LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name. The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP. Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct. Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity. Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.

Company Formation Bahraini |

A Summary of Bahraini Company Registration

Part of the gulf includes Bahrain. Both naturally occurring and artificially created islands are included in it. The Bahraini capital city of Manama serves as the country’s present commercial hub and benefits foreign investment. For the time being, Bahrain’s government has loosened limitations on foreign investment. Consequently, a variety of investors may benefit from government incentives. Bahrain has a simple process for registering businesses. But it’s crucial to follow the laws imposed by the appropriate government as well as Sharia law’s obligations.

Overview

Producing and exporting crude oil to other nations is the government's main source of income. As early as 1930, crude oil was discovered. Crude oil exports and sales provide for almost 60% of total government revenue. In addition to being a trading member of the World Trade Organization (WTO) and a party to the United Nations Convention, Bahrain has cooperative ties with other nations. In addition to the International Monetary Fund, it is a member of the Gulf Cooperation Council (IMF).

In terms of computing and telecommunications, Bahrain is the first nation in the Middle East to adopt technology. As a way to manage compliance, they have also created various governance strategies. Free trade negotiations between Bahrain and the USA are ongoing. In 2006, Bahrain and the United States concluded this free trade agreement. Investors are able to conduct business in the nation because to the free trade agreement. An investor would benefit from registering a business in Bahrain for all of the aforementioned reasons.

Bahrain's Ministry of Industry, Commerce, and Tourism is the principal regulatory body for business formation (MOICT). In order to register an entity in Bahrain, a candidate must use the "SIJILAT site." In addition, it is crucial that the applicant conducts thorough investigation and research before forming a company in Bahrain.

Advantages of Bahraini company registration

Benefits of incorporating in Bahrain include the following:

FTA- A free trade agreement between Bahrain and the USA has been in effect since 2006. Foreign investment in Bahrain will benefit greatly from this. Foreign investment in Bahrain has increased since the signing of this agreement.

Member in a number of treaties- Bahrain is an active participant in numerous international treaties and accords. In addition to being a trading member of the World Trade Organization (WTO) and a party to the United Nations Convention, Bahrain has cooperative ties with other nations. In addition to the International Monetary Fund, it is a member of the Gulf Cooperation Council (IMF). For a potential applicant wanting to register a company in Bahrain, this would offer many sorts of incentives.

No Taxes apply- Corporate tax, withholding tax, and dividend tax are just a few of the taxes that are waived when a company is incorporated in Bahrain. Benefits relating to customs duties would be available to businesses established in Bahrain Free Zone.

Financial Sector is very Advanced- Bahrain is one of the most rapidly rising hubs for corporate finance. In order to offer various types of training in the aforementioned fields, the Central Bank of Bahrain has taken the initiative. In Bahrain, Islamic finance is expanding quickly and has a positive impact on the national economy.

Agreements against Double Taxation- With foreign nations, Bahrain has established numerous agreements to prevent double taxation. In addition, the USA and the UK would be included. Because they wouldn't be taxed twice, investors would benefit.

Structures of Companies that may be Registered in Bahrain

For Bahraini company registration, the following business formats are acceptable:

Company Joint Stocks in Bahrani- A public offering of shares is permitted for this kind of organization. Open and closed joint stock companies are the two different types of enterprises that fall under the umbrella of Bahraini joint stock companies. Members have a limited scope of liability. These businesses may handle tasks relating to financial, insurance, and public procurement regulations. In order to establish this kind of organization, 250,000 BD in capital is needed. A deposit of 50% of the share capital is required from the aforementioned capital. For this kind of business, there must be at least two founders. In addition, there must be three other people on the board of directors. In this type of business, foreigners are permitted to own shares.

Companies with Limited Liability- The shareholders' liability is constrained to a certain degree in this kind of business. Shareholding in this type of company is permitted for up to 50 members. In this kind of entity, foreigners are permitted to own a portion.

Partnership Companies- An agreement to divide the company's profits among two or more people is known as a partnership. Partners typically have limitless liability. At least two partners are needed to create this kind of company.

Company Limited by Shares- The two categories of participants in this kind of company are joint partners and silent partners. For this type of organization, 20,000 BD in capital is the needed minimum. To form this kind of entity, you need at least four members.

Individual Entrepreneur- A company with only one owner is referred to as a one-person company. The number of shares is the only limit on the liability of a one-person business. For the creation of this kind of organization, there is no required minimum capital. To conduct the compliance with audits for this type of organization, an external auditor would be needed. This kind of entity typically permits foreign ownership.

Foreign-based business branches- The main firm is simply expanded through a foreign branch office. It would be the overseas parent company's responsibility to cover the branch office's liabilities. Each branch office-related task that needs to be completed must be managed by a manager.

Holding companies- For foreign joint stock firms or Bahraini public limited corporations, this type of company is typically created as a separate entity. To third parties, they would offer assurance in relation to company guarantees. A holding company's organizational structure might take on any shape.

Requirements for Minimum Eligibility to Register a Bahraini Company

To register a corporation in Bahrain, the following qualifying requirements must be met:

Requirement for Minimum Capital- A minimum amount of capital must be provided by the applicant for Bahraini company registration. The minimum capital needed to form a joint stock company is 2,50,000 BD, and the minimum capital needed to form a limited liability company is 20,000 BD.

Minimum number of shareholders- For a corporation to be registered in Bahrain, the required number of shareholders must be met. To register a corporation in Bahrain, a minimum of two shareholders are needed.

Directors at a minimum- In Bahrain, there must be a minimum number of directors chosen. The minimal number of directors for Bahraini joint stock firms is three. A minimum of one director is necessary for a limited liability company, nevertheless. An individual would serve as the only director of a single-person corporation. The appointment of at least one director would be necessary for an overseas branch office. Choosing the director is the parent company's responsibility.

Evaluation Certificate- The evaluation certificate must be shown for certain capital requirements of the company. It is required that this certificate be offered by a qualified auditor or external evaluator.

Certification for Capital Deposit- In relation to capital deposited, the Company must issue a certificate. This document is referred to as a capital deposit certificate. The minimum capital requirements of the company have been met, according to such a certificate.

Registration of Business Name- For the Bahraini registration of a company, the name of the business must be selected and reserved. The company's name must be original and must not infringe upon any laws or regulations set forth by any religious or governmental body. There must be no legal restrictions associated with conducting business in the name that is chosen for the corporation.

Registration of Companies in Bahrain: Process

Take the electronic key- An applicant must first register at the e-Government Authority office in Bahrain in order to receive the electronic key. The applicant can move forward with the process of registering under the commercial registers once the aforementioned procedure has been completed.

Application- Following completion of this phase, the applicant may submit an application for Bahrain company registration via the e-gateway system. Another name for the e-gateway system is Silijat.

Licenses- T he applicant would need to figure out what kind of license is necessary to conduct the commercial activity. Through the use of the Unified Directory of Business Activities, this system is possible. Following completion of this procedure, the applicant will need to choose the legal framework that will be used for Bahraini business registration.

Documents- All documents will be electronically sent through the system after the aforementioned process is completed, and the Ministry of Industry, Commerce, and Tourism will review them (MOICT). Additionally, the applicant would be need to pay the application's 10-dinar municipal fee. After receiving the necessary ministry approval, this would happen.

Notification- The applicant will receive updates on the status of their application. This would be approved with an electronic signature. The applicant would receive a certificate of electronic commercial registration. A cost of 2 BD must be paid if the applicant wants a paper copy of the registration certificate.

Publication- Upon approval, an application is published in the official gazette.

Requirements for Bahrain Company Registration

Shareholder Meeting- Companies with limited liability must hold a shareholders' meeting six months after the fiscal year's conclusion. Shareholders' meetings for joint stock corporations must be held three months after the fiscal year's conclusion.

Board meetings- A board meeting is required for Joint Stock Companies once every three months. Consequently, four board meetings must be held during a fiscal year. If the conditions in the articles of incorporation require it, limited liability firms are required to hold board meetings.

Annual Tax- A National Taxation Authority requires submission of annual VAT tax

Registration of Business- The MOICT and the Central Bank of Bahrain require registration of all firms.

Documents needed for Bahraini Company Registration

Copy of the Memorandum

Articles of Association

Certificate of Incorporation

Two shareholders or more

At least two directors

Agreement among shareholders

Directors' passport copies that have been notarized

Shareholders' and directors' registers' registered addresses.

How to contact Estabizz for Bahrain Company Registration?

Fill the form.

Get a call back.

Submit the required documents.

Track the progress of your application.

Get the expected results.

FAQs

Concept of LLP

LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership.
The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name.
The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP.
Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct.
Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity.

Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.

Structure of LLP

LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession.

Advantages of LLP

LLP form is a form of business model which:

(i) is organized and operates on the basis of an agreement.

(ii) provides flexibility without imposing detailed legal and procedural requirements

(iii) enables professional/technical expertise and initiative to combine with financial risk-taking capacity in an innovative and efficient manner

Other Countries where this form is available

The LLP structure is available in countries like United Kingdom, United States of America, various Gulf countries, Australia and Singapore. On the advice of experts who have studied LLP legislations in various countries, the LLP Act is broadly based on UK LLP Act 2000 and Singapore LLP Act 2005. Both these Acts allow creation of LLPs in a body corporate form i.e. as a separate legal entity, separate from its partners/members.

Difference between LLP & ‘Traditional Partnership’

Under “traditional partnership firm”, every partner is liable, jointly with all the other partners and also severally for all acts of the firm done while he is a partner.
Under LLP structure, liability of the partner is limited to his agreed contribution. Further, no partner is liable on account of the independent or un-authorized acts of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful acts or misconduct

Difference between LLP & Company

A basic difference between an LLP and a joint stock company lies in that the internal governance structure of a company is regulated by statute (i.e. Companies Act, 1956) whereas for an LLP it would be by a contractual agreement between partners.
The management-ownership divide inherent in a company is not there in a limited liability partnership.
LLP will have more flexibility as compared to a company.
LLP will have lesser compliance requirements as compared to a company.

Our Blog

Overview Advantages of Bahraini company registration Structures of Companies that may be Registered in Bahrain Requirements for Minimum Eligibility to Register a Bahraini Company Registration of Companies in Bahrain: Process Requirements for Bahrain Company Registration Documents needed for Bahraini Company Registration How to contact Estabizz for Bahrain Company Registration?FAQs Blog