Discusses the legal requirements/options for joint venture/licensing in this market.

The demand for joint ventures and licensing opportunities remains strong in Bahrain.  The infrastructure, ICT, electricity, water, tourism, training and education sectors have been privatized and are important growth sectors in the economy.

American companies are attractive to Bahraini partners due to their brand recognition and potential opportunities for technology transfer.
Bahrain’s Commercial Companies Law permits joint ventures between parties.  A joint venture agreement must specify the parties' rights and obligations and determine the division of profits and losses.  There are no other specific formalities for parties to enter into a joint venture (such as registration).  Joint ventures in Bahrain have no corporate identity.  Since all business activity in Bahrain must be conducted through a company or an individual establishment, third parties have recourse against a company or individual establishment, not directly against the joint venture.

In practice, individuals from a foreign company and a local business who want to engage in a joint venture are likely to set up a new company.  Establishing a limited liability company is the most popular business vehicle for this purpose.  The parties' relationship is governed by the constitutional documents of the new company, in particular the memorandum of association.  However, some parties also draw up additional agreements to govern their relationship.  These are enforceable only to the extent that they are not contrary to the laws of Bahrain.

The Commercial Section of the U.S. Embassy helps match American and Bahraini firms looking to form joint ventures in both the local and regional market.
 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.