Restructuring Types
🔗 Merger
Two or more entities combine into one. Transfer of assets and liabilities may qualify as Transfer of Going Concern (TOGC) — outside the scope of VAT if conditions met. MOICT merger filing required.
✂️ Demerger / Spin-off
Separating a business division into a new entity. TOGC treatment available if the division is a going concern. New entity needs separate CR, VAT registration, and GOSI registration.
🔄 Share Exchange
Share-for-share transactions are exempt from VAT (financial services exemption). No capital gains tax on the exchange. MOICT share transfer fees apply (BD 10-50).
🏢 Asset Transfer
Individual asset transfers are standard-rated unless TOGC conditions apply. Property transfers attract 2% SLRB registration fee. Capital goods scheme adjustments may apply.
🌐 Cross-Border Restructuring
Migrating operations into or out of Bahrain. Permanent establishment implications. Employee transfer obligations under LMRA. DTT impact on future operations.
💡 TOGC Conditions: For TOGC treatment, the transfer must include all assets necessary to carry on the business, the transferee must be (or become) VAT registered, and the business must be a going concern at the time of transfer.