In This Issue

Industrial Development and Mining Seminar
LEBANON amending IP Laws
New contact numbers in GAZA
ALGERIA enforces Arabic Language
Arabic Edition of GATT Guide
SAUDI ARABIA to strike off Counterfeiters
ASPIP Office
New Cinema Culture in BAHRAIN
KUWAIT : IP Panel meets
REMINDER : Change in WESTBANK Telephone and Telefax numbers

Legal Angle

Investing in the Middle-East - Part Two : JORDAN

Seminar on Industrial Property and Technology Transfer in the Arab World
Mr. Talal Abu-Ghazaleh, Chairman of the Arab Society for the Protection of Intellectual Property (ASPIP), has been invited by the Arab Organisation for Industrial Development and Mining, whose headquarters are in Morocco, to present a paper at a seminar due to be held in Amman in November on industrial property and technology transfer in the Arab countries. The seminar is held in line with the organisation's program which was approved by the Ministers of Industry in the Arab countries.

The paper's title will be "Protection of Intellectual Property as Incentive to Economic Advancement". It should be noted that ASPIP will participate in organising the seminar in cooperation with specialised international and Arab bodies, among which are WIPO, WTO, Islamic Development Bank, Gulf Industrial Consultations Organisation, King Abdul Aziz University for Science and Technology, Scientific Research Academy in Egypt, and the Higher Council for Science and Technology.

LEBANON Amending Intellectual Property Laws

The committee formed to study and update the decades-old industrial property laws in Lebanon, have been meeting on a weekly basis over the past few months in order to discuss and finalise any amendments to these laws. The target date for these amendments to be completed is August 1998. The aim is to upgrade the current industrial law to an intellectual property law that would be in compliance with the World Trade Organisation's agreements on Trade Related Aspects of Intellectual Property, which took effect on January 1, 1995. Once these amendments are completed they will be forwarded to the parliament for ratification, before the Presidential elections in October 1998.

In April 1998 Lebanon began an intensive effort to prepare its bid to join the World Trade Organization (WTO) and plans in the near future to request observer status at the WTO. However, even after submitting its application, the process of joining the WTO will still take much time as more than 30 countries have already submitted their applications and are in the process of negotiating their entry.

It is worthy of note that the copyright law in Lebanon has already been reviewed by a previous committee and the necessary amendments have been made. The revised law is expected to be discussed by the Parliament very shortly.

NEW NUMBERS IN GAZA, PALESTINE

Our Gaza Office has advised us that their numbers have changed as follows :
Telephone No : 972-7-2 824 156
Telefax No : 972-7-2 824 156

Arabic Edition of the Business Guide to the Uruguay Round

An authorised Arabic translation of the Business Guide to the Uruguay Round has just been published through a cooperation arrangement between the International trade Center UNCTAD/WTO (ITC) in Geneva, the Commonwealth Secretariat in London, Talal Abu-Ghazaleh International (TAGI) and the Arab Management Society (AMS). The publication was originally issued in English, French and Spanish jointly by ITC and the Commonwealth Secretariat. Because of the wide interest in the Guide in Arabic-speaking countries, agreement was reached between the above organisations to make it available in this language version as well.

The book is intended to serve as a basic reference for the business community on how to maximise benefits resulting from the Uruguay Round as well as meet the requirements of the new international trading system. Written in clear, non-legal terms, it should be of particular interest to officials and interested parties who wish to improve their understanding of the final act of the Round.

The Guide gives a general overview of the Uruguay Round in an introductory section. It then discusses in five main parts the role of the World trade Organisation (WTO) and the new international rules on trade in goods, trade in services, government procurement and state trading, and trade related aspects of intellectual property rights. Each chapter begins with a summary of the subject followed by a more detailed discussion, including references to specific provisions in the Uruguay Round agreements. The business implications are outlined at the end of each chapter. An index facilitates use of the guide.

For the Arabic version of this publications, all rights are reserved by the International Trade Centre UNCTAD/WTO, the Commonwealth Secretariat, and Talal Abu-Ghazaleh International.

SYRIA : Power of Attorney

According to new regulations in Syria, it has become necessary, as of July 1998, to submit a separate simply signed power of attorney with each application.

Previously one power of attorney was sufficient for several applications.
Kindly contact our Syria office or the Regional Office in Jordan for further information.

ASPIP Office Relocated

The Arab Society for the Protection of Intellectual Property (ASPIP) has now moved into its new offices in the Amman Commercial Center in Abdali, Amman, Jordan.

ASPIP members can contact the Society at the following number :
Telephone and Telefax : (962-6) 569 -8282

SAUDI ARABIA will strike off Counterfeiters

Mr. Osama Faqieh, the Saudi Minister of Trade, has affirmed that his ministry will not hesitate to strike off the complete entry off the commercial register of any merchant who is convicted of dealing with counterfeit products. Mr. Faqieh made the statement during his visit to the exhibition of the counterfeit products seized in Saudi Arabia. He expressed his satisfaction over the joint efforts of the companies in search of the counterfeit dealers.

As penalties for trademark counterfeiting, the Trademark Law of Saudi Arabia provides for an imprisonment term of up to a year and a fine of up to Saudi Riyals 50,000 (USD 13,300), plus confiscation and destruction of counterfeit products. The law also provides for cancellation of the commercial register entry of counterfeit dealers.

Local companies and dealers had earlier filed an application for the formation of a subcommittee of the Chamber of Trade for coordination with local officials in combating counterfeiting which involves a number of products. Fourteen companies which sustained damage from counterfeiting held a simplified exhibition for reviewing the problem with the Minister of Trade. Foremost amongst them were General Motors, Nestle and Unilever.

New Cinema Culture in BAHRAIN as Video Business hit by Copright Laws

The enforcement of international copyright standards in Bahrain has changed the film viewing habits of the population. The elimination of pirate tapes from the video stores has taken its toll and has now spawned a new cinema trend in Bahrain. Bahrainis are flocking to the big screen more than ever and according to analysts, unless innovative and competitively priced video membership schemes are soon offered to movie fans, the enticement of the big screen could forever replace the once lucrative movie rental business, especially with the new cinema complexes that are being opened across the country.

Since the Cabinet Affairs and Information Ministry's copyright grace period of March 1st deadline passed, as many as 30 video rental businesses have turned in their commercial registration (CR) licenses. The number of stores that will go out of business could be even higher as the regulations do not impose on a store to hand in its CR licence immediately.

The video stores that have developed new rental schemes are still finding it hard to keep their former customers as very few of them are willing to place a deposit or have to deal with time limits for each video they rent, which are rules that were never in existance before. Even more damaging to the the video proprietors business is the fact that the video clientele demand the latest movie releases; however, these are no longer available on pirate video as film companies retain the movie rights to a film for at least two years before it is released on video.

According to some reports, several large international video franchises are planning to open their own video chains in Bahrain; however, these reports are unconfirmed.

Source : The Gulf Daily News, June 13, 1998

REMINDER :

Change in Telephone and Telefax Numbers in the WEST BANK
Our telephone and telefax numbers in the West Bank will be changed as of August 4th 1998. The new numbers will be as follows : 
Telephone : (972-2) 295 48 48 
Telefax : (972-2) 295 48 49

KUWAIT Intellectual Property Panel Meets

In July 1998 the Undersecretary of Trade and Industry, His Excellency Rashed Al-Mijrin, chaired the first meeting of the intellectual property committee. This was in line with a decision issued by the Minister of Trade and Industry, His Excellency Abdelaziz Al-Dakheel, to discuss the committee's responsibilities.

The committee is made up of representatives of the Foreign Trade, Information and Health Ministries in addition to the Public Authority for Industry, General Customs Department, the Islamic Fatwa and Legislation Department, the Kuwait Institute for Scientific Research, and the Kuwait Chamber of Trade and Industry.

The meeting discussed laws and decisions related to intellectual property and the necessary bills that need to be passed, as well as the need for foreign expertise in the IP field. The committee will present draft laws to the World Intellectual Property Organisation (WIPO) for advice and review before final endorsement is given. The draft laws will then be referred to the Islamic Fatwa and Legislation Department before a comprehensive report on the matter is submitted in six months.

In April 1998 Kuwait presented its accession papers to WIPO, the UN specialised agency promoting the protection of intellectual property throughout the world. Membership becomes official three months after presentation of accession papers.

WIPO promotes the worldwide protection of intellectual property through cooperation among states and by administering treaties covering certain intellectual property areas. Kuwait is a member of the 1967 convention which established WIPO.

AGIP's WEB SITE Click Contact Link

Our Regional and Jordan Offices can be reached by E-mail at Click Contact Link

Investing in the Middle-East : Part Two - Jordan

Jordan has recently been placing more importance on changing regulations that govern external and internal investment in Jordan. Apart from the obvious benefits that such investment would bring to the country, these changes are also needed as Jordan seeks to join the World Trade Organisation and the European Partnership Agreement. Jordan is already a member of the International Center for Settlement of Investment Disputes.

Legislation

In order for Jordan to be able to join these two organisations amendments were needed to the most important legislations that provide incentives to foreign investors. These changes have been implemented over the last few years and are as follows :
1.Non-Jordanian investment regulations.
2. Companies law.
3. Income tax law

Following is a review of the most important issues related to these legislations :

In 1995 the Law for Encouraging Investment was issued. It was then followed by Regulation No. 39 for 1997. The most important items are the following :

a. A foreigner may invest and/or own the whole or part of an economic project in the various sectors.
b. His share of investment shall not be less than JD 50,000 (except in public shareholding companies).
c. Facilities and exemptions for any project are for ten years.
d.However, this system excluded the construction contracting sector, the trade and trade services sector, and the mining sector. The system limited participation in any of these sectors to not more than 50per cent of the project's capital.
e. In all cases, the foreign investor should transfer the whole of his share in the project to Jordan in a convertible currency.
This is in addition to incentives and other periodic encouraging exemptions for fixed assets, furniture, imported machinery and their spare parts for the purpose of modernisation and renewal. This law divided the kingdom geographically into three development areas (A,B,C) for the purposes of enjoying tax and customs exemptions as follows :
  • Area (A) enjoys an exemption of 25per cent
  • Area (B) enjoys an exemption of 50per cent
  • Area (C) enjoys an exemption of 75per cent

Company Formation

To realise the objectives of encouraging foreign investment, it was necessary to make some modifications on companies in terms of their type, contract and registration procedures.
1. Types of Companies :
  • a) General Partnership: It consists of 2-20 partners. A partner is liable for company's obligations to the extent of his private money.
  • b) Limited Partnership : The partners are divided into joint partners, who may share in the management of the partnership, and partners who may not share in the management.
  • c)Limited Liability Company : It consists of two persons or more, and its capital is not less than JD 30,000. At the recommendation of the Companies controller at the Ministry of Industry and Trade, this company may consist of one person. The partner's liability in this type of company is limited to his share in the capital.
  • d) Partnership Limited by Shares : In this company the partners are divided into joint partners, whose number is not less than two, and they are liable to the extent of their shares and private money, and shareholding partners, whose number is not less than three, and they are liable to the extent of their shares only. The capital of this type of company is not less than JD 100,000 and the shares are negotiable.
  • e)Public Shareholding Company : Its minimum authorised capital is not less than JD 5,000,000 divided into equal shares which are negotiable.
  • f) Exempted Companies : They are either public shareholding companies, partnerships limited by shares or limited liability companies, which are registered in the Kingdom and carry business abroad.
2. Foreign Companies :
  • a) Foreign Non-Operating Companies (Regional Offices): According to law, such companies enjoy full tax and customs exemptions, provided they do not carry on any commercial activity in Jordan.
  • b) Foreign Operating Companies : They are divided into two types -
  • - Foreign companies operating in a permanent manner under a special license from the competent parties.
  • - Foreign companies operating for a limited period. The registration of these companies expires with the completion of the work or tender which they are involved in , unless they obtain new contracts.
3. Registration Procedures :

The companies law observed expedience in the registration procedures with the Companies Controller, except the companies which require a prior approval by official authorities. In addition, it is provided that the foreign Partner's share should be fully paid up upon incorporation.

There are no restrictions on the movement of funds from and to investors.

Taxation

At the end of 1995, substantial amendments were made to the Income Tax Law. The law aimed at reducing tax on individuals and companies with ideal income. Tax rates have become as follows :

1. Individuals
  • Tax due on the first JD 2,000 - 5per cent
  • Tax due on the next JD 2,000 - 10per cent
  • Tax due on the next JD 4,000 - 15per cent
  • Tax due on the next JD 4,000 - 20per cent
  • Tax due on the next JD 4,000 - 25per cent
  • Tax due on each dinar of the next amounts - 30per cent
(Exchange Rate : JD 1 - USD 0.71)

2. Companies

Companies income tax is as follows :

a) At the rate of 15per cent of the income resulting from a project in one of the following sectors : mining, industry, hotels, hospitals, transportation and construction contracting, provided the paid up capital is not less than JD 1 million.
b) At the rate of 35per cent of the income of banks, financial companies, insurance companies, exchange companies and brokerage companies.
c) At the rate of 25per cent of the income of other companies.

Kindly contact our Regional Office in Jordan for further information.

Next Issue : Investing in the Middle East - Part Three : EGYPT

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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