to ensure that at least one of your shareholders is Bahraini. Furthermore, the shareholdings by the Bahraini do not drop below 51%. This basically ensures that the majority control of the company is by a local and not foreign owned.  There are certain businesses which are not allowed by limited liability companies such as banking, brokerage activities and insurance work.

Branch Office

These are basically businesses which have their parent companies outside of Bahrain but they are allowed to open branches inside Bahrain for certain reasons. The only way to operate branch offices in Bahrain is by getting the approval of the Minister of Commerce and Agriculture. There is also the need for a local sponsor in order to get a branch office running in Bahrain. However, the local sponsor requirement can be exempted if the said foreign company runs their main operations through the Branch office in Bahrain.

Sole Proprietorship– This is basically the single person company. There is only one owner of such a company and he or she has an unlimited liability. In order to start a business, he or she would have to invest around 50,000 BD. Sole proprietorship or single person businesses cannot engage in trading insurance, or banking or any sort of investment businesses.

Joint Stock Company

A joint stock company is the type of business where the greater part of the shareholders in the business are at risk to organization obligations to the degree of their interest in the wonder. A closed joint stock business entity can be altogether remote possessed and does not require Bahraini speculators. To set up this kind of organization requires consent from the Ministry of Commerce upheld by an Emir proclaim. There must be seven establishing individuals who claim in the vicinity of 7 and 20% of the property.

 Joint Stock Company (Open)– The same as a joint stock company (closed) business entity, with the exception of that 51 percent of the offers should be possessed by Bahraini nationals. Both types of business require a lasting office in Bahrain. An open business entity can have a top managerial staff of three to twelve individuals, named for a time of three years. Most of the executives must be Bahraini and must dwell in the nation. Moreover, Bahrainis are just allowed to pitch their offers to other Bahraini subjects.

Selection of Name– No matter the kind of company you are trying to set up in Bahrain, there is a common procedure of selecting the name for the company. This requires the investor to propose four different names for your company. These names are then further verified by the Ministry of Industry and Commerce. There are certain rules and limitations that need to be followed while proposing the company names, such as the names should not be offending anyone or any party and should not violate the customs and culture of the country. It should not be similar to any name of a company that is already in existence. A branch office name should have the same name as the parent company operating elsewhere. It should not be similar to any other famous brand names. These are some of the requirements that need to be followed while naming your company during registration.

Once the name of the company has been selected and approved and you have decided what kind of company it is that you want to operate in Bahrain, the rest of the procedures are very simple. All you have to do is show the legal documents to the Ministry of Industry and Commerce and fill out the registration application. Once submitted, it will take around 4 to 5 working days to issue your certificate of registration.

Q: How many directors are required to register new company?

Ans: It’s minimum two and maximum fifty (50) share holders.