Years ago, the Ministry of Commerce introduced licenses for “activities of a special nature” carried out from home—around 97 activities—claiming this would facilitate and support business owners whose activities do not necessarily require a property (shop/office) at the outset.
These activities are derived from the booklet International Standard Industrial Classification of All Economic Activities (ISIC4). It is notable that most of them are administrative, organizational, and advisory activities, while productive activities and light industries are absent (jewelry design is included without manufacturing).
Based on our research, we did not find an equivalent to this classification (“special nature”) in any other country except Kuwait. The first issues appeared with real estate brokerage licenses, which require a “Dallal register”. The Ministry removed them from the list after objections from real estate office owners.
It is anomalous that a country has no home industries.
The reality is that the esteemed Ministry created the list; its holders may have benefited—intentionally or otherwise—from labor support, but it kept the rest of the conditions, procedures, and regulations applicable to activities with leased premises, most notably the requirement to establish a company, which complicated matters.
Although these are home-based activities for a person working from home, they are still required to issue a “single-person company” contract and specify the “beneficial owner”.
If the home-based business owner may be a homemaker, a retiree, or an ambitious young person, why must they be bound by a “company” contract (as if it were something huge), and why the insistence on the “beneficial owner”—when the owner is an individual in their own home, the business address is their private residence, and they are not a legal entity in a foreign premises?
Consequently, the home-license holder is required to prepare financial statements to global standards like major companies, and may even have to apply the “XBRL” system for electronic filing of budgets and financial statements, with the associated effort, procedures, and costs. These are burdensome requirements for simple home-based activities.
In summary, no one opposes regulation, including for home-based activities given their importance. However, completely prohibiting productive home-based activities and industries carries many risks and drawbacks, and is also anomalous.
Light industrial and commercial activity from home has existed throughout the ages, and women in particular engage in it. It brings great benefits to them and to society.
Likewise, productive work (not administrative or advisory) from home is a platform for young people to keep themselves occupied, and perhaps to launch from it to broader markets; the examples are too many and too significant to list. It is enough that it keeps them away from trivialities and nonsense.
If the Ministry is serious about helping people, it should make their licenses ordinary sole proprietorships and allow light home-based industries. This is a natural form of regulation applied across all Gulf countries and worldwide, and it is also affirmed by the international classification booklet in its definition of industry (page 85). May God be forgiving to His servants.
Translation: “Nevertheless, units that transform materials or substances into new products by hand or in the worker’s home, and those engaged in selling the manufactured products in the same premises from which they are sold to the public, such as bakeries and tailoring shops, are also included in this section.”
