The sultanate’s government is planning to bring a new Foreign Capital Investment Law, which may allow foreign companies or individuals to increase their ownership in local companies up to 100 per cent, according to a senior industry official.
“Under the proposed new law, which is not released yet, among other things the key change will be the removal of the restriction on foreign ownership of companies in Oman. We already have a law to cover the sector but that has some restrictions,” Ahmed Amor al Esry, managing partner at EY Oman told Muscat Daily on the sidelines of an event last week.
Once the new law is enforced, some foreign companies may be allowed having 100 per cent ownership, he said, adding that going forward, the government is also likely to remove other major restrictions including requirements of having own properties, or minimum capital requirements.
“In order to safeguard small and medium enterprises, some restrictions would still be there, but to a large extent, the new law will be quiet lenient on allowing foreigners to own companies in the sultanate,” Esry said.
Currently, foreign companies have to rope in a local partner to operate in the sultanate and the local partner should have a minimum one-third share in the company.
As per the proposed new law, international arbitration of any conflict would also be permitted, Esry said. He added, “Overall, the new law is going to follow international best practices and would be instrumental in promoting foreign investment in the country.”
According to industry players, a number of foreign firms, particularly multinational companies, are awaiting more clarification on foreign ownership issue, and a new law would certainly be helpful in boosting investments in the Sultanate.
Esry expressed optimism that the new law might see the light later this year as the government is committed to pushing the growth of the private sector in the country.
Source: Muscat Daily