Company formation in Oman requires securing various licences and permits, including the trade licence, to successfully launch your business. This foundational document is key to conducting business activities in the Sultanate legally and efficiently, while simultaneously protecting you against penalties and fines and preventing closure. With a valid trade licence, business owners receive the longevity they need for long-term growth in the local market.
So, what is the Oman trade licence? Why is it important? What are the types of trade licences? This comprehensive guide offers clear answers and outlines the precise steps required to obtain and renew a business trade licence.
What is a Trade Licence in Oman? Trade Licence Meaning
The trade licence in Oman is an official legal document issued by the Ministry of Commerce, Industry and Investment Promotion (MoCIIP), authorising companies to conduct professional, commercial, or industrial activities legally in the country. All businesses operating in both the mainland and free zones are required to obtain this licence. This requirement ensures compliance with local laws and regulations, regardless of the nature of their activities or their location within the Sultanate. A trade licence is also known as an activity, and lawyers often call them ‘objects’.
What is the Purpose of the Trade Licence?
The main purpose of the Oman trade licence is to formally allow businesses to operate in the country, ensuring their activities comply with local regulations and national standards, both legally and economically. Obtaining a trade licence in Oman is mandatory for all businesses, as it provides legal protection against fines and helps prevent potential closure.
The Trade Licence Role in Regulatory Compliance
The Oman trade licence specifies the activities that a company is allowed to conduct, functioning like a safeguard against unapproved operations. It facilitates compliance for the company while enabling regulatory oversight by authorities. Moreover, this licence states that the company adheres to industry standards and government regulations, as it cannot be issued otherwise.
Trade Licence in Relation to the Process of Business Setup
Obtaining the trade licence is a key step to the business setup process in Oman. It acts like a link between the initial company registration phase and the post-registration procedures, which eventually lead to the complete operational launch. This document is essential to doing business in Oman, as it enables foreign-owned companies to proceed with business activities smoothly and properly.
Types of Trade Licences in Oman
Trade licences in Oman are categorised both by the business activities they authorise and by the company’s location (mainland or free zones), as outlined below:
Omani Mainland Trade Licences
For businesses set up in the mainland, trade licences are issued by the Ministry of Commerce, Industry and Investment Promotion (MOCIIP), and they are divided into the following types:
- Commercial Licence: This type covers activities related to trading, retail, wholesale, and general commercial operations conducted within the Omani mainland.
- Industrial Licence: This licence authorises engagement in manufacturing, production, and processing activities in compliance with Oman’s industrial regulations.
- Professional Licence: It applies to service-based activities that rely on professional expertise or specialised skills like consultancy, design, or technical services.
With this in mind, obtaining the proper type of trade licence in Oman is essential to the business setup process. Each company must apply for the proper type based on their business activities to ensure regulatory compliance and efficient operations. That said, here are the trade licence types in Omani free zones.
Omani Freezone Trade Licences
Oman trade licences for free zone companies are issued by the relevant free zone authority, operating under the oversight of the Public Authority for Special Economic Zones and Free Zones (OPAZ). Here are the trade licence types for free zone companies in Oman:
- General Trading Licence: This licence permits businesses to engage in the trade of a diverse array of goods without restricting their activities to particular categories. It is particularly suitable for companies that handle multiple types of products.
- Trading Licence: This licence allows trade but only with specified goods and categories that are explicitly mentioned in the document, providing a more controlled and limited oversight.
- Industrial Licence: This type of licence enables companies to carry out manufacturing, processing, packaging, or assembly activities of specified goods inside the free zone.
- Service Licence: With this licence, businesses are authorised to provide services such as consultancy, technical, administrative, or other professional services within the free zone.
Given the various types of trade licences in Oman, it is essential to determine whether or not you are required to obtain one. The following list outlines the individuals and entities that must hold a trade licence to conduct business legally in the country.
Who Needs a Trade Licence in Oman?
Any entity or individual that wants to conduct professional, commercial, or industrial business activities in Oman must obtain a trade licence. Those include but are not limited to the following:
- All Registered Companies: All companies with a commercial registration number must apply for a trade licence. This includes all business structures like the Limited Liability Companies (LLCs), Sole Proprietorships, branch offices of foreign companies, and public/private joint stock companies.
- Foreign Investors: Non-Omani individuals or entities planning to invest in commercial, industrial, or professional businesses must obtain a trade licence to conduct business or hold ownership. Whether the investment is done through capital, shares, or operations—the trade licence is required in all cases.
- Businesses in Free Zones: Trade licences are mandatory for businesses located in Omani free zones, allowing them to access the benefits and incentives provided by official bodies. In this case, the licence is issued by the relevant authority of each zone.
That being said, every registered company in Oman must apply for the suitable trade licence to operate efficiently and legally. Any company that carries out business without a valid trade licence is deemed illegal and can face penalties, fines, and eventual closure if no valid licence is obtained in a timely manner.
How to Get a Trade Licence in Oman: Step-by-Step Guide
Securing a trade licence in Oman paves the way for business growth, success, and long-term continuity. It is a key document for foreign-owned businesses aiming to access the Omani market and leverage the benefits of the local business environment.
Below is a breakdown of how to get a trade licence in Oman step by step:
Securing a Business Location and Lease Agreement
Finding a proper commercial premise for your company is the first step to getting the trade licence, especially since this physical location will be inspected by government authorities to ensure it meets the official requirements and standards. The lease agreement must be registered with the local municipality and it should explicitly mention the location’s address.
It is recommended to work with a trusted business partner, like Bondoni, to help you secure the right premises and finalise the lease agreement. Working with Bonondi provides you with peace of mind and confidence, as you move along the application process with ease and precision.
Preparing the Required Documents
At this phase, you should gather the necessary documents for the licence application. They vary by company, depending on the nature of the business activities and the type of trade licence applied for. A consultancy company, for instance, must provide a different set of documents than a manufacturer or a wholesaler. That said, some of the most commonly needed documents include:
- A copy of the Commercial Registration (CR) certificate.
- A copy of the registered lease agreement for the business’ premises.
- Copies of passports or national IDs of business owners and signatories.
- Other sector-specific documents that can be obtained from the relevant authorities.
Bondoni offers you support in collecting these documents and attesting them in preparation for the trade licence application. The team has worked with clients across various industries and sectors, providing you with diverse experience and reliable guidance each step of the way.
Submitting the Licence Application
The Omani government has digitalised many business setup procedures, making the overall process easier and more efficient. Therefore, you can apply for the trade licence online using the Invest Easy portal. Simply navigate to the section dedicated to applying for or updating licences and activities on the existing CR. Then, upload the documents and proceed to submit the application.
Bondoni’s team of experts can submit applications on your behalf, providing you with timely submissions, follow-ups, and guidance as you move towards the full operational launch of your business. Right from the beginning of the company formation procedures and throughout the registration and post-registration phases, Bondoni is your trusted partner for smooth business setup in Oman.
Undergoing Inspection and Approvals
The relevant authorities will review your online application and then conduct an inspection of your business premises. This process aims to verify that the location meets the safety and health standards and the official zoning regulations. It will also ensure that the conducted business activities match the description provided in the online licence application and on the Commercial Registration (CR). Various other documents are checked for validity, including the lease agreement.
If you meet all conditions and requirements, a positive report is issued in order to proceed with the trade licence. In case some issues are found, the applicant will receive a notice detailing all the changes that need to be made before undertaking a re-inspection.
Paying Licence Fees
Once the inspection and application are approved, you will be notified of the fees. The trade licence cost in Oman varies according to your company’s structure and size, business activities, and location. Additionally, new regulations can shift fees and costs, making it important to stay up to date with the local regulatory updates. Once payment is confirmed, you will receive your trade licence, which you must maintain and renew annually.
Be sure to collaborate with an experienced business partner in Oman like Bondoni to facilitate these processes and ensure you remain current with the latest regulations. Bondoni’s team helps you obtain your trade licence in Oman easily and smoothly, as it is always informed of the current local regulations and all occurring updates. No matter what your sector or business structure is, Bondoni provides you with the guidance and support needed for smooth operations and launch.
Oman Trade Licence Renewal
Oman trade licence renewals are processed online and must be carried out annually to sustain regulatory compliance and business continuity. The general process requires gathering the necessary documents, filling and submitting the application on the Invest Easy portal, and paying the fees before receiving the renewed trade licence.
Bondoni’s Document Renewal and Management System provides you with streamlined document renewal services, renewing all business documents timely before their expiration date. Partner with Bondoni today to get peace of mind and let the experts handle all necessary paperwork just in time.
Contact Bondoni now to get started.