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Kingdom of Bahrain

HOW TO START A BUSINESS IN BAHRAIN

Small Businesses

Online Business

Business For Expats

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 relays 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. 

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.

Following are the 4 steps to start a business in Bahrain:

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

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: 

  1. Allowed up to 100% for Foreigners
  2. Allowed up to 100% for GCC Nationals
  3. Allowed up to 100% for Americans
  4. Allowed up to 100% for Singaporean
  5. Allowed up to 100% for Icelander, Liechtensteiner, Norwegian, Swiss
  6. Foreign ownership equal to or less than 49%
  7. 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!

  1.  

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:

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:

  1. Administrative office
  2. Retail Shops
  3. Workshop
  4. 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:

  1. Consultation in choosing a business activity, business name, and location.
  2. Security Clearance of all shareholders
  3. Swift Bank Account opening
  4. Investor, Employee & Family resident permit processing. 
  5. Compliance Guidance.
  6. 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

Benefits of Starting 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:

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% Ownership

Unlike most of Gulf countries Bahrain allows 100% business ownership to foreign investorrs. 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

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

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

Dont's

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:

online business in bahrain

A journey through Business Friendly Bahrain: