With Oman’s economy shifting focus from being heavily reliant on oil and oil-based industries, business opportunities have escalated hugely over the past decade or so. Now’s the right time to think about starting your own small business.
There are numerous ideas that work well, from starting a perfumery or an electronics/appliance store, a commodity outlet or a restaurant, a car servicing shop or one selling automobile spare parts, a book-keeping or accountancy firm, a boutique or beauty parlour, or anything more creative that brings in guaranteed income in a short time.
According to Business Setup Worldwide, a platform that helps young, budding businessmen and women set up a small business, right from incorporation, registration and licensing to establishing office space, starting a company in Oman is a profitable move, not just for citizens but also for foreign investors.
There are, however, a few essentials that one must be aware of before proceeding to start a business. Few of the opportunities that are widely preferred in the region include tech-based firms, accounting and investment firms, real estate, foodstuff and commodity stores as well as those dealing in the digital and technology field.
Types of businesses
Registering a business unit involves numerous steps, and selecting a structure is what one has to be clear about. In Oman, an investor has the flexibility to select any of the structures from the following:
Joint Venture Company
Joint Stock Company
Starting a business in Oman
The Omani government has been taking respective measures to encourage enterprise growth and promote diversification, industrialisation and privatisation. The company registration in Oman involves a series of steps that involve:
Reserve a trade name
Apply to the Ministry of Commerce and Industry (MCI) to reserve a unique name for your company, subject to nomenclature norms in Omani Law.
One needs to make sure that the selected name for your business doesn’t sound offensive. It should stand unique from the competitors available in the market.
Submit company essentials
Documentation plays an extensive role when it comes to getting a process incorporated. Once the company name for your business is reserved and approved, draft the shareholder documents and constitutive contract, and obtain the authorised signatory form and bank certificate, and submit these to the MCI.
Register with the Oman Chamber of Commerce and Industry (OCCI)
After registering with MCI, register with OCCI for compliance with the commercial rules and regulations required of a corporate in Oman.
Get respective approvals from the government departments
Depending upon the nature of your business, its size, and activities, you may need to obtain a couple of government approvals. This can include obtaining or carrying out:
Registration with the Royal Oman Police
Registration with the Ministry of Manpower, to file for labour clearances and visas
Import/export license, if required
Industrial, environmental and other permits and licenses
Design a company seal
In simple terms, a company seal can be understood as the signature of a business entity. The company seal is often used in the letterhead and the core documents while dealing with the clients or business stakeholders.
Banking in Oman
One of the core fronts that every investor should be aware of is the banking process that every business entity must follow. Opening a corporate bank account helps a business investor gain multiple benefits, right from keeping track of the business expenses to monitoring the financial growth.
Business structures in Oman
This turns out to be feasible for the business investor who stands single. A sole proprietorship is a business procedure in which a trade license is issued in the owner’s name and trading in that name. As compared to other entities, the capital requirement turns out to be low.
Most business investors prefer to start a sole proprietorship company in Oman and later transform into an LLC. A few of the benefits that can be availed by incorporating a sole proprietorship company in Oman include:
Greater control over the business
Tax filing is easy
Tax rates are low
You can use any business losses to offset personal income from other sources
Another type of business entity that gets widely selected by business investors is the general partnership. Omani citizens are allowed to be partners in a general partnership, as compared to foreign investors. By doing so, an investor can gain the following benefits:
The tax treatment can be done in a flexible manner
The entire incorporation process turns out to be financially feasible
A limited partnership is a modified general partnership. The general partner, who is required to be an Omani national, is liable for the debts and obligations of the partnership without any limitations whereas the limited partner only has limited liability and is only liable for the company’s debts in the amount of his capital contribution. Holding an LLP is effective for a business investment due to the following benefits:
When it comes to investment, it becomes easier to market the interest of a limited liability partner
Just like a General Partnership firm, an LLP also enjoys the advantages of tax treatment
The general partners can use their expertise to make the essential decisions in managing the overall business.
Joint Venture Company
A Joint Venture is an organised legal business structure that gets established when two or three businesses come together and incorporate a business without affecting any third party. Business entities usually prefer this when they join hands to create synergy and gain a mutual competitive advantage.
Joint Stock Company
A Joint Stock Company or JSC is a legally authorised company where the capital is distributed into shares of equal value and can also be negotiated.
Coming to the incorporation part, a JSC can be divided into two types:
Public Joint Stock Company (PJSC)
Closed Joint Stock Company (CJSC)
Most business investors prefer to proceed with a Joint Stock Company (JSC) as they can enjoy enormous capital benefits, and the company’s shares can be easily transferred. Additionally, the risk involved in the process is comparatively less and can be borne at ease.
Limited Liability Company
This structure turns out to be one of the highly opted options by the foreign investors that can be incorporated at ease. The maximum number of shareholders for an LLC is 40, and each of them can hold a maximum count of 70% of the company’s capital. The Sultanate of Oman allows an investor to start an establishment with a minimum of RO20,000.
The concept of a holding company is all about business minds who wants to earn passive income. A holding company is a legal business entity that controls or gains shares of other companies by owning a minimum of 51%.
Very few investors usually select these business structures as the investment is much higher than the other business entities.