Setting up a company in Qatar
There are a few ways to set up a company or a business presence in Qatar. Foreign investors are welcomed in Doha and Qatar and various incentives are available, including tax breaks and exemptions from customs duty for many years.
To invest in the economy a local partner is generally required. The local Qatari partner must hold 51 % ownership (we have the same law in Dubai and UAE, except for the Free Zone, where people can have 100% of the ownership). The Ministry of Business and Trade may permit foreign investors to own more than 49% of a company in some specified sectors, namely, agriculture, industry, health, IT, education, tourism, and the development of natural resources, energy or mining.
Below there is a general description about the ways to set up a company or a business presence in Qatar and a detailed summary of the bureaucratic and legal hurdles to incorporate and register a new firm in Qatar.
Choosing the most appropriate business medium
Establishing a Company
In order to do business in Qatar and establish a local office, foreign and local companies are required to obtain a commercial registration from the Ministry of Business and Trade. Qatar enacted Law No. 25/2005 (the ‘Commercial Registry law’) states that no individual person or single entity may engage in commercial activity before registering in the Commercial Registry maintained by the MOBT.
Limited Liability Company
The general rule Law No13/2000 (the ‘foreign Investment Law’) is that non-Qataris, may invest only through the medium of a joint venture company incorporated in Qatar in which one or more Qatari persons or 100 percent Qatari-owned entities hold no less than 51% of the share capital. Joint venture companies with Qatari partners are allowed in all sectors of the economy excluding commercial agencies and real estate. Foreign partners in partnerships must pay the full amount of their contribution of share capital to an authorised financial institution in cash prior to obtaining the Companies’ Commercial Registration. The minimum share capital for a Limited Liability Company is Qrs200,000. The Company is required to set aside 10 percent of it’s net profits until the reserve stands at 50 percent of the share capital. The parties’ profit shares do not necessarily have to reflect their shareholdings.
100 percent foreign investment
Subject to an exemption from the Ministry of Business & Trade, the Foreign Investment Law allows foreign firms 100 percent ownership of the share capital of companies developing projects in the fields of agriculture, industry, health education, tourism, IT, exploitation of natural resources and mining. However, this 100 percent ownership is pending the approval from the government. Each application is reviewed on a case-by-case basis, by the Ministry of Business and Trade. Although there is paperwork to be filed, approvals to be obtained and registration fees to be assessed during this process, the mode of registration offers the opportunity for foreign companies to operate independently. However, it should be noted that only a small number of foreign companies have received the Ministerial approval to operate as a 100% wholly owned subsidiary.
Branch Office
The Foreign Investment Law contains provisions that, subject to an exemption from the Minister of Business & Trade, a branch of a foreign company can be registered in Qatar if that foreign company has a contract in Qatar which is performing a specific project, which “facilitates the performance of a public service or utility”. This registration does not allow for the foreign company to conduct commercial activity that is not related to the specific contract for which it is registered. Foreign companies registered under this category do not need a sponsor or Service agent. The Branch Office will be fully taxable unless it is granted a special exemption.
Commercial Agency
The foreign company does not establish a presence in Qatar, instead an agent is appointed to market goods and services within Qatar. A commercial agent generally acts as the exclusive provider of services of the foreign principal or exclusive seller in Qatar for foreign produced goods. Those companies planning to have agency agreements with Qatari firms are encouraged to review Law No. 8/2002 (‘the Commercial Agents Law’). Under a registered agency, commission is payable on all sales of products in Qatar, even if the sales are not due to the activities of the agent. It should be noted that it is difficult to terminate an agency agreement even if that agreement was for a fixed term period.
Representative Trade Office
The Decision of the Minister of Business and Trade No142/2006 provides that foreign firms may open a representational office without a local partner. Such offices may not conduct any financial transactions related to the company’s commercial activities in Qatar and are therefore not subject to taxation. Though the representational office may be registered in the Commercial Registry and employ staff in its own name, it really is a ‘shop window’ used to promote a foreign company in Qatar and introduce its products to Qatari companies.
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hi Nico,
i am a bahraini (GCC) national and i have my own business licence for more than 3 years in Bahrain. i am interested in an IT services business in qatar. do i also need a qatari partner/sponsor or can i have 100% ownership.
thanks
Nadeem Khalid
In some field, including IT, you can have 100% ownership
Dear, thank you for a helpful and up-to-date blog. I am about to start the process of establishing a commercial representation office in Qatar for my company based in Dubai.
As far as I have been able to make out from Qatari law I need to supply the following:
i. Commercial registration certification (attested)
ii. Article of association and the principle system (attested + translated)
iii. Company or establishment resolution.
Do they refer to the board resolution?
iv. Document of authorization (credentials) from the company or establishment abroad to the managing director for managing the office (attested).
Is this a regular paper simply stating who the manager is? Does the managing director have to be present in Qatar? Does he have to have a Qatari visa?
v. An authenticated document of approval from the Qatari embassy in the country where the company’s head office resides stating that the head office carries responsibility for the operations of the Qatari office.
The company in Qatar will be a rep. office for a freezone-based company in Dubai. However, this in turn is owned by a European company. Does this ownership structure need to be declared? Again, is this a simple piece of paper which my company formulates, or is there a fixed template, things that must be mentioned?
vi. A declaration of the goal (intent) of opening a commercial representation office in Qatar.
Is this just a regular piece of paper or are there specific templates for this? Should it be attested and legalized?
Does the above look correct to you or am I missing out on something? (Should everything be translated and attested etc?) (Any documents I haven’t mentioned?)
In what order do these need to be handed in?
How picky are they with the wording for all documents above, are there specific templates?
Thanks again for a great blog and for taking your time. Please do not hesitate to contact me by email if you prefer. (e.a.belfrage@gmail.com)
Regards,
Erik Belfrage
It seems to be ok, but it’s always better to check with the authority
Dear Nicola,
That’s good but it’s challenging to check with the authorities, do you have any good ideas for where this sort of info that you have provided above can be found? online or otherwise? thanks. Erik
Hi Erik, checkin on site is the only sure way, otherwise you can try:
– the official website of the authorities
– try to contact via email / phone the authorities (or for a small consultant fee we can do that for you; in case we should discuss via email)
We are based in dubai,
planning to start a trade representative office in QATAR,
same requirements as above,
Kindly reply via mail
thanks
Arun
Hello ,
We are India based company into stainless steel fabrication projects . We intent to set up a front ending office just for marketing and promotion . We shall not be doing any sale s/ billing from this office . Is it possible to set up a Trade representative office with 100% ownership of foreign .
If possible we would like the terms and conditions like time , cost , limitations etc and visa possibilities for the staff .
Looking forward to hear from you
Please revert
Anil –Group CEO
Chempharm group of companies
+919811045432
Does local authorities allow a UAE free zone registered company to own 49% of a limited liability company in Qatar?
They should
Dear sir,
How much period we need to keep the deposit in the the bank.which is deposited for llc setup.
dear sir
we got US Army contract in Qatar but we had licenses in UAE free zone authority and we would like to open a license in Qatar without sponsorship and we would to open a shop which will run by three staff
so pls give us suggestion some one who can assist in government work and lic opening etcc
if I need to approach any one in UAE , I will approach with them
I gathered some information and came to know that international company can open front office here but not allowed to do any commercial business such as transaction. This is just like a window shoping to choose and order from the home company…..I am looking to open an office to provide gardening services, rice, fabrics, IT, and medical instruments in Qatar if anyone interested to be a partner please approach……….email bham2002@hotmai.com
Dear Sir,
We are Dubai based Heavy Equipment Rental company, we would like to open our branch in Qatar, Should we utilize our existing sponsor (UAE National) in Qatar. Please advise, if not please provide some more options.
Thanks and regards.
i am an indian national and i have my own business licence for more than 8 years in abu dhabi. i am interested in an IT services business in qatar. do i also need a qatari partner/sponsor or can i have 100% ownership.and what will be the cost.
regards