WHAT IS THE STARTUP GUIDE?
The Startup Guide is a complete guide to registering and licensing a small business in Jordan, brought to you by the Ministry of Industry, Trade and Supply, Companies Control Department and the USAID Jordan Local Enterprise Support Project (LENS).
Established in 2016, the Startup Guide is available to download. It contains step-by-step information on how to establish a small business, and the five different types legal structures that a small business can register in Jordan.
The Startup Guide was developed based on a need to consolidate all the available information on business registration and licensing in one resource, without any legal jargon. In doing so, the Startup Guide makes the business registration and licensing process a lot more straightforward, and less intimidating for aspiring business owners.
It also aims to increase awareness of the major benefits to formalizing a small business, such as legal protections, being eligible for loans and other forms of financial assistance, attracting more customers, expanding to new branches or locations, or being able to access a range of investment benefits.
Its structure is based on 10 steps to make a small business legal and operational in Jordan (with a chapter on each step), in addition to also providing information on business support services for entrepreneurs and small business owners.
WHAT ARE THE STEPS I NEED TO TAKE TO FORMALIZE MY BUSINESS IN JORDAN?
Once you complete the five steps above, your business will be considered a fully registered and licensed business in Jordan. However, to be able to become fully operational, you will need to undertake these additional steps:
Mandatory if you plan on employing non-Jordanians
Depends on the nature of your work
Depends on the nature of your work
HOW DO I KNOW WHAT TYPE OF BUSINESS TO REGISTER?
The registration process will depend on what type of legal business structure you choose. Below is a list of the five main legal business structures for small business that you can register in Jordan.
For a full list of all types of companies (small and large), please ask the Companies Control Department, under the umbrella of the Ministry of Industry, Trade and Supply.
Individual Establishments are the simplest business structure. You can open an individual establishment by applying for a permit from the Central Registration Directorate at the Ministry of Industry and Trade, or the Commercial Registrar in areas outside of Amman. From a legal standpoint, this type of business is not seen as separate from the owner, therefore the owner does not have limited liability. This means the owner is personally responsible for covering all legal, financial and administrative costs incurred by the business. Capital: the minimum capital required is JD 1,000 You are not required to provide evidence of capital when applying to open an individual establishment however the Registrar may request to see documentation at his or her discretion.
General Partnership Company
A general partnership company must have at least two owners. Each owner is fully obligated to the business, meaning that they do not have limited liability .General partnerships do not require lawyers, unless the capital of the business exceeds JD 50,000. The number of partners can range from 2 to 20. Each partner must be at least 18 years of age. Capital: the minimum capital required is JD 1,000.
Limited Partnership Company
This business structure allows for a combination of general partners (just like General Partnership Companies) and limited partners (just like Limited Liability Companies).
General partners are responsible for the day-to-day operations of the business and do not have limited liability.
Limited partners contribute to the capital of the business but are not permitted to be involved in the company’s operations. They are limited to their own shares in the company.
The number of partners can range from 2 to 20. Limited partnerships do not require lawyers, unless the capital of the business exceeds JD 50,000.
Limited Liability Company
Limited liability companies (LLC) usually have more complex structures. For this reason, LLCs are required to have an auditor and requires a lawyer if their capital exceeds JD 20,000. (Note: the lawyer is required to file papers that confirm he or she is the legal counsel for the company) All partners are considered limited partners. An LLC usually has 2 or more owners, however if there is only one owner, then you will need approval from the Company Controller at the Companies Control Department. The maximum number of owners (or shareholders) is unlimited. Capital: Minimum required capital to set up this business is JD 1.
Private Shareholder Company
Private shareholding companies are limited liability companies that do not offer or trade their company shares to the general public on the stock market. Rather, the company’s stock is offered, owned and traded privately. They are usually owned either by non-governmental organizations or by a relatively small number of shareholders. Private shareholding companies are required to have an auditor and lawyer. Capital: Minimum required capital to set up this business is JD 50,000.