Law No. 1 of 2019 on the Regulation of Non-Qatari Capital Investment in Economic Activity

Law No. (1) of 2019 on the Regulation of Non-Qatari Capital Investment in Economic Activity

We, Tamim bin Hamad Al Thani, Amir of the State of Qatar,

After reviewing the Constitution, and Law No. (13) of 2000 on the Regulation of Non-Qatari Capital Investment in Economic Activity, and its amended laws, and Law No. (8) of 2002 concerning the Regulation of Commercial Agents' Activities, amended by Law No. (2) of 2016, and the Customs Law issued by Law No. (40) of 2002, and the Income Tax Law issued by Law No. (24) of 2018, and the Commercial Companies Law issued by Law No. (11) of 2015, and upon the proposal of the Minister of Commerce and Industry, and upon the draft law submitted by the Council of Ministers, after obtaining the opinion of the Shura Council,

we have enacted the following Law:

Chapter One Definitions

Article (1)

In the application of the provisions of this Law, the following words and phrases shall have the meanings indicated alongside each of them, unless the context dictates otherwise:

The Ministry: The Ministry of Commerce and Industry. The Minister: The Minister of Commerce and Industry. The Competent Administration: The administrative unit within the Ministry. Non-Qatari Investor: The person who invests their funds in one of the projects authorized for investment under this Law. Non-Qatari Capital: The monetary, in-kind funds, or rights with financial value invested by a non-Qatari in the State of Qatar, including:

1. Funds transferred to the State through licensed banks and financial companies.
2. In-kind assets imported for investment purposes in accordance with this Law.
3. Profits, returns, and reserves resulting from the investment of non-Qatari capital in the project, if used to increase this project's capital or invested in one of the authorized projects under this Law.
4. Intangible rights, such as licenses, patents, and trademarks registered in the State. The Company: Any company established in accordance with the provisions of the aforementioned Commercial Companies Law.

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Chapter Two Regulations on Non-Qatari Capital Investment

Article (2) Without prejudice to the legislation governing non-Qatari engagement in commercial activities and professions, and Article (4) of this Law, the non-Qatari investor may invest in all economic sectors up to (100%) of capital, as determined by the Executive Regulations of this Law.

Article (3) Applications for approval of non-Qatari shareholding exceeding (49%) of company capital, in accordance with Article (2) of this Law, shall be submitted to the Competent Administration on the form prepared for this purpose, accompanied by supporting documents as specified by the Administration, after payment of the prescribed fees. The Competent Administration shall rule on the application within fifteen days from the date of receiving the required documents, and notify the concerned party by registered letter or any other means indicating knowledge, and the expiration of this period without a response shall be deemed an implicit rejection of the application. The applicant whose request was rejected may appeal the Administration's decision to the Minister within fifteen days from the date of learning of the rejection decision, or from the date the request is deemed rejected. The Minister shall rule on the appeal within thirty days from its submission, and the expiration of this period without a ruling shall be deemed an implicit rejection, with the Minister's decision on the appeal being final. The Executive Regulations of this Law shall specify the mechanism for ruling on investors' applications in accordance with the provisions of this Article.

Article (4) The non-Qatari investor is prohibited from investing in the following sectors: a. Banks and insurance companies, except those exempted by a Council of Ministers decision. b. Commercial agencies. c. Any other sectors specified by a Council of Ministers decision.

Article (5) Non-Qatari companies associated with executing work contracts in the State shall comply with the following regulations:

1. The contract shall be executed through the company's branch in the State.
2. The contract shall be with one of the ministries, government entities, authorities, public institutions, or companies and institutions in which the State participates.
3. Registration in the Commercial Register and obtaining a commercial license for the company's branch through which the contract is executed in the State, after awarding the work and before signing the contract.
4. Fulfilling all requirements of the competent authorities in the State according to the legislation applied by these authorities throughout the contract execution period.
5. Renewal of the Commercial Register entry and renewal of licenses issued to the company's branch, throughout the contract duration. The Council of Ministers may, upon the Minister's proposal, amend these regulations by addition, deletion, or merger.

Article (6) In the absence of a specific provision in this Law, the rules governing obtaining the necessary licenses for non-Qatari investors to practice any of the authorized activities shall follow the laws in force in the State for that activity.

Article (7) The non-Qatari investor may own a percentage not exceeding (49%) of the capital of Qatari joint-stock companies listed on the Qatar Stock Exchange, after the Ministry's approval of the proposed percentage in the company's incorporation contract and bylaws. The investor may also own a percentage exceeding the aforementioned, with the Council of Ministers' approval, upon the Minister's proposal.

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Chapter Three Investment Incentives

Article (8) Land necessary for the non-Qatari investor to establish their investment project may be allocated by lease or usufruct right, in accordance with the laws in force on this matter.

Article (9) The non-Qatari investor may import for their investment project what is needed for its establishment, operation, or expansion, in accordance with the laws in force in the State.

Article (10) Non-Qatari investment projects may be exempted from income tax in accordance with the regulations, procedures, and periods stipulated in the aforementioned Income Tax Law.

Article (11) Non-Qatari investment projects are exempt from customs duties on their imports of machinery and equipment necessary for their establishment, and non-Qatari investment projects in the industrial sector are exempt from customs duties on their imports of raw and semi-finished materials necessary for production that are not available in local markets.

Article (12) The Council of Ministers may, upon the Minister's proposal, grant investment projects incentives and benefits in addition to those stipulated in this Law.

Article (13) Non-Qatari investments, whether direct or indirect, are not subject to expropriation or any similar measure, unless for public benefit and in a non-discriminatory manner, against fair and adequate compensation according to procedures applied to citizens.

Article (14)

1. The non-Qatari investor enjoys the freedom to carry out all transfers related to their investments to and from abroad without delay, including: a. Investment returns. b. Proceeds from the sale or liquidation of all or part of the investment. c. Proceeds from the settlement of investment disputes. d. Compensation stipulated in Article (13) of this Law.
2. Transfers shall be made in any convertible currency, at the exchange rate prevailing on the transfer date.

Article (15) The non-Qatari investor may transfer ownership of their investment to another investor or relinquish it to their national partner in case of partnership, subject to being carried out in accordance with the laws and legislation in force. In this case, the investment shall continue to be treated in accordance with this Law, provided that the new investor continues working on the project and assumes the rights and obligations of the previous investor.

Article (16) Except for labor disputes, the non-Qatari investor may agree to resolve any dispute arising between them and others through arbitration or any other approved dispute resolution means, in accordance with the law.

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Chapter Four General Provisions

Article (17) The non-Qatari investor is obligated to preserve the environment from pollution, comply with laws, regulations, and instructions related to public safety and health, and refrain from acts that may affect the State's public order or public morals.

Article (18) The provisions of this Law do not affect the benefits and tax exemptions, as well as other guarantees and incentives granted to existing companies and establishments at the time of its implementation. These companies and establishments shall retain those benefits, exemptions, guarantees, and incentives in accordance with the derived legislation, agreements, and contracts.

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Chapter Five Penalties and Final Provisions

Article (19) The Competent Administration shall notify the non-Qatari investor upon violating any provision of this Law, to rectify the violation within a period not exceeding three months from the notification date. In case of failure to rectify, the Competent Administration shall cancel the license issued to the project and strike off the company or branch registration from the Commercial Register, as applicable, while notifying relevant government authorities regarding the investment project to take their measures. The concerned party may appeal to the Minister against the decision to cancel the license and strike off the company or branch registration, with the same provisions and procedures stipulated in Article (3) of this Law applying to the appeal.

Article (20) Without prejudice to any heavier penalty stipulated in another law, anyone who engages or participates in an economic activity in violation of this Law shall be subject to a fine not exceeding (500,000) five hundred thousand riyals.

Article (21) The legal entity shall be subject to the penalty stipulated in the preceding article for acts committed in violation of this Law, if the offense is committed by one of its employees in its name or on its behalf, without prejudice to the criminal liability of the natural person subordinate to it.

Article (22) Ministry employees, who are authorized by a decision from the Public Prosecutor in agreement with the Minister to hold the status of judicial police officers, shall record and prove crimes committed in violation of this Law.

Article (23) The Minister shall determine by decision the fees for services paid in accordance with this Law.

Article (24) The Minister shall issue the Executive Regulations and all necessary regulations and decisions to implement this Law's provisions. Until their issuance, currently in force decisions shall continue to apply insofar as they do not conflict with its provisions.

Article (25) The provisions of this Law do not apply to:

1. Companies and individuals to whom the State entrusts the extraction, exploitation, or management of natural resources, under a concession or special agreement, except to the extent not conflicting with the provisions of the concession contract or special agreement.
2. Companies established or participated in by the Government and other public institutions, and companies in which the State participates with a percentage not less than (51%) or less, subject to Council of Ministers' approval, in partnership with non-Qatari investors, according to the provisions of the aforementioned Commercial Companies Law.
3. Companies and individuals licensed by QatarEnergy to conduct any petroleum operations, or those targeting investment in the oil, gas, and petrochemicals sector.

Article (26) The aforementioned Law No. (13) of 2000 is repealed.

Article (27) All competent authorities shall implement this Law, each within their respective jurisdiction. It shall be published in the Official Gazette.

Tamim bin Hamad Al Thani Amir of the State of Qatar

Issued in the Amir's Diwan on: 1/5/1440 AH Corresponding to: 7/1/2019 AD