The Sultanate of Oman issued Royal Decree 38/2025, introducing a new law to govern Special Economic Zones (SEZs) and Free Zones (FZs) on 7 April 2025. It grants qualifying businesses a 10-year exemption from corporate income tax, with the possibility of two extensions for projects that bring exceptional value or innovation.

However, this benefit excludes banks, insurance companies, telecom providers, and certain transport businesses.

Customs procedures are also streamlined under the new system, offering duty exemptions on goods used in zone-based operations and eliminating export duties. Each SEZ will host its own customs directorate to oversee and speed up the movement of goods.

In real estate, the law introduces reforms that allow developers to allocate land under usufruct rights and sell units to non-Omanis through full ownership, known as the freehold system. This move is expected to encourage urban development and expand residential options within the zones.

A key feature of the law is the introduction of a one-stop shop service, which simplifies the process for obtaining permits, licences, and approvals needed to operate in these zones. The aim is to reduce administrative burdens and create a more investor-friendly environment.

The law, published on 13 April 2025, replaces earlier regulations (Royal Decree 56/2002) and sets out a unified legal framework designed to simplify business operations, attract investment, and support economic development across these zones.

Speaking to the Oman News Agency, HE Dr Ali bin Masoud al Sunaidy, Chairman of OPAZ, explained that the newly introduced legislation aims to strengthen investor confidence. It does so by standardising the legal framework and aligning the incentives, exemptions, and support offered to economic activities across the zones. The law also grants extra advantages to strategic projects, making them more adaptable and attractive to high-value investors.