Qatar has one of the fastest growing global economies thanks to the third largest concentration of natural gas reserves in the world. This along with recent legal liberalisation, economic diversification and an expanding economy provides many investment opportunities for non‑Qataris. Profits can be repatriated as can proceeds of sale and capital on liquidation. Major investment sectors are construction, oil and gas, education, and financial and legal services, with opportunities in ICT, sport, leisure and healthcare.
The government welcomes foreign participation in joint ventures, with incentives for investment:
• A developed infrastructure and ICT network.
• Easy access to world markets with good sea and air connections, continuously being upgraded.
• Natural gas, electricity, water and petroleum at subsidised rates.
• Land for industrial development in the Industrial Area near Doha for a nominal rent of QAR1 per square metre per year.
• Loans available from Qatar Development Bank.
• Fixed parity between the Qatari riyal and US dollar (USD1 = QAR3.64).
• No customs duty on the import of plant machinery; exemption from export duty.
• Five-year renewable tax holidays (based on government approval).
• No income tax on the salaries of expatriates.
• Tax on the profits of foreign-owned stakes in Qatari companies is applied at a flat rate of 10%.
• Employment and immigration rules enable the import of skilled and unskilled labour.
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). Qatar also recently introduced new free zones designed to encourage certain bespoke investment vehicles to bring their businesses to the region.
Non-Qatari investors may only invest in Qatar in accordance with Foreign Investment Law No 1 of 2019:
• In January 2019 the Amir promulgated the new foreign investment law of 2019. According to the new law, foreign investors are permitted to hold more than 49% in commercial companies with special permission from the Minister of Commerce and Industry (MOCI) (subject to some prohibitions set out below). Under the former law such increased ownership was limited to those businesses operating in a specific set of sectors.
• Non-Qatari investors are prohibited from being appointed as commercial agents under Commercial Agencies Law No 8 of 2002, but the former prohibition preventing foreigners from investing in real estate businesses has been removed under the new Foreign Investment Law. Approval from the Council of Ministers is required for foreign investment in banking and insurance.
• 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.
• Law No 12 of 2020 regulating the partnership between the public and the private sector became law in July 2020, as per one of the following regulations: Allocation of land through a rental or usage licence, for development by the private sector; build-operate-transfer (BOT); build-transfer-operate (BTO); build-own-operate-transfer (BOOT); operations and maintenance (OM); or any other form adopted by the Prime Minister, upon the proposal of the relevant minister. The Government or other administration may, on its own initiative or at the suggestion of the private sector, identify a project for its implementation through partnership.