This week the spotlight is on legal and regulatory developments in Saudi Arabia, where the Commerce and Investment Ministry and the General Investment Authority (Sagia), have announced foreigners will be able to own 100% of construction and engineering businesses. It follows a consultation which has recently concluded. Foreigners will be able to own 100% of these businesses so long as they have a 10-year operational track record and have a presence in at least four other countries. Sagia will be able to waive these restrictions if an application is considered to be in the Kingdom’s best interests.

Elsewhere, the Head of Saudi Arabia’s General Authority for Civil Aviation, Abdul Hakim Al-Tamimi has announced all of the Kingdom’s airports will be privatised by December this year. All of the country’s airports will be transferred to the Saudi Civil Aviation Holding Co first. They will then be transferred to the Public Investment Fund (PIF). The privatisation will be carried out in three ways. The first will see an airport transferred to a company like Riyadh’s King Khaled International Airport, where a minority holding was sold and an airport board of directors will then be established which will manage the company. The second is known as operation and maintenance like Jeddah’s King Abdul Aziz International Airport in Jeddah where the Civil Aviation Authority bears the capital cost of establishing the project and shares the income with investors. The third method is through Build, Operate and Transfer, like Madinah’s Prince Mohammed bin Abdul Aziz Airport where employees are an investor’s responsibility. The investors bear the capital cost of the project and share the income with the Authority.

This week the spotlight is on the issuing of the new Tax Procedures Law in the UAE. Under Federal Law No. 7/2017 (which has not yet been Gazetted), the foundations for the tax system are laid out whilst the administration and collection of taxes processes are stipulated and the role of the Federal Tax Authority is defined. It also defines a clear set of common procedures and rules to be applied to all tax laws in the UAE, particularly VAT and excise tax laws. The law covers tax procedures, audits, objections, refunds, collection and obligations, including tax registration, tax-return preparation, submissions, payment and voluntary disclosure rules as well as tax evasion. It also lays out the penalties for non-compliance as well as clear appeal processes in line with international best practices. When it comes into force businesses will have to keep records for five years.

An unofficial translation of the Law can be accessed here: https://www.mof.gov.ae/en/lawsAndPolitics/govLaws/Pages/TAX.aspx. We are monitoring the legislative progress of this important development with our publishing Partners, SADER Legal Publishing and will provide updates as and when appropriate.

This week the spotlight is on legal and regulatory developments in Oman, where the Manpower Ministry and Central Bank have announced plans to introduce a Wages Protection System (WPS) for all private sector companies, with a trial phase to begin on 18 November 2017. The WPS aims at controlling the payment of wages by employers to ensure timely receipt of salaries by employees per the amounts agreed in their employment contracts. The programme comes as a result of implementation of Article 53 of the Labour Law imposing the obligation of depositing the employee’s salary through one of the locally approved banks. It is expected further details of the programme will be released closer to the start date. Employers in the private sector will soon be required to subscribe to the Wages Protection System for submission of their employees’ salaries through the Central Bank of Oman.

Elsewhere, Oman’s Sultan has approved a number of Sultani Decrees including Oman Sultani Decree No. 33/2017 approving the GCC Commercial Transactions Law. It will be published in the Official Gazette along with Oman Sultani Decree No. 34/2017 promulgating the Veterinarian Products Law which will apply to veterinarian products.