Qatar: Qatar Update – Recent Legal Developments

This update provides a summary of legal developments in the State of Qatar in reference to No. 9-17 of 2017 and 1-2 of 2018 of the Law Gazette.

Amendments to terrorism laws

The State of Qatar recently issued a new decree law to combat terrorist activity in the region. The decree is consistent with the State's continued efforts to uphold its established principles and also provides clarity on its rejection of terrorism, its financing and implementation of the international obligations set by the UN Security Council as well as a recent memorandum of understanding signed by the United States of America.

The new decree law will allow Qatar the freedom to act appropriately against terrorism to protect the State and its people through stricter penalties for terrorist activity. Most notably, any terrorist activity previously punishable with life imprisonment under the Qatar penal code will now be punishable by death. This was recently enforced against 11 individuals and entities, who were sanctioned as a result of their terrorist activities. The sanctions included freezing all assets and imposing a lifelong travel ban, demonstrating Qatar's no tolerance approach.

Improvements to labour dispute procedures

A new law has been introduced to strengthen employee rights and simplify litigation between an employer and an employee through the establishment of the Committee for the Settlement of Labour Disputes within the Ministry of Administrative Development, Labour and Social Affairs (Dispute Committee).

The law stipulates that, in the event of a dispute between an employee and an employer, the Department of Labour Relations needs to be consulted to achieve a settlement within a seven-day period. If the department fails to settle the dispute within seven days, it must refer the case to the Dispute Committee within three working days. In cases of dismissal, the employee is entitled to file a case directly to the Dispute Committee.

If the Dispute Committee finds a dismissal to be arbitrary, then the employee has the right to return to their job with compensation, which includes remuneration and other benefits which the employee would have been deprived of as a result of the arbitrary dismissal. The Dispute Committee will decide on the outcome of the dispute three weeks prior to the date of the final hearing. The Court of Appeal is the only authority that can suspend implementation of the Dispute Committee's decision.

Adjustments to free zone investment restrictions

Qatar has amended the Investment free zones law to reduce investment restrictions in free zones. The amendments enhance and encourage economic development and investment by providing nationals and foreign investors with a number of incentives including: no limits on capital; freedom to choose the legal outline of projects; freedom to put price tags on products and profit rates; exemption from capital assets; and exemption from production, import and export taxes and other charges. Projects in free zones are also given various guarantees, the most important being freehold ownership.

The new decree law also allows for companies with limited liability, joint ventures or any other type of corporate structure (whether owned by one or more natural or legal persons who are citizens or residents) to be established without being restricted by the non-Qatari share capital of those companies or the increase of their authorised capital.

The Free Zones Authority will provide all required facilities for issuance of licences to launch projects which will save time and effort, in addition to the provision of land plots with the required facilities in accordance with the nature of the project. The authority will also assist in the issuance of visas to investors in exchange for foreign know-how.

Introduction of new real estate regulations

A new law governing the terms and conditions relating to the licensing of real estate broking has been introduced. The law deals with the commitments of real estate brokerages, disciplinary and accountability rules, as well as the suspension and revocation of licences.

A real estate brokerage committee has also been established at the Ministry of Justice as a result of the law, which will look into complaints submitted by those affected by real estate brokers. The law will also improve the process of real estate broking and provide assurance to those using brokerage services. The law will be enforced within a maximum period of six months from the date of its implementation.

Creation of new leasing rules

It will now be mandatory for leases to be agreed in writing in order to provide clarity and guarantees. Leasing contracts must now include the name of the lessor, the tenant, their nationalities, addresses, legal representatives, the duration of the lease, the amount of the rent, means of payment and the purpose of the lease, in addition to all agreed terms.

The lessor must also register the leasing contract with the registration office of the property within 60 days from the date of the final agreement. The registration office will charge a fee for each property rental registration equivalent to 0.5 per cent of the annual rental value of each unit, where a minimum of QAR 250 and a maximum of QAR 2,500 will apply. The law sets a fine of not more than QAR 10,000 on anyone who violates the provisions.

Bitcoin trading prohibited by Qatar Central Bank

The Qatar Central Bank has issued a circular to all banks in the country, which specifies that Bitcoin trading is forbidden in Qatar due to the fact that it may be used in financial crimes and electronic piracy, in addition to the risk of losing its value without any guarantees. Any individual or entity using the Bitcoin currency will be subject to punishment under the Qatar Central Bank Law.

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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