HOW TO START A BUSINESS IN BAHRAIN

The Kingdom of Bahrain is located in the Middle East, a small island of 765.3 km² in the east of Saudi Arabia. Bahrain is known for its Business-friendly environment and exceptional lifestyle. Since Bahrain has NO corporate or income tax Bahrain’s economy mostly relies on petroleum exports. In 2019 Bahrain introduced VAT at the rate of 5% which was increased to 10% in 2022. Bahrain’s second major export is Aluminum. However, before starting a business in Bahrain in 2023, there are some things you should know to avoid potential pitfalls and challenges.

Following are major developments in 2023 that may affect starting a business in Bahrain:

  • NPRA Bahrain removed the requirement of physical presence in order to renew residency.
  • PI Startup Advisory removed the requirement of Power of Attorney for company formation.
  • Bahrain municipality upgraded its system. Possible delay in Municipality account opening.
  • Incubation centers started to offer better plans and prices.
  • Bahrain Qatar direct flight operation has resumed.

How to start a business in Bahrain

To start a Business in Bahrain a person has to obtain a Commercial Registration (CR) A CR allows the investor to practice the commercial business activities.

Step# 1. Choose the Business Activity:

The first step to starting a business in Bahrain is to check the eligibility criteria to practice a business activity. The Kingdom of Bahrain has classified its business activities into the following 7 categories:

✓ Allowed up to 100% for Foreigners

✓ Allowed up to 100% for GCC Nationals

✓ Allowed up to 100% for Americans

✓ Allowed up to 100% for Singaporean

✓ Allowed up to 100% for Icelander, Liechtensteiner, Norwegian, Swiss

✓ Foreign ownership equal to or less than 49%

✓ Foreign ownership allowed, but must include a Bahraini shareholder

So as per your nationality, you must check your eligibility criteria before starting a business in Bahrain. If there is a requirement for a Bahraini partner, you can find a feasible partner, or we can assist you in finding one!

Step# 2: Choose a Unique Name for Your Business:

The second step is to choose a unique name for your business. As per “Law No. (18) of 2012 with respect to trade names” following are the rules for choosing a proper business name:

✓ The business name can be a person’s name.
✓ The business name can be a part of a person’s name.
✓ The business name can be a an innovative name.
✓ The business name can be a a combination of above mentioned.
✓ The business name may include the description of business activity.
✓ The name must be unique and must not have been registered already. It must not be similar to an existing business.
✖ 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.
✖ It must not contradict local laws & values.
✖ It should not be the same as an internationally known company.
✖ It should not reflect any religious, political, or military affiliations.
✖ It should not be similar to any honorary name, emblem, or social organization.
✖ It should not be a translation or imitation of reputable marks, brands, or third parties.

Step# 3. Find a Suitable Business Location:

The third step is finding a suitable location for your business. We classify the business locations requirements in the following categories:

  • Administrative office
  • Retail Shops
  • Workshop
  • Factory

If you require an administrative office that does not require the display of your products, you can choose between an Incubation Centre, Business center or a Private office at the desired location

If you are going to start a business where a retail shop and display of products/services is required then you should investigate the market for a suitable location. Like many other countries, Bahrain has areas famous for some specific goods or services. For example, GOSI Complex is famous for mobile phones & accessories.

Workshops & Factories have requirements specified by relevant ministries and authorities. You should consult us before choosing a space for your workshop or factory. For example, an Air Conditioning repairing workshop area should now be less than 20 sqm. It should not be near a residential building or a public place.

Step# 4. Find an Experienced Consultant:

To start a business in Bahrain you require a consultant who can provide you following services:

Consultation in choosing a business activity, business name, and location.

 

  • Security Clearance of all shareholders
  • Swift Bank Account opening
  • Investor, Employee & Family resident permit processing.
  • Compliance Guidance.
  • Continuous support.

Choose PI Startup Advisory For Your Business Registration

PI Startup Advisory team is here to help. With our services, you can easily set up your business in the Kingdom of Bahrain without any inconvenience. With our dedicated team of company formation and commercial business registration professionals, you will be able to focus on other business tasks and save a lot of time and hassle.

All you have to do is to get in touch with us. Our consultants will discuss all the details and advise you on the best organizational structure that suits your business goals.

PI Startup Advisory team has helped numerous local-funded, as well as foreign-funded businesses in lawfully registering their businesses in Bahrain. It’s your turn now! Contact us with confidence and get your business set up in the hub of the middle east.

Apply For Business Registration in Bahrain

Foreigners can own businesses in Bahrain 100%! Foreigners can avail following benefits by owning a business in Bahrain

Investor Resident Permit

Family Resident Permits

Govt Support for 1st 2 years

No Income Tax

Easy closing within 2 years.

100% Ownership

Employee Resident Permits

No Audit for 1st year

No Corporate Tax

Contact US

    10 reasons to start Start Business in BAHRAIN

    To start a business the first thing to consider is the benefit of setting up a business in Bahrain. The Kingdom of Bahrain is very welcoming toward startup businesses. Following are the 9 reasons to start a business in Bahrain:

    • Strong Currency
    • Strategic Location
    • 100% Foreign Ownership
    • No Geographical Restrictions
    • Forward-thinking government
    • Exceptional lifestyle
    • Talented human capital
    • Consudctove business environment
    • Business support programs
    • Advanced banking system.

    1. Strong Currency

    Setup business in Bahrain with world 2nd strongest currency Bahraini Dinar. 1 Bahraini Dinar equals to 2.65 United States Dollar making it world 2nd strongest currency. Which means by investing in Bahrain you will not worry about depreciation of your money.

    2. Strategic Location

    Invest in Bahrain and connect to the $2 trillion GCC market: Bahrain is the natural gateway to the Gulf, with particularly favorable access to Saudi Arabia, the region’s single largest market and economy.

    3. 100% Foreign Ownership

    Unlike most of Gulf countries Bahrain allows 100% business ownership to foreign investors. There are 375 types of business that foreigners can own 100% in Bahrain without any local sponsor. This distinct policy provides you with freedom of choice and investment security. Find below table showing number of business activities allowed for 100% foreign ownership

    100% Business Ownership

    Nationality No. Business Activities
    All Nationalities 375
    American 557
    Singaporean 387
    Icelander 401
    Liechtensteiner 401
    Norwegian 401
    Swiss 401
    GCC 566

    4. No Geographical Restrictions

    Bahrain does not beleive in the zones. Unlike other countries in the region, Bahrain has no geographical restriction for businesses. No matter what your nationality is you can open your business at any suitable location. Therefore you can target any market in Bahrain!

    5. Forward-thinking government

    With a track record of pioneering under its belt, enacting the most business reforms out of any country in 2019 as per The World Bank, Bahrain continues to move forward with policies and reforms that empower businesses and industries to establish themselves and grow.

    6. Exceptional lifestyle

    Bahrain ranks 1st globally for work/life balance and 1st in MENA for personal happiness, regarded highly for its job opportunities, career satisfaction rates, and its friendly culture – noted for being the world’s second easiest place to settle in.

    7. Talented human capital

    Access MENA’s top talent: Bahrainis join the workforce with both an exceptional array of skills and extremely high levels of motivation, achieving The World Bank’s highest scores in MENA for human capital development

    8. Conducive business environment

    Bahrain’s government works closely with businesses and regulators to explore opportunities to enhance Bahrain’s business environment and nurture optimum commercial conditions. This collaboration has seen Bahrain take solid steps towards introducing initiatives that create an enabling and innovative ecosystem, which allows businesses to thrive, achieving the distinction of the 4th most improved economy in 2019 (World Bank).

    9. Business Support Programs

    Every year Government of Bahrain launches multi-billion dinars support programs for startups and businesses in Bahrain. For first two years you can avail 50% Govt Support for Audit, Accounting services and many other services for your startup

    10. Advanced Banking System

    Kingdom of Bahrain has a strong financial system with over 362 financial institutions including 87 Banks (June 2022). There are multiple payment gateway service providers offering reliable online payment solutions.

    Do’s and Dont’s

    If you are planning to start a business in Bahrain always choose a professional consultant who can get your business registered in the most legitimate way. To avoid fraud check the reputation of the consulting firm. If you have two options to choose always choose the legitimate one against the economic one. We suggest following Do’s and Dont’s to start a business in Bahrain:

    Do’s

    Conduct a Feasibility Analysis

    Always consult a professional consultant for your security clearance.

    Make a service agreement with your consultant

    Dont’s

    Don’t pay 100% in advance to your consultant

    Don’t choose the local agents if you are a non-resident

    Avoid Commercial Concealment

    How to Start Online Business in Bahrain:

    Starting an online business in Bahrain is very easy. The government has empowered the online business with an incredible eCommerce portal www.mall.bh. Foreigners can start services related to online business without the need for a local partner. However, Trade-related businesses require a local partner. Following is the procedure to establish an online business in Bahrain:

    1. Choose the suitable business activity
    2. Choose a unique business name
    3. Get an office solution at an incubation center
    4. Obtain Commercial Registration
    5. Register your busines at mall.bh

    Following are the business ideas for online business in Bahrain:

    • Social Media Marketing
    • Management Consultancy
    • Life Coach
    • Accounting Consultancy
    • Web Development
    • SEO Services
    • Yoga
    • SEO Services

    A journey through Business Friendly and Bahrain

    GREAT REVIEWS FOR OUR SERVICES

    Trusted by some
    Biggest Names

    Best decision ever

    PI Startup Advisory is really a trusted company. I am so happy and appreciate its wonderful business registration service.

    Mohammed Joynul Abdin

    CEO-Pakistan Medical WLL

    Absolutely spot-on!

    We really appreciated your kind support. The given commitment comes true, happy and appreciate its wonderful business.

    Muhammad Qasim

    CEO-Pakistan Medical WLL

    Saved my Business

    Thank you so much for working on the regulations and legislation part for our business.

    Jennifer Kate

    Founder – Dilumi Services

    Professional Team

    I would like to thank you for your excellent efforts and commitment in assisting us to obtain Business License in Bahrain.

    Avy Jacob

    Director – Avy Jacob Machinery