Bahrain Corporate & Trust Services

Company Formation and Management Services

the nature and size of the proposed business, as well as the particular requirements of investors govern the choice of legal vehicle in Bahrain. All types of Bahraini companies give the shareholders or the directors an Investor’s Residence Visa. The Bahrain Commercial Companies Law (BCCL) of 2001 replaced the old Bahrain Commercial Companies Law of 1975 and made substantial changes. This law applies to all legal structures except that of a Sole Proprietorship, which is registered according to the provisions of Bahrain Law of Commerce, Decree No. 7 of 1987. The principal types of vehicle are:

  • Limited Liability Company – known as company With Limited Liability (WLL) A WLL is a company of which partners are responsible for the company debts and liabilities only to the extent of their capital. The maximum number of partner is 50 and, if the number of shareholders falls below two, the company must introduce new shareholders within a period of 30 days, or by force of the law, must be converted to a single person company or proceed to dissolution. A WLL cannot engage in banking and insurance activities and cannot issue public shares, negotiable warrants or debentures. 100% foreign ownership is allowed and local operations are permitted. A local office presence is required but there is no requirement for a local sponsor. The minimum share capital is BHD20,000, the minimum number of directors is two and an annual submission of audited financial statement is required.
  • Single Person Company (SPC) An SPC is a limited liability company that has one shareholder who is responsible for the company debts and liabilities only to the extent of its capital. An SPC cannot engage in banking and insurance activities and cannot issue public shares, negotiable warrants or debentures. 100% foreign ownership is allowed and local operations are permitted. A local office presence is required but there is no requirement for a local sponsor. The minimum share capital is BHD50,000 and an SPC requires at least one director.
  • Foreign Company Branch A branch of a foreign company that is incorporated and registered outside Bahrain may be established as an Operational, Representative or a Regional Office. The limits of liability are the same as the parent company. Local operations are permitted only for an Operational Office, which require local sponsor. Representative and Regional Offices are only permitted to undertake marketing and promotion activities. A local office presence and a branch manager are required. Banking and insurance activities are allowed for Operational Offices only.
  • Bahraini Establishment or Sole Proprietorship Commercial registration for a sole proprietorship or individual establishment is only issued to Bahraini citizens, or GCC or US citizens resident in Bahrain, over the age of 18. The liability of the sole proprietor is unlimited.
  • Partnerships A general partnership company is formed between two or more people under a specific name, and the partners assume joint responsibility, to the extent of all of their funds, for the partnership’s obligations. There must be at least two partners, at least two directors and the company must set up a local office. Depending on the category, 100% foreign ownership is permitted and a local sponsor is not required.
    A simple limited partnership company (Simple Commandite) is established between two categories of partners, joint and limited partners. Joint partners are jointly and severally responsible, to the extent of all their funds, for the company’s obligations. Limited partners invest capital in the company but do not undertake management and are not held responsible for the company’s obligations save to the extent of his share in the capital. Joint partners must be Bahraini nationals and their share of the capital must be at least 51%.
    A limited partnership by shares (Commandite by Shares) is established between two categories of partners, joint and limited partners. Joint partners are jointly responsible, to the extent of all their funds, for the company’s obligations. Limited partners, the shareholders, are not liable for the company’s obligations except to the extent of their shares in the capital. There must be at least four partners and at least two directors. All joint partners must be Bahraini nationals and the percentage of their capital must not be less than 51%. The minimum capital is BHD 20,000. The company must have a local office but a local sponsor is not required and 100 % foreign ownership is possible.

The costs of incorporation vary considerably, depending on the type of entity required and the activity that it undertakes. Each business activity needs specific pre-approval from the relevant government department. Whilst Sovereign will handle all procedures, the timescales can be uncertain. Prices are in the range of BHD1,500 to BHD5,000. When we understand the nature of the business and the type of entity required, we will provide a comprehensive all-inclusive quotation before proceeding

Once incorporated, we provide a domiciliary service, which includes the provision of company secretarial, registered office and nominee shareholder services. Full management services from our own licensed corporate directors are also available and highly advisable in most cases. Re-mailing services are available at modest cost for all companies established by Sovereign.

Note: Ancillary services
In addition to providing incorporation, domiciliary and management (directorship) services, a range of ancillary services at competitive prices is available on request. These services include, but are not limited to: provision of dedicated telephone lines; office and personnel assistance; designated staff members (temporary or permanent availability); assistance with office relocation, introduction to real estate agents, government agencies and other third parties.

Trust Formation and Trustee Services

Trusts have many applications and advantages, including the protection and preserving of assets, tax planning or just avoiding the expense and delays of obtaining probate under a will. They also provide a high degree of confidentiality. The use of trusts as a means of holding and passing on family wealth, even for modest estates, has increased dramatically in recent years.

Unlike a company, a trust is not a legal entity. It is best described as a relationship; an arrangement whereby property is transferred from one person (the settlor) to another person (the trustee) who holds the property for the benefit of specified people or objects (the beneficiaries). A trust deed sets out the terms and conditions upon which the trustees must hold and administer the trust assets. The trust deed also sets out the rights and interests of the beneficiaries.

Whilst Bahrain is not a traditional “trust jurisdiction”, Sovereign administers trusts through our licensed trust corporations in Gibraltar, Guernsey, the Isle of Man and the Turks and Caicos Islands. Fees for drafting a trust deed and for the provision of trustee services will be quoted on a case-by-case basis. For more information on the setting up of a trust and how it can assist you and your family, please speak to a consultant.


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Sovereign Trust (Gibraltar) Limited
Tel: +350 200 76173