MUSCAT: In a major step to increase national employment and local workforce participation, the Ministry of Labour (MoL) has implemented a thorough mechanism requiring the hiring of at least one Omani national for each commercial registration that has been established for one year. The directive, which applies to a range of firms, including foreign investment entities, is part of the bigger labor market regulation changes revealed in early May 2025.
Foreign-owned companies in Oman are now obliged to hire at least one Omani national within three months of completing a year of operation.
The MoL stressed that violation of this rule would result in a complete closure of these institutions, regardless of the number of foreign employees hired. Companies may either directly recruit an Omani or submit a structured employment plan that results in real recruitment within the stipulated timeframe. The mechanism was created in partnership with the Ministry of Commerce, Industry, and Investment Promotion to provide better oversight of commercial registrations.
Establishments shall be given a grace period of no more than three months from the date of notification to amend their status in compliance with the decision.
The ministry has provided specific recommendations for bigger companies with more than ten employees. These firms must also provide an employment plan, which includes hiring at least one Omani within three months of the notification date. Noncompliant companies will face automatic limitations on the granting of new licenses, with enforcement carried out through the ministry's digital system.
Businesses with fewer than ten employees have been given a six-month opportunity to comply.
These entities are required to either hire one Omani, present a viable employment plan, or submit an assessment of their contribution to local value addition.
Those making actual contributions may be temporarily exempted, but noncompliance will result in licensing bans equivalent to those imposed on larger enterprises.
Entrepreneurs and full-time business owners will receive a one-year grace period to comply with Omanization standards. Within six months of receiving notification, their businesses will be evaluated for value addition. The MoL has encouraged company owners who do not yet possess a Riyada Card to register with the Small and Medium Enterprises Development Authority in order to qualify for incentives and exclusions related to Omanisation goals.
The MoL's initiative is a significant step toward aligning foreign and domestic commercial operations with national workforce development objectives. By requiring each firm, particularly foreign investment entities, to directly contribute to local employment, the policy emphasizes Oman's commitment to economic diversification while not ignoring Omani ability.
The new regulations also support Oman Vision 2040 objectives, which include a sustainable economy sustained by an empowered national workforce. Businesses are encouraged to act quickly to prevent operational interruptions and to show their dedication to the growth agenda.
