Foreign Ownership in Qatar

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By Elie Al Khawand

In keeping with the goals articulated in its National Vision 2030, Qatar is shifting its economic and developmental focus away from the reliance on oil and gas by promoting a policy of economic diversification.

Qatar has introduced several incentives and legislations that aim to opening the business environment for foreign investors as these investments are considered of high importance to Government.

For a foreign investor to start a company in Qatar, he must appoint a Qatari national as a local partner to hold 51% of the shares of the company and the foreign investor will hold the remaining 49%; however, Qatar “Foreign Investment Law” Law No. 1/2019 allow for up to 100% foreign ownership in certain business sectors which are considered to be a priority for the Qatari Government, these include:

· Agriculture,

· Business consulting and technical services,

· Culture, sports, entertainment, and distribution services,

· Development and exploration of natural resources,

· Education,

· Health,

· Information Technology,

· Industry/manufacturing, and

· Tourism.

Other businesses outside of these sectors could potentially be granted 100% foreign ownership subject to the approval by the Qatari Council of Ministers.

The law also allows foreign companies to establish a trade representation office (branch office) in Qatar without a Qatari partner to promote their activities and offers products and services to the Qatari market; however, these companies are not permitted to import, export, or sell any product in Qatar.

The law allows for the following investment incentives:

· The Lands can now be allocated to foreign investors through rent or usufruct.

· Foreign investors may be exempted from income tax.

· Expropriation shall only be done for the public interest and in a non-discriminatory matter, a fair compensation shall be paid to the investor.

· Exemption of customs on the following:

Machinery and equipment necessary for a project.

Raw and semi-manufactured goods required for manufacturing in the industry sector, that are unavailable in local markets.

 

There are a number of free zone options in Qatar that allow foreign companies to set up their business in Qatar with 100% ownership these include Qatar Free zone (QFZ) and Qatar Financial Centre (QFC).

 

Real estate ownership is generally restricted to Qatari persons; however, State of Qatar Law No. (16) of 2018 along with new Qatar Financial Centre (QFC) Real Estate Ownership Regulations, new 9 “designated areas” (including The Pearl Qatar, Lusail City, and Al Khor) have become open for full ownership to all investors regardless of nationality and 16 areas are open for usufruct rights only (i.e. 99 year lease).

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