How to do business with Bahrain
Companies operating in Bahrain are required to follow international accounting and corporate governance standards.
Bahrain hosts the Bahrain Chamber of Dispute Resolution in association with the American Arbitration Association (BCDR-AAA), providing commercial and governmental users contracting in the Gulf and beyond with solutions for resolution of economic, financial and investment disputes. See: https://www.bcdr-aaa.org/.
The DIT team in Bahrain at: https://www.gov.uk/world/organisations/department-for-international-trade-bahrain#contact-us can help you find tax and legal advisers before entering into agreements in Bahrain.
Standards and technical regulations
Your product or service will need to conform to the legal requirements set out in the relevant Bahraini standard. All suppliers and manufacturers have an obligation to ensure products are safe and meet relevant safety standards, have clear instructions for proper use and include warnings against possible misuse.
Companies need to check exact requirements for their products with the Ministry of Industry and Commerce (MOIC) at: http://www.moic.gov.bh/en/Pages/default.aspx.
Other government organisations include:
Ministry of Health for medical devices and medicines regulation (https://www.moh.gov.bh/)
Ministry of Works, Municipalities Affairs and Urban Planning for plants and seeds (https://www.mun.gov.bh/portal/indexEn.jsp)
Ministry of Interior for security equipment (http://www.interior.gov.bh/en/)
Controlled goods export licences
Any goods, software, technical information and technology which are on the UK Strategic Export Control Lists will require a licence for Bahrain. See: https://www.gov.uk/government/publications/uk-strategic-export-control-lists-the-consolidated-list-of-strategic-military-and-dual-use-items-that-require-export-authorisation for details of the lists.
There are a number of open general export licences (OGELs) which are available for exporting military and certain dual-use controlled items to Bahrain – these have a straightforward registration process. Visit: https://www.gov.uk/government/collections/open-general-export-licences-ogels for further details of OGELs.
If you cannot use an Open Licence you will have to apply for a Standard Licence. See:https://www.gov.uk/guidance/export-controls-military-goods-software-and-technology. You should also check if you need an Export Licence, at: https://www.ecochecker.trade.gov.uk/spirefox5live/fox/spire/OGEL_GOODS_CHECKER_LANDING_PAGE/new and apply via SPIRE: https://www.spire.trade.gov.uk/spire/fox/espire/LOGIN/login.
Some additional products, including consumer items, may require further certification or licensing before they can be exported to Bahrain. See the UK Government’s guidance on export licences and special rules at: https://www.gov.uk/starting-to-export/licences.
The importing of certain goods into Bahrain is prohibited. More details of these can be found on the Bahrain Government’s Customs Affairs site at: http://www.bahraincustoms.gov.bh/page.php?SID=WTBkR2JscFVNREZOUTFwMFVGUlpiV015TURsTmVrVTk%253D.
Product liability insurance
Product liability insurance covers the cost of compensation for anyone injured by a faulty product. If you design, manufacture or supply a physical product you should therefore consider taking out product liability insurance. See: https://www.abi.org.uk/products-and-issues/choosing-the-right-insurance/business-insurance/liability-insurance/product-liability-insurance/ for further information, or alternatively, contact the DIT team in Bahrain at: http://www.gov.uk/world/organisations/department-for-international-trade-bahrain#contact-us for contacts of local insurers or specialist brokers.
[Source – Government of Bahrain, BCDR-AAA, DIT Trade and Investment guide: Bahrain, gov.uk]
Double taxation agreement
The UK and Bahrain have signed a double taxation agreement, which allows some taxes paid in one country to be deducted in the other, so should prevent any double tax liability from UK and Bahrain authorities over the same income. See: www.gov.uk/government/publications/bahrain-tax-treaties.
With the lowest corporate and personal taxes in the GCC, Bahrain has very few indirect taxes and no:
personal income tax
wealth tax on capital gains
Value added tax (VAT)
Provided you get and keep evidence of your export, and comply with all other laws, you can zero-rate the sale of your goods to Bahrain. You will need to ensure the goods are exported, and provide evidence within three months from the time of sale.
Further information on VAT in non-EU markets and zero-rating conditions is available at: https://www.gov.uk/guidance/vat-exports-dispatches-and-supplying-goods-abroad.
You will need to pay excise duty on any alcohol, alcohol fuel, tobacco or other excise-equivalent products you send to Bahrain.
You can find out more about excise duty and duty drawback outside the EU at: https://www.gov.uk/government/publications/excise-notice-207-excise-duty-drawback/excise-notice-207-excise-duty-drawback.
The DIT team in Bahrain at: https://www.gov.uk/world/organisations/department-for-international-trade-bahrain#contact-us can help you find tax advisers before entering into agreements in Bahrain.
More information on GST in non-EU markets can be found at: https://www.gov.uk/guidance/vat-exports-dispatches-and-supplying-goods-abroad.
[Source – Government of Bahrain, DIT Trade and Investment guide: Bahrain, gov.uk]
Customs and documentation
If you wish to export goods into Bahrain for sale or consumption you will need to obtain a General Licence from the Customs Affairs Directorate of the Ministry of Interior, at: http://www.bahraincustoms.gov.bh/.
The GCC’s Common Customs Law sets the framework for the import regulations of all GCC countries. However, each member state administers its own list of prohibited, restricted and exempted products. If you want to re-export within the other GCC states you will need to refer to their individual lists for details. See: http://www.bahraincustoms.gov.bh/uploads/files/gcc_customs_laws.pdf for further information about the GCC’s Common Customs Law.
A certificate of origin is required for all exports to clear customs, and you need to be aware that goods manufactured in Israel cannot be imported into Bahrain.
More detailed information on export and import requirements, procedures and restrictions can be found on the Bahrain Customs website at: http://www.bahraincustoms.gov.bh/page.php?SID=WTBkR2JscFVNREpOYVZwMFVGUlpiV015TURsT1ZHYzk%253D.
Normally, customs duties are 5% for imported goods, and higher for alcohol and tobacco. Many food and medical items are exempt from customs duty, although may require special licensing.
goods for re-export
raw materials for manufacturing imports required for development projects
The EU’s Market Access Database (MADB) at: http://madb.europa.eu/madb/indexPubli.htm provides information on import conditions into Bahrain, including:
customs clearance formalities and documentation
sanitary (animal-related) and phytosanitary (plant-related) restrictions
Complying with HMRC regulations to export
To export your goods to Bahrain you must make export declarations to HMRC through the National Export System (NES). Visit: https://www.gov.uk/guidance/export-declarations-and-the-national-export-system-export-procedures for further details.
You must classify your goods as part of the declaration, including a commodity code and a customs procedure code (CPC). Commodity codes and other details applying to exports in the UK Trade Tariff can be found at: https://www.gov.uk/trade-tariff.
Contact the HMRC Tariff Classification Service at: https://www.gov.uk/guidance/finding-commodity-codes-for-imports-or-exports#list-of-useful-contacts for more help.
The EU’s Market Access Database (MADB) also has details about import tariffs. Visit: http://madb.europa.eu/madb/indexPubli.htm.
You must declare any goods that you take with you in your luggage to sell outside the EU. See: https://www.gov.uk/take-goods-sell-abroad for further information.
Temporary export of goods
You can use an ATA (Admission Temporaire/Temporary Admission) Carnet to simplify the customs procedures needed to temporarily take any goods on the UK export controls lists into Bahrain, such as commercial samples or goods for:
use in repair or maintenance
Visit: https://www.gov.uk/taking-goods-out-uk-temporarily for further information.
You can check at: https://www.ecochecker.trade.gov.uk/spirefox5live/fox/spire/OGEL_GOODS_CHECKER_LANDING_PAGE/new whether you can use an open general export licence (OGEL) for your temporary export. If not, you will need to apply for a temporary export licence. You will need a permanent export licence if the goods are not being returned.
To apply for a temporary export licence, use the SPIRE system at: https://www.spire.trade.gov.uk/spire/fox/espire/LOGIN/login.
Product-specific documentation is usually required for imports of:
drugs and medicines
meat, poultry, animal products and bi-products
Special permits may also be required for some further products, for example special-breed horses, armaments, and insecticides. Contact Bahrain Customs at: http://www.customs.gov.bh/ if you have any documentation enquiries.
More details about these and other export documents you need to move goods overseas can be found at the Institute of Export & International Trade site at: https://www.export.org.uk/page/Key_Exporting_Terms.
[Source – Government of Bahrain, DIT Trade and Investment guide: Bahrain, Official Journal of the European Union, European Commission, HMRC, Institute of Export & International Trade, gov.uk]
GCC countries enforce common labelling standards for all imported goods, and Bahraini law requires all labelling and packaging to be in Arabic or in Arabic and English.
Food labels should include product and brand names, as well as production and expiration dates and the country of origin together with the name and address of the manufacturer. They should also include the net weight and a list of ingredients. All fats and oils must be identified on labels, and pork products and those containing pork or pork lard must be clearly labelled.
Contact the Department for International Trade (DIT) team in Bahrain at: https://www.gov.uk/world/organisations/department-for-international-trade-bahrain#contact-usfor further detailed information and advice on labelling requirements.
You may choose to work with a Bahrain customs agent. Contact the DIT team in Bahrain at: https://www.gov.uk/world/organisations/department-for-international-trade-bahrain#contact-us for further advice and lists of agents.
[Source – Government of Bahrain, DIT Trade and Investment guide: Bahrain, gov.uk]
Shipping your goods
You can use a freight forwarder to move your goods if you are not knowledgeable about international shipping procedures. A freight forwarder will have vast expertise and familiarity with local documentation requirements, regulations, transportation costs and banking practices in Bahrain.
The British International Freight Association (BIFA) at: http://www.bifa.org/home and the Freight Transport Association (FTA) at: https://fta.co.uk/ can assist in locating freight forwarders to transport your goods to Bahrain.
For information about sending goods by post to Bahrain visit Royal Mail at: https://www.royalmail.com/bahrain.
[Source – Royal Mail]
Shipping restricted, banned and dangerous goods
Certain goods are classed as restricted or dangerous. If you wish to import any of these goods into Bahrain, they are subject to special rules. For more information visit: https://www.gov.uk/shipping-dangerous-goods/what-are-dangerous-goods.
You can employ a local agent who will have knowledge of the latest import licensing requirements. For information and assistance contact the Department for International Trade (DIT) team in Bahrain at: https://www.gov.uk/world/organisations/department-for-international-trade-bahrain#contact-us.
Terms of delivery
You should have a clear written contract in all international commercial transactions, to minimise any risk of misunderstanding.
Incoterms are a series of widely used commercial terms for international trade in goods, which clarify for example:
where the goods will be delivered
who arranges transport
who handles customs procedures
who is responsible for insuring the goods, and who pays for insurance
who pays any duties and taxes
Incoterms do not apply to the delivery of services. Contracts for the international delivery of services should include a Service Level Agreement (SLA), focusing on desired outcomes such as what the service should achieve.
The International Chamber of Commerce (ICC) publishes Incoterm rules, at: https://iccwbo.org/resources-for-business/incoterms-rules, and the UK Government has further general advice and details about Incoterms at: https://www.gov.uk/guidance/international-trade-paperwork-the-basics#international-trade-contracts-and-incoterms.
UK Export Finance
The UK Government’s credit agency (UKEF), wins export contracts by providing attractive financing terms to their buyers. They can help you:
fulfil orders by supporting working capital loans
get paid by insuring against buyer default
You can find out more about UKEF’s services and products at: https://www.gov.uk/government/collections/uk-export-finance-products-and-services.
For new business enquiries, email UKEF at: email@example.com or telephone: 020 7271 8010 between 9am and 5pm.
For up-to-date country-specific information on the support available see UKEF’s cover policy and indicators for Bahrain at: https://www.gov.uk/guidance/country-cover-policy-and-indicators#bahrain.
[Source – ICC, DIT, UKEF, gov.uk]
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