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Oman is a relatively easy place to do business. The Sultanate of Oman stands with a favorable ranking in international business surveys.

Are you looking for a country with a modern business law framework, respect for free markets, a prime location, a business-friendly environment, contract sanctity, and respect for property rights? A place with relatively low taxes, an educated and largely bilingual workforce, a modern transport infrastructure, and where it is easy to start your business?

Then you can surely invest in Oman.

Oman is ideal at the center of the east-west nexus joining markets in Europe, Asia, and North America. Just outside the Persian Gulf and the Strait of Hormuz, along busy shipping lanes carrying a significant share of the world's maritime commercial traffic, Oman has convenient access and connections to the Gulf, Africa, and the Indian subcontinent.

It is essential to understand that to survive and flourish a company in any country, have a complete idea about the nation’s business culture and be open to new concepts. Let us help you understand it better to help you with your company’s future.

Before moving to that, let us clarify that this country stands in a high-income category with four free zones and a greater number of business opportunities in Oman.

Let us have a look at the various reasons for facilitating foreign investment in Oman.

Just outside the Strait of Hormuz and the Persian Gulf, along the busy shipping lanes carrying a prominent share of the world's maritime commercial traffic, Oman has connections and easy access to the Gulf, the Indian Subcontinent, and Africa.

Rich in cultural diversity, heritage, and racial harmony, Oman also has some natural beauty, complete with magnificent mountains and wadis and over 3000km of public open coastal line. These attractive characteristics make Oman a tourist place and an investment hub.

International links range from the powerful concentration of global brands like Lulu, BP, Shell, Air Liquide, Vale, Jindal Power & Steel, Larsen & Toubro, Rio Tinto Alcan, and Carrefour; Oman also has some commendable trade agreements being a signatory to WTO, GCC Common Market, GAFTA, FTAs with Singapore and the US, Norway, Switzerland, Iceland, and Lichtenstein.

Oman is one of the safest and most secure countries with one of the lowest crime rates globally. In addition, it has an affordable city living with housing and rental prices well below the Gulf's regional average.

As a result, Oman is considered one of the best places in the Gulf to bring up a family. Compared to most Middle Eastern countries, Oman is home to a vibrant ex-pat and foreign investor community, amounting to almost half the country's total population.

The management style that predominates in Oman's Sultanate for business and company registration is hierarchical, though perhaps slightly less top-down than in some of its neighboring countries. Most of the decisions made at the top-level management are direct instructions given to the staff to follow.

The Islamic Sharia law is the source of all legalization in the country, with most of its laws based on a common law system. The Sultanate of Oman has stringent laws and regulations that are amended continuously to offer a flexible and updated legal framework to run a business in Oman.

The country’s commercial courts decide business disputes.

There are two vital legal structures for foreign companies in Oman, providing either a direct or indirect business presence in the country. A direct presence is availed through a corporate entity, whereas an indirect presence can be availed through commercial agents.

The Commercial Companies Law of Oman offers a broad range of partnership facilities to choose from for a foreign company.

LLCs are directed by their authorized managers whose authority to bind the Limited Liability Company is set out on the Consumer Report and in the constitutive contract of the LLC, as agreed by the company’s partners or shareholders. The authorized managers often appoint a manager to deal with the day-to-day operational management of the LLC under the authorized manager’s direction.

However, the authorized manager can be a resident overseas but may be required to occasionally attend before a specific authority in Oman to complete certain registrations or acts.

Personal income is currently subject to income taxes in the country. Accordingly, individuals do not require to file income tax returns, and the concept of tax residency is not presently defined for individuals.

Currently, the only main tax cost to Oman businesses is the corporate income tax at a rate of 15% on all taxable profits. A special provisional rate of 55% applies to income derived from the sale of petroleum.

Having a word with the firm of taxation service in Oman is advised. Omani law makes it a prerequisite that in the private sector, Omani employees must be insured against disability, death, old age, and occupational injuries and diseases by the Public Authority for Social Insurance (PASI).

Private-sector employers should make a monthly contribution to the PASI at 10.5% of each Omani employee’s basic salary. Non-Omani GCC nationals working in Oman have contributions made to PASI at a rate equivalent to their home jurisdiction, with their base jurisdiction making up any shortfall due to their home benefits being exceedingly generous than the Omani scheme.

Oman has established a special zone and three free zones, each of which is established by a special law prescribing the permitted activities and special benefits. While there are a few differences, free zones generally allow foreign owners to have 100% ownership of the company.

Oman has an investor-friendly legislative environment with no capital, profit, or repatriation restrictions. About 70% of foreign investment is in most sectors, 100% in exceptional cases and specific economic zones.

Lower Omanisation requirements, duty-free imports and exports, tax-free holidays, minimum capital investment requirements, and restrictions on repatriation of capital, investments, or profits.

Oman offers business in free zones like Salalah Free Zone, SEZD, Sohar Port and Free Zone, and Al Mazunah Free Zone.

The Sultanate of Oman is a part of the Gulf Cooperation Council (GCC) Union. Implementing the GCC Customs Union, established in 2003 to remove customs and trade barriers among the GCC member states, is still in progress.

The GCC states apply a Common Customs Law and a Unified Customs Tariff with a standard custom duty rate of 5% of goods’ cost, freight value, and insurance, with some exceptions like tobacco and alcoholic goods (they are subjected to a 100% customs duty rate).

Oman has a young, multilingual, and educated local talent pool equipped for the 21st century. Oman also has some of the most competitive salary rates in the Gulf, with a population of 4.3 million population and 1.7 million employees, and over 239,000 registered businesses.

Oman’s government focuses on diversification, industrialization, and privatization to reduce reliance on hydrocarbon revenues, and the country is committed to economic diversity and investment.  It has a leading advanced telecommunication infrastructure supporting interconnected international and domestic networks.

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