All enterprises operating in Jordan (excluding joint ventures) are required to register with the Controller of Companies in the Ministry of Industry and Trade. Registration must also be made with the Chamber of Commerce or Chamber of Industry.

What are the types of Companies that may be registered?

The following types of Companies may be registered:
> Limited Partnership.
> Joint Venture.
> Limited Liability.
> Limited Partnership in Shares.
> Public Shareholding Companies.





Where can Companies operating in the Free Zone be registered?

Companies operating in free zones shall be registered with the Free Zones Institution and in the registers prepared by it for that purpose in co-ordination with the Controller and the laws and regulations in force in such Institution shall be applied thereto provided that the Institution shall send a copy of the registration of these companies to the Controller in order to document the registration of investors in free zones with the Ministry.

What are the procedures of forming and registering a General Partnership Company?

A general partnership shall consist of a number of natural persons, of not less than two and not more than twenty, unless the increase is due to inheritance provided that such an excess is in compliance with the provisions of Articles (10) and (30) of the law.

The general partnership shall be registered in the Kingdom pursuant to the following procedures :

a) The application for registration shall be submitted to the Controller, together with the original partnership agreement, signed by all the partners, and with a statement signed by each of them before the Controller or the person authorized by him in writing. This statement may be signed before the Notary Public or a licensed lawyer.

The partnership agreement and its memorandum must include the following :

1) Title of the partnership and its trade name, if any.

2) Name of partners, nationality, age and address of each of them.

3) Head office of the partnership.

4) The partnership capital and each partner’s share therein.

5) Objectives of the partnership.

6) Duration of partnership, if limited.

7- Name of partner or names of partners authorized to manage and sign on behalf of the partnership and their powers.

8- The position of the partnership in event of the death of any or of all its partners, his bankruptcy or incompetence.

b) The Controller will approve the registration of the partnership within fifteen days from the date of the submission of the registration application. The Controller may however reject the said application if there is evidence in the partnership agreement or memorandum of violation of this law or the public order or the provisions of all the enforced legislations and if the partners do not take action rectify the said violation within the period determined by the Controller. The partners may submit an objection to the Minister against the rejection of the Controller within thirty days from the date of notifying them of the said rejection. Should the Minister decide to decline the objection, the objectors shall have the right to contest his decision before the Higher Court of Justice within thirty days from the date of their notification of the Minister’s decision.

c) If the Controller approved the registration of the partnership or if the approval was obtained by a decision of the Minister or the Court of Higher Justice, pursuant to the provisions of paragraph (b) of this article, it will be registered after the collection of the registration fees, and the Controller will issue to the partnership a registration certificate, considered as official evidence in all legal procedures. The partnership must maintain it in a visible place in its head office and the Controller shall also publish the partnership registration announcement in the official gazette.

d) The general partnership is not allowed to commence , or to exercise any of its business, except after its registration and payment of the fees in accordance with the provisions of this article, and in conformity with all the provisions of this law and the regulations issued in accordance therewith.

How can a General Partnership dissolved or liquidated?

A general partnership shall be dissolved in any of the following circumstances :

a) When all partners agree on the dissolution of the partnership or on its merger with another general partnership.

b) Expiration of the partnership’s term whether it is its original term or the extended term per the agreement of all partners.

c) Completion of the objective for which it was formed.

d) When only one partner remains in the partnership with due observance to the other conditions in the law.

e) Declaring the partnership bankrupt in which case this will result in a consequent bankruptcy of the partners.

f) Declaring one of the partners as bankrupt or legally incompetent unless all remaining partners decide to keep the partnership between themselves in accordance with the partnership agreement.

g) Dissolution of the partnership by a court order.

h) Canceling the registration of the partnership of the partnership upon the Controller’s resolution in accordance with the provisions of the companies law.

How can a General Partnership be dissolved by a court?

a) The court may consider the dissolution of a general partnership pursuant to a legal action by one of the partners in any of the following circumstances :

1- If any of the partners commits a major continuing breach of the partnership agreement or causes substantial damage to the partnership as a result of committing a serious fault or negligence while managing the partnership’s affairs or while looking after its interests or safeguarding its rights.

2- If the activities of the partnership can only be carried out at a loss.

3- If the partnership loses all of its properties or a big portion thereof making the continuity of its activities unfeasible.

4- If disagreements between partners occur that render the continuity of the partnership among them impossible.

5- If any of the partners becomes permanently incapable of performing his duties towards the partnership or fulfilling his obligations thereto.

b) The court may order the dissolution or the continuation of the partnership in carrying on its business after the expulsion of one or more partners there from if such an expulsion, at the discretion of the court, will lead to the continuity of the partnership and the smooth running of its operations in a normal manner that meets the interest of both the partnership and the remaining partners and safeguards the rights of other parties.

What are the procedures of formation and registration of a Limited Partnership company?

A limited partnership is formed of two categories of partners whose names should be listed in the partnership agreement.

a) General Partners :

They are responsible for the management and operations of the partnership. They are also jointly and severally liable for all the partnership’s debts and liabilities with their private properties.

b) Limited Partners :

They are the partners who contribute to the capital of the partnership without having the right to manage the partnership or to carry out its operations and the liability of each one of them is limited to his share in the capital of the partnership.

What are the procedures of formation and registration of a Limited Liability company?

a) The application to incorporate the limited liability company shall be submitted to the Controller along with the company’s memorandum and articles of association on the approved forms for this purpose, and shall be signed before the Controller, before any person delegated in writing by the Controller, before a notary public or before a licensed lawyer.

b) The limited liability company’s memorandum shall incorporate the following particulars :

1- Name of the company, its objectives and its head office.

2- Names of the partners, their nationalities and address of each of them.

3- Amount of capital and the shares of each partner therein.

4- Statement of the capital’s share or shares in kind, name of the partner who presented such shares and their estimated values.

5- Any other additional data which the partners may submit or which the Controller may request in implementation of the provisions of the law.

c) the articles of association of the limited liability company must include the information provided for in the law in addition to the following information :

1- The manner of managing the company, number of management committee, their powers and the limits of the powers of the management committee in borrowing, mortgaging the real estates owned by the company and presenting guarantees in its name.

2- Conditions for transferring the shares in the company and the procedures to be followed in that respect and the form of writing the transfer.

3- The manner of distributing the profits and losses to the partners.

4- Meetings of the company’s general assembly, its legal quorum, and the quorum needed for taking decisions thereby and procedures to be followed for holding the said meetings.

5- Rules and procedures pertaining to the liquidation of the company.

6- Any other additional information furnished by the partners or requested by the Controller.

If the company’s capital or a part thereof is shares in-kind offerers of these shares shall keep same and refrain from disposing of them until they are delivered to the company, registered in its name and the title thereto is transferred to it.

If offerers of these shares do not comply with the transfer of the title to these shares to the company they shall be bound by law to pay the value thereof in cash in accordance with the price approved by promoters in the company’s articles of association. The Controller shall have the right to ask for a proof of the accuracy of the evaluation of the value of the shares in kind.

The concession rights, patent rights, technical know how and other intangible rights are considered of the payments in kind.

The Controller shall issue his resolution approving the registration of the company within fifteen days from the date the application is submitted and signed by the partners. He may refuse the application if he finds that the company’s memorandum or articles of association contains a provision contrary to the provision stipulated in this law and the regulations promulgated in accordance therewith and contrary to any other legislation in force in the Kingdom and the partners have not removed the violation within the period specified by the Controller. The partners may object to the refusal resolution before the Minister within thirty days of the date they are notified of same. If the Minister refuse the objection the objectors may challenge his resolution before the Higher Court of Justice within thirty days of the date of notifying them of the resolution.

If the Controller approves the registration of the company or such approval has been made by a resolution of the Minister or the Higher Court of Justice in accordance with the provisions of paragraph (a) of this Article following the submittal by the partners of the documents which prove that not less than 50% of the company’s capital has been paid, the Controller shall collect the registration fees and issue a certificate of registration to be published in the official gazette. In all cases, the remainder of the company’s capital should be paid within the two years following its registration.

Is it possible to have a Joint Venture registered under the Jordanian law?

With Accordance to the Jordanian Company Law a joint venture is not a separate legal entity and is not subject to the provisions and procedures of registration and licensing.

The law defines a joint venture as a commercial undertaking organized as an association of two persons or more. One partner shall carry out the operations of the Joint Venture and shall deal expressly with the others. The joint venture as such is limited to the special relationship between the partners. The existence of such a partnership may be evidenced by all means of documentation.

b) A joint venture is not a separate legal entity and is not subject to the provisions and procedures of registration and licensing.

The silent partner in a joint venture shall not be considered a merchant unless he personally carries out commercial transactions.

Third parties shall not have the right of any course of action to any partner except to the one they dealt with in the joint venture. Should any other partner confess to the existence of such a company or should he notify others of its existence, the company may then be considered as an existing company and the partners therein shall become jointly responsible towards third parties.

A joint venture agreement shall specify the rights and obligations of all partners therein towards each other and towards the joint venture and the manner in which profits and losses are to be distributed amongst them.

How is a limited Partnership in Shares defined under the Jordanian Law?

A limited partnership in shares is composed of the following two categories of partners :

a) General Partners :

The number of general partners shall not be less than two and they shall be liable for the company’s debts and obligations in their personal property be

b) Limited Partners :

The number of limited partners shall not be less than three and each partner shall be liable for the company’s debts and obligations in proportion to his shareholding.

What are the requirements of the formation of a Public Shareholding company in Jordan?

A public shareholding company shall consist of a number of promoters of not less than two who subscribe for shares which are negotiable in financial papers markets and may be traded and transferred in accordance with the provisions of this law and any other legislations in force.

The application for the formation of the company shall be submitted by the company’s promoters to the Controller on the form designated for such purpose and accompanied by the following :-

1- The company’s articles of association.

2- Its memorandum of association.

3- Names of promoters of the company.

4- Names of a committee of promoters who shall supervise the formation procedures.

The shareholding company’s articles of association and memorandum of association should include the following information :

1- Name of the company

2- Its head office.

3- Objectives of the company.

4- Names of company’s promoters, their nationalities, elected domicile and the number of shares subscribed for.

5- The authorized capital of the company and the portion actually subscribed for.

6- A statement of the in kind shares of the company, if any and the value thereof.

7- If the shareholders and the holders of transferable loan corporate bonds have preemptive right to subscribe for any new placements of the company.

8- How the company is managed and the authorized signatories during the period from its formation and the meeting of the first general assembly which should be held within sixty days from the date of the formation of the company.

The articles of association and memorandum of association of the shareholding company shall be signed by each promoter before the Controller or any one delegated by him in writing. They may be signed before the notary public or a licensed lawyer.

On the recommendation of the Controller the Minister shall issue his resolution approving or disapproving the registration of the company within a maximum period of thirty days from the date of the Controller’s recommendation. The Controller shall make the recommendation within thirty days as of the date of submitting the application to him provided it shall be signed by the promoters and meeting legal conditions. If the Minister does not issue his resolution during such period the application shall be considered as accepted.

In case the Minister refuses to register the company, the company’s promoters may appeal against his decision before the Higher Court of Justice.

What are the business sectors that need to be operated by a Public Shareholding company?

The following operations cannot be undertaken except by public shareholding companies which are formed and registered in accordance with the provisions of this law :

a) Operations carried out by banks, financial institutions and various insurance activities.

b) Companies enjoying franchises.

What is the authorized capital of the Public Shareholding Companies in Jordan?

The authorized capital of the public shareholding company and that subscribed for portion shall be fixed in Jordanian Dinars and shall be divided into nominal shares valued at one Dinar each provided that the authorized capital shall not be less than five hundred thousand (500,000) Dinars and the subscribed for capital shall not be less than one hundred thousand (100,000) Dinars or twenty percent 20% of the authorized capital, whichever is greater.

How are Holding Companies defined under the Jordanian Law?

The Jordanian Companies law defines a holding company as a public shareholding company which undertakes to control the financial administrative matter of one or more companies called subsidiary companies, in one of the following methods.

To own more than one-half of its capital, and/or.

To have control over the formation of the board of directors.

A subsidiary company shall be prohibited from owning any stock or share in the holding company.

The holding company shall appoint its representative on the boards of directors of the subsidiary company in proportion to its shareholding therein. It may not participate in the election of the remaining members of the board of or the management committee, as the case may be.

What are the objectives of the holding company under the Jordanian law?

The objectives of the holding company are the following :

a) Management of subsidiary companies and participation in the management of other companies in which it owns shares.

b) Investment of its funds in shares, bonds and securities.

c) Advancing loans, guarantees and financial to the subsidiary companies.

d) Ownership of patents, trademarks and concession and other intangibles and the exploitation and leasing of same to is subsidiary companies or to others.

What are the ways of establishing a holding company under the Jordanian law?

A holding company shall be established in one of the following ways:

1- Establishment of a public shareholding, whose objectives are limited to those activity stated in companies law in any part thereof, and the establishment of subsidiary companies thereto, or the possession of shares or stocks in public shareholding companies, limited liability companies or in partnerships limited in shares to achieve the said objectives.

2- Amendment of the objectives of an existing public shareholding company to be as those of a holding company in accordance with the provisions of this law.