Investor Alert: Changes to the Commercial Registration Rules in QatarPosted on November 18th, 2014
Law no. 20 of 2014 issued on November 10, 2014 by the Emir, H.H. Sheikh Tamim bin Hamad Al Thani, has amended some provisions of Law No 25 of 2005 regulating commercial registration (CR) in Qatar.
It is important for both local and foreign investors, whether they are already established in Qatar or looking to establish, to be aware of the new rules introduced as detailed below:
1. The department responsible for commercial registration of a business is now named Administrative Unit and has to reply to an application for CR the same day.
2. The Minister of Economy and Commerce’s decision to accept or reject a request for CR of a business is final and cannot be challenged in a court of law.
The Administrative Unit must specify the reason if an application for CR is being rejected. The Minister of Economy and Commerce can be approached within 30 days with a plea to review the decision.
However, if he rejects the plea, no appeal can be filed either before him or before a court, as stated in the new Law.
Under the provisions of the previous Law, applicants had the right to go to court if their application for CR of their business was rejected.
3. The validity of a CR is for one year under the new law and must be renewed within 30 days after expiry. The renewal will also be for one year.
A CR could be issued or renewed for one year or five years under the previous law.
4. A misuse of the CR by its holders or others would hold them liable to imprisonment for up to 6 months and a fine of up to 200,000 QR.
The previous law specified a jail term of a maximum of six months and a fine of up to only 50,000 QR for the above breach.
5. Not using the registered name of a business on sign boards, letterheads and official documents exposes the owners of a business to a fine of 50,000 QR for the above violation.
The previous law applied for the above violation a sanction of imprisonment not exceeding one-month prison term, and a fine of not more than 10,000 QR, or either of these sanctions.
6. The Administrative Unit is required to be notified of any changes in the board of directors.
7. A CR can be suspended for up to a year if forged documents were used to obtain it, or for tampering with a CR.
By Aline El Sayed - Senior Associate - Al Misnad Law - In Association with the Law Offices of Khalifa Al Misnad