Qatar’s Emir has issued a Decree-Law amending the country’s 2005 Investment Free Zones Law. Qatar Decree-Law No. 21/2017 amends Qatar Law No. 34/2005. It will come into effect on its issued date and will be published in the Official Gazette.
This week the spotlight is on legal and regulatory developments in Dubai, where the Chairman of Dubai’s Airport Freezone Authority (Dafza) has announced it is going to launch the region’s first e-commerce free zone. Dubai CommerCity will be a 2.7-billion AED, 2.1-million square feet joint venture between Dafza and Wasl Asset Management Group. It will be located in the Umm Ramool area and will be strategically placed to be near Dubai’s International Airport. This will provide direct access to e-commerce stakeholders in the MENA region and South Asia. The free zone project will be implemented in two phases. 50% of the project will be completed in both phases. The aim is to accelerate the growth of the e-commerce market in the region, which is expected to reach $20 billion in 2020 in the GCC countries. Over the next five years, e-commerce sector is expected to account for 10% of Dubai’s retail sales. These sales are expected to reach 200 billion AED by the end of this year.
Elsewhere the UAE’s Vice President, Prime Minister and Dubai Ruler has issued a Law regulating inheritance, wills and probate for non-Muslims. It comes into force on its issued date and will be published in the Official Gazette. Dubai Law No. 15/2017 will apply to the wills and assets of non-Muslims based in the Emirate including the DIFC. It creates a clear legal framework for non-Muslims to create wills in line with their wishes. It also outlines clear legal procedures to encourage residents to register their wills and manage their assets in Dubai. It will establish a Non-Muslim Wills and Probate Registry in both the DIFC and Dubai Courts. The heads of these Courts will develop its regulations, policies and procedures. It will specify the legal requirements for wills and probate for non-Muslims as well as the liabilities and obligations of the beneficiaries of wills. In addition it will specify the responsibilities and limitations of will executors as well the regulations governing inheritance and the distribution and management of the estate as well as appeal procedures. Disputes will be adjudicated by the Dubai Courts or DIFC Courts, depending on where the wills are registered. Any non-Muslim will registered at the DIFC or Dubai Courts before this Law will remain valid.
According to local newspaper reports, Saudi Arabia’s Government has approved new tourism visa plans. To begin with visas will only be issued to tourists using authorised tour operators. The announcement comes as the Kingdom looks to encourage more tourism.
According to senior International Monetary Fund officials, VAT is likely to be introduced at different times across the GCC region. They had intended to introduce VAT simultaneously in January but so far only Saudi Arabia and the UAE look like they will do so. When it is introduced VAT will be introduced at 5%. It will require significant administrative and technical changes including detailed regulations and making sure all affected companies are registered. However all six GCC states remain committed to introducing it.
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This week the spotlight is on legal and regulatory developments in Qatar, where the country’s Cabinet has approved a draft industrial zones law and referred it to the Advisory Council for further consideration. It defines industrial zones as areas designated for industrial purposes in line with its provisions, including lands, installations and facilities erected on it. Under the law, the establishment of industrial zones will be decided by a Cabinet Decision following a recommendation from the Energy and Industry Minister and the relevant authorities in the country. All natural resources which appear or lie in the industrial zone territory will be State property and tenants will be adequately compensated for the loss of full or partial use of these lands. No industrial establishment will be able to be founded in the industrial zones without authorisation from relevant authorities in the State and after Energy and Industry Ministry approval.
The Cabinet also approved a draft law to protect national products and tackle any practices which may harm them internationally but in line with World Trade Organisation agreements. ‘Harmful practices’ are defined as ‘dumping, dedicated subsidy and increase in imports’. ‘Dumping’ is defined as ‘exporting a product to the country at a price below the normal value of its counterpart in the exporting country’. A committee to enforce the law will be established at the Economy and Commerce Ministry. Its members will have experience in WTO agreements and Ministry representatives and relevant entities. It will have the power to receive reports on violations of the law and review them as well as carry out the necessary investigations. It will also be able to propose appropriate measures and practices to be taken regarding complaints referred to it and submit relevant proposals to the Minister. In addition, they will be able to propose preventive measures to protect national products in line with the law. Based on Committee recommendations the Minister will take appropriate measures to enforce the law.
This week the spotlight is on tax developments in Oman, where the country has joined the Organisation of Economic Development’s Base Erosion and Profit Shifting framework. It aims to curtail multinational group tax avoidance and improve the resolution of tax disputes between countries. By joining it, Oman has agreed to adopt minimum standards developed in 2015 by the Organisation and G20 nations. The country will now have to adopt provisions to prevent tax treaty ‘shopping’, implement country-by-country reporting on multinationals and exchange country-by-country reports. It will also have to limit the benefits of any intellectual property or other preferential tax regimes established in Oman and will need to fully implement the mutual agreement procedures in its tax treaties with other countries to aid resolution of tax disputes. The Sultanate becomes the 103rd country to join the framework.
Elsewhere, the country’s Health Ministry has announced it is considering introducing a junk food tax following concerns over obesity and other related health issues in the country. It comes as Oman amongst the other GCC countries work towards implementing an excise tax on energy and fizzy drinks as well as tobacco. Ministry officials said the tax could see junk food prices increased from 100 or 200bz to 500bz.
Saudi Arabia’s Justice Minister, Walid Al-Samaani has announced the Kingdom’s commercial courts have officially launched. There are three commercial courts in the Kingdom and they are in Riyadh, Jeddah and Dammam. It is hoped they will encourage investment in the country in line with the Saudi Vision 2030. Specialist commercial chambers have also opened in the public courts in several Saudi cities.
The UAE’s Finance Ministry has announced it is developing the Implementing Regulations to the Federal VAT Decree-Law. The VAT rate on all taxable and exempt goods, exports and services is yet to be announced. The relevant Regulations will be published in the Official Gazette.
Bahrain’s Central Bank has announced it is going to establish a dedicated Fintech Unit to ensure the best services are provided to individual and corporate customers in the financial sector. The announcement was made following the Bank’s latest Board meeting. The proposed Unit will be responsible for approving companies’ participation in the Regulatory Sandbox. It will also supervise licensed companies’ activities and operations, including cloud computing, payment and settlement systems, and monitoring technical and regulatory developments in the fintech field.
