For an entrepreneur who dreams of company incorporation, choosing a jurisdiction might seem like a confusing task. Among its contemporaries, Bahrain stands out in terms of opportunities it provides to business owners to establish their presence in this Kingdom.

Bahrain company setup was simplified in recent times with the introduction of a legislation that allows 100 percent ownership across various business sectors. The high inflow of investment into Bahrain from various sectors such as infrastructure, manufacturing, healthcare and amusement offer a rewarding environment for your business to thrive in.

Bahrain company formation cost is beneficial compared to others in the Middle East and North Africa (MENA) region. In this informative article, we will delve into the details of company formation in Bahrain and the cost one might incur during the process

First, let us understand the process of Bahrain company registration.

Benefits of Bahrain Company Formation

A liberal business environment collaborating along with numerous business opportunities makes company formation in Bahrain stand out when compared to other jurisdictions. Some of the reasons why you should consider starting a company here are –

  • Low cost of operation
  • World-class infrastructure
  • Access to a versatile market
  • Streamlined financial services
  • Tax incentives
  • Low Tariffs on import-export businesses

These benefits make Bahrain a lucrative destination for kickstarting your entrepreneurial journey.

Steps for Bahrain Company Registration

Bahrain’s company incorporation process is simple and streamlined which encourages entrepreneurs to set up their business here. The steps are listed below –

1.   Choose a Legal Structure

Bahrain company formation costs can vary depending on the legal structure of the business. This crucial decision has to be made keeping in mind the operations and activities of the company.

2.   Choose a Trade Name

Bahrain’s Ministry of Industry & Commerce (MOIC) has formulated the guidelines which must be followed while choosing a name for your company. The naming rules are as follows –

  • The chosen name must not be in violation of trademarks or Intellectual Property (IP) rights.
  • You must check if your name is not registered priorly with the Directorate of Industrial Property.
  • A branch office cannot have a different name than its parent office. The name should be a reflection of your business activity.
  • There should be no underlying political meaning or ideas in your name

3.   Submit the Registration Papers

During Bahrain company registration, you must draft and submit the commercial registration papers of the company. This process varies depending on whether the company is an individual establishment or an organisation.

  • If you choose to form an individual establishment, you must register with the Bahrain Investors Center (BIC).
  • For organisations, the registration papers are available at the Ministry of Industry and Commerce Registration Directorate (MOIC).

Bahrain company registration costs will include the fees that need to be paid here.

4.   Apply for Licences

Most commercial businesses are allowed to carry out their operations immediately after commercial registration. However, some business activities require permits and licences from government authorities and agencies. Bahrain company formation cost will include the fees incurred while applying for licences. The steps for applying for licences are listed below –

  1. Visit the e-gateway of the online registry system and provide the required documents.
  2. Provide information on the type of business activity in the forms attached
  3. Fill in the legal forms associated with your enterprise
  4. Verify if your business meets all the requirements of obtaining a licence
  5. Pay the fees through the e-payment gateway

Bahrain’s proactive administration is encouraging and welcoming entrepreneurs by simplifying the process of company setup. Further, online integration of the process helps in making it more efficient and streamlined.

Cost of Setting Up a Business in Bahrain

The company formation cost in Bahrain can fluctuate depending on the number of partners involved in the business setup and the nature of the business. Registration fees, taxes and other legal expenses also contribute to the cost. Real estate costs such as renting or leasing office space are also a crucial part of this.

In addition to all this, as discussed above, each company structure will have a different slab for acquiring a licence which you must pay. All of these together are the major components of the company formation cost in Bahrain.

Types of Company Structures for Bahrain Company Formation

Understanding the types of business structures that can operate in Bahrain is important as it is the primary step which can affect the Bahrain company formation cost. The popular structures include –

1.   Limited Liability Company (WLL)

  • There is no minimum share capital specified for this company.
  • This type of company cannot issue negotiable shares or bonds
  • Activities relating to the finance sector cannot be conducted under an LLC
  • Share capital is divided into equal amount of shares for shareholders

2.   Limited Partnership Company

  • It is a company of two or more persons who are jointly liable for the company’s obligations
  • The partners involved also act as merchants in the case of trade
  • This type of company can be established by drafting agreements between Bahraini and non-Bahraini partners

3.   Branch Office

  • A branch office is a branch of company registered outside the Kingdom that is licenced to carry out the operations and offer services of the parent company.
  • The documents for establishing this type of company must be in Arabic or English
  • The head office must be located in Bahrain

4.   Simple Commandite Company

  • Is a type of joint liability company where all shareholders are liable for the company’s obligations.

5.   Public Shareholding Company (BSC)

  • The minimum share value is 1 Fils (1 Bahraini Dinar = 1000 Fils) and cannot exceed 100BD
  • The number of founders must be at least 2
  • The shares must be indivisible

6.   Closed Shareholding Company

  • The minimum share capital of the company has to be 250,000 BD
  • Upon increase of share capital, new shares can be underwritten
  • The share value must be between 100 Fils to 100 BD
  • The number of shareholders must be at least 2

Trending Businesses in The Kingdom of Bahrain

The business landscape of Bahrain is booming with opportunities. Various sectors have promising growth making them suitable for you to set up your business. Bahrain company formation cost might show variation depending on the sector you choose because of the different licensing requirements. The sectors include –

1.   Information Technology (IT) Industry

Bahrain is a host to some of the leading tech startups and established MNCs. The deregulation of the telecom market has made it easier for new telecom operators to explore the Bahrain market. The shift towards cloud-based solutions is creating new opportunities for the IT sector company formation in Bahrain.

2.   The Banking Sector

Bahrain can be considered the FinTech capital of the GCC. It acts as a financial centre offering various services ranging from banking to insurance. Solutions are being designed for the financial market which makes business setup fruitful.

3.   The Logistics Industry

The strategic location of Bahrain in the Persian Gulf makes it suitable for conducting logistical operations. The cost benefits are high, regulations are low and the taxes are optimal which you can utilise for generating surplus revenue.

4.   The Hospitality Sector

From Prince Khalifa Bin Salman Island to the Arad Fort, Bahrain’s tourist centres are vast and attractive. The global tourist influx has caused a surge in demand for hotels, restaurants, resorts, and amusement centres. Tapping into these will help you make your business profitable.

5.   The Construction and Civil Works Industry

The tall buildings and the majestic towers that are a common sight around the Kingdom show the dominance of Bahrain in the infrastructure sector. A business in this domain will help you gain profits while having easy access to labour and valuable resources.

For starting a company in Bahrain, the choice of sector is very important. It is advised to take assistance from business setup experts when choosing a location as this will be the future of the business.

Business Setup Worldwide specialises in company formation. To get a fair idea about Bahrain company formation costs, contact our consultants today.