Why to convert Individual Establishment to WLL
Want to increase your annual profit? Willing to expand your business in every corner of the country? Want to gain the confidence of both public and private partners? Then, consider converting your individual establishment to a WLL company. With our fruitful conversion process, your business will be able to champion more growth, value, and legitimacy.
An individual establishment refers to the commercial entity that is owned by a citizen of Bahrain or those residing in the Gulf Cooperation Council (GCC) countries. Using this establishment, the citizens can establish their individual establishment business in Bahrain. However, with such a model, the owner is responsible for all the liabilities and debts incurred in the operations.
On the other hand, if you choose to set up a WLL company, then you will only have limited liability falling on your shoulders.
Impact of Converting Individual Establishment to WLL
- Issuance of new commercial registration number
- Disclosure of the nature of the invested capital
- Eligibility of the shareholders for investor visas
- Notarizing of the Declaration of Incorporation
- Cancellation of the resident and work permits from the old branch
- Company bank account will be opened.
Here’s what we will need to convert your individual establishment to a result-driven WLL company:
- Owner’s resolution (We will prepare the draft)
- Scanned copy of the owner’s passport
- Power of attorney or an Ekey & Authorization Letter
PI Startup Advisory brings you the chance to revolutionize the commercial industry in Bahrain. With our specialized understanding and experience in the field, you will be able to set up a legal business and run your operations in a productive manner. We have a talented team of experts who have helped a handful of businesses from diverse industries through:
- Industry-related consultation
- Preparation of transfer documents
- Newspaper advertisement
- Drafting and Notarization of the Memorandum of Association.
- Opening of company bank account
- LMRA Registration
- Updating of the record in the commercial registry
Whether you want to establish a new business or take your existing one to new heights, it is essential to know the legalities behind commercial practices. If you are particularly not from Bahrain, it becomes even more imperative to be well-versed with the different rules set by the government in the country, especially commercial concealment!
So what is commercial concealment exactly?
Commercial concealment means renting the CR that allows non-Bahrainis individuals or businesses to engage in business activities that they are not permitted to do. The Ministry of Industry, Commerce, & Tourism in Bahrain currently permits around 375 types of businesses for all Non-Bahrainis, including manufacturing, consulting, and technical services. However, if you are involved in commercial concealment, for instance, by renting a construction CR against a fixed fee, then the consequences can be quite unfavorable.
The government is taking active steps against commercial concealment since it creates unequal market opportunities and promotes commercial fraud, and money laundering – all of these are quite helpful to not only the local market but the overall commercial structure in the country.
Therefore, as an individual or a company, if you are interested in investing in Bahrain, then you should ensure that your business meets the specified regulation as specified by the government. Failure to do so can result in commercial concealment penalties, which includes:
- Fine up to BD1,000
- Imprisonment for almost a year.
How can it be legalized?
There are two ways to legalize your operations in case you have rented someone’s CR or rented it to another individual:
- Allow the actual owner to undertake the CR
- Make renter and rentee partners by converting individual establishment to WLL