Spirit of the Laws

How has Qatar’s potential as a business hub changed with the introduction of the new FDI legislation?

The new Foreign Investment law strengthens the option of using arbitration to resolve commercial disputes as a non-Qatari investor may agree in its agreements on settling disputes with other parties through arbitration or other means, such as out-of-court dispute settlement. The new law provides several investment incentives for non-Qatari investors and allows the allocation of land to a non-Qatari investor to establish his investment project through rent or usufruct in accordance with the legislation in force. Moreover, a non-Qatari investor may import the necessary equipment to establish, operate, and expand investment projects, while non-Qatari investments may be exempt from income tax in accordance with the procedures and regulations stipulated in the Income Tax Law. Equally important, the law states that non-Qatari investment projects are exempt from customs duties on machinery and equipment imports, while non-Qatari investment projects in the industrial sector shall be exempt from customs duties on imports of raw materials and semi-manufactured goods required that are unavailable in local markets. In addition, the Council of Ministers may, on the proposal of the Minister, grant investment project incentives and benefits in addition to the incentives provided for in this law. Other incentives are that non-Qatari investments shall not be directly or indirectly subject to expropriation or other similar actions, unless undertaken for the public good and with appropriate compensation; non-Qatari investors are also free to transfer their investments to and from Qatar without delay, including proceeds from the sale or liquidation of all or some of their investments, the proceeds of the settlement of investment disputes, and any compensation due to a non-Qatari investor; and a non-Qatari investor may transfer the ownership of his investment to any other investor or relinquish it in favor of his national partner in case of a joint venture. The investment shall continue to be treated in accordance with the provisions of the law, provided that he or she continues to operate the project and assumes the previous investor’s rights and obligations.

To what extent do other changes in the residency legislation attract FDI?

Under Law No. 10 of 2018 on permanent residency, expatriates in Qatar can obtain a permanent residency permit (PRP) under certain rules and conditions. Expatriates in Qatar should complete 20 years in the country on a legal ordinary residency permit if he or she is born abroad and 10 years for expatriates born in Qatar. The residency duration should be uninterrupted and completed prior to the date of application. With the implementation of a formal permanent residence program, Qatar’s aim is both to retain the existing highly skilled foreign population and reward them for their services to Qatar. Furthermore, the program aims to attract additional foreign investments and open Qatar’s economy up to other industries as the country’s efforts to diversify continue.

SANAD was developed by ASTAD to support contractual procedures in the construction industry. How can it be used to avoid disputes?

SANAD, meaning support in Arabic, is the integrated suite of contracts developed by ASTAD. It includes a suite of four contract templates and standardized forms covering construction, design and build, design services, and professional services. It aims to bring all parties involved in a project together by reducing costs, maintaining appropriate risk for all parties, and offering more balanced contract terms and conditions. It solves the key challenge of standard contracts in the region regarding inequitable and inefficient tender documents, while providing users with its original purpose, to support and improve traditional contractual procedures.