Company Registration in Oman - Business Starting & Setup

The legal system of Oman is based on Muslim law. Sharia is the main source of legislation.

Until recently, uncodified Muslim law was almost the only form of effective law in Oman. After Sultan Qaboos ascended to the throne in 1970, a number of codified laws were enacted in the field of personal status, trade, criminal, labor and tax law, and elements of the modern rule of law were gradually approved.

Legislation of Oman (Article 4 of the Commercial Companies Law) provides for the formation of the following types of legal entities:

• General Partnership;
• Limited Partnership;
• Joint Venture;
• Joint Stock Company (Public / Closed);
• Holding Company;
• Limited Liability Company;
• One-Person Company.

Limited Liability Company is the most popular form of establishing foreign business in Oman.

Most activities are available to companies with 100% foreign ownership. However, some activities are prohibited for foreigners.

The list of activities prohibited for foreigners numbers about 70, including:

• insurance agencies;
• real estate brokerage;
• labor recruitment offices;
• wholesale of fruits and vegetables;
• wholesale of fish and marine animals;
• wholesale of fish products;
• wholesale of live livestock, except for projects with large production facilities;
• retail trade in stores specializing in meat and meat products;
• beekeeping and production of honey and beeswax;
• marine fishing, etc.

Some activities may require additional authorizations from the relevant regulatory authorities.

There are 3 types of licenses:

1. Licenses that are obtained automatically as a result of submitting an online application and paying the appropriate fees. Such licenses include, for example, software development and sales and most commercial activities (including trade in building materials, industrial equipment, computers, etc.).
2. Licenses that are obtained by submitting an online application after approval by the relevant regulatory authority and payment of the relevant fees - advertising and marketing activities, construction and engineering activities, opening restaurants and coffee shops, etc.
3. Licenses that require a physical person to obtain a license.

Registration of a new Omani company in the register takes at least 1 week, and this period may be extended due to the necessity to obtain additional permissions to conduct proposed activity.

The name of the company:

• must not be identical or similar to the name of an existing company;
• must contain an indication of the legal form of organization (Limited Liability Company or the abbreviation LLC);
• must not contain an indication of the names of rivers, cities and names of famous places in Arab countries;
• the words - International, Global, Overseas - are available for companies with a Registered Capital of at least OMR 100 000 (~ USD 260 000);
• the words - Oman or Omani - may be used by companies whose Registered Capital is at least OMR 500 000 (~ USD 1 299 000).

The name of a limited liability company may consist of the name of one or more members and any word or expression, provided that such name shall not be misleading as to the purpose of the company or the identity of its members.

Sequence of steps to register a local company in Oman.

1) First of all it is necessary to determine:

Company name to check for uniqueness (at least 3 variants);Company structure (shareholders, manager);Types of activities.

Some types of activities require special permits from various governmental authorities (federal and local).

2) Pay for the services.

3) It is necessary to submit documents for managers / shareholders / attorneys (in original or notarized copies):

• internal and foreign passports;
• document confirming residence address;
• CV (resume).

For shareholders it is additionally necessary to provide:

• CV data in the form of a letter: phone number, e-mail address, residential address, country of residence, mother's name, marital status, religion, citizenship.

4) Verify the names and obtain the appropriate certificate (Certificate of the trade name).

Registration is possible remotely on the basis of a power of attorney (which will need to be apostilled).

5) Apply online to the Ministry of Commerce, Industry and Investment Promotion (MoCIIP) for company registration.

The application must contain information about the shareholders and commercial activities of the company, Articles of Association of the company. Upon inspection, the Ministry issues a Commercial Registration (CR) certificate.

6) After obtaining the Commercial Registration Certificate, apply for a license through the portal of the Ministry of Commerce, Industry and Investment Promotion or physically (depending on the type of license) and fulfill the necessary requirements.

7) Obtain a TIN from the Sultanate of Oman Tax Authority (TA).

The total time to register a local Omani company is on average 1 week.

Companies must have a registered office in Oman. Copies of corporate documents of the company, and some other documents must be stored at the address of that registered office.

Legislation of Oman does not have requirements regarding the existence, form and content of the seal.

Redomiciliation of companies from or to Oman is not possible now.

The management of a limited liability company is entrusted to one or more managers from among the shareholders or other persons who are natural persons. There are no citizenship or residency requirements.

Managers are appointed for a fixed or indefinite term in accordance with the founding documents or a resolution of the Shareholders' Meeting.

A limited liability company (LLC) consists of individuals or legal entities whose number must not be less than 2 or greater than 50.

Liability of a company’s members for its debts is limited to the value of their shares in the Authorized Capital.

The number of shareholders may be increased in some companies beyond the maximum number (50) by a resolution of the Minister, in accordance with public interests and for reasons that he has taken into consideration.

A company makes a register of its shareholders which contains the full name of each shareholder, their citizenship, nationality, place of residence and address, age and the number of shares held by them as well as legality of disposal of those shares.

Managers bear joint liability for keeping such a register and correctness of data contained therein, and shareholders and any concerned persons have the right to familiarize themselves with the register.

A limited liability company shall convene a meeting of shareholders at least once a year within 180 days after the end of the financial year at time and in a place stated in the founding documents or by the company’s manager.

In December 2022, Oman adopted the Ultimate Beneficiary Identification Procedures Regulations, which came into force on 2 January 2023.

The Regulations apply to all commercial companies provided for by the Commercial Companies Law, except for public joint stock companies that must keep a register containing information about all shareholders who hold 25% of shares or more in any company in the registered head office of the company ("The Register").

In the Regulations, beneficiary (UBO) means any person who directly or indirectly owns or exercises ultimate control over a commercial company, including any person who has control or ownership through the chain of ownership or control, other than direct control.

If a beneficiary is an individual, then the register must contain information on them, including the full name, citizenship, date and place of birth, address, place of residence, information on the individual’s employer, and the number of shares held by them. A copy of the individual’s valid passport or identity card must also be kept.

If a beneficiary is a legal entity, then the register must contain the name, legal status and founding documents of the legal entity, address of the head office (or the principal place of business, if the legal entity is foreign) and information about the legal representative of the legal entity in the Sultanate of Oman. The register must also include passports / identity cards of the executive management of the legal entity.

This information must be provided to the Ministry of Commerce, Industry and Investment Promotion and registered in the trade register. Any changes that must be made to information contained in the register must be made within 5 workdays after this change becomes known to the company.

Article 5 of the Regulations sets punitive measures that may be applied by the Ministry in the case of a violation, including a penalty of up to 1,000 OMR or suspension of the company’s commercial registration for a period of up to 3 months. In the case of a repeated violation, the punitive measures may be doubled.

Companies covered by the Regulations must comply with them starting on 29 January 2023.

The authorized capital of a limited liability company must be divided into shares of equal value. There are no requirements for the minimum amount of the authorized capital.

Contributions to the authorized capital of a limited liability company may be made in cash or in kind, but may not consist of services or labor.

The amount of the Authorized Capital must be deposited in one of the approved local banks, after which the company can complete the incorporation procedure.