Bahrain was one of the first Emirates in the Persian Gulf region to successfully establish a diversified economy which is not solely dependent on the trade of fuel and petroleum. A strategy that was pre-emptively focused towards investing in prominent sectors such as banking and tourism came to fruition in the mid-2010s when more than 50% of the revenue earned by the Emirate was a result of the developed post-oil economy.
As a result of these advances, Bahrain has a very high Human Development Index (HDI – 0.838). And, it is also recognised as a high-income economy by the World Bank with a GDP of over 78.7 Billion USD as of the previous year. Thus, business setup in Bahrain is encouraged for growing and scaling the business entity in the UAE market.
Types of Bahrain Shareholding Company (BSC)
1. BSC – Public
Commonly known as the public joint stock company is a public shareholding company in Bahrain consisting of a number of investors or promoters [A minimum of 7] who’ll have partnership ties with the company and therein subscribe negotiable shares.
With the recent law passed by the Bahraini Government to speed up the business growth in the region which is to give fill 100% foreign investment in several sectors of business, however in certain areas for the for the foreign investors it is required to get a special approval from the Bahrain ministry and commerce that determines the percentage of shares.
A minimum shared capital of BHD 1 million stocked from the investors, partners or shareholders in the form of stocks are required for the formation of Bahrain Shareholding Company and that stocks can also be offered to the public.
2. BSC - Closed
Commonly known as a closed joint stock company [B.S.C closed] which usually consists of not less than two partners or investors who subscribe therein by way of negotiable shares is a closed Shareholding Company in which the shares can be transferred but for subscription it cannot be sold to the general public.
For starting a closed entity, the minimum share capital required is BHD 250,000 but 50%minimum of the capital must be produced initially and remaining within a time period of three years.
Common Documents Required for Setup
- Application form of company registration.
- After preliminary approved capital deposit certificate.
- Articles and association and draft memorandum.
Documents if Partner is Individual
- An original bank reference and CV for non-GCC nationals.
- If a partner or investor is a non-Bahrain citizen then a copy of valid passport and visa pages.
- For partners who are Bahraini the CPR copy.
- In the private sector, signed and stamped a no objection letter from the current employer for Bahraini.
- Copy of original education qualification and experience.
Documents Required if Partner is Company
- Business entity or latest audited financial report.
- Copy of the commercial registration certificate.
- A copy of commercial registration certificate obtained from the government or regulatory authority.
Business Setup Guidelines
The Arabian economy is rapidly growing undoubtedly at a significant rate, and hence the businesses are expanding or planning to expand throughout the MENA region. Bahrain is an active business hub for corporations, manufacturers and SMEs making it one of the most developed areas for business setup in the UAE.
Essentially the Bahrain Shareholding Company must adhere to the following guidelines –
- Limited liability company structure.
- Three directors minimum are required.
- It is compulsory to annually submit the audited financial statements to MOICT.
How can Commitbiz Help?
A consultant strives to ensure the business kick-offs to perform exponentially in the market. Finally, when business scalability has been saturated, liquifies hassle-free, providing a suitable amount of remuneration to the top managers and available severance to the hard-working employees. The energetic and ever buzzing business environment in the UAE always leads new business owners to raise questions on how to set up business in the UAE.
Well, that's why UAE is home to industry professionals that cater to providing new business owners with step-by-step solutions to business setup services in UAE. We at Commitbiz have been catering to various clients across a tenure of over 15 years, providing our clients with tailor-made solutions for all their administrative activities, from accounting to company secretarial services. Our consultants have been diligently working to provide clients with nothing but the best in class services. Contact us to know more about starting your entrepreneurial journey in the UAE.