100% foreign ownership under the 2019 Investment Law
Oman's Foreign Capital Investment Law, Royal Decree 50/2019, took effect 1 January 2020 and removed
the prior general requirement of a minimum 30% Omani partner, enabling up to 100% foreign ownership in
most sectors, subject to a negative list of activities still reserved for Omanis or requiring joint
venture participation -- commonly cited examples include certain retail trading, real-estate brokerage,
and security-related services, though the published list is periodically revised. Investor protections
include expropriation only via court order with fair compensation and the right to repatriate invested
capital and profits. Separately, Oman's Income Tax Law, Royal Decree 28/2009, applies a flat 15%
corporate tax rate to most companies regardless of the proportion of foreign ownership, with no
separate, higher rate specifically for foreign-owned entities. Current negative-list sectors and any
minimum-capital requirements should be confirmed directly with Invest Oman or the Ministry of Commerce,
Industry and Investment Promotion before finalizing a structure.
Registration and Oman's free zones
Business registration is handled through the Ministry of Commerce, Industry and Investment
Promotion's “Invest Easy” online portal, which covers reserving a trade name, obtaining a
Commercial Registration (CR) certificate, and registering with the Oman Chamber of Commerce and
Industry; most foreign-owned entities also need municipal licensing and, where relevant, approval from
a sector-specific regulator before commencing operations. Oman also operates several free zones -- Al
Mazunah, Sohar, Salalah, and the larger Duqm Special Economic Zone -- generally offering 100% foreign
ownership, exemption from customs duty on imported equipment and raw materials, full repatriation of
capital and profits, and long-term corporate tax holidays (commonly cited as up to 25-30 years, subject
to each zone's own published terms), alongside Omanisation requirements for local hiring that vary by
sector and zone. NRIs should confirm current incentive terms, minimum investment thresholds, and
Omanisation quotas directly with the relevant free zone authority before committing to a structure,
since these are reviewed periodically.
FEMA and outbound investment from India
FEMA's Overseas Direct Investment rules and the Liberalised Remittance Scheme apply to persons
resident in India, not to NRIs investing already-foreign-sourced earnings into an Omani business --
an NRI already living and working in Oman generally falls outside this framework for that investment.
FEMA becomes relevant if an India-resident individual or Indian company wants to invest India-sourced
funds into the Oman venture, whether by subscribing to equity or extending a loan -- such an investment
must generally be routed through an authorised dealer bank, reported on Form FC within the prescribed
timeline, and kept within applicable financial-commitment limits, with an Annual Performance Report due
each year the overseas entity remains active. The framework also becomes relevant if the NRI later
becomes an Indian resident again while still holding the Oman business, since FEMA's overseas-investment
and reporting obligations would then attach going forward to a holding that previously fell outside
them.
