BRANCH OFFICE

Branch Office

A very popular way for foreign companies to benefit from 100 percent foreign ownership is to establish a Branch Office of a parent company. A Branch Office is legally part of and an extension to its parent company, it does not therefore have a legal identity distinct from its parent company. As such, the name of a Branch Office will be the same as that of the company of which it is a part.

How is a Foreign Branch in Oman Set Up and Structured?

For the establishment of a branch of a foreign company, it is essential that the foreign company has a contract with a government entity or company wholly owned by the government. The foreign company must provide an undertaking with the registration documents, which stipulates that it will bear the liabilities of the branch and the acts of the branch manager. The duration of the Branch Office is limited to the period of time necessary for the execution of the project in Oman and it is not permitted to carry out any other type of work for any third parties. The activities of the branch must be similar to the activities of its parent company and other activities are not permitted unless first approved by the parent company and registered with the Ministry of Commerce and Industry.

More Information about Foreign Branches:

• Activities – as a Branch Office, you are entitled to undertake the commercial activities of your parent company, although some activities are restricted (for example, for trading, you would be required to set up as an LLC).
• Liability and tax – the Branch Office is not a separate legal entity and therefore the foreign parent company is 100% liable for the actions of the branch and the revenue of the branch will be taxable (in the country where the relevant foreign parent is resident) as the income of the foreign parent.
• Government Liaison Officer – each foreign Branch Office requires a local Omani to be the company’s Government Liaison Officer. The GLO has no equity participation or liability for the business, nor can the person represent the Branch Office or participate in its management.

Advantages of Sovereign PPG being your GLO service provider:

• As your service provider, we will use our experience to handle all the necessary paperwork to establish your business in a timely manner. This includes applying for visas, licences, obtaining labour quotas, translation services and assisting with the opening of corporate bank accounts.
• Fixed fee.
• Full Management Team on hand 24/7.
• Suitable for entrepreneurs, SMEs and MNCs entering the Oman market.
• Honest answers, transparency, reliability and realistic timeframes, enabling you to be fully informed at all times.

Representative Offices of Foreign Companies

A representative office of a foreign company is legally distinct from a Branch Office of a foreign company in that it is only permitted to promote its parent company’s activities. Therefore, if a parent company deals in the sale and/or production of certain products and opens a representative office in Oman, the office will only be able to promote and market the sale and/or production of such products and facilitate contracts in Oman. It cannot conduct sales or production itself. It should be noted that in addition to the above limitations, representative offices have other restrictions in that they are not allowed to obtain credit facilities or put forward offers.

How is an LLC Company in Oman Set Up and Structured?

In order to establish a representative office in Oman, the parent company must provide a certified copy of the articles of association, a certified copy of the commercial registration certificate, authorisation for the manager of the representative office to manage the office and a letter of undertaking to bear all liabilities of the office.

More Information about Representative Offices:

• Parent company requirement – A certification showing the company/ organisation was established in its original home 10 years ago is required.
• Liability and tax – A Rep Office is not a separate legal entity and therefore the foreign parent company is 100% liable for the actions of the Rep Office.
• Government Liaison Officer – each Rep Office requires a local Omani to be the company’s Government Liaison Officer. The GLO has no equity participation or liability for the business, nor can the person represent the Rep Office or participate in its management.

Advantages of Sovereign PPG being your GLO service provider:

• As your service provider, we will use our experience to handle all the necessary paperwork to establish your business in a timely manner. This includes applying for visas, licences, obtaining labour quotas, translation services and assisting with the opening of corporate bank accounts.
• Fixed fee.
• Full management team on hand 24/7.
• Suitable for entrepreneurs, SMEs and MNCs entering the Oman market.
• Honest answers, transparency, reliability and realistic timeframes, enabling you to be fully informed at all times.