Oman, one of the Arabian countries situated in the southeastern Arabian Peninsula, has always been in the priority list of international investors and business owners. Be it for a new business setup in Oman, or for expansion, the location provides the flexibility to investors to opt for any one of them. Apart from the partnership firms, the location also encourages individuals to come forward and initiate a one-man company with low capital, also known as a sole proprietorship. If you are planning to invest in Oman for the first time, or want to invest with low capital, you can always opt for a sole proprietorship firm. By the end of the article, you will get a clear picture of the necessary steps to be taken.
What Is a Sole Proprietorship Firm?
A sole proprietorship is one of the corporate structures that is initiated by an individual who serves to be the sole owner. An individual trades on his own account and obtains a trade license on his own name. Since the owner bears the full extent of assets and liabilities, the establishment doesn’t possess a different legal entity from its owner. To understand it in a better way, let’s have a look at…
Key Features of a Sole Proprietorship in Oman
- Single person owned
- No restriction to start or close
- Owner holds the complete control
- Lower cost of formation and compliance
- Unlimited liability is borne by the owner
- Profits and losses are borne by the owner
- No special legislation
As you have noted the key features, the next step that you should be aware of is the documents that you must possess to open a sole proprietorship in Oman.
Documents Required to Set Up a Sole Proprietorship in Oman
- Public Key Infrastructure (PKI) enabled ID Card
- Public Key Infrastructure (PKI) enabled Resident Card
- Authorized Signatories Form
- Individual’s identity card
Process of Registering a Sole Proprietorship in Oman
The process of sole proprietorship registration involves way fewer steps as compared to the other business entities in Oman. The core steps include:
1. Minimum Capital
Now, to initiate a sole proprietorship firm, the first and foremost thing that an individual needs to do is register the business entity with a minimum capital of OMR 3000.
2. Liaise with the Ministry of Commerce and Industry (MOCI)
The above-stated documents are required to be presented at the MOCI to initiate the registration process.
3. Register with the Royal Oman Police
It becomes necessary that the individual ensures registration of the business entity with the ROP and obtains a good standing certificate.
Certain government approvals are required to complete the registration process. Trade license will be issued by the Ministry of Commerce and Industry. Once obtained, the core business practices can be commenced. Now, once you are on the field with the business operating its relevant activities and earning profits, you can even convert your one-man company to a partnership firm. Yes! According to the Omani law Article 13 Bis1 of the Sultanate Decree of 1974 Commercial Company Law, it is permissible to convert a one-man company to other corporate structures. So, what are you waiting for?
To initiate a company from the very scratch, it is advisable to take the help of business consultants. The main reason behind this is that business consultants are strong in understanding the specific law that every business entity needs to maintain while setting up a business in a foreign land. Commitbiz is here to help you in this process. We stand as a premium business consultant in Dubai helping our clients with incorporation services along with setting the core pillars like accounting, taxation, legal, visa etc. Our business experts will understand your requirements and will cater them accordingly. To know more, do contact us – we’d be happy to assist.