Legal and Regulatory Frameworks for Startups


The Royal Decree No 56/2002 has opened the borders for tech companies in Oman and established the following free zones:

  1. Special Economic Zone Duqm
  2. Salalah Free Zone
  3. Sohar Free Zone
  4. Al Mazyunah Free Zone

These strategic locations provide Omani or foreign investors benefits with regards to promotion, sourcing of materials, tax incentives and export/import regulations. The government has established a special economic development zone at Duqm (also known as the free zone), where a logistics hub is being planned. These zones are located in Oman but have distinct jurisdictions, meaning that they operate under their own laws. You can set up a sole proprietorship or a limited liability company with at least two shareholders if you want to register your tech startup in these zones.

Conducting business in the free zone includes:

  • 100% foreign ownership is permitted
  • Exemption for custom duties on imports and exports
  • No minimum capital requirement
  • No taxes on profits or dividends for 30 years
  • No personal tax
  • Omanisation law applies with a lower threshold (See – Omanisation)
  • Fast-track customs handling, helpful for businesses exporting products
  • Knowledge Oasis Muscat – a technology park established for businesses and startups allow tech companies to permit 100% foreign ownership