Modernising Business Law to Boost Investor Confidence

TDT | Manama

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Bahrain introduced amendments to its Commercial Companies Law as part of efforts to modernise the Kingdom’s business environment, strengthen corporate governance and enhance investor confidence.

The reforms, issued under Decree-Law No. 38 of 2025, aim to align Bahrain’s commercial legislation with global economic and technological developments while simplifying procedures for businesses and investors.

Speaking in an interview, Lawyer Manal Dhahi, Owner of a legal consultancy and law firm said the amendments represent a significant shift in the legal framework regulating companies in Bahrain.

She said one key change is the wider adoption of digital solutions, including electronic board meetings, online general assemblies and electronic voting systems.

According to Dhahi, the measures are expected to speed up corporate decision-making and facilitate investor participation from inside and outside Bahrain while maintaining secure procedures and data protection standards.

The amendments also allow the establishment of a closed joint-stock company owned by a single shareholder, a move Dhahi described as providing greater flexibility for investors operating within a regulated legal structure.

The reforms further seek to strengthen transparency and accountability by abolishing the “joint participation company” structure and widening the scope of personal liability for company directors and de facto managers.

Dhahi said the changes would help limit the misuse of corporate entities and reinforce protections for creditors and stakeholders.