Registering a business in someone else's name in Qatar: the legal risks

What is commercial concealment?

Under Qatari law, concealment (tasattur) means enabling a non-Qatari, whether an individual or a company, to do any of the things prohibited by Articles 2 and 3 of Law No. 3 of 2023 on combating concealment (Article 1). They are:

• For a non-Qatari: practising or investing in a commercial, economic or professional activity that they are not licensed for under the laws in force (Article 2(1)).
• Also for a non-Qatari: taking a share of profits above the percentage set in the company's founding document or articles (Article 2(2)).
• For anyone, individual or company: covering for a non-Qatari by letting them use one's name, licence or commercial or professional registration, or by any other means that lets them escape their legal obligations, whether this is for the account of the non-Qatari, the person covering or anyone else (Article 3).

Two examples the definition covers: a shop registered to someone who receives a fixed monthly payment, while a non-Qatari actually owns and runs it; or a company whose founding document gives the non-Qatari partner 49 per cent, while a side agreement gives them all the profits.

Which law prohibits it?

The main law is Law No. 3 of 2023 on combating concealment of non-Qataris practising commercial, economic and professional activities in breach of the law. It repealed the earlier Law No. 25 of 2004 (Article 19). The Anti-Concealment Committee at the Ministry of Commerce and Industry receives and examines reports and refers serious ones to the Public Prosecution (Articles 4 and 5).

Cabinet Decision No. 2 of 2024 formed the Committee with two representatives of the Ministry of Commerce and Industry and one each from the Ministry of Interior, the Ministry of Labour, Qatar Central Bank, the State Security Bureau, the General Tax Authority and the Financial Information Unit (Article 1).

Other laws apply alongside it:

What are the risks for the person whose name is used?

Some registration holders see their role as a formality and the monthly payment as harmless. The law punishes the person who covers just as it punishes the person covered:

• Up to two years in prison and a fine of up to QAR 500,000, or either, with the fine multiplied by the number of people, shops or establishments involved (Article 8).
• Further penalties the court may add: confiscation of the money involved or the proceeds, a ban on the activity for up to three years, and publication of the judgment at the convicted person's expense (Article 9).
• Joint liability with the non-Qatari for taxes, fees and any other financial obligations arising from the unlawful activity (Article 13).
• Obligations in their own name: in law they are a trader as the person in whose name the business appears (Commercial Law Article 13), and the parties' creditors acting in good faith may rely on that outward position (Civil Code Article 174).
• The separate offence of letting others exploit a commercial registration: up to six months in prison and a fine of up to QAR 200,000, or either, and the court may strike off the registration, close the premises or suspend the activity for up to a year (Commercial Register Law Article 16).
• If the person covering is a company, whoever actually manages it is punished if they knew, or if their negligence contributed, and the company itself is fined (Article 11).

What are the risks for the real operator?

The real operator puts money and effort into a business they do not legally own, and also faces criminal liability:

• The same penalties under Articles 8 and 9 for breaching Article 2.
• Deportation after serving the sentence, if the court orders it (Article 9(2)).
• Losing the business: the registration, licence and accounts are in someone else's name, and the court may confiscate the money involved or its proceeds, subject to the rights of third parties acting in good faith (Article 9(1)).
• A weak side agreement: an agreement hiding the real owner may be treated as void, because a contract is void if its object is contrary to public order or its cause is unlawful (Civil Code Articles 151 and 155). The operator may have little protection if the registration holder refuses to hand the business over.
• Residence consequences: if their permit is for work with a particular employer, running a business for themselves may breach the purpose of the permit, which carries its own criminal penalties (Law No. 21 of 2015, Articles 16 and 38).
• Joint liability for taxes, fees and financial obligations arising from the activity (Article 13), and trader status with its obligations (Commercial Law Article 13).

How is concealment detected, and what happens next?

The law widened the ways concealment comes to light, so it does not depend on either side reporting it:

• Financial institutions notify Qatar Central Bank of transactions that suggest concealment, and the bank passes them to the Committee (Article 6).
• Anyone who learns of a concealment offence through their job or work must report it to the Committee (Article 7).
• Judicial officers may enter company premises, establishments and offices, examine books and computers, and seize documents (Articles 14 and 15).

The person examining a report may summon the person accused, put the evidence to them and allow them to be assisted by a legal representative. The Committee then refers serious reports to the Public Prosecution (Cabinet Decision No. 2 of 2024, Articles 11 to 13).

Three provisions affect what happens next. The Minister, or a delegate, may settle the offence before a final judgment in return for half the maximum fine (Article 16), and may approve regularising the business at the offender's expense under the relevant laws (Article 17). An offender who reports the offence to the authorities before they know of it is exempt from punishment (Article 12).

What are the legal alternatives?

If the aim is for a non-Qatari to own or share in a business, the law offers open routes instead of concealment:

• Ownership of up to 100 per cent in permitted activities, with Ministry approval to exceed 49 per cent of the capital (Law No. 1 of 2019, Articles 2 and 3), outside closed sectors such as banking, insurance and commercial agencies (Article 4).
• A limited liability company (WLL) with a genuine Qatari partner, whose notarised founding document reflects the shares and profit split actually agreed (Commercial Companies Law Article 6; concealment law Article 2(2)).
• A branch of a foreign company to perform a government contract, or a Qatar Financial Centre licence for activities permitted there.
• Regularising an existing arrangement with the Minister's approval under Article 17 of the concealment law.

Our guide to registering a company in Qatar explains these options step by step, and our guide to partner disputes covers how a partner exits or is bought out.

When should you speak to a lawyer?

Putting things right early is easier than dealing with a report or an inspection. Signs it is worth getting advice:

• A business you own or run is registered in someone else's name, or you receive payment for the use of your registration.
• The founding document does not match what really happens with ownership or profits.
• You want to turn an existing arrangement into open ownership, or end it with the registration holder.
• You have been summoned by the Anti-Concealment Committee, or judicial officers have visited.
• You and the registration holder, or the operator, disagree over money or assets.
• Someone has offered to register a business in their name for a fee.

Questions people ask