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Habiba Mokhtar ([email protected]) – Associate

 

 

 

The Bahraini Ministry of Industry and Commerce (the MOIC) has introduced updated regulations for online businesses under Ministerial Resolution No. 51/2024 permitting the practice of some commercial activities virtually (the New Resolution) on 1 August 2024 and was immediately enforced the following day. The New Resolution aims to enhance flexibility in the practice of virtual commercial activities, supporting innovation and fair competition, to promote the growth of small businesses. This article will explore the New Resolution, its impact on Bahraini online businesses and provide legal clarity for both current and prospective online traders.

 

The New Framework

The Virtual Commercial Register (Sijili) was launched and regulated by the MOIC in 2016, allowing commercial activities to be carried out without having a physical address, significantly reducing costs and encouraging innovation. The initial resolution enacted in 2016, had regulatory gaps concerning culinary activities and online sales, which were effectively addressed in subsequent resolutions enacted by the MOIC in 2021. The New Resolution repeals all previous resolutions, namely Resolution No. 152/2016 Allowing the Pursuit of Commercial Activities Virtually, Resolution No. 11/2021 Regulating Culinary Activities Performed Virtually and Resolution No. 12/2021 Regulating Online Sales by a Virtual Business (collectively hereinafter the Repealed Resolutions) and has consolidated them under one resolution for greater clarity and ease of reference.

Updated Licensing Requirements

To be eligible for a Sijili license, the applicant must satisfy the following conditions:

  • Must be a Bahraini National of Legal Age
  • Commit to conducting business solely through a sole proprietorship.
  • Provide a permanent mailing address.

 

In contrast to the Repealed Resolutions, the New Resolution now allows sole proprietors, members and directors of other companies to be eligible applicants and engage in online commercial activities. This initiative considerably expands the pool of eligible applicants who can benefit from Sijili, enhancing flexibility and driving economic activity in the Bahraini market.

New Permitted Activities

The New Resolution has expanded the business activities that can be practiced with a Sijili license from 39 activities to 71 distinct activities, adding 32 new activities. Some of the new permitted activities include animal training, personal shopper services, hairstyling services, car maintenance works, effectively extending the scope of businesses that can be practiced with minimal costs.

The regulation of culinary services remains the same, providing that culinary services are restricted, subject to the applicant obtaining a license and adhering to the following:

  • Maintain high levels of hygiene at all stages of food preparation to ensure safety of ingredients, methods, and storage.
  • Display the commercial registration number prominently on the electronic page.
  • Sell directly to consumers or through contracts with restaurants and hotels, or any other entity.

 

Restricted Activities

The restrictions stipulated under the Repealed Resolutions, listing twelve categories of products that cannot be sold online, including food and beverages, medical equipment, pharmaceutical products, chemicals, tobacco and other regulated products requiring official approvals remain restricted under the New Resolution.

The licensee remains prohibited from employing foreign employees under the Virtual CR and the New Resolution continues to allow the sale of products purchased from abroad and does not only restrict it to the local market.

Concluding Remarks

The New Resolution mainly aims to consolidate all the previous resolutions enacted by the MOIC, to facilitate and ease referencing by any concerned individuals and eliminate any ambiguity. Additionally, the New Resolution significantly enhances flexibility and expands the eligibility of a broader group of Bahraini traders, by allowing owners or directors of other businesses to now be able to obtain a virtual CR, and by adding 32 new activities that can be conducted online.

 

For more information, please contact us on [email protected].

 

 

 

 

 

 

 

 

 

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