A Comprehensive Guide to Jordan Company Formation
Located in Southwest Asia, Jordan has a unique and strategic location. At the crossroads of Asia, Africa, Europe, and the Middle East, the country has become a prime destination for offering businesses a large gateway for other continents. Apart from that, Jordan is a haven for international entrepreneurs, offering a favourable business environment, free trade agreements, and diverse investment opportunities.
Therefore, whether you’re a tech whiz, a manufacturing guru, or a tourism enthusiast, Jordan is the place to be for your entrepreneurial dreams to take root and flourish. In this article, we will cover the main essentials of setting up a business in Jordan, some heads-up tips, and where you can find help to expedite your business set-up.
How To Start Your Business in Jordan
Do note that there may be additional steps in setting up your business in Jordan.
Pick a Suitable Legal Business Structure
| Public Limited Company (PLC) |
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| Jordan Limited Liability Company (LLC) |
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| Branch Office |
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| Representative Office |
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| Offshore Company |
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Secure Your Unique Business Name
To select and reserve your business name in Jordan, check the Companies Control Department’s (CCD) online database to ensure its availability. Once confirmed, reserve the name with the CCD for JD 50. This would allow you exclusive rights to use it for six months.
This can take from one to three days.
Memorandum and Articles of Association Drafting
The Memorandum and Articles of Association are the key documents that explain how your company is set up, what it does, and how it will be run. Once you have written these documents, you can start the process of registering your company. Make sure you have all the important papers, including the Memorandum and Articles of Association, a list of all the directors and shareholders, and the registration fee, ready to be handed in.
This can take up to two days. However, the drafting really comes down to the level of detail you aim to achieve. A more detailed drafting process could take longer.
Obtaining a Certificate of Incorporation
Once you have successfully filed the necessary documents for company registration with the CCD, they will issue you a Certificate of Incorporation. This official document serves as concrete proof that your company has been legally registered and recognized as a distinct legal entity. This certificate is an essential document for various purposes, including opening a corporate bank account, entering into contracts, and applying for licences and permits.
This will take anywhere from four to six weeks. The time frame depends on the complexity of your company’s structure and the volume of applications being processed by the CCD.
Acquiring the Tax Identification Number (TIN)
The Income and Sales Tax Department (ISTD) is responsible for issuing TINs to companies. TIN is essential for tax registration, filing returns, and fulfilling tax obligations. To obtain a TIN, companies must submit the necessary application forms and supporting documents to the ISTD.
This process can take from two to four weeks.
Obtaining the Commercial Registration
The Ministry of Industry, Trade, and Supply (MITS) is responsible for granting Commercial Registrations, which authorize companies to legally operate their businesses in Jordan. To apply for Commercial Registration, companies must provide a comprehensive set of documents, including the company’s Memorandum and Articles of Association, a list of directors and shareholders, and payment of the registration fee.
This process can take up to Commercial Registration takes six to eight weeks.
Fulfilling Social Security Obligations Social Security Corporation (SSC)
Jordanian businesses with five or more employees are mandated to register with the Social Security Corporation (SSC) to ensure the welfare and social security of their workforce. By completing the required registration form, businesses can fulfil their legal obligations and provide their employees with access to social security benefits.
This registration process will take up to seven days and incur no cost.
Wait! You Should Know These As Well
| Cost of setting up a business in Jordan | Varies depending on the type of business and the location |
| Corporate tax rate in Jordan | Currently set at 25% – additional deductions and exemptions are available as well |
| Sectors in Jordan limited to nationals | Banking, insurance, telecommunications, air transport, tourism |
| Need for registered office | Must be located in Jordan; can be physical or virtual |
Last but not least, it is vital to note that the Jordanian government continuously evaluates and updates its business regulations to ensure a favourable environment for investors. There are a few potential changes that entrepreneurs should be aware of, such as streamlined investment approvals, enhanced support for startups, focus on specific sectors, e-government initiatives, and labour law amendments.
Let Us Be of Service
It is crucial for businesses to stay informed and adapt to the evolving regulatory landscape by regularly monitoring government announcements, consulting with legal and financial experts, and actively engaging with business associations. Embarking on the journey of starting a business in a foreign country can be a time-consuming endeavour.
This is precisely where 3E Accounting steps in. We are your one-stop solution team dedicated to making your journey to Jordan company formation smoother. We cover pre-, during and post-business set-up so you can worry less and focus on building the core of your business. To get started, contact us today!
