MARKET ENTRY STRATEGIES TO QATAR STEPS & CONSIDERATIONSPresented by Liam Trump

AGENDA

1. Who We Are

2. Offshore Trading Options

3. Onshore Establishment Options

4. Points to Consider

• Established in 2010, 100% Qatari owned.

• PRO-Partnership act as the 51% Qatari corporate partner for LLC companies who wish to start or expand their businesses in Qatar.

• Provides greater safety and security for your investment

ABOUT US

Offshore Trading Options

ONSHORE OPTIONS OVERVIEW

Offshore Options

Fly In/Fly Out Method

Commercial Agency

Agreement

1. FLY IN & FLY OUT METHODThe method most preferred by Consultants: Fly in to Qatar on a Business Visa, complete the project and fly back out.

• Considerations of The Fly In/Fly Out Method:

• Less projects being awarded to non-local entities.

• As invoicing is coming from abroad, subject to withholding taxes of 5-7% of gross invoice amount.

• Obtaining the correct visa’s are difficult (Should be business visa)

2. COMMERCIAL AGENCY AGREEMENTSFully Active Commercial Agency Agreements:

Full commercial agency agreements allows the local Qatari Company to fully trade products in Qatar meaning:

• They have a legal commercial trade licensing company in Qatar • As there is no general trade license activity the Qatari company must have a trading

license matching the product or services in order to trade it legally • Depending on the product they have the ability to apply via the appropriate ministry to

approve product for import • The local representative company must be a 100% Qatari owned company

If the above is matching the local representative is able to offer a full representative service including:

1. Importing and storing the product 2. Selling of product & service 3. Invoicing 4. Represent the company 5. Apply for customs license

2. COMMERCIAL AGENCY AGREEMENTSPartial Agency Agreements:

Partial agency agreements allows the local Qatari company to simply represent the product or service in Qatar meaning.

1. They have a legal marketing company

If the above is matching the local representative is able to offer the following:

2. Represent the product and service3. Sell the product

However under partial agency agreement the company can’t:

4. Invoice 5. Import or store 3. All importing and invoicing would be done via a local 3’d party partner or directly via the buyer.

Onshore Establishment Options

ONSHORE OPTIONS OVERVIEW

Onshore Options

LLC Incorporation

100% Foreign Ownership

Branch OfficeTrade

Representative Office

QFC Law 1 2010

1. LIMITED LIABILITY COMPANYA Limited Liability Company (LLC) is the most common establishment option in Qatar.

Key Requirements/Considerations:

• (Usually) Requires a 51% Qatari Partner/Shareholder. However, profit share doesn’t necessarily reflect Shareholding.

Main Advantages of Operating As a Limited Liability Company:

• Can fulfil an unlimited number of contracts

• Recognised as a local company, often permitting the entity to take part in an increased number of government and private tenders.

• The company will not be subject to withholding tax.

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2. BRANCH OFFICE If you are a foreign company executing a specific contract issued by a government or quasi-government entity in Qatar, you may establish a Branch Office.

The contract, must “facilitate the performance of a public service or utility,”

Main Advantages of Operating As a Branch Office:

• Can maintain 100% Foreign Ownership

Considerations of a Branch Office:

• Limited to single contract

• Expensive Government License Fee’s levied

Option For Manufacturing companies

This type of representation is useful in introducing your products to Qatari companies as a non-trading ”shop-window.”

Main Advantages of Operating As a Trade Representative Office:

• Can maintain 100% foreign ownership

Considerations of a Trade Office:

• Cannot export, import or sell in the State of Qatar• Requires Ministerial Approval based on the manufacturing License of the mother

country entity

3. TRADE REPRESENTATIVE COMPANY

Allows For Foreign Ownership in a large number of fields as long as it fits their criteria which are:

Main Advantages of Operating Under QFC:

• Can maintain 100% foreign ownership

Considerations of Operating Under QFC:

• No Trading Companies

• No Blue Collar Workers

• No Startups

4. QATAR FINANCIAL CENTER

Law No.1 of 2010, amending Law No.13 of 200 allows for 100% foreign ownership in certain sectors, namely …

• Agriculture• Industry• Health • Education• Tourism• Development Natural Resources• Energy or Mining

• Consultancy & Technical Services• Information Technology• Culture• Sport & Recreation Services• Distribution Services

BUT…. It Requires Ministerial Approval!

6. LAW NO.1 2010

GENERAL CONSIDERATIONS FOR ONSHORE ENTITIES

GENERAL CONSIDERATIONS FOR ONSHORE ENTITIESCompanies Locally Established in Qatar, be it an LLC, Branch Office, Trade Representative Office, QFC Must Maintain:

• A 12 month lease of an office space in the name of the company.

• A locally appointed auditor to file your tax returns

• Are subject to 10% Corporation Tax

SUMMARYNext Steps..

1. Identify opportunity in the marketplace, short & long term.

2. Identify which Market Entry Method is best suited to your organisation

3. Seek out expert advice e.g. PRO-Partnership, Lawyers, Business Owner Referrals

THANK YOU

QUESTIONS? www.propartnership.com

Tel: +974 40120320