Company Formation in Bahrain: Your 2025 Guide to 100% Ownership & Tax-Free
Company formation in Bahrain in 2025 is faster, more accessible, and more rewarding than ever before. With 100% foreign ownership granted in most sectors of the economy, an investor can establish a business with full ownership without the need for a local sponsor.
The process of company registration in Bahrain is quick and efficient, typically taking between 7 and 21 days, with the issuance of Commercial Registration (CR) usually completed in 5-10 business days. The cost of company formation in Bahrain through a sponsor started at BHD 1350, depending on how you choose to structure your legal entity in terms of office set-up.
Bahrain offers a 0% corporate income tax for most businesses, except those in the oil and gas sector. There is also a standard 10% value-added tax (VAT) on goods and services sold within the country. Opening a corporate bank account in Bahrain can be completed in as little as 2 days, and investor residency visas are available to shareholders with a renewable 2-year validity.
With clear regulations, full foreign ownership, and a streamlined business setup process, Bahrain remains a leading destination for company registration in the Gulf Cooperation Council (GCC).
Key Information
| Ownership | 100% Foreign Ownership Allowed |
| Tax | 0% Corporate Tax, 0% Income Tax |
| Available Business Structures | – With Limited Liability (WLL) |
| – Branch of a Foreign Company | |
| – Joint-Stock Company | |
| – Partnership Company | |
| Minimum Capital Required | No minimum capital requirement specified. |
| Registration Timeframe | Approximately 11–20 Business Days Platinum Package |
| Required Documents | – Clear copies of passports |
| – Duly signed KYC forms | |
| – Duly signed Engagement letter | |
| – Authorization letter |
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Benefits of Company Formation in Bahrain
Bahrain has positioned itself as a hub for business and investment in the Middle East with its advantageous location, strong economic environment, and business-friendly policies. The company formation in Bahrain for foreigners will give you access to regional markets. The following are the key benefits of company formation in Bahrain:
- No Corporate Tax: Bahrain offers no corporate tax on most businesses, helping you keep more earnings.
- No Income Tax: There is no tax on personal income to worry about in the Kingdom of Bahrain, meaning you can take home all you earn.
- No Third-Party Involvement: You do not need third-party involvement, meaning you control your business.
- 100% Full Ownership: You can have 100% foreign ownership of your company to control it.
- Access to a Highly Skilled Workforce: Bahrain has a skilled and diverse workforce that is ready to meet your business needs.
7 Easy Steps to Company Formation in Bahrain – 2025
Bahrain company registration can be effortlessly accomplished with our seven simple steps. Based on our 6+ years of expertise and the successful completion of over 700 applications, we have designed a streamlined seven-step process for company formation in Bahrain. We understand the legal requirements you must comply with to ensure a successful company registration. This 7-step process involves the approval of various ministries. Each ministry has its requirements, and you must meet them for a successful business registration in Bahrain.
Follow these 7 easy steps to complete your company formation in Bahrain:
Step # 1: Obtain Security Clearance
Security clearance is the first step towards company formation in Bahrain. PI Startup Advisory makes essential KYC (Know Your Customer) documents, and ensures that it possesses all the information in details that meet the regulatory standards.
Requirments:
- Clear Copies of Passports
- Duly Signed KYC Forms
- Duly Signed Engagement Letter
- Authorization Letter
After collecting the above documents, and you have signed, we submit (copies of your passports, authorization letters) to Bahrain’s Nationality, Passport, and Residency Affairs (NPRA) for approval. With our expertise of over 6 years, this process doesn't take too long, and we deliver in a short span of time with complete efficiency.
Processing Time:
Usually takes 3-5 business days
Step # 2: Reserve Your Commercial Name
In the second step of the company formation in Bahrain, your company needs a unique and compliant business name. We guide you in selecting a name that complies with Bahrain’s regulations while representing your brand. You’ll provide three name options, and we’ll submit them to the MOIC for reservation.
Commercial Name Rules in Bahrain
The following are the rules and regulations for choosing the commercial name of the company:
✅ The business name in Bahrain can be a person’s name or a part of a person’s name.
✅ The business name can be innovative and may include a description of the business activity.
✅ The name must be unique and must not have been registered already.
🚫 The name should not consist of a common word only, such as Mechanical Workshop, Hospital, School, etc.
🚫 It must not contradict the undertaken business activities and local laws & values.
🚫 Cannot be identical to an international brand, religious, political, or military term.
🚫 It should not be a translation or imitation of reputable marks, brands, or third parties.
We ensure your chosen name gets approved quickly so you can confidently move forward.
Requirements:
3 unique business names
Processing Time:
1-3 business days
Step # 3: Register Your Company's Head office
The third step of company formation in Bahrain is registering the head office at the Bahrain Municipality. The business address is submitted to the Bahrain Municipality for pre-approval. After the pre-approval lease contract is signed, the electricity is registered.
Requirements:
- Office Photos (Pre-Approval)
- Lease Agreement (After approval)
- Electricity Bill (After approval)
We provide a complete office solution that matches your requirements.
Processing Time:
4-6 Business days
Step # 4: Draft the Deed of Association
Preparing the deed of association is the most essential part of the company formation process in Bahrain. The deed of Association is an important document that details shareholder responsibilities, capital contributions, and company rules. It comprises 27 articles defining the company's specifications, shareholder responsibilities, capital contributions, and company principles.
Once the draft is completed, the documents are submitted to the Ministry of Industry, Commerce, and Tourism (MOIC) for approval and further processing. Completing the deed of association is essential in securing your business’s legal existence in Bahrain.
Requirements:
The draft should be based on the guidelines provided by the Ministry of Industry & Commerce, Bahrain. Below is a sample draft:
Processing Time:
1 business day.
Step # 5: Notarize the Deed of Association
The next step in the company formation process in Bahrain is notarizing the Deed of Association from a public or private notary. The PI Startup Advisory team manages the entire notary attestation process for our clients, ensuring a smooth company registration in Bahrain.
Requirements:
For the notarization of the company’s Memorandum (Deed of Association), the following requirements must be met:
⦁ The physical presence of the shareholders is mandatory for company formation in Bahrain.
⦁ The original Power of Attorney is required if an attorney is signing the documents.
⦁ All shareholders must present their original passports to the notary for the company’s registration.
⦁ All shareholders must sign the Memorandum using their Passport Signature, a crucial step in setting up a company in Bahrain.
After the steps mentioned above, we can add notarization to the items we can help you with. We have spent years developing the processes to ensure compliance without delays.
Processing Time:
1 business day
Step # 6: Open a Company Bank Account
As per MOIC Resolution 43 of 2024, opening a bank account in the company’s name is mandatory for company formation in Bahrain. Our banking consultants can open a corporate bank account within 1-3 business days.
We assist you in a swift bank account opening in Bahrain by selecting a suitable Bahraini bank. We will guide you through the account opening process. The company’s bank account is opened in a chosen Bahraini bank, and the capital amount is deposited.
Requirements:
To open a company bank account in Bahrain, the following are the 4 requirements:
- A recent bank statement covering six months in English with a bank seal on each page to verify its authenticity.
- The physical presence of all company shareholders at the bank branch where you intend to open the account.
- Supporting documents that demonstrate your income source, such as business bank statements or salary slips, in case you are employed.
- A business summary outlining the nature and scope of your business, along with a financial plan projecting your expected revenue and expenses.
Processing Time:
Al Salam Bank: 1-2 Business Days
Ithmaar Bank: 5-6 Business days
Ahli United Bank: 3-4 weeks
National Bank of Bahrain: 5-6 weeks
Bank of Bahrain & Kuwait: 1-2 weeks
With our help, this step will go smoothly for you and remain compliant with the financial regulations.
Step # 7: Finalize the Company Registration with MOIC
In this final step, we take the notarized Deed of Association and the capital deposit certificate and submit both documents to the Ministry of Industry, Commerce, and Tourism (MOIC). Once they approve this setup, your business will be registered, and you can legally start your new venture in Bahrain. With this final step, the entire company formation process is now complete.
Requirements:
- Notarized Deed of Association
- Capital Deposit Certificate (Including AML Clauses)
- IBAN Certificate
Processing Time:
1-2 business days.
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Types of Company Formation in Bahrain
Bahrain offers a range of possibilities for commercial buildouts. Each has its benefits based on your commercial needs. Lastly, here are the most common types of companies in Bahrain.
With Limited Liability Company (WLL)
A WLL is a private company similar to LLC in other countries where shareholders’ liability is limited to their capital share. There is no minimum capital requirement, but sufficient capital is needed for business objectives. It allows up to 100% foreign ownership and is ideal for small to medium businesses.
Branch of a Foreign Company
In Bahrain, a foreign entity can operate a branch, which exposes the parent company to liability. A branch must be registered with the Ministry of Industry, Commerce, and Tourism (MOICT) and is limited to operating according to the laws of Bahrain. Can operate Parent company business activity only.
Single Person Company (SPC)
An SPC is owned by one individual or corporate entity with limited liability to the capital invested. There’s no minimum capital requirement. Since March 31, 2021, the SPC company registration type has been merged with WLL, offering flexibility on the number of shareholders while limiting liability.
Joint-Stock Company (Public Shareholding Company)
A JSC divides capital into transferable shares, with liability limited to share value. The minimum capital required is BHD 1 million. Suitable for larger businesses seeking public investment and offering shares to the public.
Bahrain Shareholding Company (Closed) – BSC(C)
A joint-stock company where shares aren’t publicly offered. Shareholder liability is limited, with a minimum capital of BHD 250,000. Ideal for companies with a limited number of shareholders.
Bahrain Shareholding Company (Public) – BSC(P)
A public joint-stock company where shares are traded publicly. The minimum capital required is BHD 1 million. It suits large businesses seeking public investment and listing on the stock exchange.
Partnership Company
A general partnership is a structure where two or more partners share profits and are severally liable for obligations. Managed directly by the partners, this structure works well for small businesses or professional firms.
Simple Commandite Company
A limited partnership with general partners (fully liable) and limited partners (liability restricted to their contributions). It offers precise management and investment roles, making it suitable for partnerships with distinct responsibilities.
Foreign Ownership Eligibility by Sectors
Bahrain is perceived as offering very appealing ownership opportunities for foreign investors, with the country allowing up to 100% foreign ownership, which demonstrates its commitment to creating a positive business environment.
A foreign investor can exercise complete control over companies without a Bahraini partner, making market entry criteria as simple as possible. Below is a simplified overview:
| Sector / Business Sector | Foreign Ownership Allowed | Bahraini Ownership Requirement / Notes |
|---|---|---|
| Information Technology (IT) | 100% | Includes software, SaaS, AI, etc. |
| Consulting & Advisory | 100% | Legal, financial, HR, etc. |
| Goods Re-Export | 100% | Local Distributor required if selling inside Bahrain |
| General Trading / Trade | 99.99% / Up to 99.99% | A Bahraini or GCC partner is required (any percentage). Minimum 0.01% Bahraini ownership |
| Manufacturing & Industry | 100% | Encouraged under Bahrain Industrial Policy / None |
| Real Estate Management | 100% | Subject to land ownership rules |
| Restaurants & Cafes | 100% | Health and municipality approvals required |
| Healthcare | 100% | Licensing by NHRA required |
| Education & Training | 100% | Subject to Ministry of Education approvals |
| Services | 100% | None |
| Construction | Up to 49% | Minimum 51% Bahraini ownership required |
Start Your Business in Bahrain Today!
PI Startup Advisory is ready to assist you in the company setup process, from paperwork to licensing. Contact us today for a free consultation!
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Bahrain Company Registration Costs
The cost of company formation in Bahrain can be divided into three sections:
- Licensing and Consulting Cost
- Business Address Cost
- Investor Residency Cost
1. Licensing and Consulting Cost
Licensing and consulting costs can vary depending on your business activities and the quality of service you require. A typical company can be formed in Bahrain for BHD 1000 (excluding the office Address Costs).
Note that our packages include all licensing and consulting costs.
2. Business Address Cost
In Bahrain, having a registered business address is mandatory. The cost varies depending on the office’s type, size, and location. The following are the estimated costs of an office in Bahrain:
- One Month Office Address: BHD 300
- Full Year Business Center address: BHD 1200
- Full Year Incubation Center Address: BHD 600
- a 20sqm Workshop in industrial areas: BHD 150-200
Note that our packages include the cost of a one-month business address.
3. Investor Visa Cost
Obtaining investor residency for all company shareholders is mandatory to complete the company formation process. The cost of investor residency can be as follows:
- Investor Residency Govt Fee: BHD 172
- LMRA Admin Fee: BHD 10
- Investor Post Residency Medical: BHD 20
- Identity Card BHD: 136
- Remote Visa Application: BHD 100
- Remote LMRA Registration: BHD 100
- Scheduling Medical & Biometrics Assistance: BHD 30
Our Packages:
Following are our comprehensive Bahrain business setup packages that match your needs and budget:
How Long Does Company Formation Take?
The duration of the company formation process in Bahrain varies based on the selected package and the complexity of your business structure. Below is an overview of our packages and their respective processing times:
Package | Processing Time | Highlights |
|---|---|---|
| Platinum | 11–20 business days | Premium fast-track service |
| Gold | 25–30 business days | Faster approval, priority handling |
| Silver | 35–40 business days | Standard processing, budget-friendly |
Factors Affecting Processing Time
Several elements can influence the duration of the company formation process in Bahrain:
- Business Activity Type: Certain sectors may require additional approvals or licenses, which can extend the processing time.
- Compliance Checks: Background verification and regulatory approvals can affect timing.
- Document Readiness: Complete and accurate submission of required documents is crucial to avoid delays.
- The Processing Timeline for the Government: Any applicable authority, along with its workload, which for our purposes includes the MOICT, Sijilat, and any other relevant authorities, may disrupt timelines.
- Company Bank Account Opening and Activation: The time to open and activate a corporate bank account may differ between banks.
- Physical presence: Certain processes may necessitate the presence of stakeholders, which can compromise timelines.
Knowledge of these issues will enable you to have a realistic expectation and prepare to respond effectively.
Business Environment for Foreign Investors
At PI Startup Advisory, we help our customers navigate the corporate world in Bahrain with startup advisory and specialized company formation services. We meet with our customers, note their needs, and customize our services accordingly. We have also conducted detailed research to give investors a clear picture of Bahrain’s business environment.
Free Zone
Unlike other Gulf countries, the Kingdom of Bahrain has no geographical restrictions. The whole country is a free zone area. Therefore, you can set up a company in any city in Bahrain. However, there are certain restrictions related to business activities
Tax Structure
- Corporate Tax in Bahrain: 0%
- VAT in Bahrain: 10%
- Income Tax in Bahrain: 0%
Read complete article here Taxes in Bahrain & VAT | Simplified – PI Startup Advisory
Share Capital Requirements
- Requirement to deposit capital in a local bank: Yes
- Minimum Capital: No restriction by law.
- Public disclosure of Share Capital: Yes.
- Capital in cash: Allowed.
- Capital in kind: Allowed.
- Debentures: Allowed for Bahraini Shareholding Companies Only
Public Disclosure of Annual Reports
- WLL Companies: No
- Single Person Companies: No
- Bahraini Shareholding Company: Yes
- Foreign Branch: No
- Partnership Company: No
Foreign Ownership
100% foreign ownership allowed:
- All Nationalities: 379 Business Activities
- American Nationals: 557 Business Activities
- GCC Nationals: 570 Business Activities
- Singaporeans: 391 Business Activities
- Icelander, Liechtensteiner, Norwegian, Swiss: 405 Business Activities
99.99% foreign ownership allowed:
49% foreign ownership allowed:
Banking
- Requirement for the personal presence of Shareholders to open a company account: Yes
- Online Banking: Available
- Corporate Debit Card: Available for single-member companies
- Current Account: Available
- Saving Account: Available
- International Funds Transfer: Available
- Trade Instruments: Available
Organizational Structure
- Minimum Shareholders: 1
- Maximum Shareholders: Unlimited
- The requirement of local Directors: No
- Residency of Directors: Not Required
- Residency of Shareholders: Required by banks
- Residency of Authorized Signatories: Not Required
Regulatory Bodies
- Commercial Register: The Ministry of Industry, Commerce & Tourism (MOIC) is responsible for commercial registration in Bahrain.
- Commercial Law: All commercial companies in Bahrain are regulated by the Commercial Companies Law, Bahrain DECREE LAW NO. (21) OF 2001.
- Employment Regulation: The Labour Market Regulatory Authority, Bahrain (LMRA), is responsible for implementing the Labour Law in Bahrain.
- Tax Regulation: The National Bureau for Revenue (NBR) implements tax regulations in the Kingdom. Currently, the only tax in Bahrain is VAT, which is 10%.
Business Development Programs
- Incubation Centers: Available
- Business Development Loans: Available
- Govt Support Programs: Available
- Business Centers: Available
Taxes in Bahrain for Foreign-Owned Companies (As of 2025)
Bahrain provides a very favorable tax environment for foreign investors, with the following main tax provisions:
- Personal Income Tax: In Bahrain, individuals and shareholders are exempt from paying personal income tax.
- Corporate Income Tax: There is no corporate income tax, except for companies in the oil & gas sector, which are subject to sector-specific tax regulation.
- Capital Gains Tax: Bahrain does not impose a capital gains tax on asset sales.
- Withholding Tax: There are no withholding taxes on dividends, interest, or royalties paid to foreign persons.
- Inheritance Tax: There is no inheritance tax of any kind in Bahrain.
- Value Added Tax (VAT): A flat 10 percent VAT is applied to most goods and services, with some exemptions available under Bahrain’s VAT laws.
- Multinational Companies: A 15% Tax from January 1, 2025, for multinational enterprises aligns with OECD Standards.
These tax benefits make Bahrain one of the most pro-business jurisdictions in the GCC.
Business Visa in Bahrain
Acquiring an appropriate visa is essential for forming a business in Bahrain. We offer individualized assistance with business visa services in Bahrain, emphasizing sponsored business visas for investors and foreign business owners. Business visas allow business owners to operate and remain in Bahrain while sponsoring their employees.
Processing Time: 5-10 Business Days
Required Documents:
- Valid passport copy
- Proof of business ownership or partnership
- Medical fitness certificate
- Application form
Our Services in Bahrain
At PI Startup Advisory, we have a variety of services catering to entrepreneurs and businesses who want to set up in Bahrain. Our qualified team provides hassle-free services, from company formation to residency solutions. We have the core services we offer below:
Company Formation in Bahrain
All-inclusive services that help you register and set up your business in Bahrain while meeting the local laws and requirements.
WLL Company Formation in Bahrain
Specialized assistance for establishing a WLL (With Limited Liability) company, an ideal structure for businesses looking for flexibility and liability protection.
Business Visa Services
We assist with obtaining the Sponsored Business Visa, ensuring all necessary documentation is completed accurately and efficiently for foreign investors and business owners.
Bahrain Business Licenses
We help businesses acquire the necessary licenses, including commercial and industrial permits, to operate in Bahrain legally.
PRO Services
Our Public Relations Officer (PRO) services assist with the bureaucratic processes of working with government authorities, ensuring smooth operations and compliance.
Bank Account Setup Assistance
Support opening a corporate bank account in Bahrain, ensuring your company’s financial operations are set up with the right bank to suit your business needs.
Company Formation in Bahrain Legislation Timeline
Explore the key legal reforms that have shaped Bahrain’s business landscape from 1961 to 2024. Next, we look ahead to reforms and anticipated changes that will further facilitate the company registration in Bahrain.
1961
Established the Commercial Registry, requiring businesses to register officially before commencing operations.
1987
Defined core commercial activities and legal framework for merchants, contracts, and trade practices.
2001
Introduced structured legal forms of companies: W.L.L., Joint Stock, SPC, Holding Companies, etc.
Defined:
- Minimum capital requirements
- Governance models
- Shareholding structures (with local majority ownership)
2014
Adjusted capital and governance rules for W.L.L. and closed shareholding companies.
2018
Focused on transparency, board responsibilities, and reporting duties for joint stock companies.
2020
- SPCs Abolished: All SPC companies of Bahrain were converted to W.L.L.
- W.L.L. Companies: The Restriction of 2 or more shareholders for WLL companies was removed. WLL company can be formed with a Single owner.
- No minimum capital required. The restriction on the minimum capital amount was removed.
- JSCs: Joint Stock Companies can raise capital through debt-to-equity, convertible bonds.
June 2024
- Mandatory business bank accounts for all companies.
- E-payment integration is required for compliance.
- Penalties for non-compliance, including CR deletion.
- MOIC Announcement
November 2024
- New Penalty Structure for Late CR Renewals.
- Streamlined delegation and CR submission process.
- Auto-deletion of CRs not activated within 12 months.
- Reinstatement timeframe extended.
Easiest Businesses to Scale in Bahrain
For entrepreneurs seeking to start and grow their businesses, Bahrain provides an ideal environment in which to do so. The following sectors are identified as offering significant potential for entrepreneurs, requiring relatively low startup investments, and providing opportunities for growth.
IT Services
- Bahrain is a regional tech hub backed by Amazon Web Services (AWS), and its only Middle East data center is located in Bahrain.
- Government initiatives, such as Bahrain’s Cloud-First Policy and Economic Recovery Plan, encourage digital transformation.
- Tamkeen offers financial support and subsidies to tech startups and freelancers.
Opportunities: Software development, IT consultancy, cybersecurity, cloud computing, and app development.
E-commerce
- Bahrain’s e-commerce market is expected to grow at an annual growth rate (CAGR 2025-2029) of 7.01%, resulting in a projected market volume of US$1.63bn by 2029.
- High internet penetration (over 99%) and a young, tech-savvy population.
Simple business setup via Sijilat with options for 100% foreign ownership. - Low logistics costs and proximity to GCC markets make it easy to scale regionally.
Opportunities: Dropshipping, online marketplaces, niche e-commerce stores.
Digital Marketing
- A surge in digital transformation among small and medium-sized enterprises (SMEs) is fueling demand for online visibility.
- Digital services can be launched from a virtual office or co-working space.
Access to clients across the GCC and international markets with minimal overhead.
Government Support: Marketing and creative service firms are eligible for funding and advisory services under the Tamkeen programs.
Opportunities: Social media management, SEO, influencer marketing, branding, and content creation.
Consulting Services
- Ranked among the top 10 for business-friendly regulations in the MENA region.
Home to many regional HQs and cross-border service providers. - Bahrain has no corporate income tax (except for oil companies) and no withholding tax, making it ideal for financial consultancy firms.
- Ideal for professionals with experience in business, legal, or financial sectors.
Opportunities: Company formation, tax advisory, management consulting, compliance, and accounting.
Education & Training
- The demand for reskilling and upskilling has increased post-COVID and in line with Bahrain Vision 2030.
- High digital literacy and increasing reliance on remote education.
- Regulatory support from the Education & Training Quality Authority (BQA).
- The growing niche is Arabic-English bilingual training content and professional certification programs.
Opportunities: E-learning platforms, coding bootcamps, vocational training, and corporate training.
Why These Businesses Scale Easily in Bahrain
Many of the new business models listed above leverage Bahrain’s regulatory frameworks, strategic location, and emerging digital economy, making them sound options for start-ups and foreign investors.
- 100% Foreign Ownership available in all sectors (except Oil and Gas).
- No minimum capital requirements for many legal structures.
- Affordable commercial registration and office space options (including virtual offices).
- Digital government portals (Sijilat, eKey, iGA) streamline licensing and compliance processes.
- Tax-friendly ecosystem with no personal income tax and no capital gains tax.
PI Startup Advisory
Why Choose PI Startup Advisory for Company Formation in Bahrain?
Below are some of the reasons why PI Startup Advisory is the go-to source for business formation in Bahrain:
Best Company Formation Agents in Bahrain: With more than 6 years of experience, our experts have a treasure trove of knowledge to ensure that your business set-up process follows regulations.
Full Business Setup Assistance: We assist with all processes, from registering the business and securing licenses to opening your business bank account.
No Hidden Expenses: We aim to be transparent with our customers. Our rates are similar but, above all, open so you know what to expect.
Quick Registration: We expedite the process of company formation in Bahrain so that you can have your business up and running as quickly as possible.
Frequently Asked Questions
How long does company formation in Bahrain take?
The company formation in Bahrain typically takes 1 to 3 weeks, depending on the company’s nature and the required approvals.
Can a foreigner set up a company in Bahrain?
Yes, definitely! Bahrain encourages foreign investment and permits 100% ownership in most industries.
How much does it cost to set up a company in Bahrain?
Fees vary depending on the company type, office, and other required services, but they are usually about BD 1,326.
What are the tax benefits for companies in Bahrain?
Bahrain offers 0% corporate and income tax, with a standard VAT rate of 10%, making it highly attractive for businesses.
What is the minimum capital of a company in Bahrain?
The law does not impose a minimum capital requirement, but share capital must be deposited in a local bank and publicly disclosed. Both cash and in-kind contributions are allowed.