As in any other country, Qatar has its own specific guidelines and requirements on foreign nations operating in this country. There are adequate services in Qatar for legal, financial, tax, business advice, background check of the company and feasibility studies. Professional experts are available for any professional advice on such matters.

To start a business in Qatar foreign companies must first appoint an agent / service sponsor. However, experts say that the agent / sponsor service requirement in Qatar is becoming more lenient and can be abolished in the coming years.

General laws to establish and operate a commercial establishment in Qatar

According to the Law on Commercial Companies No.5 (2002), a company must be based in Qatar. The company can take different forms, depending on its size, relationship between the participating entities, desired structure – singular, as part of a larger group, or within a holding company, etc. However, the types of generally accepted companies that can operate in Qatar are:

• Joint venture
• Limited Partnership
• Private company
• Shareholding company
• Limited Liability Company
• Stock Company

All required documentation, conduct and procedures are detailed in the Commercial Companies Law. In all legal contracts, the language used must be Arabic, and always, the Arabic version will be

Associated Society

Trade association agreements are common in Qatar. An associated company comprises two or more partners responsible for the responsibilities of the company. But, in such cases, all joint partners should be Qatari, and each partner has the power to hold business and business meetings under the name of the company. But, it is mandatory to obtain approval first before proceeding with any investment.

Limited partners

They are only responsible for debts incurred by the company, or to the extent of their registered investment. They have no administrative authority.

Stock Company

An equity company comprises two teams, with one or more partners responsible for the company’s debts in all its assets, while the other includes shareholders.

Shareholding company

This company is formed through an equity agreement, approved by the Ministry of Economy and Commerce, before the establishment of the company. The capital of the company is distributed to negotiable shares of equal value. The number of shareholders must be at least five, all being Qatari.

Foreign ownership

In general, owners and investors of foreign companies will often form a Private Limited Liability Company (LLC) to operate within Qatar. In such cases, the company must have a minimum authorized share capital of QR200,000 and two shareholders, and a maximum of 30 shareholders. Foreign investors have 49% ownership of the share capital, while the remaining 51% is held by one or more Qatari partners.

The Ministry of Economy and Commerce can grant permission for the participation of foreign investors to exceed 49% and up to 100%, depending on the case, provided the business is compatible with Qatar’s development plans.

Certain other factors, such as whether the company exploits domestic raw materials, offers new products or establishes new technologies, and takes into account the interest of national cadres.

Qatar Tax System

Personal tax:

There is no personal income tax per capital. This implies that employees can take their wages and salaries home without tax deduction. But, a person who enters into any type of commercial activity with an interest to earn income will have to pay taxes, in accordance with the

Corporate Tax Law.

The income of Qatari citizens and the CCG residing in Qatar is tax exempt. The tax rate is 10 percent of the company’s total state revenue, paid annually. However, this fixed rate only applies to companies, and not to individual income or personal tax.

Typical commercial costs are deductible and losses can be transferred for a period not exceeding three years from the original accounting statement. The term “commercial activity” could imply any vocation, service, profession, industry, commerce, speculation, contractual work or any business that generates profits and income. Rental income is subject to a fixed rate of 10 percent.

Tax exemptions

Tax exemptions are applicable to revenues on Public Treasury Bonds, Public Corporation Bonds and Development Bonds, Income from shares that comply with conditions in Article 4 of Law No.21 of 2009, small handicraft businesses with less than 3 employees, income of companies working in fisheries, agriculture, aerial, and maritime transportation on condition of reciprocity, and Qatari legal persons residing in the State.

There are no other taxes, as Qatar is among the topmost low taxation countries across the world, which makes it attractive to expats.

The Customs Duty for general cargo entering Qatar is about 5%. For temporary imports into Qatar, permission from the General Director of Qatari Customs is necessary, apart from a cheque or bank guarantee to Customs Department towards duty charges for shipment. This will be refunded on producing proof of export from Qatar. Normal customs clearance by air is 1-2 days and by sea is 2-4 days.

As for banking, foreign investors require permission from Qatari Government to invest in the banking and insurance sectors.