A Branch Office for Setting Up a Company in Oman

The Sultanate of Oman has been tirelessly developing itself as a business hub and has opened its wings to embrace all corporate structures. Business setup in Oman is easy as it provides international investors and business owners with multiple options to operate their businesses. 

One such option turns out to be the establishment of a branch office. Creating a global footprint for every organization to set its respective industry benchmark is essential. 

Although it is necessary to build influence and produce maximum leads in the domestic sector, its growth will be sluggish without globalization. In addition to several other advantages, opening a branch in an international area will expand revenue prospects by expanding their services into the markets. 

Oman is said to be the business hub for all start-ups and existing companies. This article will take you through the process of initiating a branch office in the country.

Opening a Branch Office for Your Business in Oman

While some opt for Oman mainland company formation or a free zone, others open a branch or a representative office to grow their Middle-East company. The key characteristics of a branch office for an Omani Business Setup are as follows:

• Branch offices are deemed to be fully-fledged corporations
• Branch offices are allowed to conduct contracts or other tasks as stated in their license
• International companies are permitted to create wholly-owned branches in the Emirate but must have an Oman citizen as a 'Service Agent’.

The local service provider shall be an Oman citizen or a wholly-owned entity by Oman nationals, as set out in an agency arrangement signed before a local notary public.

Benefits of a Branch Office in Oman

With the implementation process of incorporating a branch office in Oman, an investor or business owner will be able to avail of benefits like:

• No minimum capital requirement
• Administrative burdens become less to a great extent
• Branches are 100% owned by the parent company
• Liabilities are to be borne by the parent company
• Gateway to a new location
• Deals with Omani Government that enhance goodwill.

The Companies Law allows a foreign company to exercise its main activity in the country by opening a branch or an Oman representative office.

A foreign business that opens a branch in Oman may openly carry out the activities for which it is authorized. In contrast, a representative office may only carry out promotional activities for the parent company’s goods and services.

To engage a foreign branch to work in Oman, it should receive a license from the Ministry of Commerce and Industry before obtaining a permit from the Sultanate of Oman. It is now allowed for foreign professional and service companies to open their Branch in Oman without the Ministry of Commerce and Industry.

Types of Branch Offices for Foreign Companies in Oman

There are mainly two types of branch offices established in Oman: Mainland and Free Zone branch offices. The critical distinctions between the two forms of business are:

• Free zone branch offices will be subjected to the identification and license standards levied by the jurisdiction under which they work
• Free zone branch offices will be subjected to strict capital conditions in Oman’s free zones, although there are no minimum capital requirements for incorporating a branch office in Oman’s mainland.
• Free zone branches are restricted from completing their activities in the free zone they were registered in.

How to Open a Branch Office for Starting a Business in Oman?

The life of a branch office in Oman deals with a contractual period with an Omani government agency or a quasi-government agency. Once the deal has entered its termination point, the commercial registration comes to an end. 

Establishing such a corporate organization would not require a minimum capital allocation; the internal set-up process is much more straightforward than the parent corporation. Next, you will deal with the needed vital document, followed by the branch office’s essential phase in the country.

1. Submission of Request

This is the initial step where a request needs to be submitted to the Investors Services Department stating that a branch office needs to be incorporated.

2. Documents Required for Expanding Your Big or Small Business in Oman

This is the next step wherein the supporting documents mentioned below must be submitted along with the application form duly signed, whether an Oman free zone company formation or a mainland branch office.

• Application form for registering the Branch Office
• Certified copies of the Memorandum and Articles of Association
• Certificate of Company Establishment
• Authorization letter from the Main Office to the Branch Manager
• Copies of ID Cards of the authorized signatories
• Authenticated letter submitted by the min office that states it bears all the responsibilities of the Branch Office
• Copy of the agreement signed with the Omani government that depicts the number of contracts and date of commencement and expiry.

3. Collecting Application Number

The computerized system ends up generating an application number and date of submission that will be forwarded to the applicant via registered mail and contact details.

4. Checking the Status of the Application

The next step is checking the application status, which states whether it’s approved, rejected, or requires additional information.

5. Collection of Certificate and Fee Payment

This is the final step wherein the investor needs to pay the required amount to collect the certificate and registered papers required by the Commercial Registration Office.

You have now reached the point where you have a thorough understanding of what a branch office is all about, how to start the process of creating it, and the advantages that you, being an investor or a company owner, will reap. All you need now is a guide, a spark that will motivate you to take the first step.

At Commitbiz, we take care of the same. We are a team of experts who help build business roots and incorporate legal, visa, accounting, and legal processes for our customers. To take your idea to the next phase, and initiate the incorporation process, contact us today.