Overview
Oman’s foreign ownership framework underwent a fundamental transformation with the enactment of the Foreign Capital Investment Law (Royal Decree 50/2019), which replaced the previous restrictive regime requiring minimum 30 percent Omani partnership in most sectors. The new law permits 100 percent foreign ownership across the majority of commercial activities, positioning Oman alongside the UAE and Saudi Arabia in eliminating one of the most significant historical barriers to foreign direct investment in the Gulf region. This reform is a cornerstone of the Vision 2040 strategy to attract international capital and expertise at scale.
Key Facts
The Foreign Capital Investment Law applies to all foreign investors — individuals and corporate entities — seeking to establish commercial operations in the Sultanate. One hundred percent foreign ownership is permitted in most sectors without requiring an Omani partner. Minimum capital requirements have been reduced or eliminated for many activities. The law provides legal protections including freedom from expropriation without fair compensation, the right to repatriate profits and capital, and access to the Investment and Commercial Court for dispute resolution. Free zone entities have always permitted full foreign ownership under their respective legal frameworks, and this continues unchanged.
Restricted Sectors
Certain sectors remain subject to foreign ownership limitations or require specific government approvals. Defence and military-related industries are restricted to Omani ownership. Banking and insurance require Central Bank of Oman and Capital Market Authority approvals respectively, with foreign participation subject to licensing conditions. Media and publishing require Ministry of Information approvals. Importation of certain controlled goods requires specific permits. A negative list maintained by the Ministry of Commerce, Industry and Investment Promotion specifies activities excluded from automatic 100 percent foreign ownership. This list is periodically updated and has been progressively narrowed since 2019.
Free Zone Provisions
Oman’s free zones — including Duqm SEZ, Sohar Free Zone, Salalah Free Zone, and the Knowledge Oasis Muscat — operate under distinct regulatory frameworks that have permitted 100 percent foreign ownership since their establishment. Free zone companies benefit from additional incentives including tax holidays (up to 30 years), customs duty exemptions on imports, and streamlined licensing procedures. However, free zone entities may face restrictions on selling directly into the Omani mainland market, requiring a local distributor or mainland branch for domestic commercial activity.
Practical Considerations
Investors should engage qualified Omani legal counsel to confirm that their specific business activity is eligible for 100 percent foreign ownership under the current negative list. Company registration is processed through the Invest in Oman portal managed by the Ministry of Commerce, Industry and Investment Promotion. Commercial registration typically requires 7-14 business days for straightforward applications. Omanisation quotas apply regardless of ownership structure — foreign-owned companies must comply with sector-specific minimum Omani employment percentages. Land ownership by foreign entities outside designated areas remains restricted, with long-term leases available as an alternative.