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:
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.
Here is how to start a business in Bahrain in 2023:
Step# 1: Choose the Business Activity
Step# 2: Choose the Business Name
Step# 3: Find a Suitable Business Location
Step# 4: Find an Experienced Consultant
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!
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.
The third step is finding a suitable location for your business. We classify the business locations requirements in the following categories:
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.
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.
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.
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:
Nationality | No. Business Activities |
---|---|
All Nationalities | 375 |
American | 557 |
Singaporean | 387 |
Icelander | 401 |
Liechtensteiner | 401 |
Norwegian | 401 |
Swiss | 401 |
GCC | 566 |
✓ Conduct a Feasibility Analysis
✓ Always consult a professional consultant for your security clearance.
✓ Make a service agreement with your consultant
✕ Don’t pay 100% in advance to your consultant
✕ Don’t choose the local agents if you are a non-resident
✕ Avoid Commercial Concealment
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: