For the most part, companies entering the Qatar market will form a Limited Liability Company – LLC. The Foreign Investment Law states that foreign investors with non Qatari nationality, may invest only through the medium of a company incorporated in Qatar, in which one or more Qatari nationals or 100% Qatari national owned company, hold no less than 51% of the share capital. Foreign investors can therefore, not own more than 49%*. These joint venture companies with Qatari partners are allowed in most business sectors of the economy excluding commercial agencies, auditing and accounting, security and real estate**. Therefore a Limited Liability Company LLC in Qatar allows access to almost all the activities that a company can undertake in Qatar.
* Different rules apply to GCC Nationals who may partner with Qatari partners in Qatar on a 50%-50% share basis and in some instances own 100%
** Please seek advice from us in relation to which activities must be ‘Qatari companies only’
Share Capital Requirements for LLCs in Qatar
One of the key advantages of an LLC setup is that the partners have limited liability exposure due to their share in the total investment capital. The minimum share capital, in order to obtain the commercial registration was QAR 200 000, this has been recently amended as a result of the new Companies Law, No. 11 of 2015, currently there is no set limit for the share capital deposit and no requirement to deposit share capital.
Profit Share arrangements for LLCs in Qatar
The 51% – 49% shareholder relationship does not have to be reflected in the profit share, this can be determined by agreement between the foreign shareholders and their Qatari partner.
Clearly, the 51% – 49% shareholding relationship requirements in Qatar dictates that foreign entities wishing to establish themselves in Qatar are extremely cautious about who they choose to partner with, partnering with Venture Partner Qatar, eliminates the need for a protracted search for the ideal Qatari partner.
When establishing through Venture Partner Qatar, we ensure that agreements are in place that completely protect the foreign investor’s control and profits. In addition, we provide a penalty free exit strategy for the foreign investor.
Advantages of Partnering with Venture Partner Qatar: