Question

To answer these questions you can refer to Oman commercial Companies Law, (Link is provided in Moodle under chapter-5).         

1. Describe briefly about different types of limited companies in Oman as per Oman commercial companies Law. (Answer not to exceed 1 page).
2. 2.   Compare between Limited Liability Company and Sole/one Person Corporation.        

Answer 1

Answer:(1) The consolidation of a business company in Oman is administered by the Commercial Companies Law, Foreign Capital Investment Law, and the Commercial Register Law. Contingent upon the capital of the business, destinations of the gatherings in question and the sort of business, the most well-known types of business organizations utilized in Oman are:

• 1. Limited Liability Company: A limited liability company (LLC) is one where every investor's liability is limited to a lot of the capital. An LLC company in Oman is required to have at least 2 investors (at any rate one of whom must be a resident of Oman, a Gulf Cooperation Council (GCC) state or the USA, and must claim over 30% of the company's offers) and 1 executive. The base capital required to begin an LLC company in Oman is OR 150,000 (around 390,000 USD). An Omani LLC is the most usually favored company type by outsiders needing to set up a business in Oman.
• 2. Public Joint Stock Company: A joint-stock company is one the capital of which is disseminated as stocks. The portions of a public joint-stock company in Oman can be exchanged publicly. The base offer capital required to begin such a company is OR 150,000 (around 390,000 USD). A joint-stock company may not be fused without the endorsement of the Ministry of Commerce and Industry and issuance of a permit affirming that.
• 3. Private Joint Stock Company: A joint-stock company the portions of which are not accessible for exchanging publicly is a private joint-stock company. A private joint-stock company in Oman requires at least 3 investors (one of whom ought to be an Omani resident holding at any rate 30% of the all-out offers) and a base offer capital of OR 50,000 (around 130,000 USD).
• 4. Limited Partnership: A limited partnership in Oman can be shaped by at least 2 individuals. It requires at any rate 1 general accomplice and 1 limited accomplice to be enlisted. The general accomplice, who must be an Omani national, is subject to the obligations and commitments of the partnership without restriction in liability. The limited accomplice bears the limited liability and is at risk for the company's obligations and commitments just to the degree of one's capital commitment.
• 5. Business Agency: A business office in Oman is a company that is appointed to advance or disseminate items or administrations of an outside substance in the Sultanate. The essential capacity of such a company is to send out products and enterprises to Oman by a remote business. In a business organization in Oman, the job of a business operator can be allowed just to an Omani national enrolled with the Omani Chamber of Commerce or a nearby substance having at any rate 51% neighborhood shareholding.

Answer:(2) Contrasting an LLC with a Sole Proprietorship

Focal points of an LLC Compared to a Sole Proprietorship

• Proprietors are Not Personally Responsible for Company Debts: This is the most significant quality of an LLC. Insole ownership and association, the proprietors are by and by answerable for business obligations. If the benefits of the sole ownership or association can't fulfill the obligation, lenders can pursue every proprietor's very own financial balance, house, and so forth., to compensate for any shortfall. Paradoxically, if an LLC comes up short on reserves, the proprietors are typically not subject.
• Simpler for A LLC to Raise Money: A LLC has numerous roads to raise capital. It can concede new individuals by selling participation interests, and it can make new classes of enrollment interests with various democratic or benefit attributes. Also, speculators will be guaranteed that they are not by and by at risk for organization obligations.
• The simplicity of Ownership Transfer: Ownership interests in a constrained risk organization may for the most part be offered to outsiders without upsetting the proceeded with the activity of the business. The matter of sole ownership or association, then again, can't be sold entirety. Rather, every one of its advantages, licenses and allows must be exclusively moved. New financial balances and expense ID numbers are likewise required.

Drawbacks of an LLC Compared to a Sole Proprietorship

• Cost of Set-Up: It costs more to begin an LLC and run it than sole ownership or organization. For instance, there are the underlying arrangement expenses, documenting charges, and yearly state expenses. These expenses are incompletely balanced by lower protection costs.
• Formal Organization: Although an LLC requires fewer customs than a company, there is still more desk work required than sole ownership or association. Sole ownership or association can open and work with no formal sorting out methods - not so much as a manually written understanding.
• Separate Records: In request to keep up the different types of the LLC and keep up the risk security of its individuals, LLC proprietors should cautiously keep up independent records and keep individual undertakings separate from the LLC's business. Much more critically, the LLC's cash ought to never be blended with individual cash.

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