Renting out commercial registrations is ‘commercial concealment’, lawyer warns

TDT | Manama

Email: mail@newsofbahrain.com

Renting out a commercial registration in exchange for a monthly payment is not a harmless side deal but a criminal offence known as “commercial concealment”, Bahraini lawyer Jassim Al Issa has warned in an interview with The Daily Tribune.

“This relationship is not a lease arrangement involving the commercial registration. It is regarded as an offence, described under Bahraini law as commercial concealment,” Al Issa said.

He described the practice as allowing a foreigner to run a business under a Bahraini’s name while the Bahraini collects money without real involvement.

Al Issa said the authorities can act against both sides of the arrangement, meaning the foreign party running the business and the Bahraini individual or company providing the cover, with measures that can include suspending or cancelling the registration and shutting the premises until the status is corrected.

“The ministry may act against those engaging in commercial concealment by administratively closing the commercial premises until the legal status of the commercial registration is rectified,” he said.

Al Issa pointed to penalties set out in Decree-Law No. 1 of 1987 concerning certain provisions related to the sale and lease of commercial premises, saying repeat offences can bring jail time, a fine, and removal from the commercial register.

Imprisonment

He said reoffending can be punished by imprisonment for up to a year and a fine of up to BD1,000, or one of the two, alongside striking off the registration and closing the premises where the violation took place.

The lawyer said the practice is treated as a crime because commercial activity is granted to the registered merchant and is not meant to be passed on to someone else.

The offence, he added, is made out when a Bahraini enables a non-Bahraini to carry out commercial activity that the non-Bahraini is barred from practising, while the foreign party controls the business in reality.

Al Issa said Bahrain has stepped up oversight through inspections and information-sharing between agencies, and that penalties may extend to deportation for foreigners involved.

He also pushed back against the idea that collecting modest monthly sums makes a person a “business owner”, arguing the wider harm falls on the market and on small traders.

The lawyer said commercial concealment can curb economic growth, distort fair competition, and weaken service quality when the real operator of a business is hidden behind paperwork.

Al Issa said the practice can also leave consumers and suppliers dealing with blurred responsibility, while enabling non-Bahrainis to corner certain activities through front arrangements that appear compliant on paper but are not so in practice.