The Khareef Kiosk Conundrum: Unveiling the Shadows of Business Ownership
In the bustling heart of Salalah, during the vibrant Khareef season, a peculiar phenomenon unfolds within the temporary madhbi kiosks. These kiosks, a staple of the local culinary scene, have sparked a heated debate about the true nature of business ownership and the blurred lines between permit holders and their actual involvement.
The Permit Conundrum
The story begins with an Omani job-seeker, who, with a Riyada card in hand since 2022, embarks on his first venture into the world of madhbi kiosk ownership. His experience highlights a concerning trend: the presence of expatriate workers managing these kiosks, often under arrangements that go beyond standard employment. This raises the question: who is truly in control?
The investor's assessment reveals a startling reality. Out of the 15 madhbi kiosks at Nashib, only three are directly managed by their Omani permit holders. The remaining kiosks, he claims, are under the management of expatriate workers, suggesting a potential violation of permit conditions. This distinction is crucial, as it highlights the fine line between lawful employment and hidden trade.
Unraveling the Legalities
The concern extends beyond the presence of expatriate workers. It delves into the realm of control and responsibility. When a permit holder relinquishes effective control over management, decision-making, financial risk, and returns, they may be lending their name to a business rather than genuinely operating it. This gray area demands scrutiny, as it can lead to hidden trade, a practice Oman has been actively combating.
The Dhofar Municipality's recent actions in November 2025 underscore the seriousness of this issue. They removed kiosks managed by expatriate workers, emphasizing the need for citizens to supervise their businesses. This incident serves as a stark reminder that inspections must go beyond surface-level observations.
The Financial Incentive
A second Omani investor's experience sheds light on the financial allure behind these arrangements. After leaving school without further education or employment, he entered the business world in 2016, obtaining activity licenses for businesses he didn't operate and renting licenses and signboards for fixed monthly payments. This passive income model, he admits, provided a quick financial boost, allowing him to start a family and buy a car.
However, this investor's story also highlights the importance of genuine entrepreneurship. The Covid-19 pandemic and increased scrutiny of business accounts, lease contracts, and compliance requirements served as a turning point, prompting him to reevaluate his approach. This narrative underscores the potential pitfalls of hidden trade and the need for a more active role from permit holders.
Enforcement and its Limits
Oman's efforts to strengthen enforcement against hidden trade are evident in Ministerial Decision 412/2023. The Ministry of Commerce, Industry, and Investment Promotion has been vigilant, verifying commercial registrations and issuing administrative undertakings to non-compliant entities. However, the success of seasonal licensing goes beyond the number of permits issued.
It requires a comprehensive assessment of how many outlets are genuinely owner-managed, compliant, and operational. The Consumer Protection Authority's extensive inspections during the Khareef Dhofar Season 2026, targeting food outlets and madhbi restaurants, are a testament to this. Yet, they only scratch the surface, as establishing effective control requires a holistic evaluation of municipal licensing records, employment data, and commercial registration.
The Way Forward
The issue is particularly significant in a short tourism season, where temporary permits offer Omani entrepreneurs income, practical experience, and a chance to test their business models. However, if effective control passes to another party, these opportunities can be compromised. The cancellation of permits for non-compliance can result in lost trading weeks for replacement entrepreneurs.
The solution lies in a multi-faceted approach. While enforcement plays a crucial role, it must be complemented by a shift in societal attitudes. As the second investor pointed out, hidden trade thrives when citizens accept fixed payments in exchange for using their names and licenses. Until this changes, the battle against hidden trade will remain an uphill struggle.
In conclusion, the Khareef kiosks serve as a microcosm of the broader challenges surrounding business ownership and hidden trade in Oman. It is a call to action for policymakers, entrepreneurs, and citizens alike to address this issue head-on, ensuring a fair and transparent business environment that fosters genuine entrepreneurship and economic growth.
