Company Formation in Jordan for Foreigners

Company formation in Jordan for foreigners starts with choosing the right legal structure, preparing the required documents, registering the company, and obtaining the licenses related to the business activity. The process differs depending on whether the investor wants to establish a Jordanian company owned by a non-Jordanian, or register a branch of a foreign company already established outside Jordan.

In this article, we explain the steps for establishing and registering a company in Jordan for foreigners, the main legal requirements, the most suitable company types for foreign investors, open and restricted sectors, and the obligations that should be considered before and after registration.

Are you planning to establish a company in Jordan and unsure about foreign ownership rules or registration procedures? The corporate lawyers at Al-Atassi Law Firm can help you choose the appropriate legal structure, review licensing requirements, and guide you through the company formation process with clarity.

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Best Types of Companies for Foreign Investors in Jordan

Before starting the procedures for company formation in Jordan for foreigners, the investor must determine the most suitable legal structure for the business activity. The type of company affects legal liability, capital, management, licensing, and registration requirements.

The main legal structures that may suit foreign investors include:

Limited Liability Company

A limited liability company is one of the most commonly used legal structures for small and medium-sized businesses. It offers flexible management and generally separates the company’s financial liability from the personal liability of the partners, within the limits of the capital and shares.

Private Shareholding Company

A private shareholding company may be suitable for larger projects or businesses that require a broader management structure or multiple shareholders. It may also be appropriate for activities that need more detailed financial and administrative organization.

Branch of a Foreign Company

A branch of a foreign company is suitable for companies already established outside Jordan that wish to carry out activities or execute contracts inside the Kingdom. In this case, the matter is not limited to establishing a new Jordanian company, but rather registering a branch of a foreign company according to the specific requirements applicable to this type of entity.

If the foreign company is already established outside Jordan and wants to operate or execute contracts inside the Kingdom, it is better to review the requirements for registering a branch of a foreign company in Jordan before choosing this route.

Choosing the Legal Structure Before Registration

Choosing the company type is not a purely formal step. It is a fundamental stage before submitting the registration application because it determines the required documents, the scope of partners’ liability, the management structure, and the subsequent tax and regulatory obligations.

Steps to Establish a Company in Jordan for Foreigners

Before a foreign investor starts the company formation process in Jordan, the legal structure and business activity must be clearly determined. Registration and licensing requirements may vary depending on the type of company and the nature of the activity. Companies in Jordan are registered through the Companies Control Department in accordance with the Jordanian Companies Law No. 22 of 1997 and its amendments.

1. Choosing the Legal Structure of the Company

At this stage, the investor chooses the appropriate legal structure based on the nature of the activity, the number of partners, and the limits of liability, after comparing the available legal forms.

2. Reserving the Trade Name

After choosing the legal structure, the investor must select an appropriate trade name that is not prohibited and does not conflict with or closely resemble the name of an already registered company. The trade name is one of the first practical requirements before submitting the registration application.

3. Preparing the Memorandum and Articles of Association

The memorandum of association and articles of association are prepared in Arabic, with certified translation where necessary. These documents should include the partners’ details, capital, shares, management structure, company objectives, and the rights and obligations of the founders.

4. Submitting the Registration Application

The company formation application is submitted to the Companies Control Department along with the required documents, such as the founders’ details, company address, memorandum of association, articles of association, and any other documents requested depending on the type of company.

The Companies Control Department allows company formation applications to be submitted electronically for different types of companies.

5. Obtaining Approvals and Licenses According to the Activity

Some activities may require approvals or licenses from specialized regulatory authorities before or after registration. This may apply to professional, industrial, health, financial, or other activities that are subject to special regulation.

6. Completing Tax Registration and Post-Registration Requirements

After the company is registered, the investor must complete the subsequent requirements, such as tax registration, obtaining a tax number, securing professional licenses where required, and updating company and beneficial owner information in accordance with official requirements.

Capital, document, and approval requirements may vary depending on the company type and the intended business activity. Therefore, the requirements related to the selected legal structure should be verified before submitting the registration application.

After registration, companies that plan to hire non-Jordanian employees should also consider the requirements for work permits and residency for expatriates in Jordan.

Requirements for Establishing a Company for Foreigners Under Jordanian Law

Jordanian law does not prevent a non-Jordanian from establishing a company. However, it sets certain requirements and controls to ensure transparency and protect the national economy.

These requirements include:

The non-Jordanian founders must be legally identified and must submit their official identification documents, such as passports and other required identity documents.
Their shares in the company capital must be clearly determined and must not conflict with restrictions imposed by legislation on certain activities.
In the case of foreign branches, the branch must be registered under the Companies Law and a legal representative must be appointed in Jordan.
Investment laws allow the transfer and repatriation of foreign capital in a convertible currency within the legal framework.
The company must conduct lawful activities and must not be used for fraudulent purposes or for activities contrary to public order or economic security. The law also restricts the registration of names used for fraudulent purposes or names identical to previously registered companies.

Open and Restricted Sectors for Foreign Investment

The Jordanian market includes sectors that may be open to foreign investment, and others that may be subject to restrictions, special approvals, or ownership limits.

Open Activities

Foreign investors may be allowed to own full shares in companies established in free zones or development zones, subject to the applicable regulations.

In many commercial and industrial sectors, foreign investors may be treated similarly to Jordanian investors, unless a law or regulation provides otherwise.

Restricted Activities

Some activities may require special approvals, local ownership participation, or specific licensing requirements. This may include regulated sectors such as insurance, banking, financial services, transport, energy, or other activities subject to sector-specific supervision.

In some cases, foreign ownership may be limited according to the applicable legal and regulatory framework.

Incentives in Development Zones

Companies operating in development zones may benefit from tax and customs incentives, in addition to procedural facilities related to licensing and registration through the investment window or the relevant competent authorities.

Legal Rights and Obligations of Foreign Investors

When a foreign investor enters the Jordanian market to establish a company, they may benefit from legal protections for their investment. At the same time, they must comply with the obligations imposed by Jordanian legislation to ensure transparency and proper operation.

Foreign investors may have the following rights and obligations:

The right to transfer and repatriate foreign capital in a convertible currency in accordance with the law.
The right to receive treatment similar to that granted to local investors unless the law provides otherwise.
The obligation to pay local taxes, such as income tax, sales tax, and applicable fees.
The obligation to submit annual financial reports and maintain proper accounting records.
The obligation to comply with labor, environmental, health, and occupational safety laws.
The obligation to update company information if there is any change in management, ownership, or address within the legally required timeframes.

Investors considering long-term presence in Jordan may also review the available routes for Jordanian citizenship and residency by investment.

Importance of Hiring a Corporate Lawyer for Company Formation

When establishing a company as a foreign investor, working with a lawyer experienced in corporate and investment matters is an important step to avoid errors and ensure full legal compliance.

A corporate lawyer can help by:

Evaluating the most suitable company type for the intended activity in terms of legal structure and risk.
Drafting the memorandum and articles of association in a legally accurate manner that protects the founders’ rights and complies with Jordanian legislation.
Following up on official procedures and government approvals from company registration until final licensing.
Ensuring that the company complies with tax, labor, and regulatory laws after registration.
Representing the company legally if a dispute arises or if the company is subject to review or official inquiry.

If you are not sure which legal structure is suitable for your activity or whether your business is subject to foreign ownership restrictions, consulting a corporate lawyer in Jordan can help you establish the company correctly from the beginning.

Frequently Asked Questions About Company Formation in Jordan for Foreigners

Can a foreigner establish a company in Jordan?

Yes, a foreigner can establish a company in Jordan. However, this depends on the type of business activity, the legal structure, and the permitted foreign ownership percentage. Some sectors are open to foreign investment, while other activities may require special approvals or may be subject to certain restrictions. Therefore, the business activity should be determined before choosing the company type.

What is the best company type for a foreign investor in Jordan?

A limited liability company is often a suitable option for many foreign investors because it is flexible in management and works well for small and medium-sized businesses. However, a private shareholding company or a branch of a foreign company may be more suitable in certain cases, depending on the project size, activity, and number of partners.

Can a non-Jordanian fully own a company in Jordan?

A non-Jordanian may fully own a company in many activities, unless the activity falls within a restricted sector or requires specific ownership percentages or special approvals. Therefore, it is not enough to consider the investor’s nationality alone; the economic activity itself must be reviewed before registration.

What are the steps to register a company in Jordan for foreigners?

The steps to register a company in Jordan for foreigners usually begin with choosing the legal structure, reserving the trade name, preparing the memorandum and articles of association, submitting the registration application to the Companies Control Department, and obtaining the necessary approvals and licenses for the activity. After registration, tax and regulatory requirements must also be completed.

Is there a difference between establishing a Jordanian company owned by a foreigner and registering a branch of a foreign company?

Yes. Establishing a Jordanian company owned by a foreigner means creating a new legal entity inside Jordan, such as a limited liability company. Registering a branch of a foreign company applies when the company already exists outside Jordan and wants to conduct business or execute contracts inside the Kingdom.

How long does it take to establish a company in Jordan for foreigners?

The time required to establish a company in Jordan for foreigners depends on the company type, business activity, completeness of documents, and any required approvals. The process may be completed faster when the documents are ready, while regulated activities may take longer because of licensing or review by competent authorities.

Conclusion

This brings us to the end of our article on company formation in Jordan for foreigners. We explained the registration steps, legal requirements, key company types suitable for foreign investors, and the sectors that may require special approvals or be subject to ownership restrictions.

Establishing the company correctly from the beginning is essential to avoid registration delays or unexpected legal obligations later. Therefore, if you wish to open a company in Jordan as a non-Jordanian, you can contact a legal consultant at Al-Atassi Law Firm via the WhatsApp button to review your activity, determine the appropriate legal structure, and identify the required licenses.