Since 2003, Healy Consultants efficiently and effectively assists our Clients i) determine what type of business entity to register in Qatar ii) what class of business license to apply for iii) how a Qatari national sponsor will help iv) banking and cash flow considerations v) immigration and recruitment strategies and vi) office rental solutions.
Press the link headings below to read detailed, relevant, up to date information.
Advantages and Disadvantages
Advantages of Qatar company registration
Qatar is a small country boasting i) the third largest natural gas reserves in the world and ii) the highest GDP per capita in the world and iii) annual growth of 11% per annum. Consequently, the Qatar Government enjoys limitless cash reserves and is hungry to hire international firms to develop their economy.
The insatiable demand for foreign company products and services is further fueled by Qatar being the host country for Football World Cup of 2022. The country is transforming into a world class sports and tourism infrastructure hub. Consequently, Qatar is a mecca for foreign engineering firms. Estimates of government infrastructure expenditure over the coming decade are approximately US$200 billion.
- Foreign companies setting up industrial plants in Qatar enjoy i) natural gas priced at US$0.60 – US$0.75 per million Btu ii) electricity at US$0.0178 per Kwh iii) industrial land at a nominal rent starting at one Qatari Riyal (US$1 = QR3.64) per square meter per year iv) no custom duties on imports of machinery, equipments, and spare parts v) no export duties vi) 10-year tax holidays and vii) excellent telecommunications facilities
- Another advantage of registering a new business in Qatar is that there are no income tax or social security deductions payable on wages and salaries. Consequently, Qatar is an attractive location for expatriate employees;
- Our Clients will also benefit from the availability of cheap labour and existence of easy recruitment procedures in Qatar. Plus, due to liberal immigration policies, it is easy to import skilled and unskilled labor;
- In Qatar, English is the primary business language and is spoken by 60% of the population. Foreign investors interested in doing business in Qatar can easily communicate with employees, customers and suppliers;
- To aid imports and exports, Qatar boasts 5 modern sea ports, 2 international airports, and modern roads connecting Saudi Arabia and the UAE. A major causeway connecting the country to Bahrain has been planned for 2015.
Qatar is an excellent way to book global profits while legally minimizing international tax. While there is company tax of 10%, there is no personal tax, nor VAT, nor export taxes, nor capital gains tax for Qatar company.
Disadvantages of Qatar company registration
Before investing in Qatar, foreign entrepreneurs should be aware of the following challenges:
- The vast majority of foreign companies must appoint a 51% Qatar national shareholder. The minimum annual fee payable to a Qatari nominee shareholder is US$40,000;
- Finding quality local employees can be challenging in Qatar. Consequently, foreign investors pursuing Qatari company are forced to import expatriate workers, increasing company labor costs. By contrast, the government has a strategic goal to increase the proportion of Qataris in both the public and the private sectors. This “Qatarisation” policy forces companies to hire “suitably qualified” Qatari employees. The government’s aim is to increase the proportion of Qataris in the manufacturing sector to 50% by 2020;
- If a Qatar business cannot pay creditors, the foreign entrepreneur pursuing Qatar company must personally do so. Debt and financial irregularities are considered to be serious offences, and the business owners may not be allowed to leave the country. This risk is greater if loans are owed to Qatar-based banks;
- Because Qatar is a small country in high demand, living and business costs are growing exponentially. For example, the minimum annual fee for a 51% Qatar national shareholder is US$40,000 compared to US$11,000 in Dubai and US$15,000 in Saudi Arabia;
- The cost of Qatar company can be high due to the following reasons: i) multiple government fees during company registration ii) compulsory office rentals iii) compulsory hiring of staff and iv) high paid up share capital of US$55,000;
- The majority of company visas and licenses are sponsored by Qatari nationals, giving the latter indirect control over the business;
- Government tenders favor Qatari nationals and companies that employ Qatari nationals;
- In disputes over business and investments, Qatar business practices and laws still favor Qatari nationals over foreigners. Disputes with Qatari shareholders and agents cause serious problems for foreign investors pursuing Qatar company. Qatar Courts conduct proceedings in Arabic only and can impose precautionary restraint on foreign company assets pending the adjudication of a commercial dispute. Consequently, foreign entrepreneurs registering companies in Qatar should select international binding arbitration as the method of dispute resolution;
- During the company registration process, the Qatar Government frequently requests documents to be translated in Arabic and then attested by the Qatar Embassy in the country of origin of our Client. This is both a costly and time consuming exercise and complicates the company incorporation process. Examples of documents include i) passports copies ii) parent certificate of incorporation and the M&AA and iii) power of attorney. To overcome this problem, our Clients appoint Mr. Aidan Healy as the temporary nominee shareholder, director and bank signatory. As a note, foreign companies willing to register a subsidiary under a name similar to their own must provide the authorities with a letter from their Board of Directors authorizing such use.
Best uses for a Qatar company
- Most cities in the Middle East and Africa (MEA) do not view foreign companies in a positive light. By contrast, Qatar boasts favorable laws for foreign entrepreneurs which are aimed at protecting investors’ interests;
- Doha is one of the most livable cities in the MEA, comprising a cosmopolitan and multi-cultural population. The country boats highly developed infrastructure for tourism, banking, entertainment and business. It has high quality office and residential accommodation, reliable power and utilities, first class hotels, hospitals, schools, shops etc.
Along with Dubai, Qatar will be a financial capital of the Middles East and Africa. The Qatar Financial Center has hundreds of financial companies, insurance companies, banks, and asset management companies. Earning tax free profits within a liberal economy free of exchange controls.
- Time to incorporate: Four weeks
- Cost to set up: US$30,914
- Minimum capital: US$55,000
- Physical office required: Yes
- Shareholders: 2
- Directors: 1
- Company secretary: Yes
- Resident director: Yes
- Corporate tax rate: 10%
- Corporate tax base: Territorial
- Shelf companies: Unavailable
- Main company type: LLC
Frequently asked questions
Is it necessary to appoint resident shareholders when starting a company in Qatar?Yes, Qatari nationals must own at least 51% of the shares in a resident company.
Useful links for Qatar
Government and public authority websites:
- Qatar Tax Authority
- Qatar Company Registrar
- Central Bank of Qatar
- Qatar Stock Exchange
- Investment Authority
- Chamber of Commerce
- Qatar airport
- Visiting Qatar
- E&Y Doing business in Qatar
- PWC Qatar – Doing Business
- Qatar Pro Partnership – Investment
- 2013-14 Worldwide Corporate Tax Guide – Qatar
- PWC – Qatar Tax Summary
- Consider Qatar
- Rise with Qatar
- Qatar’s Investment Law
- Business Guide to Qatar
- Visa Requirements
- A Practical Guide to Living in Doha