2011 Bahrain Country Commercial Guide - US - Export.gov

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Chapter 3: Selling U.S. Products and Services
Using an Agent or Distributor
Establishing an Office
Franchising
Direct Marketing
Joint Ventures/Licensing
Selling to the Government
Distribution and Sales Channels
Selling Factors/Techniques
Electronic Commerce
Trade Promotion and Advertising
Pricing
Sales Service/Customer Support
Protecting Your Intellectual Property
Due Diligence
Local Professional Services
Web Resources
Using an Agent or Distributor Return to top
Due to the implementation of the FTA and BIT, American companies are no longer required to
appoint a local commercial agent, though they may opt to do so anyway. A commercial agent is
any Bahraini party appointed by a foreign party to represent the foreign party‘s product or service
in Bahrain. Local law governs the relationship, whether the relationship is structured as a
distributorship, sales agency, or otherwise. Appointing a commercial agent enables the foreign
party to achieve significant market penetration without establishing a direct presence. As in other
Gulf countries, regular, personal contact is the key to success in trade relationships.
A company that services even one additional Gulf Cooperation Council (GCC) country qualifies as
a regional office. Bahraini law does not require foreign companies to hire a local agent or partner to
establish a regional office in Bahrain. Nevertheless, U.S. companies setting up regional offices
typically find it useful to have a relationship with a local representative, particularly to deal with the
local bureaucracy.
When a contract is being drawn up, the use of the term "agent" often creates difficulties due to
definitional differences. The Ministry of Industry and Commerce allows for substitution of the term
"agent" with the term "distributor", which can more accurately describe the function intended.
Contracts between the Principal and the Bahraini agent should contain the names, nationalities,
and assets of the parties, along with a description of the types of products handled. It is advisable
to obtain legal counsel before drawing up an agency agreement. While the Embassy‘s Commercial
Section offers general information on Bahrain‘s commercial regulations, formal legal counsel is
recommended for specific questions on labor, investment, licensing procedures and for the
resolution of commercial disputes.
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