Basic Steps to Setting Up a Company in Bahrain

Basic Steps to Setting Up a Company in Bahrain

In Bahrain, establishing a company requires adherence to specific laws and regulations outlined by the Ministry of Industry and Commerce (MOIC) and, for banks and financial institutions, the Central Bank of Bahrain (CBB). This article outlines the fundamental steps involved in setting up a company in Bahrain, providing insights into the incorporation process, required documentation, and regulatory considerations.

This article will explain two types of commercial registrations: incorporating a company with or without a license application. These options and relevant details will be discussed, and the process can be initiated through the Sijilat portal.

Relevant Laws

• Law No. 21 of 2001, promulgating the Commercial Companies Law (CCL) and its amendments.
• Ministerial Order No. 6 of 2002, promulgating the Implementing Regulation of the Commercial Companies Law issued by Law No. 21 of 2001 and its amendments.
• Legislative Decree No. 7 of 1987, promulgating the Law of Commerce.
• Legislative Decree No. 27 of 2015 regarding the Commercial Registration Law and its amendments.
• Ministerial Order No. 126 of 2016, issuing the Implementing Regulation of Legislative Decree No. 27 of 2015 regarding Commercial Registration.

Considerations When Incorporating a Company

1. Company Type
   • What is the minimum capital required?
   • What is the proposed management structure?
   • What are the disclosure requirements?
2. Shareholders
   • How many shareholders are there, and what is their nature (corporate or individual?)
   • What are the nationalities of the shareholders?
3. Commercial Activities
   • What are the relevant commercial activities? Is only one activity required or more?
   • Are there any foreign ownership restrictions? Are there any restrictions on the company type?
   • What are the approvals, supporting documents, and special licenses required?
4. Licenses required (if any)
   • What documentation and information required for obtaining licenses?
   • What are the licensing conditions?
   • What are the applicable laws and regulations?

 Commercial Registration (CR) without License Application

Step 1: Submission of documents to the MOIC

Information:

1. 1. Proposed commercial name;
   2. capital amount
   3. total number of shares;
   4. distribution of shares amongst shareholders;
   5. new company’s director(s), email addresses, and mobile numbers (marital status, education, occupation if not a GCC national); and
   6. selected commercial activities.

•  Documents:

1. 1. Copies of passports/ identity cards of the new company’s directors;
   2. copies of passports/ identity cards of the new company’s authorised signatories; and
   3. if the shareholder(s) are:

Natural persons

1. 1. 1. A copy of each shareholder’s passport/ identity card, mobile, and email (marital status, education, occupation if not a GCC national); and
      2. A copy of the signed letter authorizing the professional body to submit the application (or notarized and ratified (where relevant if a submission is taken by a third party) Power of Attorney).

Juridical person

1. 1. 1. Copies of the ratified commercial registration and constitutional documents; and
      2. original resolution approving the setup of the new company duly ratified and notarized (if relevant).

Step 2: Security clearance approval by Nationality, Passports & Residence Affairs (NPRA)

Step 3: MOIC Approval

Step 4: Payment of application fees

Commercial Registration (CR) with License Application

Step 1: UBO & Commercial Address

• • Details of Ultimate Beneficial Owner(s) (UBO): name, mobile, email address, Tax Identification Number (TIN), Proof of TIN and UBO Declaration of each UBO;
  • copy of the signed lease agreement for the new company’s office in Bahrain;
  • copy of the address card;
  • pictures of the leased offices from the inside and outside of the address plate;
  • copy of any document showing that an Electricity and Water Authority (EWA)/ Municipality Account was opened by the new company;
  • termination letter of the previous tenant;
  • evidence that the lease agreement was registered at bh; and
  • resubmit CR WO/License Documents.

Step 2: Licensing Entity Approval

• • Submitting the documents required by licensing entities.

Step 3: Obtaining Municipality Affairs preliminary approval

Step 4: Obtaining licensing entities’ preliminary approval

Step 5: Final Municipality Affairs approval (where relevant)

Step 6: MOIC approval of Constitutional Documents

• • Submitting the draft constitutional documents of the new company.

Step 7: Notarization of Constitutional Documents

• • Know Your Customer (KYC) form;
  • original notarized authority document of any representative signatory; and
  • identity card/ passport of the signatory.

Step 8: Capital Certificate

• • Capital certificate from the bank evidencing the deposit of the new company’s share capital; and
  • notarized constitutional documents.

Step 9: Final site approval by licensing entities

Step 10: Final MOIC approval

Step 11: Payment of application fees 

Establishing a company in Bahrain involves a meticulous process governed by a set of laws and regulations. Each step requires careful attention to detail and compliance. By following the outlined steps and ensuring the submission of required documents, entrepreneurs can navigate the incorporation process smoothly, paving the way for a successful venture in Bahrain’s vibrant business landscape.

Contact us at Zu’bi and Partners to directly assist you in setting up your company in Bahrain. Our dedicated team is committed to guiding you through the entire process, ensuring compliance with all legal requirements.