There are primarily two regulatory jurisdictions for foreign investors seeking to conduct commercial business in Qatar: the regulations of the State of Qatar, and the rules and regulations of the Qatar Financial Centre (discussed in more detail below). Non-Qatari investors may only invest in Qatar in accordance with Foreign Investment Law No 13 of 2000 and its numerous revisions:
– In May 2018 the Minister of Economy and Commerce confirmed that legislation permitting non-Qatari investors to own 100% of the shares in Qatari company was on track to become binding legislation.
According to the draft law, the increased foreign ownership in a company is subject to the non-Qatari investor having in place a Qatari service agent. The service agent acts as a liaison between the non-Qatari owned company and the local authorities. However, non-Qatari investors will not be allowed to act as commercial agents or engage in property sales activities. Investing in banking and insurance still requires special government permission.
– Non-Qatari investors are prohibited from being appointed as commercial agents under Commercial Agencies Law No 8 of 2002 or from investing in real estate businesses (apart from designated real estate areas). Approval from the Council of Ministers is required for foreign investment in banking and insurance.
– The Minister of Economy and Commerce (MEC) may permit non-Qatari investors to own up to 100% of a business in one of the following sectors, if such projects match the development plan of the State of Qatar: agriculture; industry; health; education; tourism; development and exploitation of natural resources; technical and information consultancy; cultural, sports and entertainment services; distribution services; and energy or mining.
– Foreign capital is protected against expropriation (although the State may acquire assets for public benefit on a non-discriminatory basis, provided the full economic value is paid for the asset).
– Subject to Ministerial approval, a foreign company performing a specific contract in Qatar may set up a branch office if the project facilitates the performance of a public service or utility.
– A non-Qatari company operating in Qatar under a Qatari government concession to extract, exploit or manage the State’s national resources is exempt from the Foreign Investment Law. In practice this covers all large oil and gas companies.
– A company formed by a non-Qatari entity with the government or a government entity (‘Article 207 Company’) may be subject to special rules and exemptions from the Commercial Companies Law No 11 of 2015.
– All international companies securing mega infrastructure development work must share at least 30% of the contract with local entities.
– Law No 7 of 1987 governs the practice of commercial activity by GCC citizens in Qatar, and was amended in April 2017 under Law No 6 of 2017. GCC citizens as individuals or legal personalities can practice retail and wholesale trade in Qatar. However, the GCC citizen engaging in the activity must be directly responsible for it. Those undertaking retail business must do so via direct sale to customers in a shop, and those in wholesale trading are required to import and export the goods.
NB: the blockade against Qatar means that some aspects of this commercial activity is subject to change and legal advice is recommended.