Govt offers incentives to create joint-stock firms

Muscat - The Ministry of Commerce, Industry and Investment Promotion, in coordination with relevant authorities, has prepared and implemented a package of incentives aimed at establishing or converting companies from limited liability to closed joint-stock companies.

This comes within the framework of the directives to launch the capital market stimulus program in May to achieve sustainable growth for the targeted companies and enhance their competitiveness and ability to expand and develop their businesses.

These efforts resulted in the transformation of 7 limited liability companies into closed joint-stock companies, in addition to the establishment of 10 closed joint-stock companies, including holding companies, which contributed to raising the level of competitiveness of these companies, and promoting the application of the best corporate governance standards, which supports their sustainability and financial stability, and enhances their ability to compete in local and international markets, and attract quality investments.   

Mohammed bin Salem al Hashmi, Director of the Regulatory Establishments Department at the Ministry of Commerce, Industry and Investment Promotion, pointed out that the transformation into closed joint-stock companies contributes to raising the level of compliance and transparency, and enhancing the application of governance principles, which positively impacts the sustainability and financial stability of companies, supports their growth and expansion, and contributes to the development of the national capital market.

He explained that the package of incentives offered to companies wishing to transform includes an exemption from one-third of income tax for two years, a fast track to financing through the Development Bank, a 10 percent price preference in tenders, in addition to the installment of income tax, and an exemption from value-added tax for 6 months.

He pointed out that companies eligible for the transformation must have a capital of no less than RO500,000, have at least 20 Omani employees, or meet the prescribed Omanization ratios, and be committed to paying value-added tax, to ensure the promotion of company growth, support the capital market in the Sultanate of Oman, and achieve financial and economic sustainability.