Doing business in Jordan: the Jordanian Regional Office in 2023
Since 2003, Healy Consultants Group has been assisting our multi-national Clients to establish entities in Jordan (click link). The Regional office in Jordan is legally tax exempt for both employer and foreign employees. With the introduction of VAT and corporation tax across the Middle East, a Jordanian Regional Office is becoming more attractive to international companies.
To qualify as a Regional Office
- Our multi-national Clients must register a representative office in a Jordanian city and sign a lease agreement for its physical office premises;
- The Representative office exists to merely supply i) technical support to customers including on-site training and ii) back office support to our Clients’ international headquarters;
- The Jordanian entity will not conduct trading activities within the country, nor supply products and services within Jordan;
- The Jordanian entity will neither issue sales invoices nor sign legal sales contracts with local customers;
- The Representative office must appoint a resident manager of any nationality. If required, Healy Consultants Group can act as the professional passive nominee manager;
- At least 50% of the employees must be Jordanian nationals. Some of our Clients engage Healy Consultants Group to recruit (click link) local employees.
Permitted activities of a Regional Office
- The Jordanian entity can conduct trading activities with customers outside of Jordan, including supplying products and services to the neighboring countries;
- The Jordanian entity can issue sales invoices and sign legal sales contracts with international customers outside the Kingdom;
- The Regional Office can open Jordanian multi-currency corporate bank accounts to i) receive funding from parent company and ii) receive revenue from the sale of products and services to international customers and iii) pay local expenses and employee salaries;
- Within Jordan, the Regional Office can:
- conduct local and international market research;
- supply onsite technical support and training to Jordanian customers;
- promote the business of the parent company to Jordanian customers;
- supply back office support to the parent company and international subsidiaries;
- import a sample of commercial products for illustration purposes;
- The Jordanian entity can employ staff to serve the MENA customers. The employees will need to travel to neighboring countries to sell their products and services.
Advantages of a Jordanian Regional Office
- The Regional Office is legally tax exempt from all Jordanian taxes including i) corporation taxes; ii) employee taxes; iii) sales taxes; and iv) import taxes;
- The Regional Office can be wholly foreign-owned and does not need a local sponsor nor a representative of Jordanian nationality. The representative can be a foreigner resident in Jordan. If needed, Healy Consultants Group can assist our Client to secure a work permit for this person;
- There is no minimum paid-up share capital for the parent company nor for the Jordanian representative office;
- During entity registration, there are no Government incorporation fees, or Chamber of Commerce fees, or annual vocational trade license fees;
- There are no restrictions on remittances by non-Jordanian investors, which prevents the risk of expropriation by the government;
- Jordan is a moderate, peaceful, stable and safe country; tolerant of all religions and nationalities.
Registering a Regional Office in Jordan
- Without our Client requiring to travel, Healy Consultants Group will project manage (click link) Regional office registration within 2 months, including multi-currency corporate bank account opening;
- Within one month thereafter, our Firm will timely secure post registration formalities including Municipality registration;
- To comply with Jordanian corporate law, the parent company’s financial statements for the last two fiscal years must be certified by an independent auditor;
- Foreign companies operating permanently in Jordan need to fulfil license requirements issued by the Companies Control Department;
- The parent company’s documents must be legalized by i) the Jordanian Embassy in the country of the parent company ii) the Ministry of Foreign Affairs in the country of origin and iii) the Jordanian Ministry of Foreign Affairs;
- All documents submitted to the Jordanian Government must be translated into Arabic and legalized by a public notary in Jordan;
- The foreign company’s representative office will need to maintain financial records, to prove compliance with the tax exemption requirements;
- Healy Consultants Group will assist our Client coordinate the legalization of all documents;
Healy Consultants Group fees
- Our fees to complete the A to Z (click link) of a Regional Office set up amounts to US$26,595, including i) securing a registered address for incorporation and ii) securing a long term lease for physical office premises and iii) multi-currency corporate bank account opening and iv) government registrations and v) completing the translation and attestation of corporate documents with the Jordan MFA;
- Refer to the embedded Adobe pdf file to view a detailed breakdown of the above:
ConclusionA Jordan Regional Office is the optimum legally tax exempt solution for those Clients who i) do not intend to invoice customers locally and ii) need to deploy staff for technical support or after sales support to customers in Jordan and iii) conduct market research and promote the services and products offered by the parent company.