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 Registration in Jordan |

Overview of Company Registration in Jordan

The Hashemite Kingdom of Jordan, which is located in the Arabic Peninsula, is the official name of Jordan. It can be found in West Asia’s Levant region. It is regarded as the smallest Arab nation. The Dead Sea lies next to the nation, and it has a coastline that stretches for more than 26 kilometres. Officially, Jordan is situated halfway between Asia, Africa, and Europe.

Overview

The Middle East's second-smallest market for various types of resources is thought to be Jordan. As a result, there aren't many resources in this nation. After Iran, Yemen, and Palestine, Jordan has the fifth-lowest yearly purchasing power on the Arabian Peninsula. As a corporation can be established with just one director and shareholder, company registration in Jordan is fairly simple. A director and shareholder may be from any country. Therefore, it can be inferred from the foregoing that setting up a business in Jordan is a simple procedure.

Jordan has established significant trade relations with nations like the USA. 100% free trade with the USA is permitted by the USA-Jordan free trade agreement. Incorporation of businesses is simple in Jordan. US multinational corporations are permitted to re-export their goods into the USA as a result of this free trade agreement. As a result, when these products are exported again, there are no customs fees or tariffs.

When compared to other Middle Eastern nations, Jordan's business tax rate is significantly lower. The annual corporate tax rate for businesses operating in Jordan is 14%. The Jordan Investment Promotion Act (Jordan Investment Promotion Law) reduces corporate tax to 3% for businesses engaged in specific industries like tourism and agriculture. This company tax will be in effect for ten years. For a period of ten years, any business involved in the generation and distribution of renewable energy is exempt from paying corporate tax. Therefore, this would be advantageous for a business owner who wants to incorporate a renewable energy company in Jordan.

In Jordan, there are more than ten free trade zones. So, if a business is incorporated in this free trade zone, an investor who registers a corporation in Jordan will pay less corporate tax. In this free trade zone, corporate taxes are assessed at a rate of 5%, and there is no VAT of any kind. Comparing Jordan to its neighbours, fewer goods are exported from Jordan. Aside from this, Jordan has excellent road connectivity. So, when importing goods from Jordan, an importer has a variety of transport options.

Advantages of Jordanian Company Registration

The advantages of registering a business in Jordan include the following:
USA Free Trade Agreement with Jordan- Different free trade agreements have been signed by Jordan with various nations. The United States and other significant free trade partners. As a result, US multinational corporations can reexport goods with little or no tariffs. This has numerous advantages for investors.

Corporate Tax- Jordan only levies a 14% business tax. When compared to other jurisdictions in the Arabic Peninsula, this tax is rather low. The Jordan Investment Promotion Act (Jordan Investment Promotion Law) reduces corporate tax to 3% for businesses engaged in specific industries like tourism and agriculture. This company tax will be in effect for ten years.

Renewable Energy Businesses- Renewable energy generation and distribution businesses are exempt from taxes for the first ten years.

Zones of Free Trade- In Jordan, there are more than ten free trade zones. So, if a business is incorporated in this free trade zone, an investor who registers a corporation in Jordan will pay less corporate tax. In this free trade zone, corporate taxes are assessed at a rate of 5%, and there is no VAT of any kind.

Structures of Companies that may be Registered in Jordan

The following business models are acceptable for registering companies in Jordan:
Jordan LLC- When forming a Jordan LLC, at least one shareholder and one director are required. The minimum capital needed to establish this type of organization is JD 30,000, which must be divided into shares that are not divisible and have a minimum JD 1 value. The directors and shareholders of this sort of company have certain restrictions on their liability. This kind of entity can be formed pretty easily.

Jordan Public Limited Company- A joint stock company that lists its shares on a public stock exchange would be the same as a Jordan public limited company. This kind of entity can be created with just one shareholder. In addition to this, a prior contract with the business must be made. A Jordan Public Limited business must have more than $100,000 in paid-up capital. The directors and shareholders of this sort of company have certain restrictions on their liability.

Branch office- An extension of the overseas parent firm is a branch office established in Jordan. The parent firm is responsible for the branch office's liabilities. In Jordan, a branch office may engage in profitable operations. This kind of business would need to produce annual reports. For the creation of this kind of corporation, the foreign parent company must choose a Jordanian representative. In addition, the foreign parent business must demonstrate that Jordan would serve as the location for local operations. The Companies Registrar must receive audited financial statements.

Jordan Offshore Enterprises- A Jordan offshore firm would only be established to handle tasks associated with concluding contracts with businesses located outside of Jordan. A simple lease agreement is all that is needed to create this kind of organization. These businesses would be exempt from paying payroll taxes and corporate taxes. These businesses must still provide annual financial statements, though. If an investor wishes to create an offshore corporation, he can register a business in Jordan.

Representative Office- An extension of the overseas parent firm is a representative office established in Jordan. The parent firm is responsible for the representative office's liabilities. Any profitable operations cannot be undertaken by a representative office. The representative office is only permitted to conduct marketing and promotional initiatives on behalf of the overseas parent firm.

Minimum Requirements for Jordanian Company Registration

The following qualifying requirements must be met in order to register a business in Jordan:
Shareholders at a minimum- In order to register a corporation in Jordan, an applicant must choose a minimum number of shareholders. For instance, only one shareholder is required to incorporate an LLC in Jordan. Therefore, the application must meet the minimal shareholder requirement.

Minimum Directors- Additionally, a candidate must meet the standards for company directors. In Jordan, a minimum of one director is needed for an LLC. This is the bare minimum legal prerequisite for registering a company in Jordan.

Representative- To establish a branch office or representative office in Jordan, a foreign parent firm must select a representative. The international business must provide evidence that it has domestic activities.

Obey Companies Law No. 22 of 1997- An applicant who wishes to create a company in Jordan must comply with "The Companies Law No.22 of 1997."

Jordan's Company Registration Process

The applicant for a Jordanian company registration must adhere to the following steps:

Name Acceptance- The firm name must be reserved first and foremost. The company name must be compliant with the Jordanian Companies Act.

Minimum Capital- The applicant must meet the minimum capital requirements once the company name has been secured. The MOA and AOA would both make this clear.

Put money in a bank- If a foreign shareholder establishes the company, the required minimum capital must be deposited. Bonds can be deposited with certain companies, and these companies are excluded to a limited extent.

Obtain Ministry of Trade and Industry Directorates approval- All essential approvals must be obtained from the Ministry of Trade and Industry Directorate after this phase is finished.

File an Application- When the application is finished, it needs to be sent together with the appropriate paperwork. Following this, the ministry would examine the supporting papers, and if everything was in order, they would issue the applicant with a certificate of incorporation.

Requirements for Jordanian Company Registration

When registering a business in Jordan, the following requirements must be met:

Shareholders' Meeting- At least once every year, shareholders meetings are required. The Companies Registrar must receive copies of every shareholder meeting resolution. After this meeting, you have 10 days to complete this.

Agreements- The Ministry of Trade and Industry requires that all agreements, including joint venture agreements, be registered.

Accounting Statements- The Ministry of Finance must get copies of all business records and financial statements.

Corporation Tax- Corporation tax returns must be filed at a rate of 14% for companies founded in Jordan. There are, however, a number of exceptions for specific businesses. For ten years, for instance, businesses in the renewable energy sector are exempt from paying taxes.

Lease agreement- All businesses are required by Jordanian law to have a lease agreement. This Agreement shall be effective for a 12-month term.

Article of Association- The company's articles of association must be accessible to the public in accordance with Jordanian law. There must be details about the directors and stockholders.

Documents Needed

The following papers must be submitted in order to register a business in Jordan:

Completed Application Form:

Information about the business

Details about the company's directors and promoters

Company’s capital information

Any further information about the business that is pertinent.

Draft of a Memorandum of Association

Draft Articles of Association

Shareholder Information

Lease Agreement

Foreign Shareholders and Directors Permits and passports

Information about Representative Appointment.

What Estabizz can do for you?

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 Jordanian Company Registration Structures of Companies that may be Registered in Jordan Minimum Requirements for Jordanian Company Registration Jordan’s Company Registration Process Requirements for Jordanian Company Registration Documents Needed What Estabizz can do for you?FAQs Blog