Qatari Investment Between National and Foreign Capital
In recent years, Qatar has witnessed significant economic openness, making it an attractive destination for both national and foreign investments. At the dawn of the third millennium, Qatar took substantial steps to promote economic openness. Among these measures was the issuance of Law No. (1) of 2019 by the Qatari legislator, regulating the investment of non-Qatari (foreign) capital in economic activities.
This law aims to accelerate economic development, attract foreign investments across all economic and commercial sectors, and achieve economic diversification in line with Qatar National Vision 2030.
Investment Incentives for Non-Qatari Capital
Non-Qatari Investor
The law defines a non-Qatari investor as any person who invests their funds in an authorized project in accordance with the provisions of this law.
Authorized Projects
Foreign investors are permitted to invest in all economic and commercial activities except for the following:
1. Banking and Insurance
Investment in banking and insurance sectors is prohibited, except as authorized by a decision from the Council of Ministers.
2. Commercial Agencies
Investment in this sector is strictly prohibited.
3. Other Areas
Any additional restrictions may be determined by a decision from the Council of Ministers.
Non-Qatari Capital
The law defines non-Qatari capital as all funds, whether monetary or in-kind, or rights with financial value invested by a non-Qatari individual in Qatar, including:
1. Cash transferred into the country through licensed banks and financial institutions.
2. Tangible assets imported for investment purposes.
3. Profits, revenues, and reserves generated from the non-Qatari capital invested in the project.
4. Intangible rights, such as licenses, patents, and trademarks registered within the state.
Investment Incentives
1. Land Allocation
Non-Qatari investors are allocated land for their investment projects through usufruct or lease agreements in accordance with prevailing regulations.
2. Import of Equipment
Investors are allowed to import necessary equipment and machinery to establish, operate, and expand their investment projects.
3. Tax Exemptions
Non-Qatari investment projects may be exempted from income tax, subject to prescribed regulations and procedures.
4. Customs Exemptions
Non-Qatari investment projects are exempted from customs duties on imports of machinery and equipment required for their activities.
5. Protection of Property
Non-Qatari investments are safeguarded from expropriation, whether direct or indirect, except for cases of public benefit, carried out in a non-discriminatory manner, and accompanied by fair and adequate compensation.
6. Transfer of Funds
Non-Qatari investors are allowed to transfer their investments in and out of Qatar without delay. These transfers include investment returns, proceeds from the sale or liquidation of investments, amounts resulting from the settlement of investment disputes, and any due compensation.
7. Transfer of Ownership
Non-Qatari investors may transfer their investment ownership to another investor or relinquish it to their Qatari partner, provided the new investor continues the project and assumes the previous investor’s rights and obligations.
8. Dispute Resolution
Investors may agree to resolve any disputes arising between them and other parties through arbitration or other legally approved dispute resolution methods, except for labor disputes, which fall under the authority of Qatari courts.
Regulations for Non-Qatari Capital Investment
Investment Procedures
1. Application: Submit a request to the relevant authority with supporting documents and pay the prescribed fees.
2. Decision: The application must be decided upon within 15 days.
3. Notification: The applicant is informed of the acceptance or rejection of the request.
Right to Appeal
If the application is explicitly or implicitly rejected, the investor may appeal to the relevant minister within 15 days of receiving the rejection notice
Exemptions from the Law
Certain cases are exempted from the provisions of this law, such as:
– Non-Qatari companies assigned by the state to extract, exploit, or manage natural resources under a concession or special agreement.
– Companies established or partially owned by the state, with a minimum of 51% state ownership, or a lesser percentage approved by the Council of Ministers.
– Companies and individuals licensed by Qatar Petroleum to conduct petroleum-related activities or invest in the oil, gas, and petrochemical sectors.
Conclusion
The Qatari legislator allows non-Qatari investors, whether natural or legal persons, to invest in all economic sectors except for banking, insurance, and commercial agencies. The law offers a comprehensive set of investment incentives, including land allocation, tax and customs exemptions, property protection, and the free transfer of funds. These measures aim to attract foreign investments, promote economic diversification, and support the goals of Qatar National Vision 2030.