Location is everything when you plan to trade internationally. It must benefit your business strategically and financially. That includes thinking about costs and business banking arrangements, of course, because you’ll have to pay suppliers for imported goods, pay employees’ salaries, cover the costs of starting the business, etc.
One country you may consider starting up an international trade business in is Qatar. As Qatar prepares to host the 2022 World Cup, its economy has opened up to international business and offers a series of special zones, with equally special perks, for foreign entrepreneurs wanting to undertake new business ventures.
But like everything, they have their pros and cons. Here they are to help you make this decision.
Operating above the law
Ever wanted to be above the law? Consider setting up your business in one of Qatar’s free trade zones. Okay, so you can’t go round flaunting the laws, but businesses in these zones do enjoy certain financial privileges.
One of the main ball and chains that Qatar’s free trade zones release from business owners’ legs is the obligation to be business partners with a Qatari national. Normally, foreign nationals must co-own any business they start up in Qatar. If your business is in IT; sports, culture, and entertainment; distribution; agriculture; industry; tourism; or development and exploitation of natural resources, you can still avoid this.
Not a taxing affair
Taxes are a bitter pill to swallow when you work hard, but companies in Qatari free trade zones enjoy tax exemption, including duties on goods or services that the business imports. This is especially handy when you consider that the US trades heavily with Qatar, providing a great deal of equipment to support Qatar’s oil and gas industry as well as machinery, medical equipment, and agricultural supplies.
Taking your pick
One of the other benefits of operating in a free trade zone is that you have the freedom to hire as many expats as you want (subject to them meeting legal requirements). While the rest of Qatar concentrates on hiring Qatari nationals, you have freedom over who works for you.
Free trade zones may sound too good to be true, but the leases for the businesses that operate in them are high. Not only that, if you run into financial trouble not even free trade zones can save you. Whether you’re in a zone or not, Qatari authorities don’t take kindly to financial irregularities or debt.
If you set up your business outside of a free trade zone, your Qatari business partner would own 51% of the business — the majority share. To add insult to injury, they wouldn’t have to contribute financially or get involved in the running of the business, but they’d be able to end business operation without consulting anyone.
Qatar has its perks if you’re looking to set up you’re business there and tries to make it easy as possible for you, by offering tax and duty exemption and the freedom to employ whoever you wish. If ever the going does go bad, consult your bank for some business banking advice. They can help make Qatar a great place to trade.
If you’d like to find out more about setting up a business in Qatar, you can visit the Qatar Government portal.