Foreign investors will now be allowed to own 100% of businesses in the Gulf kingdom of Bahrain, after the Bahraini government earlier this week approved an amendment to the country’s existing legislation.
Gulf press reports said Bahrain’s prime minister, Prince Khalifa Al Khalifa, presided at the cabinet meeting at which the amendment took place.
The decision to allow full ownership of businesses by foreign entities and individuals is intended to “spur growth, generate rewarding jobs for citizens, and attract businessmen to invest in various economic sectors”, Gulf news reports said, quoting a cabinet statement.
Bahrain is one of a number of Gulf countries that have been looking at boosting permissible levels of foreign ownership as a way of diversifying their economies, in the wake of economic hardship that has accompanied the recent plunge in world oil prices.
Other countries that have been reported to be considering similar moves, at least for certain types of businesses, include the United Arab Emirates and Oman. Last year, Apple was reported to have obtained an exemption to the UAE’s ownership laws – which mandate that foreigners not own more than 49% of any UAE firm unless it is incorporated in a free zone – but this was later denied by a government minister, according to a report in the Gulf News last August.
In June, Saudi Arabia said it would allow foreign entities to own 100% of Saudi retail and wholesale businesses, up from 75%, although those firms licensed to do so “must invest at least SR200m (US$53.3m) over the first five years after obtaining [their operating] license”, the English language Saudi Gazette noted at the time.
“Bahrain will stand a good chance to improve its rating on the index of Facility of Starting Business – an asset which will encourage leading international firms to establish in Bahrain – the gate to the GCC and the region,” said the Bahraini cabinet said, in a statement, according to the Gulf News.
Under the new ownership rules in Bahrain, foreign entities will be allowed to own 100% of companies in the kingdom that are involved in residency, food, administrative services, arts, entertainment and leisure, health and social work, information and communications, manufacturing, mining and quarrying, the supply of water, and professional, scientific, technical and real estate activities.