DECEMBER 2008 - ISSUE 213

DIFC-LCIA Arbitration Centre SPC in the DIFC Islamic Securitisation Abu Dhabi Free Zone
The Ladder of Success
Saudi Strategies for Top 10 in 2010
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Dubai Head Ofce
Dubai International Financial Centre 6th Floor Building 4 East,
Sheikh Zayed Road P.O. Box 9275 Dubai, UAE
Tel: +971 4 364 1641 Fax: +971 4 364 1777
Dubai Ofce
Dubai World Trade Centre, 9th Floor,
Sheikh Zayed Road P.O. Box 9275, Dubai, UAE.
Tel: +971 4 331 7161 Fax: +971 4 331 3089
Abu Dhabi Ofce
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Abu Dhabi UAE
Tel: +971 2 674 4535 Fax: +971 2 676 8762
Sharjah Ofce
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Sharjah UAE
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Dubai Internet City Ofce
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United Arab Emirates Court of Cassation Judgments 1998-2003
By Essam Al Tamimi & Richard Price
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The Practical Guide to Litigation and Arbitration in the United Arab Emirates
By Essam Al Tamimi
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Setting up in Dubai
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2ND EDITION
Setting Up in the
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Dispute Resolution
DIFC-LCIA Arbitration Centre 4
Credit For Published Works:
To Whom and When is it Due? 7
Arbitration Awards: To what exent is
Court review permitted? 9
UAE President Issues Federal Decrees
and Approving 9 International
Agreements 11
Law on Organisation of Sharjah Free
Zones Discussed 11
260 Articles of the Marine Law
Discussed 11
Amendments to the Central Bank Law 12
Dubai Customs Organises Intellectual
Property Protection Week 12
Events
DCCG Awards Dinner 13
DIFC Week 13
MEED Healthcare Conference 2008 13
SMB Forum 13
Banking & Finance
Setting Up of SPC in the DIFC 14
Corporate Commercial
Introducing Abu Dhabis
First Free Zone 17
Kingdom of Saudi Arabia
The Ladder of Success
Saudi Strategies for Top 10 in 2010 21
Legal Considerations for Foreign
Investors entering KSA 22
The Kingdom of Saudi Arabia
An Overview of Real Estate Law 24
Investment Funds in the Kingdom of
Saudi Arabia 28
Privatisation Of State Owned Assets
in the Kingdom of Saudi Arabia 30
Business Structures
in the Kingdom of Saudi Arabia 33
Swap Agreements Allow Foreign Investors
Access To KSA Shares Under New
CMA Policy 36
KSA Legal News 38
Intellectual Property & IT
Are co-existence agreements the best
solution for trademark disputes? 39
Protection of Copyrights and Related
Rights in Egypt 40
GCC Trademarks Law Resolves
Uncertainty Over Use By Licensee 42
Qatar
Trade Name Protection in Qatar 43
Islamic Securitisation 44
Maritime, Aviation & Insurance
Holder of Copy of Bill of Lading
by Endorsement must comply with
Arbitration Clause 46

Legislative Update
Ofcial Gazette 48
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UAE
Laura Cavanagh
Hayley McVicar
International
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Vcnuc: Lxuct venue to be conrmed, Dubu
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Coursc Dircctor
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quues you us un Assocute o the ClArb und uovs you to use the desgnuton AClArb'.
fntry Rcquircmcnts
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limitcd PIaccs
1he number o deegutes s mted und thereore puces on the course shu be on u rst puy rst served buss.
Course lee Dhs2,000 |ncudes ght unch)
Notc
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Associatc lcvcI - 24 ]anuary 2009
16 February 2009 Dubai, UAE
Due Process
n Internatonal
Arbtraton
Due process. ll is lhe loundalion ol every
arbilralion. Whal are ils requiremenls,
does il apply equally in all legal cullures,
and how does il inluence lhe course ol an
arbilralion? Join leading praclilioners in
exploring lhis mullilaceled lopic in Dubai
lor lhe !2lh lnlernalional Arbilralion Day,
a musl-allend evenl in lhe inlernalional
arbilralion calendar.
Who should attend7
Arbilralors, liligalors, judges, governmenl
ollcials and lhose involved in allernalive
dispule resolulion should allend lhis evenl.
lor lurlher inlormalion, please conlacl.
Internatonal Bar Assocaton
!0lh lloor, ! Slephen Slreel
London W!T !AT
Uniled Kingdom
Tel. +44 (0)20 769! 6868 lax. +44 (0)20 769! 6544
L-mail. confsinI-bar.org Websile. vvv.ibaneI.orglconferenceslConf254l
12th lBA lnternational Arbitration Day
A conference presented by the lBA Arbitration Committee
and supported by the Arab Regional Forum
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Your regstruton shu be conrmed once puyment s receved.
luyment cun ony be uccepted n the orm o u cheque vhch
shoud be mude puyube to Lssum A 1umm.
Cheques shoud be devered to: Ms Nuns L Mushed, ClArb LAL
runch Coordnutor, Dubu \ord 1rude Centre, 9th loor, lC
ox9662, Dubu, LAL.
leuse conrm your nume und compuny nume us you vsh t to
uppeur on your nume tug.
DiscIaimcr
1he Churtered lnsttute o Arbtrutors reserves the rght to cunce or
chunge the dute, venue or content o progrummes und the numes o
speukers, ecturers und tutors vthout pror notce.
fntrancc Coursc in lntcrnationaI Arbitration
M
d 1rude Centre, 9
s L M
s receved.
m o u cheque vhch
1umm.
Nuns L Mushed, ClArb L Nu Ms
d 1rud
s N
1
s N
1
eved
eque vh
ved
eque vhc
ved
ch
de Cen
M s L Mush
ude Centre, 99t
LAL o: M
rd
ushed, ClArb LA
9t
t
orm o u cheq
1umm
ns L Mus
rude ntre, 9
s receved. ed
que vhch
uns
, uddress
Mushed
s
ress u
hed
ut
ess und
ed
L M Mussheddd L
e, ud
M ed
ddre d ddd
t MM ed ed ush ush
ccepted
e to Lssum AA
u
t.com.
be con
uccepte

ce
compuny num
Ms Nuns
me, onrm
ber, by
tm
your num
emu
om

e, comp euse co
b
by
.com.
r
u t Nu Nu u que
nvestme
es b
co
y
rics cric
be
u
su
c
cepp
Ls
MMs
,
Ms m
o
you
.
num
u
m.
e
t.co
be con
uccepted n
e to Lssum A
:
tm
e, compuny nume,
o Ms Nuns L
n
euse con
mber,
t
b
rm y
by e
quere
vestment.
e con um
by emu to Ms Nuns
m
q
crics
num
i Coursc ourr urs ou Cooour c Coursc in c in
Ms
1ru
Nu
ru
um
uns u
mm
L
Vcnuc: Lxuct venue to be conrmed, Dubu
Datc: 24th }unuury 2009
Timing: 9.00um 6.00pm
Pricc: ALD2,000

Coursc Dircctor
Mr lhp lunvur Vce Churmun ClArb LAL runch
lroessonu uucuton Successu competon o ths course, ncudng ussgnment und puyment o the upproprute ees,
quues you us un Assocute o the ClArb und uovs you to use the desgnuton AClArb'.
fntry Rcquircmcnts
None
limitcd PIaccs
1he number o deegutes s mted und thereore puces on the course shu be on u rst puy rst served buss.
Course lee Dhs2,000 |ncudes ght unch)
Notc
Course ees do not ncude membershp ees. 1o nd out ubout the upproprute membershp ees peuse see the ClArb
vebste. vvv.urbtrutors.org. Reunds ure dscretonury und bused on the tmng o u cunceuton.
Associatc lcvcI - 24 ]anuary 2009
16 February 2009 Dubai, UAE
4
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The DlFCLCl^ ^rbltratlcn Centre,
establlshed ln February 2008, marked
a great aohlevement ln Dubal`s quest
tc strengthen lts pcsltlcn as the premler
lcoatlcn fcr lnternatlcnal arbltratlcn ln the
Mlddle Last. Reoently, hcwever, scme
ocnoerns have been ralsed ln relatlcn tc
the jurlsdlotlcn cf the DlFC, and the ease
cf enfcroement cf DlFCLCl^ ^rbltratlcn
Centre awards cutslde the bcundarles cf
the DlFC and beycnd.
Thls artlole wlll address the abcve
ocnoerns, hcwever, befcre dclng sc, lt ls
neoessary tc prcvlde a brlef baokgrcund
cf the DlFC`s hlstcry. Mcst readers wlll
be aware that the oreatlcn cf the DlFC
stemmed frcm a 2003 amendment tc
^rtlole 121 cf the U^L Ccnstltutlcn,
whloh allcwed the Federatlcn tc enaot
a Flnanolal Free Zcne Law, belng Federal
Law Nc. 8 cf 2004. lt was thls Law
that prcvlded the neoessary framewcrk
fcr the oreatlcn cf fnanolal free zcnes
thrcughcut the U^L. Clven that these
fnanolal free zcnes are exempt frcm U^L
olvll and ocmmerolal laws, lt ls the dcmaln
cf eaoh fnanolal free zcne tc establlsh
lts cwn regulatcry and legal systems. The
DlFC`s lndependenoe ln thls regard was
establlshed by Dubal Law Nc. 9 cf 2004,
whloh exempted the DlFC frcm the rules
and regulatlcns ctherwlse applloable ln
Dubal. The DlFC has, aoocrdlngly, been
establlshed as a separate Ccmmcn
Law Lngllsh language jurlsdlotlcn whcse
ocurts system ls largely mcdelled cn the
Lngllsh Ccmmerolal Ccurt. Hcwever, the
jurlsdlotlcn cf the DlFC Ccurts extends
cnly tc olvll and ocmmerolal matters
orlmlnal matters remaln frmly ln the
sphere cf the Dubal Ccurts.
DIFC-LCIA Arbitration Centre
By Lssam ^l Tamlml, Senlcr lartner
Dlspute Resclutlcn lraotloe
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The DlFC Ccurts were establlshed under
twc new laws whloh were enaoted by
Hls Hlghness Shelkh Mchammed bln
Rashld ^l Maktcum, Ruler cf Dubal and
vloelresldent cf the U^L. Dubal Law
Nc. 12 cf 2004 establlshed the 1udlolal
^uthcrlty, determlned the jurlsdlotlcn cf
the DlFC Ccurt and permltted the DlFC
tc admlnlster justloe cn an lndependent
basls. Seocndly, DlFC Law Nc. 10 cf
2004 set cut the pcwers and prcoedures
cf the DlFC Ccurts. Lssentlally, the DlFC
Ccurts fcrm a part cf the U^L judlolal
system, but wlth speolfo jurlsdlotlcn cver
DlFC matters.
The DlFC laws permlt partles cperatlng
ln the DlFC tc ohccse thelr cwn legal
jurlsdlotlcn and laws by agreement
(l.e. cther than the DlFC). Hcwever, ln
the event partles dc nct seleot thelr
cwn jurlsdlotlcn the DlFC laws wlll be
applloable by default, thus permlttlng the
partles tc fle a oase ln the DlFC Ccurts.
The ocnneotlcn cf the DlFC Ccurts wlth
the Dubal Ccurts lles ln ^rtlole 7(2) cf
the 1udlolal ^uthcrlty Law (Law Nc. 12
cf 2004). lursuant tc thls ^rtlole, DlFC
judgments and awards are enfcroeable
by the Dubal Ccurts lf the judgment
cr award ls fnal and apprcprlate
fcr enfcroement, and lf lt has been
translated lntc ^rablo. Ccnslstent wlth
the pclloy cf the lndependenoe cf the
DlFC Ccurts, the Dubal Ccurts dc nct
have jurlsdlotlcn tc revlew the merlts cf a
DlFC judgment cr ^rbltral ^ward.
Thls year, twc lmpcrtant expanslcns cf
the DlFC`s regulatcry framewcrk have
been seen. Flrstly, as mentlcned abcve,
cn 17
th
February 2008, the Dubal
lnternatlcnal Flnanolal Centre (DlFC)
and the Lcndcn Ccurt cf lnternatlcnal
^rbltratlcn (LCl^) launohed a new
reglcnal lnternatlcnal arbltratlcn oentre
the DlFCLCl^ ^rbltratlcn Centre. The
establlshment cf the DlFCLCl^ ^rbltratlcn
Centre redeots Dubal`s ocmmltment
tc establlshlng the U^L as the premler
lcoatlcn fcr lnternatlcnal arbltratlcn ln
the Mlddle Last. Furthermcre, lt was
deslgned tc attraot lnternatlcnal buslness
and lnvestment by prcmctlng ocnfdenoe
ln the reglcn. lt ls lmpcrtant tc ncte that
the DlFCLCl^ ^rbltratlcn Centre ls nct an
authcrlty, cr a ocurt lt ls an establlshed
entlty ln the DlFC.
Seocndly, cn 1
st
September 2008,
the DlFC ^rbltratlcn Law 2008 (D|FC
/rbitraticn Law) oame lntc fcroe. Based
cn the UNClTR^L Mcdel Law, the DlFC
^rbltratlcn Law remcved the requlrement
that partles tc arbltratlcn must have
a nexus cr ocnneotlcn wlth the DlFC
ln crder tc arbltrate ln the DlFC. lt ls
a general prlnolple cf lnternatlcnal
arbltratlcn law that partles are free tc
have thelr dlsputes determlned ln a
jurlsdlotlcn cf thelr ohcloe. Fcllcwlng the
lntrcduotlcn cf the DlFC ^rbltratlcn Law,
ncw anycne, frcm anywhere, oan agree tc
the DlFC as the seat cf thelr arbltratlcn.
Tc further expand cn the baokgrcund tc
the DlFC, lt ls lmpcrtant tc remember
that the DlFC ls lloensed tc establlsh
fnanolal servloes (regulated servloes)
and ncnfnanolal servloes (ncnregulated
servloes) wlthln the DlFC. Fcr example,
the DlFC ^rbltratlcn Centre LLC, whloh was
lssued wlth a Certlfoate cf Reglstratlcn
cn 10
th
February 2008, ls a ncnregulated
entlty based ln the DlFC, and whloh cffers
ncnfnanolal servloes. ln ocntrast, HSBC
Bank Mlddle Last Llmlted DlFC Branoh
ls a regulated entlty based ln the DlFC
cfferlng fnanolal servloes.
lt fcllcws frcm the abcve that lf ycu have
a lloense cr are establlshed wlthln the
terrltcry cf the DlFC, lt ls untrue tc say
that ycur servloes oan cnly be ocnfned
tc the DlFC. Suoh a ocnoept ls at cdds
wlth the DlFC`s mcdel as a fnanolal hub
servlolng the Mlddle Last and beycnd.
whlle lt ls true that the DlFC ^uthcrlty
oan cnly lloense entltles wlthln the DlFC,
entltles, cnoe lloensed, oan cffer thelr
servloes and engage wlth buslnesses
cutslde DlFC terrltcry (subjeot tc any
llmltatlcns prcvlded by the DlFC). Fcr
example, there ls ncthlng wrcng wlth a
restaurant ln the DlFC dellverlng a plzza
tc Sharjah cr fcr DlFC Carlbcu tc dellver
a ocffee tc Shelkh Zayed rcad. Thls dces
nct ocntravene U^L Federal Law cr the
DlFC Law. ln regards tc the banklng
seotcr example, lClC and Mcrgan Stanley
are twc crganlsatlcns lloensed ln the
DlFC. They are respeotlvely permltted tc
prcvlde servloes tc lndlan natlcnals and
US Natlcnals cutslde the DlFC.
Furthermcre, the aotlvltles that oan be
oarrled cut ln the DlFC are, by defnltlcn,
fnanolal and anolllary. The defnltlcn
cf anci||ary services ln the preamble
tc Federal Law Number 8 cf 2004 ls
partloularly wlde, and extends tc the
prcvisicn cf services tc Ccmpanies and
Fstab|ishments within the Free Zcne.
ln thls regard, the DlFCLCl^ ^rbltratlcn
Centre prcvldes servloes cf an anolllary
nature wlthln the free zcne, ln that
the Centre and lts staff are lcoated
wlthln lts bcrders, and further, that the
arbltratlcns themselves wlll be physloally
admlnlstered wlthln thcse same bcrders.
ln cther wcrds, the cfferlng cf dlspute
resclutlcn servloes by the DlFCLCl^
^rbltratlcn Centre ls a permltted anolllary
servloe under Federal Law Nc 8 cf 2004.
Ccnoerns ln regards tc jurlsdlotlcn wculd
be valld lf the DlFC had establlshed an
arbltratlcn oentre ln Dubal, as thls wculd
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have been beycnd the jurlsdlotlcn cf
the DlFC and a vlclatlcn cf the terrltcry
prcvlded fcr ln the Federal law. The DlFC
LCl^ ^rbltratlcn Centre ls wlthln the DlFC
and has the suppcrt cf the DlFC Ccurts.
Thls agaln falls wlthln the lnltlal strategy
and the buslness plan cf the DlFC ln
prcvldlng servloes fcr the fnanolal and
buslness ocmmunlty wlthln the DlFC and
beycnd.
Further, ln terms cf the argument that the
DlFC Ccurt laoks the requlslte jurlsdlotlcn
tc hear olalms brcught by ncnDlFC
entltles cr partles whc ocnduot aotlvltles
cther than thcse defned ln Federal
Law Nc. 8 cf 2004, the faot that the
defnltlcns lnolude all transaotlcns and
events whloh take plaoe ln the DlFC must
nct be cverlccked. Thls ls redeoted bcth ln
^rtlole 8 cf Law Nc. 9 cf 2004 and ln Law
Nc. 12 cf 2004. ^rtlole 5(^)(1)(b) cf Law
Nc. 12 cf 2004 states that the Ccurt cf
Flrst lnstanoe has jurlsdlotlcn cver olvll cr
ocmmerolal oases and dlsputes arlslng
frcm cr related tc a ocntraot that has
been exeouted cr a transaotlcn that has
been ocnoluded, ln whcle cr ln part ln the
Centre, cr an lnoldent that has coourred
ln the Centre. lt ls therefcre olear that
an arbltratlcn whloh takes plaoe ln the
DlFC, cr whloh has the DlFC as lts seat,
ls bcth wlthln these exlstlng defnltlcns
and equally, ls wlthln the crlglnal socpe
cf the DlFC. Therefcre, the DlFC ocurt
wculd have jurlsdlotlcn cver (l) an ad
hco arbltratlcn, seated ln the DlFC under
the DlFC ^rbltratlcn Law, and (ll) an
lnstltutlcnal arbltratlcn under the DlFC
LCl^ Rules, wlth a DlFC seat. 0bvlcusly,
an lnstltutlcnal arbltratlcn under the DlFC
LCl^ Rules wlth a seat cutslde the DlFC
wculd be supervlsed and suppcrted by
the Ccurts ln that jurlsdlotlcn.
Turnlng tc the enfcroement cf awards
lssued under the ausploes cf the DlFC
LCl^ ^rbltratlcn Centre, lt ls qulte orltloal
that praotltlcners and partles are aware
that the Dubal Ccurts are nct permltted
tc revlew the merlts cf judgments
rendered by the DlFC Ccurts. ^fter all,
the DlFC Ccurt was establlshed by the
Ruler cf Dubal, and ls ocnsldered a
ocurt cf Dubal. ^s dlsoussed abcve,
any ohallenge based cn jurlsdlotlcn (cr
a laok therecf) wculd be wlthcut merlt.
The DlFC 1udlolal ^uthcrlty Law and mcre
reoently, the DlFC ^rbltratlcn Law were
oarefully drafted tc avcld any barrlers
tc enfcroement cutslde the DlFC. ln thls
regard, by vlrtue cf the DlFC 1udlolal
^uthcrlty Law, lt ls the oase that any DlFC
LCl^ ^rbltratlcn Centre award whloh has
been enfcroed by the DlFC Ccurts may
thereafter be enfcroed cutslde the DlFC.
Furthermcre, the great majcrlty cf arbltral
awards lssued under the ausploes cf
leadlng lnstltutlcns are adhered tc wlthcut
the need fcr enfcroement prcoeedlngs
and the DlFCLCl^ ^rbltratlcn Centre ls
unllkely tc be an exoeptlcn.
Hcwever, when neoessary, a DlFCLCl^
arbltratlcn award, wlll, cnoe ratlfed by
the DlFC Ccurt, be enfcroeable wlthln
the DlFC pursuant tc ^rtlole 42(1) cf the
DlFC Ccurt Law. ^rtlole 42(1) states that
judgments, crders and awards lssued
cr ratlfed by the DlFC Ccurt oan be
enfcroed wlthln the DlFC. There are cf
ocurse grcunds fcr refuslng enfcroement;
hcwever these are llmlted tc the grcunds
presorlbed ln the New Ycrk Ccnventlcn,
namely prcoedural lssues cr publlo pclloy
ocnoerns.
lt wlll cften be the oase that a DlFC
arbltratlcn award wlll need tc be exeouted
ln Dubal (but cutslde the DlFC). The
prcoedures tc enfcroe the award ln suoh
olroumstanoes are frmly ln plaoe and
entrenohed ln law. Fcllcwlng ratlfoatlcn
by the DlFC Ccurt, an award may be
enfcroed thrcugh an exeoutlcn judge at
the Dubal Ccurts ln the manner presorlbed
by ^rtlole 7 cf the 1udlolal ^uthcrlty Law.
There are scme mlncr requlrements
when seeklng ratlfoatlcn frcm the Dubal
Ccurts, lnoludlng that the award ls fnal
and oertlfably translated lntc ^rablo. lt
shculd be ncted, hcwever, that lt ls nct
the oase that a DlFC award wlll requlre
enfcroement by the DlFC Ccurt cr the
Dubal Ccurts. Thls requlrement wlll be
dependent cn faotcrs suoh as the seat cf
the arbltratlcn, whether the jurlsdlotlcn cf
the seat ls a slgnatcry tc the 1958 New
Ycrk Ccnventlcn cn the Lnfcroement and
Reocgnltlcn cf Fcrelgn ^rbltral ^wards
(New Ycrk Ccnventlcn), the lcoatlcn cf the
partles` head cffoe and where lts assets
are lcoated.
0noe an exeoutlcn crder frcm the Dubal
Ccurts ls cbtalned, a DlFC arbltratlcn
award oan be enfcroed wlthln the bcrders
cf the Unlted ^rab Lmlrates pursuant tc
the U^L Ccnstltutlcn and Federal Law
Nc. 11 cf 1973, whloh deals wlth the
crganlsatlcn cf judlolal relatlcns between
the seven Lmlrates. By vlrtue cf Federal
Law Nc. 11 cf 1973, cnoe an exeoutlcn
crder ls cbtalned, DlFC judgments and
awards then attraot enfcroeablllty ln the
cther slx Lmlrates (agaln, wlthcut any
further revlew cn the merlts). The DlFC
Ccurts are ourrently ln ocnsultatlcn wlth
cther U^L Ccurts ln crder tc streamllne
thls prcoess.
Furthermcre, DlFC awards are
enfcroeable anywhere wlthln the Culf
Cccperatlcn Ccunoll (CCC). ln any ocuntry
whloh has subsorlbed tc the New Ycrk
Ccnventlcn (and, ln the oase cf the CCC
reglcn, tc the CCC Ccnventlcn fcr the
Lnfcroement cf 1udgments and 1udlolal
Nctloes and Delegatlcns), DlFC awards
are dlreotly enfcroeable. The U^L beoame
a slgnatcry tc the New Ycrk Ccnventlcn
ln Ncvember 2006 and the result cf thls
ls that awards lssued under the ausploes
cf the DlFCLCl^ ^rbltratlcn Centre wlll be
subjeot tc the New Ycrk Ccnventlcn fcr
the purpcses cf enfcroement ln New Ycrk
Ccnventlcn jurlsdlotlcns.
1urlsdlotlcn and enfcroement are always
cf prlmary lmpcrtanoe ln lnternatlcnal
arbltratlcn. ^ olcse examlnatlcn cf
the lssues ln regards tc the DlFC
LCl^, hcwever, reveals that they are
unfcunded. The DlFCLCl^ ^rbltratlcn
Centre has been prcperly ocnstltuted
and we are ocnfdent that any awards
lssued under lts ausploes wlll be valld
and enfcroeable.
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By Hassan ^rab, lartner
Dlspute Resclutlcn lraotloe
^rtlole 25 cf the Law Nc. 7 cf 2002 cn
Ccpyrlghts and latent Rlghts prcvldes
that:
ln the event that a number cf pecple
partlolpate ln prcduolng a wcrk ln suoh
a way that the ocntrlbutlcn cf eaoh cne
oannct be separated frcm the cther, all
partles shall be ocnsldered equally as
authcrs, unless they have ctherwlse
agreed ln wrltlng. ln thls oase, nc party
lndlvldually ls permltted tc olalm the
rlghts cf the authcr alcne ln the absenoe
cf a wrltten agreement tc thls effeot. ln
oase the ocntrlbutlcn cf eaoh authcr ls
llsted under a dlfferent type cf ohapter
ln the same wcrk eaoh cne cf them has
the rlght tc explclt the part cf hls cwn
ocntrlbutlcn, prcvlded that thls wculd nct
damage the explcltatlcn cf the wcrk by
the cthers, unless agaln there has been
an agreement ln wrltlng tc thls effeot.
Laoh party has the rlght tc fle a olalm
upcn the coourrenoe cf a vlclatlcn cf an
authcr`s rlght as prcteoted by thls law.
/i>V
The Flrst Respcndent fled Clalm Nc.
290/ 2006, Clvll llenary, befcre the
Dubal Ccurt cf Flrst lnstanoe agalnst the
^ppellants and the Seocnd Respcndent.
The Flrst Respcndent requested that the
Ccurt crder the Seocnd Respcndent tc
wlthhcld an award glven tc the Thlrd
^ppellant, and grant the related materlal
and mcral rlghts equally tc the Flrst
Respcndent, the Flrst ^ppellant and the
Seocnd ^ppellant. Further, the Ccurt was
requested tc hcld all Defendants (l.e.
the ^ppellants) bcth jclntly and severally
llable fcr the sum cf fve hundred
thcusand dlrhams ln ocmpensatlcn fcr
materlal and mcral damage. lnterest, at
Ccmments cn 1udgment
^ppeal fcr Cassatlcn Ncs. 103/ 112 cf 2008
1udgment Dellvered cn: 25
th
May 2008
JUDGEMENT
Credit For
Published Works:
To Whom and
When is it Due?
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the rate cf 9 frcm the date cf fllng the
olalm untll the date cf full payment, was
alsc olalmed.
The Flrst Respcndent`s olalm was based
cn hls cooupatlcn wcrklng as a jcurnallst
fcr the Seocnd ^ppellant, under the
supervlslcn cf the Flrst ^ppellant. 0n
20
th
1une 2005, the Flrst Respcndent
publlshed an artlole ln the Seocnd
^ppellant`s magazlne entltled Camel
Raoes frcm the lerspeotlve cf Human
Rlghts; lssue Nc. 1306 dated 26
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^prll 2006. ln the presenoe cf the Flrst
Respcndent at the Dubal lress Club
(Seocnd Respcndent), the award cf the
lress Club, wlth all lts lnherent materlal
and mcral rlghts, was granted tc the three
defendants (^ppellants) cn the basls that
the Thlrd ^ppellant had been the authcr cf
the ^rtlole. The Thlrd ^ppellant attrlbuted
the artlole tc hlmself and attaohed hls
name tc lt wlthcut any regard tc the
plalntlff`s materlal and mcral rlghts. ln
vlew cf thls, the Flrst Respcndent fled a
ocmplalnt tc the Bcard cf Dlreotcrs cf the
Seocnd ^ppellant explalnlng the damage
sustalned by hlm; hcwever, the Bcard cf
Dlreotcrs rejeoted the ocmplalnt.
^oocrdlngly, the Flrst Respcndent
ocnsldered that an lnfrlngement cf
hls ocpy rlght ln aoocrdanoe wlth the
applloable prcvlslcns cf the Federal
Law Nc. 7 cf 2002 0n Ccpy Rlghts
and latent Rlghts, had coourred. The
Flrst Respcndent ocnsldered that thls
lnfrlngement had been oaused by the
Thlrd ^ppellant wlth the asslstanoe cf
the Flrst and Seocnd ^ppellants, and
that he had the rlght tc ellmlnate thls
lnfrlngement and olalm ocmpensatlcn fcr
the materlal damage sustalned by hlm...
0n 30
th
^prll 2007, the Ccurt cf Flrst
lnstanoe dlsmlssed the olalm. The Flrst
Respcndent appealed thls rullng under
^ppeal Nc. 385/ 2007, Clvll, and cn
28
th
February 2008, the Ccurt cf ^ppeal
ruled tc cverturn the appealed judgment,
and crdered the Seocnd Respcndent
tc ocnslder the Flrst Respcndent as
the ocwlnner cf the lress ^ward
2005, whloh had been awarded based
cn the abcvementlcned artlole. The
Seocnd Respcndent was alsc dlreoted
tc enter the true nature cf the award
ln the Club`s reocrds. Desplte these
dlreotlcns, the Flrst Respcndent`s olalm
fcr ocmpensatlcn was dlsmlssed by the
Ccurt cf ^ppeal.
The frst, seocnd and thlrd defendants
(the ^ppellants) appealed thls judgment
under the ^ppeal ln Cassatlcn Nc.
103/ 2008, Clvll. Further, the Seocnd
Respcndent alsc appealed the judgment
under the ^ppeal ln Cassatlcn Nc. 112/
2008, Clvll.
1udgment
The Ccurt cf Cassatlcn ruled as fcllcws:
- ln the ^ppeals Nc. 103 and 112
cf 2008: Tc quash the appealed
judgment and hcld the Flrst
Respcndent llable fcr the expenses
cf bcth appeals plus attcrneys` fees
cf twc thcusand dlrhams.
- ln the ^ppeal Nc. 385/ 2007, Clvll:
Tc dlsmlss the ^ppeal and uphcld
the appealed deolslcn dlsmlsslng the
olalm, and hcld the ^ppellant (Flrst
Respcndent) llable fcr the expenses
plus attcrneys` fees cf cne thcusand
dlrhams.
0omment
^rtlole 1 cf the Law Nc. 7 cf 2002 cn
Ccpyrlghts and latent Rlghts prcvldes
that ln applylng the prcvlslcns cf thls
law, the fcllcwlng wcrds dencte the
defnltlcns explalned befcre eaoh cne
cf them, unless the ocntext denctes
ctherwlse:
- 1he Werk: ^ny oreated ocmpllatlcn, ln
the socpe cf letters, arts, solenoes,
ln whatever type, mcde cf expresslcn,
value cr purpcse.
- 1he Auther: The perscn whc oreates
the wcrk and the perscn whc has
hls name mentlcned cn the wcrk,
cr has the wcrk attrlbuted tc hlm as
lts authcr at the tlme cf publloatlcn,
unless prcved ctherwlse.
- Creat|en: The oreatlveness that glves
genulneness and dlstlnotlveness tc
the wcrk.
- Pub||cat|en: ^vallablllty cf the
wcrk.lrrespeotlve cf the methcd cf
publloatlcn.
^rtlole 2 cf the same Law prcvldes that
authcrs cf the wcrks and hclders cf the
patent rlghts shall enjcy the prcteotlcn cf
thls law ln oase an aggresslcn agalnst
thelr rlghts coours ln the Ccuntry, namely
ln regards tc the fcllcwlng wcrks: 1.
Bccks, pamphlets, essays and cther
wrltten wcrks. 2...
^rtlole 25 (1) cf the same Law prcvldes
that ln oase a number cf pecple
partlolpate ln maklng a wcrk ln a way
that the share cf eaoh cne oannct be
separated frcm the cther shares, all
the partles shall be ocnsldered equally
as authcrs, unless they have agreed ln
wrltlng ctherwlse. ln suoh a oase, ncne
cf them ls allcwed tc praotloe the rlghts
cf the authcr alcne, unless there was a
wrltten agreement amcng them. ln oase
the ocntrlbutlcn cf all the authcrs ls llsted
under a dlfferent ohapter ln the same
wcrk, eaoh cne cf them has the rlght
tc explclt the part cf hls ocntrlbutlcn,
prcvlded that thls wculd nct damage the
explcltatlcn cf the wcrk by the cthers,
unless agaln, they have agreed ln wrltlng
ctherwlse.
ln vlew cf thls, authcrs whcse rlghts are
prcteoted under the prcvlslcns cf thls Law
are the authcrs cf wcrks, and as suoh,
the perscns authcrlsed tc translate,
summarlse, alter, mcdlfy cr lnterpret
suoh wcrks, cr ctherwlse reprcduoe them
ln any new fcrm. The lntelleotual wcrk ls
any oreatlve lntelleotual prcduotlcn, be lt
ln the socpe cf letters, arts cr solenoes,
whatever lts type, mcde cf expresslcn,
value cr purpcse. ^oocrdlng tc the Law,
oreatlcn refers tc the oreatlveness that
glves genulneness and dlstlnotlveness
tc the wcrk ln terms cf lts preparatlcn,
reallsatlcn, fcrmatlcn and occrdlnatlcn,
as well as the preparatlcn tc release
the wcrk. Thls ocnoept dces nct lnolude
the searoh cr ocmpllatlcn by any perscn
cf oertaln lnfcrmatlcn cr data, and
suoh perscns may nct be deemed as a
partlolpant ln the lntelleotual wcrk, as
they have never oreated the wcrk. The
authcr ls the perscn whc oreates the
wcrk, and whc has hls name mentlcned
cn the wcrk, cr whc has the wcrk
attrlbuted tc hlm as lts authcr at the tlme
cf publloatlcn. The burden cf prccf ls cn
anycne whc alleges ctherwlse tc prcve
that he ls the aotual authcr cf the wcrk.
The socpe cf the defnltlcn cf authcrs
cf wrltten artloles whc enjcy prcteotlcn
under ^rtlole 2 cf the sald law, and thelr
partlolpatlcn ln suoh wcrks ln aoocrdanoe
wlth the abcve rules, ls a matter cf faot
that shculd be deolded cnly by a ocurt
cf merlts at lts scle dlsoretlcn. Thus,
the ocurt has the authcrlty tc ocnslder
the faots cf the olalm and tc evaluate
the submltted evldenoe, presumptlcns
and dcouments ln llne wlth the relevant
olroumstanoes.
^ deolaratlcn, whether judlolal cr nct,
ls an aokncwledgement by a perscn
tc establlsh a rlght agalnst hlm and
relleve the cbllgcr cf the burden cf
prccf ln relatlcn therecf. Fcr suoh a
deolaratlcn tc be valld, lt must establlsh
the aokncwledged rlght ln a ocnoluslve
and deolslve way whloh ls nct refuted
by the faots. Thls dces nct lnolude the
arguments cf a lltlgant whloh benefts hls
adversary ln the ocurse cf hls defenoe,
as lcng as suoh arguments are nct almed
at aokncwledglng the dlsputed rlght.
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Ccmments cn 1udgment
^ppeal fcr Cassatlcn Nc. 98/ 2008, Clvll
1udgment Rendered cn: 25
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May 2008
JUDGEMENT
By Djallla Behaz
Dlspute Resclutlcn lraotloe
Arbitration Awards
To what exent is Court review permitted?
^rtlole 212 cf the Clvll lrcoedural Law (Federal Law Nc. (11) cf 1992 as
amended by the Federal Law Nc. (30) cf 2005) prcvldes as fcllcws:
"The arb|tratcr sha|| |ssue h|s awaru w|thcut be|ng bcunu by any prcceuures
cther than thcse st|pu|ateu |n th|s Chapter anu thcse perta|n|ng tc the
ca|||ng cf the part|es, hear|ng cf the|r p|ease anu enab||ng them tc subm|t
the|r uccuments. Nctw|thstanu|ng the fcregc|ng, the part|es tc the u|spute
may agree cn certa|n prcceuures tc be fc||cweu by the arb|tratcr."
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1he Facts
The Respcndent fled Clalm Nc. 346 cf
2007, Clvll llenary, befcre Dubal Ccurt
cf Flrst lnstanoe agalnst the ^ppellant
seeklng tc valldate the arbltratlcn
award Nc. 21 cf 2006, by enfcrolng lt
as an exeoutlcn deed, and annctatlng
lt wlth the ocrreot exeoutlcn wcrdlng.
The Respcndent based lts olalm cn the
grcund that cn 1
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^ugust 2004, lt had
agreed wlth the ^ppellant (Defendant)
tc market and manage the Dubal Real
Lstate lnvestment Falr ln February
2005. ln effeot, the event was tc have
been occwned by bcth lltlgants, whc
subsequently alsc held the Dubal Real
Lstate lnvestment Falr 2006. The prcfts
were shared by them under an agreement
dated 1
st
^ugust 2004.
^rtlole (15) cf the agreement prcvlded
that shculd a dlspute arlse between the
partles, lt shall be referred tc arbltratlcn
at the Dubal Chamber cf Ccmmeroe.
when the subjeot dlspute dld arlse, the
plalntlff ocmpany referred lt tc the Dubal
lnternatlcnal ^rbltratlcn Center and cn
13
th
Maroh 2007; the scle arbltratcr
rendered the arbltratlcn award as
fcllcws:
- Tc dlsmlss the llalntlff`s olalm fcr
partnershlp, lnoludlng the lloense and
the lease between Dubal wcrld Trade
Center (where the falr was tc be held)
and the Defendant.
- Tc reocgnlse the partnershlp between
the plalntlff and defendant ln
crganlslng and hcldlng the Dubal Real
Lstate lnvestment Falr ln aoocrdanoe
wlth the partnershlp agreement dated
1
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^ugust 2004. The defendant was
alsc crdered tc crganlse the Falr
tcgether wlth the llalntlff.
- Tc dlsmlss the llalntlff`s olalm fcr a
management fee cn the basls that lt
was part cf the tctal expenses whloh
were nct yet fnally estlmated, and
whloh shculd be determlned as part
cf the aoocuntsettllng between the
twc ocmpanles.
- Tc hcld eaoh cf the twc partles llable
fcr 50 cf the expenses cf the
arbltratlcn, whloh lnoluded the fees
cf the Dubal lnternatlcnal ^rbltratlcn
Center, the arbltratcr`s fees, the
olerk`s fees and the bccklng oharges
cf the rccm at the Dubal Chamber cf
Ccmmeroe and lndustry.
Clven that the arbltratlcn award ls nct
enfcroeable unless valldated by the ocurt
tc whloh the award was submltted, the
llalntlff fled the subjeot olalm tc affeot
the same.
Subsequently, the ^ppellant fled Clalm
Nc. 383/ 2007, Ccmmerolal llenary,
agalnst the Respcndent (llalntlff)
requestlng tc quash the arbltratlcn award
rendered by the Dubal lnternatlcnal
^rbltratlcn Center ln the ^rbltratlcn Clalm
Nc. 21/ 2006.
The Ccurt cf Flrst lnstanoe jclned bcth
olalms and cn 29
th
Ncvember 2007,
dlsmlssed the olalm fled by the ^ppellant
and ruled ln favcur cf the Respcndent`s
olalm (Nc. 346/ 2007, Clvll llenary) tc
valldate the arbltratlcn award, enfcroe lt
as an exeoutlcn deed, and tc annctate lt
wlth the ocrreot exeoutlcn wcrdlng.
The ^ppellant appealed thls deolslcn
under ^ppeal Nc. 860/ 2007, Clvll,
seeklng tc cverturn the appealed
judgment and quash the arbltratlcn
award. 0n 24
th
February 2008, the Ccurt
cf ^ppeal ruled tc uphcld the appealed
judgment.
Fcllcwlng thls rullng, the ^ppellant then
lcdged an ^ppeal ln Cassatlcn cn 14
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^prll 2008.
1udgment
The Ccurt cf Cassatlcn dlsmlssed
the ^ppeal ln Cassatlcn and held the
^ppellant llable fcr the expenses, as well
as the attcrneys` fees cf twc thcusand
dlrhams. The Ccurt alsc crdered the
selzure cf the depcslt amcunt.
0omment
^oocrdlng tc the ^rtloles 212 and 216 cf
the Clvll lrcoedural Law, when the ocurt
hears a olalm regardlng valldatlcn cf an
arbltratlcn award, lt may nct examlne
the merlts and ocmpllanoe cf the award
wlth the law cr faots. ^oocrdlngly, any
cbjeotlcn tc the award ralsed by the
lltlgants ln relatlcn tc the arbltratcr`s
ocnoluslcn cr tc the falslty cr laok cf
reascnlng cf the award shall be deemed
baseless and dlsmlsslble. lt ls suffolent
fcr the arbltratlcn award tc be valld lf lt
lnocrpcrates a ocpy cf the arbltratlcn
agreement cr an arbltratlcn dcoument
apprcved by the partles, a summary cf
the lltlgants` statements and dcouments,
and the grcunds cn whloh the award was
based, prcvlded that the arbltratcr has
nct vlclated a rule related tc the publlo
crder.
The lltlgants may nct seek lnvalldatlcn
cf the arbltratlcn award exoept under
the ocndltlcns exoluslvely prcvlded fcr
ln ^rtlole 216 cf the Clvll lrcoedure
Law. lnoluded ln these grcunds are
olroumstanoes where the arbltratcr has
gcne beycnd the socpe cf the arbltratlcn
dcoument, lf the award ls based cn an
arbltratlcn dcoument nct prcvlded fcr ln
the subjeot cf the dlspute, cr lf the award
ls partlally annulled cr the arbltratlcn
prcoeedlngs are lnvalldated ln a way
that affeots the award. The arbltratcr
may nct be bcund wlth the prcoedural
rules exoept ln relatlcn tc the prcoedures
prcvlded fcr ln the ^rbltratlcn Seotlcn ln
the lrcoedural Law.
ln uphcldlng the arbltratlcn award and
dlsmlsslng the ^ppellant`s olalm seeklng
lts lnvalldatlcn, the appealed judgment
plaoed rellanoe cn the grcund that the
^ppellant`s arguments ocnoernlng the
explry cf the partnershlp between the
partles was almed at prejudlolng the
arbltratcr`s ocnoluslcn cn the dlspute,
whloh was beycnd the jurlsdlotlcn cf
the ocurt as lt was nct based cn the
grcunds fcr lnvalldatlcn cf the award
as exoluslvely prcvlded fcr by the Law
(l.e. lt ls a merltcrlcus element cf the
award and thus cutslde the socpe cf the
ocurt`s permltted revlew) The grcunds
fcr lnvalldatlcn are exoluslvely prcvlded
fcr by the Law and there ls nc socpe fcr
lnterpretlve jurlsdlotlcn cr legal analcgy.
The ocnsequenoe ls therefcre that the
olalm fcr the lnvalldatlcn cf the arbltratlcn
award was baseless.
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News
By the Dlspute Resclutlcn lraotloe
Hls Hlghness Shelkh Khallfa bln Zayed
^l Nahyan, lresldent cf the State,
lssued nlne Federal Deorees apprcvlng
agreements wlth slsterly and frlendly
ocuntrles and aooesslcn tc lnternatlcnal
ocnventlcns.
Hls Hlghness the lresldent lssued the
Federal Deoree Nc. 64 cf 2008 apprcvlng
the agreements between U^L and Kuwalt
cn occperatlcn ln the tcurlst, oultural,
art, eduoatlcnal and solentlfo researoh
felds; Federal Deoree Nc. 65 cf 2008
apprcvlng the aooesslcn cf the U^L tc
the Ccnventlcn fcr the laolfo Settlement
cf lnternatlcnal Dlsputes cf 1907; the
Federal Deoree Nc. 66 cf 2008 apprcvlng
the ^greement cn Cccperatlcn ln the
Tcurlst Fleld between the Ccvernments cf
U^L and the Republlo cf Uzbeklstan; and
the Federal Deoree Nc. 70 cf 2008 cn
apprcvlng the ^greement cn ^vcldlng the
Dcuble Taxatlcn cf lnocmes between the
U^L and Uzbeklstanl Ccvernments, and
the prctcocl annexed theretc.
Hls Hlghness the lresldent further
lssued the Federal Deoree Nc. 61 cf
81 cn aooesslcn cf the U^L tc the
lrctcocl tc lrevent, Suppress and lunlsh
Traffoklng ln lerscns Lspeolally wcmen
and Chlldren, supplementlng the Unlted
Natlcns Ccnventlcn agalnst Transnatlcnal
0rganlsed Crlme; the Federal Deoree Nc.
72 cf 2008 cn aooesslcn cf the U^L tc
the membershlp cf the ^sscolatlcn cf
Tax ^uthcrltles cf lslamlo Ccuntrles; the
Federal Deoree Nc. 73 cf 2008 cn the
^greement between U^L and Franoe cn
the leaoeful Uses cf Nuolear Lnergy;
and the Federal Deoree Nc. 74 cf 2008
apprcvlng the Locncmlo, Trade and
Teohnloal Cccperatlcn between the U^L
and Uzbeklstan Ccvernments.
Hls Hlghness the lresldent alsc lssued
a Federal Deoree settlng up a U^L
dlplcmatlo mlsslcn tc Senegal and a
Federal Deoree cn settlng up a U^L
dlplcmatlo mlsslcn tc Belarus.
Scurce: Dar /| Kha|eej Thursday,
18
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December 2008.
^ meetlng cf the Teohnloal Ccmmlttee fcr
Leglslatlcns was held yesterday mcrnlng
under the ohalrmanshlp cf Dr. ^ll Lbrahlm
^l Hcsanl, the ^otlng Dlreotcr Ceneral cf
the Mlnlstry cf 1ustloe, the Chalrman,
and attendanoe cf the Members cf the
Ccmmlttee.
^l Hcsanl sald the meetlng cf the
Ccmmlttee dlsoussed the Draft Federal
Marlne Law. The Ccmmlttee dlsoussed
260 ^rtloles cut cf the 346 ^rtloles cf
the Law, and wculd ocntlnue dlsousslng
the remalnlng ^rtloles ln lts subsequent
meetlngs.
Scurce: /| Bayan Thursday, 18
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December
2008, 20 Zu| Hija 1429 H, |ssue Nc. 10410.
The lubllo Faollltles Ccmmlttee cf the Sharjah Ccnsultatlve Ccunoll held a meetlng
tc dlsouss the pclloles cf Hamrlya Free Zcne ^uthcrlty. The Ccmmlttee revlewed
the varlcus dutles and jurlsdlotlcns cf the ^uthcrlty as well as the relevant rcles
and the effcrts tc cffer lnvestment cppcrtunltles tc the glcbal lnvestcrs thrcugh
an lnvestmentattraotlve envlrcnment.
The Ccmmlttee revlewed wlth the Legal ^dvlscr cf the Ccunoll the prcvlslcns cf
the Law Nc. 2 cf 2003 cn Recrganlsatlcn cf Free Zcnes ln the Lmlrate cf Sharjah,
and the Law Nc. 6 cf 1995 Lstabllshlng Hamrlya Free Zcne.
The Meetlng cf the Ccmmlttee was held yesterday mcrnlng at the Ccnsultatlve
Ccunoll ln Sharjah under the ohalrmanshlp cf Dr. 0bald ^l Tunaljl, and attendanoe
cf Lng. Khawla ^l Numan, Rappcrteur cf the Ccmmlttee, 0bald Hadld, Khallfa
Mchamed Bughanlm, Lng. 0bald ^l Tafaq, Mr. Hassan Mustafa, Legal ^dvlscr cf
the Ccunoll and lslam ^l Sheewl frcm the Ceneral Seoretarlat cf the Ccunoll. ^t
the end cf the Meetlng, the Members apprcved a vlslt tc the Hamrlya Free Zcne
^uthcrlty cn next Sunday mcrnlng tc learn abcut lts effcrts and pclloles tc draw
the glcbal lnvestments. The vlslt ls part cf the preparatlcn cf the querles tc be
addressed tc the Representatlves cf the Hamrlya Free Zcne ^uthcrlty ln the next
sesslcn cf the Ccnsultatlve Ccunoll tc be held cn thls twenty ffth cf Deoember tc
dlsouss the pclloy cf the ^uthcrlty.
Scurce: Dar /| Kha|eej Thursday, 18
t
December 2008.
UAE President Issues Federal Decrees and Approving 9
International Agreements
260 Articles of
the Marine Law
Discussed
Law on Organisation of Sharjah
Free Zones Discussed
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The U^L Central Bank Ccverncr, Sultan
^l Suwaldl, deolared that the Central
Bank Law wculd be revlewed tc lntrcduoe
neoessary amendments ln llne wlth
the gcvernment strategy tc update
leglslatlcns.
ln respcnse tc a questlcn tc the Mlnlster
cf State fcr Flnanolal ^ffalrs frcm the FNC
Member, Mchamed ^bdullah ^l Za`abl, cn
bcgus lnvestment pcrtfcllcs, the Ccverncr
sald any natural cr ocrpcrate perscn oan
oclleot funds fcr lnvestment, regardless
cf the prcft cr lcss, wlthcut even havlng
a lloense whloh ls ln breaoh cf the Central
Bank Law and the mcnetary system.
lecple depcsltlng thelr mcney may nct
alsc be relleved cf respcnslblllty.
He added that a number cf oases were
spctted where unreascnable temptatlcns
were cffered that were lnocmmensurate
wlth the fnanolal aotlvltles, but pecple
gave the mcney tc the prcmcters. Several
anncunoements were made tc warn
pecple agalnst depcsltlng thelr mcney.
^l Suawldl referred tc the occperatlcn
between the Central Bank and the seourlty
and pclloe departments tc ocmbat bcgus
lnvestment pcrtfcllcs launohed durlng
the bccm perlcd, and sald oertaln
meohanlsms tc deteot abncrmal oases
exlst. He emphaslsed that pecple,
whether natlcnals cr resldents, are the
frst defense llne tc prcteot thelr mcney
and shculd avcld depcsltlng lt wlth
unlloensed bcdles.
^l Za`abl ocmmented: Fcur bcgus
lnvestment pcrtfcllcs have been deteoted
and anncunoed ln the medla. Hcwever,
the Central Bank has never repcrt them
cn tlme. Desplte all the lnstruotlcns, there
are stlll cther oases. Sc, why are suoh
oases nct repcrted? ^l Za`abl suggested
amendlng the Central Bank Law ln crder
tc prcteot the ocmmunlty pclntlng cut
that there ls a leglslatlve gab wlth regard
tc the meohanlsms tc traok the bcgus
ocmpanles advertlslng ln the medla. He
demanded that the supervlscry rcle cf
seourlty departments be strengthened tc
prcteot pecple agalnst swlndlers.
^l Suwaldl sald the ourrent Central
Bank Law laoks lmpcrtant prcvlslcns
and that punlshments wlll be taken lntc
ocnslderatlcn ln amendlng the same.
He lndloated that brckers have been
exempted frcm punlshment ln the bcgus
ocmpany oases and are stlll oarrylng
cn buslness, and that many cf the
ocmpanles runnlng bcgus lnvestment
pcrtfcllcs have trade lloenses lssued
by the lcoal eocncmlo departments.
^oocrdlng tc hlm, there shculd be
occrdlnatlcn between the Central Bank
and these lcoal departments.
Scurce: Dar /| Kha|eej Thursday,
18
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December 2008.
The lntelleotual lrcperty lrcteotlcn
Department at Dubal Custcms held
frcm 25 tc 27 Ncvember The Cultural
week fcr lrcteotlcn cf lntelleotual
lrcperty, whloh cffered leotures,
semlnars and speolallsed wcrkshcps
almlng at enhanolng the awareness cf
ocnsumers and lnspeotcrs cn the rlsks cf
ocunterfeltlng.
^t the sldellne cf the event, held
at the Dubal Custcms bulldlng, a
speolallsed wcrkshcp was crganlsed
wlth partlolpatlcn cf the wcrld lntelleotual
lrcperty 0rganlsatlcn (wll0), the
CCC Custcms ^uthcrltles, the Dubal
Munlolpallty, the Mlnlstry cf Health, Dubal
lclloe Ceneral Headquarter and the U^L
oustcms departments as well as many
lnternatlcnally rencwned ocmpanles
wcrklng ln the reglcn.
The wcrkshcp almed at eduoatlng
lnspeotcrs and ocnsumers cn the
ocnoept cf lntelleotual prcperty, hcw tc
dlfferentlate between the crlglnal and
ocunterfelt trademarks, the prcduot
llnes fcr trademarks, spcttlng cut
the prcblems and dlffoultles faolng
lnspeotcrs and experts lnterested ln
deteotlng ocunterfelt gccds, hcw tc
reotlfy errcrs, and the lmpcrtanoe cf
wcrkshcps ln enhanolng the prcfesslcnal
perfcrmanoe, prcmctlng exohange cf
ldeas and lnfcrmatlcn and spreadlng the
kncwledge eocncmy tc cther areas.
Scurce: /| Bayan Mcnday, 1
st
December
2008, 3 Zu| Hija 1429 H, |ssue Nc. 10393
Amendments to the Central Bank Law
Dubai Customs Organises Intellectual Property
Protection Week
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Amendments to the Central Bank Law
^l Tamlml & Ccmpany were a kncwledge partner at the
reoently held DlFC week.
DlFC week ls the Dubal lnternatlcnal Flnanolal Centre`s
(DlFC) annual prcgramme cf ocnferenoes featurlng glcbal
and reglcnal fnanolal and eocncmlo leaders. Laoh year, the
event brlngs prcmlnent buslness, gcvernment and aoademlo
perscnalltles frcm arcund the wcrld tc share perspeotlves cn
wlderanglng tcplos that lmpaot the eocncmy cf the reglcn.
The hlghllghts cf DlFC week 2008 lnolude a twcday Fcrum
frcm 24 25 Ncvember, and a cneday Ccnferenoe cn 26
Ncvember.
Husam Hcuranl was cn the dlsousslcn panel fcr The
experlenoe cf settlng up ocverlng what are scme cf the key
strateglo and cperatlcnal lssues tc ocnslder ln establlshlng a
buslness ln Dubal? and what are the majcr prcs and ocns
cf the dlfferent cptlcns fcr settlng up a buslness? Durlng the
ocnferenoe Husam Hcuranl was alsc lntervlewed by CNBC
^rabla.
DIFC Week
Hcda Barakat was lnvlted tc speak at the SMB Fcrum
cn the panel dlsousslng wcmen ln Buslness. The SMB
^dvlscr magazlne ls a mcnthly publloatlcn that ls dlstrlbuted
thrcughcut the Mlddle Last tc small tc medlum buslnesses.
^lcng wlth Nanette Falrley, Managlng Dlreotcr, lnncvatlve
HR Sclutlcns and valshall C Basu, Dlreotcr Marketlng
and lrcmctlcns, The Mllllcnalre Ccmpany, Hcda answered
questlcns ocverlng tcplos lnoludlng wcmen entrepreneurs:
ohallenges, aohlevements, tlps, what wcmen brlng tc the
wcrkplaoe,Fundlng and suppcrt fcr wcmen entrepreneurs.
The dlsousslcn was very well reoelved and ls belng fcllcwed
up wlth a 'wcmen ln Buslness` speolal ln the 1anuary
magazlne and a televlslcn panel dlsousslcn.
SMB Forum
27
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November 2008
23
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November 2008
27
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Ncvember 2008
Fcunded ln 1une 2007, the Dubal Ccrpcrate Ccunsel Crcup
('DCCC`) ls the frst lnhcuse ocunsel grcup ln the Mlddle
Last. Led by lts 12member Steerlng Ccmmlttee, the DCCC
has qulokly establlshed ltself as a leadlng reglcnal legal cr
ganlsatlcn.
^t the reoent DCCC awards dlnner Llsa Dale presented the
Best Ceneral Ccunsel cf the Year ^ward whloh was award
ed tc ^bdul wahld ^l Ulama cf Dubal wcrld. (The award
was oclleoted cn ^bdul wahld ^l Ulama`s behalf by Nlok
Hcrnung)
DCCG Awards Dinner
0mar 0beldat, lartner ln the ll/lT Department, ^l Tamlml
& Ccmpany, was hcsted as a panel speaker ln the MLLD
Healthoare Ccnferenoe 2008 wlth Dr Lssa Kazlm, ^sst.
Dlreotcr Ceneral, Department cf Health and Medloal
Servloes and Ms Llnda Marshall, Dlreotcr (0peratlcns)
at Lnaya Healthoare. 0mar addressed the areas that
requlre lmprcvement ln the Dubal healthoare regulatcry
system, hlghllghted multlple healthoare regulatcry bcdles
ln the U^L and the ocndlots arlslng cut cf duplloatlcn cf
authcrltles, laok cf transparenoy and the need fcr unlfcrm
standards tc be applloable thrcughcut the U^L. 0mar
stressed that bellef and trust ln the healthoare system
stems frcm havlng a sclld regulatlcn that prcvldes fcr hlgh
standards, whloh ls laoklng ln cur healthoare regulatlcns.
0mar ralsed the ocnoern that prcvldlng ln cur regulatlcns
a meohanlsm fcr treatment abrcad ls cnly cne example
fcr dlsbellef ln the healthoare system. Flnally, 0mar urged
the regulatcry authcrltles tc lmprcve regulatlcns attraot
lng hlghly quallfed physlolans tc mcve tc the ocuntry.
MEED Healthcare
Conference 2008
Hcda Barakat, Managing Par tner at /| Tamimi & Ccmpany
addresses the audience at the SMB Fcrum.
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Tc prcvlde fcr a mcre attraotlve buslness
envlrcnment fcr fnanolal lnstltutlcns, the
DlFC cn 7
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Ncvember 2008 lssued the
Speolal lurpcse Ccmpany Regulatlcns
(the Fegu|aticns") enabllng fnanolal
lnstltutlcns tc qulokly fcrm Speolal
lurpcse Ccmpany (SlC) struotures wlthln
the DlFC.
Under the new Regulatlcns, SlC`s are
granted the fcllcwlng exemptlcns whloh
wculd nct crdlnarlly apply tc ocnventlcnal
ocmpanles ln the DlFC:
- SlC`s shall nct be requlred tc
malntaln, audlt cr fle lts aoocunts;
- SlC`s shall nct be requlred tc fle
^nnual Return presorlbed under
^rtlole 22 cf the DlFC Ccmpanles Law
cf 2006;
- SlC`s shall nct be requlred tc hcld
annual sharehclders meetlng;
- SlC`s oan be admlnlstered by a
Ccrpcrate Servloe lrcvlder (CSl)
1
- SlC`s may reoelve admlnlstratlcn
servloes fcr lts assets frcm a
thlrd party asset admlnlstratcr cr
management prcvlder; and
- Lxemptlcns frcm oertaln prcvlslcns cf
the DlFC lnsclvenoy Law cf 2004
Activities in the 0IF0
The oreatlcn cf SlC`s ln the DlFC must
be llmlted tc oarrylng cut the fcllcwlng
aotlvltles (the Fxempt /ctivities"),
regardless cf whether undertaken ln an
lslamlo cr ocnventlcnal way:
- The aoqulsltlcn (by way cf |easing, tit|e
transfer, risk transfer cr ctherwise),
hcldlng and dlspcsal cf any asset
(tangib|e cr intangib|e, inc|uding but
nct |imited tc receivab|es and shares)
ln ocnneotlcn wlth and fcr the purpcse
cf a transaotlcn;
- The cbtalnlng cf any type cf fnanolng
(banking cr capita| markets), the
grantlng cf any type cf seourlty
lnterest cver lts assets, prcvldlng cf
any lndemnlty cr slmllar suppcrt fcr
the beneft cf lts Sharehclder(s) cr any
cf lts subsldlarles, cr the enterlng lntc
any type cf hedglng arrangements, ln
ocnneotlcn wlth and fcr the purpcse
cf a transaotlcn;
- The fnanolng cf the lnltlatcr
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cr
ancther SlC;
- The aotlng as a Trustee cr agent fcr
any partlolpant ln the transaotlcn;
- ^ny cther aotlvlty apprcved ln wrltlng
by the Reglstrar; cr
- ^ny anolllary aotlvltles whloh are
related tc the aotlvltles set cut
abcve.
lt must be ncted that the term
transacticn" ocntemplated under these transacticn" transacticn"
aotlvltles refers tc elther an lslamlo
cr ocnventlcnal struotured fnanoe
transaotlcn oarrled cut fcr the beneft
cf the lnltlatcr ln ocnneotlcn wlth whloh
the SlC has been establlshed. The
transaotlcns shall lnolude, withcut
|imitaticn, any type cf seourltlsatlcns cr
cther oapltal market transaotlcns.
Legal Restrictions on SP0's
The DlFC has lmpcsed the fcllcwlng
restrlotlcns cn SlC`s:
- SlC`s are prchlblted frcm undertaklng
aotlvltles cther than the Lxempt
^otlvltles;
- SlC`s may nct be
the Trustee cf an lnvestment
Trust;
the Ceneral lartner cf an
lnvestment lartnershlp; cr
an lnvestment Ccmpany
Hcwever, SlC`s may be used by the
fcllcwlng entltles tc hcld the prcperty cf
a Fund:
Trustee cf an lnvestment Fund;
lnvestment Ccmpany; and
lnvestment lartnershlp
- SlC`s shall nct undertake any
fnanolal servloes as defned by DFS^
Rules unless lt ls authcrlsed by the
DFS^ tc dc sc.
0apital
The mlnlmum share oapltal requlred fcr
SlC`s shall be US5100.
Shareholders
SlC`s shall nct have mcre than three
By Cherry ^nn Turoal
Banklng & Flnanoe lraotloe
Setting Up of
SPC in the DIFC
5|nce |ts |ncet|en |n 5etember 2004, the uba| Internat|ena| F|nanc|a| Centre ("IFC") has cens|stent|y fecused en
ach|ev|ng |ts v|s|en ef "sha|ng temerrew's nanc|a| ma as a g|eba| gateway fer ca|ta| and |nvestment". It has set eut
var|eus ru|es and regu|at|ens based en |nternat|ena| best standards te attract |nvesters areund the g|ebe te cens|der
IFC as the|r centre ef che|ce fer sett|ng u the|r bus|ness ent|t|es and the structur|ng ef the|r nanc|a| and cemmerc|a|
transact|ens |n the reg|en. 1he IFC |s determ|ned te effer art|c|ants w|th wer|d c|ass jur|sd|ct|ena| framewerk cemat|b|e
te a medern-day |nternat|ena| nanc|a| centre.
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sharehclders and every Sharehclder
must be:
- a Ncmlnee
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hcldlng the shares ln
the SlC cn trust fcr dlsoretlcnary
purpcses;
- the lnltlatcr cr ancther partlolpant ln
the Transaotlcn; cr
- ancther SlC
0irectors and Secretary
SlC`s shall have a mlnlmum cf twc
dlreotcrs.
The majcrlty cf Dlreotcrs shall be
emplcyees cf CSl. The Dlreotcrs are nct
requlred tc be resldents ln Dubal.
The Ccmpany Seoretary cf the SlC
shall be lts CSl cr any cf lts affllates cr
subsldlarles.
Method oI Formation
& Requirements Ior
Incorporation
The applloatlcn fcr settlng up an SlC
must be lcdged wlth the DlFC Reglstrar cf
Ccmpanles (DlFC R0C). SlC`s oan be
set up ln the DlFC as a ocmpany llmlted
by shares.
The fcllcwlng relevant fcrms and
dcouments must be ocmpleted and fled
fcr prcoesslng cf the applloatlcn by the
DlFC R0C:
- Transaotlcn Desorlptlcn the
applloant ls expeoted tc prcvlde the
DlFC R0C wlth an cvervlew cf the
prcpcsed aotlvltles cf the SlC. The
transaotlcn desorlptlcn shculd ocver
the fcllcwlng areas tc ald the DlFC
R0C ln revlewlng the applloatlcn:

Desorlptlcn cf the aotlvltles and
purpcse cf lnocrpcratlng a Speolal
lurpcse Ccmpany;
Detalls cf the Ccrpcrate Servloe
lrcvlder;
Detalls cf the lnocrpcratcr(s);
Detalls cf the Sharehclder(s) lf
dlfferent frcm the lnocrpcratcr(s);
Detalls cf the lnltlatcr
(lf applloable);
Detalls cf the Ncmlnee
(lf applloable)
- Fcrm SlC1 - ^pplloatlcn fcr
Reservatlcn cf a Ccmpany Name
(cpticna|);
- Fcrm SlC2 ^pplloatlcn fcr
lnocrpcratlcn cf a Speolal lurpcse
Ccmpany;
- Fcrm SlC7 Detalls cf Benefolal
0wners whc enjcy dlreot cr lndlreot
beneft cf cwnlng at least 10 cf the
shares, regardless cf whcse name
the shares are ln;
- Ccnfrmatlcn Letter frcm the
lnocrpcratcr/Sharehclder that the
SlC wlll cnly undertake Lxempt
^otlvltles;
- Ccpy cf the ^rtloles cf ^sscolatlcncf
the SlC slgned by the lnocrpcratcrs;
- Ccpy cf the Certlfoate cf lnocrpcratlcn
cf the Ccrpcrate Servloes lrcvlder;
- Ccpy cf the Certlfoate cf lnocrpcratlcn
cf the lnltlatcr;
- Ccpy cf the Certlfoate cf lnocrpcratlcn
cf the Ncmlnee (if app|icab|e);
- Ccpy cf the Certlfoate cf lnocrpcratlcn
cf the Sharehclder(s) (if app|icab|e);
- Resclutlcn cf the Bcard cf Dlreotcrs
cf eaoh Sharehclder authcrlslng the
lnocrpcratlcn cf the SlC ln the DlFC
and ocnfrmlng that the ^rtloles cf
^sscolatlcn have been duly adcpted
by the Sharehclder;
- lasspcrt ocples cf all dlreotcrs,
cffoers, and sharehclders (lf
sharehclders are lndlvlduals).

SPC`s are a||cwed tc f|e an app|icaticn
fcr inccrpcraticn via e|ectrcnic means
(e.g. fax, scanned ccpies, etc.) prcvided
that the crigina|s sha|| be de|ivered cr
f|ed with the FOC within cne mcnth frcm
submissicn cf the e|ectrcnic dccuments.
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when all the abcve mentlcned
requlrements have been submltted
and the R0C ls ocnvlnoed that all the
ocndltlcns requlred under the new
Regulatlcns have been ocmplled wlth,
the R0C shall lnocrpcrate the SlC.
The R0C shall lssue a Certifcate cf
|nccrpcraticn whloh expressly sets cut
the status cf the ocmpany as a 'Speolal
lurpcse Ccmpany`. The R0C shall enter
lts name bcth ln the Speolal lurpcse
Ccmpanles Reglster and ln the Reglster
cf Ccmpanles ln the DlFC.
Registered 0Ice in the 0IF0
SlC`s must arrange fcr an cffoe address
ln the DlFC tc whloh all ocmmunloatlcns
oan be dellvered. lf the SlC wculd be
admlnlstered by a DlFCreglstered CSl,
lt shall use the buslness address cf the
CSl cr any cf lts DlFC based affllates cr
subsldlarles.
lf, cn the cther hand, the CSl ls nct a
DlFC reglstered entlty
4
the SlC cr the
CSl must arrange fcr an address wlth
a DlFC based law frm, aoocuntlng frm
cr a bank.
0onversion oI existing non-
regulated entities into SP0
The new Regulatlcns dc nct prchlblt suoh
ocnverslcn prcvlded that a ocmpany
lntendlng tc ocnvert lts exlstlng ncn
regulated lloense tc SlC lloense shall
make the neoessary ohanges tc lts
ourrent struoture ln crder tc meet all
the requlrements fcr the SlC set up and
prcvlded that lts aotlvltles fall under the
Lxempt ^otlvltles as defned under the
new Regulatlcns. ^ny suoh ocnverslcn
must be nctlfed tc the DlFC R0C.
ln addltlcn, the ocmpany wlll be requlred
tc submlt a Letter cf Ccmfcrt explalnlng
hcw the cutstandlng llabllltles, lf any, wlll
be settled.
Reporting Requirements
- ln 1anuary cf eaoh year SlC`s shall
fle tc the DlFC R0C a ocnfrmatlcn
that there has been nc amendment
cf lts ^rtloles cf ^sscolatlcn slnoe lts
lnocrpcratlcn cr prevlcus repcrtlng;
and
- lf applloable, tc fle a nctloe cf any
cf the fcllcwlng ohanges wlthln cne
mcnth frcm the date the relevant
ohange coours uslng the fcrm
presorlbed by the DlFC R0C:
ohange tc lts reglstered cffoe cr
ocntaot detalls (telephcne, fax,
emall, eto.);
any ohange tc lts Sharehclders;
ohange cf ocmpany name; cr
any ohange ln lts buslness
aotlvltles
Ncte: SPC's sha|| nct be exempt frcm
the repcrting requirements cf any |isting
authcrity cr rating agency invc|ved in its
Transacticn cr frcm which it has cbtained
membership.
0issolution oI SP0's
The Sharehclders may agree by vlrtue cf
a Speolal Resclutlcn tc vcluntarlly wlnd
up the SlC. Hcwever, under the new
Regulatlcns, the Speolal Resclutlcn may
cnly be passed and ocnsldered legally
blndlng lf the SlC has nc cutstandlng
llabllltles.
The DlFC R0C must be nctlfed cf suoh
dlssclutlcn and, upcn reoelpt therecf,
shall publlsh the faot cf dlssclutlcn cn
the DlFC webslte.
Revocation oI SP0 Status
lf an SlC ls fcund tc have undertaken
any aotlvltles whloh are nct ocnsldered
Lxempt ^otlvltles, the DlFC R0C shall
revcke the status cf the ocmpany as
a Speolal lurpcse Ccmpany. 0noe
revcked, the ocmpany shall autcmatloally
be subjeot tc the prcvlslcns cf the
Ccmpanles Law.
Applicable Fees
^pplloatlcn fcr reservatlcn cf ocmpany
name US5200
^pplloatlcn fcr lnocrpcratlcn cf SlC
US51,000
^nnual fee US51,000
^n SlC shall nct requlre a ocmmerolal
lloense.
Penalties
- lf an SlC undertakes aotlvltles cther
than Lxempt ^otlvltles US55000
- lf crlglnal dcouments are nct
submltted tc the DlFC R0C wlthln
1 mcnth cf submlttlng the faxed cr
soanned ocples US52000
- lf repcrtlng requlrements are nct
fulflled US52000
0onclusion
ln the mldst cf eocncmlo orlsls affeotlng
majcr parts cf the wcrld, many fcrelgn
lnvestcrs are keen tc fcous thelr buslness
aotlvltles ln the reglcn and tc establlsh
legal presenoe ln Dubal. The mcve cn the
part cf the DlFC tc cpen up lts dccrs fcr
the settlng up cf SlC struotures ls seen
nct cnly as an lnstantanecus respcnse tc
thls glcbal trend, but mcst lmpcrtantly,
the enaotment cf the SlC Regulatlcns
has shcwn that the DlFC ls ocmmltted tc
pursulng lts mlsslcn tc be a oatalyst fcr
reglcnal eocncmlo grcwth, develcpment
and dlverslfoatlcn and be at par wlth
cther leadlng fnanolal oentres ln the
wcrld.
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Ccrpcrate Service Prcvider means an
entlty reglstered ln the DlFC cr lloensed
ln any Reocgnlsed 1urlsdlotlcn cr any
cther jurlsdlotlcn apprcved by the DlFC
Reglstrar cf Ccmpanles tc undertake
ocrpcrate servloes buslness.
2
|nitiatcr means the entlty fcr
whcse transaotlcn the SlC has been
establlshed.
3
Ncminee means a regulated entlty
reglstered ln the DlFC cr lloensed ln any
Reocgnlsed 1urlsdlotlcn cr any cther
jurlsdlotlcn as apprcved by the R0C tc
undertake trust buslness.
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CSP can be entities |icensed in cther
jurisdicticns reccgnised cr apprcved by
the Fegistrar cf Ccmpanies. The |ist cf
Feccgnised Jurisdicticns under the new
Fegu|aticns wcu|d inc|ude:
* /ustra|ia;
* Canada;
* Furcpean member States;
* Cuernsey;
* Hcng Kcng;
* |ndia;
* |s|e cf Man;
* Jersey;
* Ma|aysia;
* Singapcre;
* Scuth /frica;
* Switzer|and;
* United Kingdcm; and
* United States cf /merica
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By 1ames MaoCallum, lartner, and wafa ^llseyed, ^sscolate,
Ccrpcrate Ccmmerolal Department, ^bu Dhabl
Introducing Abu Dhabis
First Free Zone
Representlng the gecgraphlo occrdlnates cf the Clty cf ^bu Dhabl,
twcfcur54 ls a free zcne lcoated ln the Lmlrate cf ^bu Dhabl. Lstabllshed
pursuant tc Law nc. 12 cf 2007 (ocnoernlng the establlshment cf the
Medla Zcne ^uthcrlty, ^bu Dhabl), twcfcur54 was cffolally launohed
cn 12
th
0otcber 2008 and ls cpen fcr buslness. twcfcur54 has been
speolfoally develcped as a medla and ocntent oreatlcn free zcne. lt
olalms tc cffer a strateglo gecgraphlo lcoatlcn, an lntegrated statecf
theart envlrcnment and frstrate lnfrastruoture fcr lcoal, reglcnal and
lnternatlcnal ocmpanles, crganlsatlcns and lndlvlduals lccklng tc oarry
cut medla related buslness aotlvltles ln the Mlddle Lastern and the
Ncrth ^frloan reglcn.
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Principal benets oI establishing
a business in a Iree zone
^s a general rule, a fcrelgn natlcnal
cr ocrpcratlcn wlshlng tc establlsh a
presenoe ln the U^L wlll need a U^L
natlcnal partlolpant, fcr example, as a
sharehclder ln a ocmpany fcrmed under
the U^L Federal Ccmpanles Law cr as a
lcoal servloe agent cf a branoh cf a fcrelgn
ocmpany. Free zcnes, cn the cther hand,
permlt 100 per oent fcrelgn cwnershlp as
well as unrestrloted repatrlatlcn cf prcfts
and oapltal. ln addltlcn, althcugh the
number cf seotcrs ourrently susoeptlble
tc ocrpcrate and perscnal tax ln the U^L
ls very llmlted, a number cf free zcnes
have glven guaranteed exemptlcns frcm
ocrpcrate taxatlcn tc buslnesses settlng
up wlthln thelr terrltcrles fcr up tc 50
years, whloh perlcd may be renewed.
Brcadlyspeaklng, the prcoedure fcr
settlng up a presenoe, cbtalnlng a
buslness lloenoe and prcourlng vlsas fcr
the wcrkfcroe ln a free zcne ls quloker
and mcre streamllned than cutslde free
zcnes. Thls ls beoause the free zcne
admlnlstratlcn ls mcre oentrallsed and
lts funotlcn and respcnslblllty ls mcre
llmlted ln socpe, whloh faollltates the
swlfter prcoesslng cf applloatlcns.
ln addltlcn, eaoh lndlvldual free zcne ln
the U^L ls crlentated tcwards oaterlng fcr
partloular felds cf buslness aotlvlty and
have put ln plaoe dedloated lnfrastruoture
tc fcster the aotlvltles oarrled cn wlthln
thelr respeotlve terrltcrles. Further
lnoentlves arlse cut cf the lmplementatlcn
cf leglslatlcn deslgned tc prcteot the
lnterests cf and enhanoe the servloes
cffered by tenants cf partloular free
zcnes. Fcr example, the Dubal Teohnclcgy
and Medla Free Zcne has put ln plaoe
regulatlcns prcmctlng eocmmeroe,
publlshlng and brcadoastlng, the Dubal
lnternatlcnal Flnanolal Centre has
extenslve laws and regulatlcns regulatlng
the fnanolal servloes seotcr thereby
prcmctlng lt as a mcdel cf transparenoy,
lntegrlty and prcfesslcnallsm and the
U^L`s tradlng and manufaoturlng free
zcnes have speolfo regulatlcns regardlng
lnfrastruoture, envlrcnmental and health
and safety lssues.
Business activities that may be
carried on in twoIour64
twcfcur54`s mlsslcn statement asserts
that lt ls ocmmltted tc establlshlng the
Lmlrate cf ^bu Dhabl as a oentre cf
exoellenoe fcr medla ocntent oreatlcn
where all types cf medla related
buslnesses lnoludlng flm, televlslcn,
brcadoastlng, muslo, dlgltal medla,
advertlsement and publlolty, publlshlng
and art oan cperate tcgether ln a
ocheslve and lntegrated envlrcnment.
^lsc ocmpanles lccklng tc oarry cut
manufaoturlng cf prcduots and materlals
used ln the preparatlcn, paokaglng,
prcduotlcn cr dlstrlbutlcn cf advertlslng
materlals as well as ocmpanles lntendlng
tc undertake lmpcrt, expcrt and stcrage
cf devloes, materlals, prcgrams and any
cther prcduots used ln the medla and
advertlslng lndustry may ocnduot thelr
buslnesses wlthln twcfcur54.
Clven lts strateglo lcoatlcn (cn ^bu Dhabl
lsland, well served by unocngested majcr
rcadways, lts prcxlmlty tc the ^bu Dhabl
^lrpcrt) and statecftheart lnfrastruoture,
twcfcur54 has already attraoted scme
cf the wcrld`s mcst rencwned ocntent
oreatlcn ocmpanles.
1he Iour pillars oI twoIour64
twcfcur54 olalms tc be bullt arcund fcur
plllars namely tadreeb, lbtlkar, lntaj and
tawascl. ^ brlef cvervlew cf eaoh cf these
plllars ls glven belcw:
- twcfcur54 tadreeb ls tc serve as
the reglcn`s premler vcoatlcnal
tralnlng aoademy tc develcp skllls,
upsklll and resklll medla prcfe
sslcnals and lndlvlduals whc wlsh
tc pursue a oareer ln the medla
lndustry aorcss a ocmprehenslve
range cf medla dlsolpllnes.
- twcfcur54 ibtikar prcvldes suppcrt,
seed fundlng and prcfesslcnal advloe
fcr new U^L crlglnated ocntent and
oreatlve buslnesses. Thls feature cf
twcfcur54 effeotlvely ocmprlses an ln
hcuse venture oapltal fund tc prcmcte
and asslst ln the develcpment cf
buslnesses ellglble tc cperate wlthln
the free zcne. Thls cffer cf fundlng
ls llkely tc be appreolated durlng
ourrent tlmes when external fundlng,
ln partloular fcr newer buslnesses, ls
llkely tc be harder tc ocme by.
- twcfcur54 intaj prcvldes statecf
theart ocntent prcduotlcn and pcst
prcduotlcn faollltles servlolng multlple
medla platfcrms.
- twcfcur54 tawasc| exlsts tc asslst ln
the relcoatlcn and establlshment cf
ocntent crganlsatlcns and thelr staff
ln twcfcur54.
Regulatory regime and set-up and
licensing processes
Laoh cf the U^L`s free zcnes has lts
cwn set cf laws and regulatlcns whloh
oater fcr and regulate ln a mcdern,
cpenmlnded and fcrwardlccklng manner
the partloular buslness aotlvltles tc be
oarrled cn there. twcfcur54 has begun
and ls set very muoh tc fcllcw sult ln
thls respeot. ^ncther lnncvatlcn cf the
Ccvernment cf ^bu Dhabl, lnscfar as
free zcne oreatlcn and admlnlstratlcn ls
ocnoerned, ls that lt ls lntended that all
cf the free zcnes ln ^bu Dhabl wlll adcpt
and cperate ln aoocrdanoe wlth the same
baslo regulatlcns, lnoludlng as regards
the lnocrpcratlcn, reglstratlcn and
admlnlstratlcn cf ocmpanles and branoh
cffoes. Thls ocntrasts wlth the pcsltlcn ln
the cther emlrates cf the U^L where eaoh
free zcne has adcpted lts cwn dlstlnotlve
set cf laws and regulatlcns. ^ unlfcrm set
cf base laws and regulatlcns wlll lcgloally
prcmcte unlfcrmlty cf lnterpretatlcn,
lmprcve understandlng and ocmpllanoe,
faollltate free zcne admlnlstratlcn and
prcgress unlversal refnement cf the
rules applloable thrcughcut ^bu Dhabl`s
free zcnes.
The Medla Zcne ^uthcrlty (^uthcrlty),
whloh ls respcnslble fcr the lssuanoe
and lmplementatlcn cf regulatlcns and
pclloles ocnoernlng the cperatlcn cf
twcfcur54, has tc date lssued twc sets
cf regulatlcns namely Buslness Lloenslng
Regulatlcns (BLR) and Dlssemlnatlcn
Lloenslng Regulatlcns (DLR) and ls ln
the prcoess cf lssulng lts Ccmpanles
Reglstratlcn Regulatlcns (CRR).
^oocrdlng tc the BLR, ocmpanles and
branoh cffoes lnocrpcrated / reglstered
ln twcfcur54 pursuant tc the CRR, and
cther perscns (lnoludlng ocmpanles
and lndlvlduals) lcoated cutslde the
gecgraphlo bcundarles cf twcfcur54,
may apply fcr a lloenoe tc cperate wlthln
twcfcur54. Buslness lloenoes allcwlng
the lloensee tc oarry cn buslness wlthln
twcfcur54 wlll crdlnarlly be granted fcr
a perlcd cf cne year (renewable). The
^uthcrlty may alsc lssue 'tempcrary`
lloenoes tc applloants, whc wlsh tc
oarry cut cnecff buslness aotlvltles ln
twcfcur54 ln ocnneotlcn wlth speolfo
events.
lerscns, whether ocrpcrate cr lndlvldual,
hcldlng a ourrent lloenoe lssued by the
^uthcrlty pursuant tc BLR may apply
fcr a 'ocntent dlssemlnatlcn lloenoe`
under DLR. The ocntent dlssemlnatlcn
lloenoe allcws the applloant tc oarry cut
brcadoastlng, transmlsslcn, publloatlcn,
prlntlng, ocmmunloatlcn cr dlstrlbutlcn tc
the publlo cf any ocntent ln the ocurse cf
cperatlng a buslness, lnoludlng any fcrm
cf eleotrcnlo medla cr prlnt publloatlcn ln
twcfcur54.
^lthcugh the ^uthcrlty ls stlll ln the
prcoess cf lssulng CRR whloh wlll olarlfy
the features and prcoedures applloable
tc the varlcus types cf legal struotures
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able tc be fcrmed ln twcfcur54,
aoocrdlng tc the BLR and DLR, lt ls
ourrently understccd that the fcllcwlng
types cf legal struotures wlll be able tc
be lloensed ln twcfcur54:
- llmlted llablllty ocmpany lnocrpcrated
ln the free zcne;
- branoh cf a U^L based ocmpany;
- branoh cf a fcrelgn ocmpany;
- shcrtterm buslness cperatlng under
a 'tempcrary` lloenoe; and
- buslness cperatlng under a lloenoe
lssued tc any perscn cr ocmpany
pursuant tc a resclutlcn cf the ^bu
Dhabl Lxeoutlve Ccunoll.
The prcoess and prcoedures relevant
tc the lnocrpcratlcn cf a free zcne
ocmpany, the reglstratlcn cf a branoh ln
the free zcne cf a ocmpany lnocrpcrated
elsewhere and the lloenslng cf eaoh
ls ln oertaln respeots slmllar tc thcse
applloable ln cther U^L free zcnes,
but wlth a number cf refnements.
Reglstratlcn and lloenslng wlthln the free
zcne ls nct as cf rlght, lndloatlng that
applloants e.g. prcspeotlve sharehclders
cf new free zcne ocmpanles cr
ocmpanles lccklng tc reglster a branoh
cffoe ln the free zcne wlll need tc cbtaln
the prellmlnary apprcval cf the ^uthcrlty
by demcnstratlng tc the ^uthcrlty that
thelr buslness mcdel allgns wlth the free
zcne`s ollent prcfle.
0pcoming Abu 0habi Iree zones
wlth the advent cf twcfcur54, whloh
enjcys the dlstlnotlcn cf belng the frst
cperatlcnal free zcne ln the Lmlrate cf
^bu Dhabl, several cther free trade zcnes
are underway and are expeoted tc cpen
fcr buslness ln ^bu Dhabl ln the near
future. These upocmlng free trade zcnes
lnolude:
- ^bu Dhabl ^lrpcrt Free Zcne, whloh
wlll allcw lnvestcrs tc undertake all
types cf buslness aotlvlty, cther than
banklng and lnsuranoe and subjeot tc
applloable envlrcnmental llmltatlcns.
^bu Dhabl ^lrpcrt Free Zcne`s phase
1 ls expeoted tc ocmplete by 2010.
- Masdar Clty Free Zcne, whloh ls
expeoted tc cpen ln 2009, wlll be an
lntegrated 'green ocmmunlty` cfferlng
praotloal faollltles fcr the Masdar
lnstltute, the Researoh Netwcrk,
llght lndustry, develcpment unlts and
labcratcrles. Upcn ocmpletlcn, Masdar
Clty wlll be hcme tc up tc 50,000
resldents and wculd aoocmmcdate
up tc 1,500 buslness entltles
prlmarlly ocnslstlng cf ocmmerolal
and manufaoturlng faollltles that
speolallse ln envlrcnmentallyfrlendly
prcduots and servloes.
- Khallfa lcrt and lndustrlal Zcne
(KllZ), whloh ls strategloally
lcoated between the Lmlrates cf
^bu Dhabl and Dubal ln Taweelah,
wlll be ^bu Dhabl`s frst free zcne
trade and lcglstlos park. The frst
phase cf KllZ ls expeoted tc be
ocmplete ln 2010 and wlll lnolude a
wcrldolass ocntalner and lndustrlal
pcrt surrcunded by free trade zcne
terrltcry.
- The lndustrlal Clty cf ^bu Dhabl ls
sltuated ln and arcund the Mussafah
dlstrlot cf ^bu Dhabl. lt ourrently
oaters fcr manufaoturlng, prcoesslng
and heavy lndustry seotcrs and
ls understccd tc be ocnslderlng a
transfcrmatlcn tc free zcne status.

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The Ladder of Success
Saudi Strategies for Top 10 in 2010
1o contact Al 1amimi & 0ompany's KSA 0Ice:
Tel: +966 1 4169 666
Nicholas Diacos
Partner & Head of KSA Ofce
0ver reoent tlmes the eocncmlo prcgress
and prcsperlty wlthln the Klngdcm cf
Saudl ^rabla (KS^) has meant that the
ocuntry ls ldeally pcsltlcned tc embark
cn lts mcst ambltlcus prcjeot tc date,
the 10 x 10 prcgramme. The cverall
cbjeotlve ls tc plaoe KS^ ln the tcp 10
mcst ocmpetltlve natlcns ln the wcrld by
2010. The suooessful lmplementatlcn
wlll mean that KS^ wlll emerge as cne
cf the wcrld`s mcst attraotlve buslness
destlnatlcns.
The KS^ gcvernment has cver the last
fve years stlmulated eocncmlo aotlvlty
ln the Klngdcm thrcugh a number
cf eocncmlo and regulatcry refcrms
lnoludlng the establlshment cf the Saudl
^rabla Ceneral lnvestment ^uthcrlty
(SA0IA). These refcrms, ocmblned
wlth the effeotlveness cf S^Cl^ and
lts gccd wcrklng relatlcnshlp wlth
cther gcvernmental authcrltles, have
ocntrlbuted tc an attraotlve buslness
envlrcnment. S^Cl^ ls respcnslble fcr
cverseelng the 10 x 10 prcgramme by
occrdlnatlng fcrelgn lnvestment lloenslng
and seeklng tc oreate an lnvestment
frlendly envlrcnment.
The Klngdcm has nct been lmmune
frcm the ourrent orlsls faolng the wcrld
fnanolal markets. Nct cnly dc many
Saudls lnvest ln fcrelgn markets but alsc
the Saudl stcok market (the />`>)
has suffered ln a slmllar veln tc that cf
lts western ocunterparts. Desplte thls
there ls a hlgh level cf cptlmlsm fcr the
lmmedlate and lcng term future cf the
ocuntry wlth encrmcus lnfrastruoture
and cther publlo develcpments. There ls
alsc a deslre by the Saudl gcvernment
tc partlally cr fully prlvatlse many state
cwned cperatlcns, partloularly ln the
water and eleotrlolty lndustrles. The
expeoted grcwth and develcpment wlthln
KS^ make lt an ldeal lnvestment lcoatlcn
fcr the astute lnvestcr.
^ntlolpatlng the grcwth ln KS^, and
the need fcr hlghly prcfesslcnal legal
servloes ln the Klngdcm, ^l Tamlml &
Ccmpany cpened lts cffoe ln Rlyadh
durlng Maroh 2008, fcllcwlng suooessful
cpenlngs ln lraq (Baghdad), atar (Dcha),
and mcre reoently 1crdan (^mman).
^l Tamlml & Ccmpany are the cnly fcrelgn
law frm ln KS^ lloensed tc praotloe ln lts
cwn name, wlthcut a lcoal asscolatlcn,
ensurlng ocnslstent, hlgh quallty legal
servloes.
wlthln the cffoe there ls a blend cf
experlenoed Saudl and western lawyers
whc are ourrently lnvclved ln a large
varlety cf transaotlcns ranglng frcm:
- settlng up fcrelgn ocmpanles;
- lntelleotual prcperty reglstratlcns and
dlsputes;
- lltlgatlcn;
- ocnduotlng oapltal market
transaotlcns;
- prcjeot fnanoe;
- prcperty develcpment.
^s the largest lndependent law frm ln the
reglcn, cur unparalleled lcoal kncwledge
and ocntaots, whloh are essentlal ln KS^,
allcw us tc asslst ollents tc aohleve thelr
buslness cbjeotlves.
l hcpe ycu enjcy thls edltlcn cf Law
Update, ln whloh we fcous heavlly cn
the legal landsoape ln KS^ and the
strategles ln plaoe tc aohleve the 10 x 10
prcgramme. lf ycu have any ocmments cr
requlre any further updates then please
dc nct hesltate tc ocntaot me cr cne cf
my team ln the Rlyadh cffoe.
Nlohclas Dlaocs, Head cf ^l Tamlml & Ccmpany`s KS^ 0f floe prcvldes an cver vlew cn
Saudl`s develcpment tc date, lt`s taotlos fcr sur vlval and grcwth amldst the flnanolal
orlsls and the ocuntr y`s ambltlcns and gcals fcr the ocmlng years.
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The trade pclloles are qulte llberal wlth
nc quantltatlve cr prloe restrlotlcns
fcr lmpcrters. There are varlcus
gcvernmental bcdles and regulatlcns that
gcvern trade wlthln the Klngdcm.
KS^ alms tc be cne cf the tcp ten mcst
ocmpetltlve eocncmles ln the wcrld by
2010 and beoause cf thls ambltlcn lt has
launohed what ls kncwn as the 10 x 10
prcgramme. The prcgramme ls cverseen
by the Saudl ^rablan Ceneral lnvestment
^uthcrlty (S^Cl^) wlth the cverall cbjeotlve
cf maxlmlslng the eocncmlo prcgress and
prcsperlty cf the ocuntry.
Thls paper revlews fcur key ocnslderatlcns
fcr lnvestcrs ocnslderlng entry lntc the
KS^ market belng, vlsas, Custcms Duty,
Ccmpetltlcn Law and Lmplcyment Law.
Visas
^ vlsa ls requlred fcr every fcrelgn vlsltcr
tc the Klngdcm cf Saudl ^rabla. The
type cf vlsa requlred wlll depend cn the
purpcse fcr enterlng the Klngdcm. The
fcllcwlng are an example cf the types cf
vlsas ourrently avallable:
- lnvestcr vlsa;
- Buslness vlslt vlsa;
- Lmplcyment vlsa;
- Famlly vlslt vlsa;
- Rellglcus Hajj and Umrah.
Reoently there have been mcves tc
lntrcduoe a tcurlst vlsa that wlll be lssued
thrcugh lloensed tcur cperatcrs.
The KS^ Ccvernment has lmplemented
new prcoedures almed at slmpllfylng
and expedltlng buslness travel ln the
Klngdcm. The new measures are part cf
an cverall drlve by the KS^ Ccvernment tc
prcmcte and faollltate fcrelgn lnvestment
ln the Klngdcm.
Ncw the lssulng cf buslness vlsas fcr
oertaln ocuntrles nc lcnger requlres a
letter cf lnvltatlcn oertlfed by the KS^
Chamber cf Ccmmeroe and lndustry. The
buslness vlsltcrs need nct be part cf an
crganlsatlcn that ls already establlshed ln
the Klngdcm they need cnly be affllated
wlth a buslness entlty reglstered ln thelr
ocuntry cf crlgln.
Mcst vlsa applloatlcns are ncw requlred
tc be handled by a lloensed fcrelgn agent.
^ llst cf the agents oan be cbtalned
thrcugh the websltes cf lcoal KS^
Lmbassles cr Ccnsulates. Cenerally the
Lmbassy/Ccnsulate wlll nct deal dlreotly
wlth applloants.
Fcr fcrelgners wantlng tc wcrk ln KS^
lt ls neoessary tc have a wcrk vlsa that
may be fcllcwed by an lqama (resldenoy
status).
0ustoms 0uty
ln respcnse tc the expandlng aotlvltles
cf the Mlnlstry cf Flnanoe, a number
cf publlo dlreotcrates were oreated
wlthln the Mlnlstry, lnoludlng the lubllo
Dlreotcrate fcr Custcms.
The Klngdcm cf Saudl ^rabla Custcms
pclloy has the fcllcwlng key cbjeotlves:
- Rellglcus and seourlty cbjeotlves
whloh are represented by the
preventlcn cf entry lntc the ocuntry cf
ltems whloh are:
agalnst lslamlo ocde (Sharlah);
agalnst KS^ tradltlcns and
values;
oause harm tc the scolety;
threatenlng tc the stablllty cf the
ocuntry.
- ^n eocncmlo cbjeotlve by the
lmpcsltlcn cf oustcm dutles cn
lmpcrted gccds aoocrdlng tc speolfo
tarlff oategcrles thereby prcteotlng
natlcnal lndustrles.
- ^ scolal cbjeotlve whloh alms at
exemptlng neoessary gccds frcm
oustcms dutles cr lmpcslng a very
lcw tarlff rate cn the lmpcrtatlcn cf
crdlnary ocnsumer gccds.
^ll gccds destlned fcr entry lntc KS^
must meet the applloable health and
safety standards set by KS^ Standards
0rganlsatlcn (S^S0). The S^S0 ls the
scle standardlsatlcn bcdy ln the Klngdcm
and ls entrusted wlth all aotlvltles relatlng
tc standards and measurements.
KS^`s aooesslcn tc the wcrld Trade
0rganlsatlcn has brcught abcut slgnlfoant
ohanges tc lts oustcms reglme. The
Klngdcm has ocmmltted tc mcdlfy tarlffs
cn many lmpcrted prcduots.
ln addltlcn tc lts cbllgatlcns fcllcwlng
aooesslcn tc the wcrld Trade
0rganlsatlcn, KS^ ls alsc a member cf
the oustcms unlcn cf the Culf Cccperatlcn
Ccunoll Unlfed Custcms Unlcn alcng wlth
Bahraln, Kuwalt, 0man, atar and the
Unlted ^rab Lmlrates.
These CCC members have lmplemented
a oustcms unlcn remcvlng oustcms
tarlffs cn mcst lmpcrted gccds frcm
unlcn member ocuntrles. Tc be exempt
frcm duty prcduots manufaotured gccds
must have a oertlfoate cf crlgln frcm
ancther unlcn member ocuntry. They
have alsc agreed cn a ocmmcn tarlff cf
5 applylng tc many stlpulated fcrelgn
gccds lmpcrted frcm cutslde cf member
ocuntrles.
^lthcugh lmplementatlcn cf the tarlff
reduotlcns are set tc take plaoe cver
the next fcur years KS^ has already put
ln plaoe a large part cf the prcgramme
ocverlng a wlde range cf prcduots.
lmpcrters cf gccds must have a
ocmmerolal reglstratlcn that matohes
the type cf gccds belng lmpcrted. Scme
gccds are strlotly prchlblted frcm belng
brcught lntc the ocuntry, fcr example
alochcl, pcrk and representatlcnal
cbjeots cf art.
Legal Considerations for Foreign
Investors entering KSA
By Clenn Lcvell
KS^ 0f floe
The lmpaot cf the Klngdcm cf Saudl ^rabla (KS^) aooedlng tc the wcrld Trade 0rganlsatlcn
ln 2005 has resulted ln a transfcrmatlcn cf trade pclloles that prevlcusly aoted as prcteotlcn
measures agalnst fcrelgn traders wantlng tc ocmpetltlvely enter the Saudl market.
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Rates cf duty vary dependlng cn the type
and quantlty cf the ocmmcdlty. Mcst
baslo ocnsumer prcduots are duty free.
0ompetition Law
The Ccmpetltlcn Law was lntrcduoed by
Rcyal Deoree ln 2004 wlth the alm tc
prcteot and enocurage falr ocmpetltlcn
and tc ocmbat mcncpcllstlo praotloes
that affeot legltlmate ocmpetltlcn. The
cverseelng bcdy cf the law ls the Mlnlstry
cf Ccmmeroe and lndustry.
lnterestlngly the prcvlslcns cf the
Ccmpetltlcn Law apply tc all entltles
wcrklng ln KS^ markets exoept fcr publlo
ocrpcratlcns and whcllycwned state
ocmpanles.
The defnltlcn cf entltles lnoludes a
faotcry, establlshment cr ocmpany
cwned by natural cr ocrpcrate perscn(s),
and all grcups praotlolng ocmmerolal,
agrloultural, lndustrlal cr servloe aotlvltles,
cr selllng and purohaslng ocmmcdltles
and servloes.
The defnltlcn cf market lnoludes a plaoe
cr means where a grcup cf ourrent and
prcspeotlve buyers and vendcrs meet
durlng a speolfo perlcd cf tlme.
The Ccmpetltlcn Law ocntalns prcvlslcns
that prchlblt behavlcur that has the
lntentlcn cf, cr results ln, restrlotlng trade
and falr ocmpetltlcn between entltles.
^lsc prchlblted are entltles hcldlng a
dcmlnatlng pcsltlcn ln the market tc
engaglng ln behavlcurs that wculd have
the effeot cf llmltlng ocmpetltlcn. ^ll
praotloes, agreements, and ocntraots,
verbal cr wrltten, express cr lmplled,
between ocmpetlng entltles cr llkely
ocmpetlng entltles ls prchlblted lf lt
restrlots ocmmeroe cr llmlts ocmpetltlcn
between entltles.
^n lndependent ocunoll oalled the
Ccmpetltlcn lrcteotlcn Ccunoll,
headquartered at the Mlnlstry cf
Ccmmeroe and lndustry, ls respcnslble
fcr the enfcroement and develcpment cf
the Ccmpetltlcn Law.
Lntltles lntendlng a merger cr aoqulsltlcn
that may plaoe that entlty ln a dcmlnatlng
market pcsltlcn are cbllged tc make an
applloatlcn tc the Ccmpetltlcn lrcteotlcn
Ccunoll fcr ocnsent cf the aotlvlty at
least 60 days prlcr tc aotlng. The Ccunoll
ls requlred tc nctlfy the entlty cf an
aooeptanoe cr rejeotlcn wlthln nlnety
days.
The maxlmum penalty fcr a frst cffenoe ln
breaoh cf the Ccmpetltlcn Law ls S^R fve
mllllcn. The maxlmum penalty ls dcubled
fcr repeat cffenders. These penaltles
may be lmpcsed wlthcut prejudloe tc any
cther penaltles that may be applloable
under any cther laws.
Employment
The maln law gcvernlng emplcyment ln
Saudl ^rabla ls the Labcur Law lssued by
Rcyal Deoree ln 2005 supervlsed by the
Mlnlstry cf Labcur. ln addltlcn there are
a number cf Rcyal Deorees, mlnlsterlal
deolslcns and resclutlcns, departmental
olroulars and cther prcncunoements
cf cffolal bcdles relatlng tc labcur
matters lssued frcm tlme tc tlme that
have the fcroe cf law. Unfcrtunately
there ls nc oentral system that prcvldes
a ocmprehenslve referenoe fcr all the
laws pertalnlng tc emplcyee/emplcyer
relatlcnshlps.
The prcvlslcn cf the Labcur Law wlll apply
tc almcst every ocntraot cf emplcyment
under whloh any perscn undertakes
tc wcrk fcr an emplcyer fcr a wage.
Lxemptlcns frcm the Labcur Law exlst
fcr example, emplcylng members cf
the emplcyer`s famlly whc are the cnly
emplcyees, hcusemalds, ncnSaudl
wcrkers perfcrmlng a speolfo task
fcr less than twc mcnths and spcrts
players.
The Scolal lnsuranoe Regulatlcns
requlre emplcyers whc have at least
cne fcrelgn emplcyee tc make mcnthly
ocntrlbutlcns tc the Ceneral 0rganlsatlcn
fcr Scolal lnsuranoe (C0Sl) cn behalf
cf eaoh emplcyee. These ocntrlbutlcns
are oaloulated as a peroentage cf the
emplcyees` wage. The ocntrlbutcry
wage means cnly the baslo salary and
aoocmmcdatlcn allcwanoe, nct exoeedlng
S^R 45,000 per mcnth.
The applloable peroentage fcr ncnKS^l
emplcyees ls 2 cf the emplcyee`s
mcnthly salary payable by the emplcyer
wlthcut any deduotlcn frcm the emplcyee`s
salary tc ocver wcrk related lnjurles. Fcr
KS^ emplcyees the emplcyer ocntrlbutes
11 cf the emplcyee`s mcnthly salary, 2
cf whloh ocvers wcrk related lnjurles and
9 fcr retlrement benefts. The emplcyee
alsc ocntrlbutes an addltlcnal 9 cf thelr
mcnthly salary fcr retlrement benefts.
The Scolal lnsuranoe Regulatlcns defne
salary tc lnolude bcth salary reoelved and
hcuslng allcwanoe.
lt ls ocmpulscry under the Cccperatlve
Health lnsuranoe Law fcr emplcyers tc
prcvlde medloal lnsuranoe that ocvers
the emplcyee and the emplcyee`s famlly.
Thls ls ncrmally dcne at the emplcyer`s
ocst.
The Scolal lnsuranoe Regulatlcns prcvlde
that a retlrlng wcrker whc ls aged 60 years
cr cver ls entltled tc an cld age penslcn.
The full penslcn ls cnly avallable tc KS^
natlcnals whc have ocntrlbuted tc C0Sl
durlng thelr wcrklng llfetlme.
^n emplcyer ls entltled tc request
an emplcyee undergc a prcbatlcnary
perlcd cf nc mcre than nlnety days. Thls
prcbatlcnary perlcd must be stlpulated ln
the ocntraot fcr emplcyment ctherwlse lt
wlll nct apply.
lndefnlte term ocntraots termlnate at
the dlsoretlcn cf elther party prcvlded
wrltten nctloe ls glven tc the cther party
statlng the valld reascn fcr termlnatlcn.
^t least thlrty days nctloe ls requlred
fcr ocntraots where the wcrker ls pald
mcnthly cr nct less than ffteen days
nctloe ln any cther oase. Unfalr dlsmlssal
may result ln a number cf remedles
lnoludlng relnstatement cr mcnetary
ocmpensatlcn.
^t the end cf a labcur ocntraot the
emplcyee ls entltled tc reoelve an end
cfservloe award. Cenerally the amcunt cf
the award ls oaloulated as a halfmcnth
wage fcr eaoh cf the frst fve years cf
servloe and a cnemcnth wage fcr eaoh cf
the fcllcwlng years.
lald annual leave oan vary but under
the Labcur Law emplcyees are entltled
tc 21 days full wages that ls lnoreased
tc a perlcd cf nct less than 30 days lf
the wcrker has spent fve ocnseoutlve
years servloe wlth the same emplcyer.
lrcvlslcns are ocntalned ln the Labcur
Law deallng wlth parental leave, rellglcus
leave, unpald leave, eduoatlcnal leave
and slok leave.
The Labcur Law prcvldes a brcad
cbllgatlcn cn an emplcyee tc malntaln
ocnfdentlallty ln relatlcn tc the emplcyer`s
buslness lnfcrmatlcn. Mcre speolfo
ocnfdentlallty arrangements shculd be
addressed ln the emplcyment ocntraot.
Fcrelgn lnvestcrs settlng up ln KS^
shculd be aware cf the Saudlsatlcn pclloy
that requlres a mlnlmum numbers cf
Saudls tc be emplcyed. Thls mlnlmum
number depends cn the type cf ocmpany
and lndustry. Cenerally 30 cf the
wcrkfcroe ls requlred tc be KS^ unless
the buslness relates tc ocnstruotlcn,
oleanlng cr cperatlcnal wcrk ln whloh
oase the requlrement ls 10.
Fcrelgn wcrkers must lnltlally cbtaln
a wcrk permlt vlsa and then wlth the
asslstanoe cf thelr emplcyer make
applloatlcn fcr a resldenoy permlt, the
lqama. There may be a degree cf
dlffoulty and delay lnvclved ln cbtalnlng
vlsas sc early enqulres shculd be made
ln suoh sltuatlcns.
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Deallngs wlth KS^ real estate are
prlnolpally oarrled cut aoocrdlng tc a
well establlshed and tradltlcnal prcoess
lnvclvlng prlvate negctlatlcns fcllcwed by
the partlolpatlcn cf a reglcnal gcvernment
emplcyee cf Sharl`lte quallfoatlcns
(Nctary lubllo) tc ocmplete the ohange
cf cwnershlp.
Hcwever, as ls the oase wlth many
aspeots cf the KS^ regulatcry reglme,
the gcvernment ls seeklng tc mcdernlse
the struoture by embarklng cn an
ambltlcus plan tc oreate an effolent
and transparent land ldentlfoatlcn,
cwnershlp and reglstratlcn system whloh
wlll ultlmately ocver all real estate ln the
Klngdcm.
Untll thls prcoess ls fnallsed, real estate
deallngs wlll ocntlnue tc lnvclve bcth:
- The ocnventlcnal and tradltlcnal
methcd (whloh ln ltself ls belng
mcdernlsed); and
- lnoreaslngly, updated prcoedures
as the new land ldentlfoatlcn
and reglstratlcn prcoesses are
lntrcduoed.
The ocndltlcns whloh apply tc cwnershlp
cf real estate ln KS^ are drlven prlnolpally
by the natlcnallty cf an lndlvldual buyer
cr, ln the oase cf a ocmpany, lts plaoe
cf lnocrpcratlcn and the natlcnallty cf
lts sharehclders. ^s cne wculd expeot,
Saudl natlcnals and CCC members
enjcy dlfferent rlghts tc thcse enjcyed by
fcrelgn lnvestcrs.
Legal Iramework
The fundamental law cf the KS^ ls the
Sharl`ah. The Sharl`ah ls a oclleotlcn cf
prlnolples derlved frcm dlfferent scuroes,
but prlnolpally the Hcly ur`an and the
Sunnah (the wltnessed saylngs and
aotlcns cf the lrcphet Muhammad).
Under the Sharl`ah, a tradltlcnal and
lcoallsed system cf reocgnltlcn cf
deallngs wlth land by the lcoal Nctary
lubllo has cperated fcr many deoades.
That prcoess cf land transfer ls desorlbed
later ln thls ^rtlole.
The seoular authcrltles are permltted tc
supplement the Shalr`ah and the Saudl
Ccvernment dces sc thrcugh a serles cf
pclloy pcsltlcns whloh are deslgned tc
address partloular scolal and eocncmlo
lssues.
ln an effcrt tc mcdernlse, prcvlde
effolenoy and lnjeot transparenoy lntc the
land transfer and reglstratlcn prcoess,
the KS^ gcvernment has lnltlated the
masslve and ambltlcus task cf ldentlfylng
all KS^ land (and all prcperty lnterests
ln partloular paroels cf land) and
lnocrpcratlng that lnfcrmatlcn lntc a real
estate reglster fcr eaoh deslgnated realty
area.
The maln beneft cf the new system ls
that lt wlll prcvlde an lnvestment frlendly
envlrcnment wlth teohnloally aoourate
land ldentltles tc faollltate prcperty
deallngs.
lursuant tc lts pcwer tc make seoular
laws, the KS^ gcvernment has lntrcduoed
twc partloularly relevant pleoes cf
leglslatlcn:
- The Fea|ty in Kind Fegistraticn Law,
lssued by Rcyal Deoree Nc. 6 cn
9/21423H, ocrrespcndlng tc 24/2/
2004 (RKR Law).
Thls law redeots the faot that majcr
develcpment ls bcth planned and
under way ln KS^. lt establlshes a
deoentrallsed system cf land reglstratlcn
and transfer whloh redeots the apprcaoh
and methcdclcgy cf slmllar systems
thrcughcut the wcrld. ^fter a speolfed
perlcd cf cbjeotlcn, the reglster wlll
desorlbe eaoh land paroel ln the
deslgnated area, lts lcoatlcn, legal
status, cwnershlp rlghts and cbllgatlcns,
all ln the ocntext cf lndefeaslblllty cf tltle
(ln the absenoe cf a breaoh cf Sharl`ah
prlnolples cr fcrgery). Laoh land paroel
wlll have a unlque serlal number. The
fcous ls cn the ldentlty cf the land paroel,
wlth prcprletary lnterests establlshed by
referenoe tc reglstered deallngs.
There wlll be twc phases tc the rcll cut cf
the new reglstratlcn system:
The Kingdom of Saudi Arabia
An Overview of Real Estate Law
By ^lan Hall
KS^ 0ffoe
lnterest ln the real estate seotcr ln the Klngdcm cf Saudl ^rabla (KS^) has lnoreased slgnlfoantly ln reoent
tlmes. Many lcoal lnvestcrs, CCC and ncnCCC entltles are aotlvely dclng feaslblllty studles, launohlng
lnltlatlves cr expandlng cperatlcns ln KS^ ln crder tc take advantage cf the ollmate cf lnvestment
cppcrtunlty whloh ls ourrently absent frcm many cther ocuntrles.
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First Fegistraticn Phase. The Mlnlstry cf
Munlolpal and Rural ^ffalrs wlll prepare
oadastral maps cf eaoh prcperty ln a
deslgnated area. The Mlnlstry cf 1ustloe
wlll then dcoument the rlghts relatlng
tc eaoh ldentlfed prcperty and that
lnfcrmatlcn wlll be plaoed ln the reglster
aoocrdlng tc the status quc under the
supervlslcn cf a ocmpetent lcoal ocurt
judge. Durlng thls phase, cnly the perscn
wlth the rlght tc dlspcse cf partloular
rlghts wlll be able tc request a ohange tc
reocrded lnfcrmatlcn. lerscns ocnoerned
by the frst reglstratlcn prcoess have
rlghts cf cbjeotlcn wlth speolfed tlme
llmlts.
Subsequent Fegistries Phase, where
deallngs subsequent tc the frst
reglstratlcn wlll be detalled and reocrded
ln the reglster. These deallng lnolude
transfers, varlatlcn cf rlghts, lcng term
leases and mcrtgages. Reglstratlcn fees
wlll apply.
- The System cf Ownership cf Units,
Fstates and their Scrting, lssued by
Rcyal Deoree Nc. 5 cn 11/2/1423H,
ocrrespcndlng tc 24/4/2002.
Thls law redeots the unlversally well
kncwn ocnoept cf strata cwnershlp cf
bulldlngs, that ls, bulldlngs are subdlvlded
lntc lndlvldual unlts. The lndlvldual
cwners are jclntly respcnslble fcr the
malntenanoe and repalrs cf ocmmcn
prcperty aoocrdlng tc thelr shares.
Under the Realty ln Klnd Reglstratlcn
Law, multldat and multldccr prcpertles
wlll be deemed tc be cne realty unlt,
wlth ocmplementary sheets attaohed fcr
the prcprletcrs cf dats and dccrs. The
transfer cf cwnershlp ls stated tc be
oarrled cut ln aoocrdanoe wlth exlstlng
prcoedures.
lt ls thls ocmblnatlcn cf the tradltlcnal
apprcaoh, supplemented by reoent
leglslatlcn suoh as the RKR Law
reocgnlslng ourrent lnternatlcnal best
praotloe, whloh wlll lead tc a transltlcn
perlcd ln whloh there wlll be a dual
system cf land transfer reglstratlcn. The
lmmlnent Law cf the Reglstered Mcrtgage
aokncwledges thls duallty ln ^rtlole (1).
Hcwever, thls dual system has a llmlted
llfe span. ^s the new tltle ldentlfoatlcn
and reglstratlcn system under the RKR
Law ls rclled cut, the areas regulated by
ourrent praotloes wlll reduoe, ultlmately tc
a pclnt where the new tltle ldentlfoatlcn
and reglstratlcn prcoesses have elther
replaoed cr been lnocrpcrated lntc all
areas cf KS^.
Nccne underestlmates the encrmlty
cf the task belng undertaken by the
gcvernment tc brlng all KS^ real estate
under the new reglme. The Mlnlstry cf
1ustloe and the Mlnlstry cf Munlolpal
and Rural ^ffalrs (the twc respcnslble
gcvernment bcdles) lntend tc gradually
enfcroe the new system under the RKR
Law cver the next 20 years, wlth newly
affeoted areas tc be publlshed ln the
cffolal gcvernment gazette. Hcwever,
just as the Lcng Maroh began wlth the
frst step, the system has already been
launohed ln respeot cf 1,600 real estate
unlts the Hcrlymllaa lrcvlnoe and ls
under way.
Acquisition oI land
Unllke many cther jurlsdlotlcns, the
seller cf KS^ real estate ls generally
nct cbllged by law tc dlsolcse any
partloular lnfcrmatlcn ocnoernlng the
land cr bulldlng tc the buyer. Hcwever,
a seller`s fallure tc prcvlde substantlal
lnfcrmatlcn ln relatlcn tc the cwnershlp
and cooupanoy arrangements cf a mcre
ocmplex prcperty wlll lnevltably trlgger a
request fcr further lnfcrmatlcn frcm the
buyer as part cf a due dlllgenoe prcoess.
^part frcm enqulres cf the seller, there ls
cften llttle by way cf prcperty lnvestlgatlcn
whloh oan be oarrled cut by a prcspeotlve
buyer. Currently, there ls llttle ablllty tc
searoh varlcus lcoal gcvernment agenoles
and reocrds fcr real estate lnfcrmatlcn.
Further, cwnershlp cf land, and whether
there are any deallngs affeotlng that land,
oan cnly be ocnfrmed at the stage when
the Nctary lubllo beocmes lnvclved ln
the reglstratlcn prcoess.
^s a ocnsequenoe, buyers generally need
tc rely cn representatlcns and warrantles
glven by the seller as tc cwnershlp cf the
relevant land and the exlstenoe cf thlrd
party lnterests untll the transfer prcoess
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ls ocmpleted befcre the lcoal Nctary
lubllo (Nl).
Tradltlcnally, the aoqulsltlcn cf land and
bulldlngs ln KS^ lnvclves a prlvately
negctlated transaotlcn between the twc
partles, cften lnvclvlng a real estate
agent. The prcoess redeoted a perscnal
prcperty law apprcaoh where tltle deeds
prcve cwnershlp ln the absenoe cf a valld
cbjeotlcn.
Mcst frequently a sale agreement
ls prepared cn behalf cf the seller
whc prcvldes that dcoument tc the
prcspeotlve buyer, pcsslbly tcgether wlth
lnfcrmatlcn regardlng ln the land. The sale
agreement oan be expeoted tc ocntaln
the ocmmerolal terms cf the transaotlcn
and the varlcus rlghts and cbllgatlcns cf
the partles. lt ls cften the oase that the
mcst negctlated prcvlslcns wlll relate
tc the level cf dlsolcsure by the seller
under the agreement and the nature and
extent cf the seller`s representatlcns and
warrantles suppcrtlng that dlsolcsure.
Brledy, ln the past a tradltlcnal aoqulsltlcn
was generally ocmpleted by a number cf
falrly stralght fcrward steps:
- The legal representatlves cf the buyer
and seller appear befcre the lcoal Nl.
The representatlves cf bcth partles
must prcvlde ocples cf any relevant
artloles cf asscolatlcn (cr perscnal
ldentlty papers) tc ocnfrm oapaolty
and the representatlve cf the seller
prcvldes the crlglnal tltle deed.
- The Nl sends the crlglnal tltle deed
tc the reocrds department olerk tc
ensure authentlolty cf the tltle deed.
The Nl reocrds that transaotlcn cn
the reocrd cf Transfer. The partles
then slgn the Reocrd befcre the Nl.
- The lcoal reglstrar ocples detalls cf
the transaotlcn ln the tltle reglster
held by the Nl.
- The Nl lssues a new tltle deed (cr
ln scme oases endcrses the exlstlng
deed) ln the name cf buyer (lnoludlng
the transaotlcn detalls) tc the legal
representatlves cf the buyer.
^s thls prcoess shcws, the Nl played, and
wlll ocntlnue tc play, a plvctal rcle ln the
land transfer prcoess. He ensures that
the partles are fully aware cf thelr rcles
and respcnslbllltles ln the transaotlcn
and that there ls nc ocmmerolal cr
prcoedural mlsunderstandlng.
The pcwers and dutles cf the Nl were
reoently desorlbed ln detall ln the
Fxecutive Fegu|aticns cf Nctaries Pub|ic
Jurisdicticns, lssued by Hls Hlghness the
Mlnlster cf 1ustloe`s Clroular Nc 13/T/
2460 cn 25/5/1425H, ocrrespcndlng tc
13/7/04 (Nl Regulatlcns). lmpcrtantly,
the Nl ls glven the olear and express
pcwer tc oertlfy estate cwnershlp
transfers as well as mcrtgages affeotlng
real estate.
Ncwadays, a streamllned verslcn cf thls
tradltlcnal prcoess generally applles.
Thls mcdern prcoess:
- lnocrpcrates the benefts cf an
lnoreased rcle cf teohnclcgy;
- ^dcpts a mcre scphlstloated
prcoedure;
- Redeots the prcoedures under the
new laws and exeoutlve regulatlcns
and oan be expeoted tc be the basls
fcr future regulatlcns enhanolng the
reglstratlcn prcoess;
but at the same tlme retalns the essenoe
cf the earller prcoedure.
ln the oase cf Rlyadh, thls ocntempcrary
prcoess ls oentred cn the Nctary lubllo
Department (NlD) and ls wcrthy cf
desorlptlcn. Lstabllshed ln 2007, the NlD
cperates and manages what ls effeotlvely
a full servloe eleotrcnlo system fcr the
reglstratlcn cf transfers cf cwnershlp.
The key steps ln the prcoess are:
- The legal representatlves cf bcth
buyer and seller jclntly gc tc the
NlD.
- The NlD prcvldes the representatlves
wlth a transfer ncte whloh ldentlfes
the prcperty and lts reocrded value.
- The representatlves then take the
transfer ncte tc a meetlng wlth an
avallable Nl.
- The representatlves cf bcth partles
present tc the Nl:
(lf thelr party ls a ocmpany), a ocpy
cf the artloles cf asscolatlcn;
(lf thelr party ls an lndlvldual),
perscnal ldentlty papers; and
dcouments evldenolng the
authcrlty cf eaoh representatlve tc
appear befcre the Nl cn behalf cf
the buyer and seller respeotlvely.
- The representatlve cf the seller
prcduoes the crlglnal tltle deed ln
the name cf the seller. The oruolal
rcle cf the crlglnal deeds relevant
tc a transaotlcn ls reocgnlsed ln the
reoent Nl Regulatlcns under whloh
the Nl must depend cn the crlglnal
ocpy cf the deed, and ncthlng else
(^rtlole 13).
- The Nl then revlews and verlfes:
the artloles cf asscolatlcn cf the
partles, tc ensure the oapaolty
cf the partles tc buy and sell the
partloular prcperty;
the crlglnal tltle deed, tc ensure
cwnershlp by the seller;
the authcrltles cf the
representatlves cf the partles;
and
the lnltlal transfer ncte shcwlng
the reocrded value cf the
prcperty.

- 0noe satlsfed that all dcouments
are ln crder, the Nl wlll eleotrcnloally
transfer the transaotlcn lnfcrmatlcn
tc the Reocrds Department.
- The Reocrds Department then:
ocples detalls cf the transaotlcn
lntc the tltle reglster;
prepares a new tltle deed shcwlng
the buyer as the cwner cf the
prcperty and full transaotlcn
detalls; and
eleotrcnloally lnoludes the new
tltle ln the Reocrd Department`s
cf all tltle deeds ln Rlyadh.
- The representatlves then reappear
befcre the Nl whc:
prlnts a ocpy cf the new tltle deed
ln the name cf the buyer;
requlres the legal representatlves,
and twc wltnesses, tc slgn a
standard fcrm sale agreement;
glves the new tltle deed tc the
representatlves cf the buyer;
soans the sale agreement lntc the
reocrds fles; and
retalns the crlglnal sale
agreement.
- The buyer appears befcre the Nl and
slgns a ocnfrmatlcn cf reoelpt cf the
tltle deed.
Thls reglstratlcn system largely redeots
aooepted praotloe thrcughcut the wcrld.
Hcwever, many lnternatlcnal prcperty
authcrltles and real estate stakehclders
wculd be envlcus cf the faot that the
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abcve prcoess usually takes less than
twc days and ls free.
000 and Ioreign ownership oI
real estate in KSA
Key aws
Real estate cwnershlp ln KS^ fcr
ocmpanles and lndlvlduals whloh are
CCC natlcnals as well as fcrelgners ls
malnly ocvered by the fcllcwlng laws and
regulatlcns:
- The Fegu|aticns cf Ownership cf
Fea| Fstate by Naticna|s cf the Cu|f
Cc-cperaticn Ccunci| States. These
regulatlcns prcvlde the ocndltlcns
and restrlotlcns fcr ocmpanles and
lndlvlduals frcm CCC states tc cwn
real estate ln KS^ (CCC Regulatlcns).
- The Law cf Ncn-Saudis Prcprietcrship
and |nvestment cf Fea| Fstate lssued
by the Rcyal Deoree Nc M/15 dated
17/04/1421H ocrrespcndlng tc
20/07/2000C. Thls law establlshed
the ocndltlcns and restrlotlcns cn
real estate cwnershlp by ncnSaudl
lndlvlduals cr ocmpanles (NcnSaudl
lrcprletcrshlp Law);
- Fcreign |nvestment Law lssued by the
Rcyal Deoree Nc 1 dated 5/1/1421H
ocrrespcndlng tc 10/4/2000C. Thls
law deals wlth fcrelgn lnvestment ln
KS^ and the rlghts and cbllgatlcns cf
fcrelgn lnvestcrs (FlL).
lt ls alsc lmpcrtant tc ncte that there ls
strlot antlharbcurlng leglslatlcn ln plaoe ln
the fcrm cf the ^ntl Ccmmerolal Ccverlng
up Law (^ntlharbcurlng Law) lssued
by Rcyal Deoree Nc M/22 dated 4/5/
1425H, ocrrespcndlng tc 22/6/2004C.
^rtlole 1 cf that Law prchlblts a ncnSaudl
frcm lnvestlng cr praotlolng, fcr hls cwn
perscnal aoocunt cr ln ocllabcratlcn wlth
cthers, any aotlvlty that the FlL cr cther
related laws and lnstruotlcns dc nct allcw
hlm tc dc. Mcrecver, any Saudl oltlzen
whc enables lnapprcprlate lnvestment
cr praotloe ls ocnsldered tc be a ocverlng
up (harbcurlng) aoocmplloe. Severe
penaltles, lnoludlng lmprlscnment, apply.
GCC ownershp
By vlrtue cf the CCC Regulatlcns, CCC
entltles (bcth ocmpanles and lndlvlduals)
are allcwed tc cwn real estate ln KS^,
subjeot tc the restrlotlcns and ocndltlcns
mentlcned belcw.
ln the oase cf a CCC ocmpany whclly
cwned by CCC natlcnals:
- the prcperty must be allcoated fcr
the needs cf the lloensed buslness
aotlvlty ln KS^;
- the slze cf the prcperty must
be apprcprlate fcr the needs cf
the lloensed buslness aotlvlty,
as determlned by the ocmpetent
authcrlty;
- the prcperty shall nct be scld unless
the ocmpany has oeased tc ocnduot
the lloensed buslness aotlvlty cn the
prcperty, the ocmpany has relcoated
cr the lssued buslness lloense
permlts the sale cf prcperty (ln the
oase cf real estate develcpment);
and
- the prcperty must nct be sltuated
wlthln the vlolnlty cf Meooa and ^l
Madlna ^l Munawara.
^ CCC ocmpany partly cwned by ncn
CCC natlcnals (cther than a CCC publlo
ocmpany) wculd be treated as a fcrelgn
ocmpany and therefcre the restrlotlcns
mentlcned belcw wculd be applloable
and a fcrelgn lnvestment lloense wculd
be requlred frcm the Saudl ^rablan
Ceneral lnvestment ^uthcrlty (S^Cl^).
Thls applles lrrespeotlve cf whether the
fcrelgn cwnershlp ls a mlncrlty cr majcrlty
lnterest.
^n lndlvldual whc ls a CCC natlcnal:
- ls nct allcwed tc cwn mcre than
three pleoes cf prcperty (unless
sc authcrlsed by the ocmpetent
authcrlty) and the ocmblned area
must nct exoeed 3,000 square
meters;
- ls allcwed tc cwn prcperty cnly fcr
resldentlal purpcses fcr hlmself cr
hls famlly cnly;
- must, where the prcperty ls
undevelcped land, ocmplete the
ocnstruotlcn cf lmprcvements
wlthln slx years frcm the date cf
reglstratlcn cf the land cwnershlp ln
hls name; ctherwlse the gcvernment
may ocnfsoate the prcperty (and
ocmpensate the cwner fcr an amcunt
equal tc the lesser cf the lnltlal
purohase cr sale prloe) cr extend the
perlcd cf slx years lf satlsfed wlth the
reascns fcr the ocnstruotlcn delay;
- shall nct transfer cwnershlp cf the
prcperty befcre the explratlcn cf
fcur years frcm beocmlng reglstered
cwner, unless sc authcrlsed by the
ocmpetent authcrlty ; and
- and ls naturallsed, may be the subjeot
cf a stlpulatlcn by the ocmpetent
authcrlty that at least fve years
shculd elapse befcre he has the rlght
tc cwn prcperty.
ln addltlcn, lf the CCC natlcnal ls lloensed
tc undertake a prcfesslcn cr buslness ln
KS^ by the ocmpetent authcrlty, then
all the restrlotlcns mentlcned abcve ln
relatlcn tc CCC ocmpanles wculd apply.
Foregn ownershp
The lnvestment laws ocmblne tc
ocnfer a number cf benefts, lnoentlves
and guarantees cn lloensed fcrelgn
lnvestment prcjeots ln crder tc prcmcte a
mcre level playlng feld wlth whclly Saudl/
CCC entltles.

0ne cf the key reolplents cf these
benefts are fcrelgn lnvestment prcjeots
whloh oan be (cr need tc be) enhanoed
by the cwnershlp cf the real estate
asscolated wlth the partloular lnvestcr`s
lloensed aotlvltles.
Hcwever, whllst that may ocnstltute a
beneft, lt ls alsc a restrlotlcn ln that
fcrelgn cwnershlp cf KS^ real estate
must be llnked tc a partloular prcjeot and
ls nct a general rlght.
The NcnSaudl lrcprletcrshlp Law
entltles fcrelgn lnvestcrs tc cwn real
estate ln KS^ whloh ls requlred fcr:
- the ocnduot cf thelr prcfesslcnal,
teohnloal cr eocncmlo aotlvltles;

- prlvate resldenoes fcr hcuslng cf a
lloensed prcjeot`s emplcyees; cr
- resldentlal use by lndlvlduals wlth
ncrmal legal resldenoy status.
^s ncted abcve, even the smallest
mlncrlty lnterest held by a ncnCCC
natlcnal wlll be suffolent tc make a
ocrpcrate entlty fcrelgn, requlrlng a
fcrelgn lnvestment lloense frcm S^Cl^.
lf that lloense permlts prcperty
develcpment, then the tctal ocst cf
the prcjeot (bcth land purohase and
ocnstruotlcn ocst) must be:
- at least SR 30 mllllcn; and
- lnvested wlthln fve years frcm the
date cf purohase cf the land.
^t thls stage, lnstead cf deslgnatlng
areas fcr pcsslble fcrelgn cwnershlp ln
the nature cf free zcne jurlsdlotlcns, KS^
has left the lloenslng cf slte aoqulsltlcns
tc the dlsoretlcn cf S^Cl^ and slmply
stlpulated twc areas where there ls a
prchlbltlcn cr fcrelgners aoqulrlng real
estate, namely land wlthln the olty llmlts
cf Meooa and ^l Madlna ^l Munawara.
Hcwever, fcrelgn Musllms may rent
prcperty ln these twc areas fcr renewable
terms cf nct mcre than twc years.
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0verview oI investment Iund
regulation
The Capltal Market ^uthcrlty (CM^) ls
respcnslble fcr cverseelng the regulatlcn
cf lnvestment funds.
The fcllcwlng are the prlnolpal laws
gcvernlng lnvestment funds:
- Capltal Market Law lssued by Rcyal
Deoree ln 2003 (CML);
- lnvestment Funds Regulatlcns lssued
by Rcyal Deoree ln 2006 (lFR);
- ^uthcrlsed lerscns Regulatlcns
lssued by Rcyal Deoree ln 2005
(^lR); and
- Seourltles Buslness Regulatlcns
lssued by Rcyal Deoree ln 2005
(SBR).
The abcve laws need tc be read tcgether
ln crder tc have a better understandlng cf
the regulatcry framewcrk fund managers
must wcrk wlthln. Speolfoally, the
lnvestment Fund Regulatlcns regulate the
establlshment, cfferlng and management
cf lnvestment funds and asscolated
aotlvltles ln the Klngdcm cf Saudl ^rabla
(KS^).
Investment Funds in the Kingdom of
Saudi Arabia
By Clenn Lcvell
KS^ 0f floe
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Establishment oI a Iund
^n lnvestment fund ls a oclleotlve
lnvestment soheme almed at prcvldlng
lnvestcrs wlth an cppcrtunlty tc
partlolpate oclleotlvely ln the prcfts cf
the soheme whloh ls managed by a fund
manager fcr speolfed fees.
^ fund manager must be an ^uthcrlsed
lerscn
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ln aoocrdanoe wlth the ^lR and
duly lloensed by the CM^ tc manage
lnvestment funds. Tc beocme an
^uthcrlsed lerscn an applloatlcn must
be made tc the CM^. Laoh applloatlcn
must be aoocmpanled by the detalled
requlrements speolfed ln the ^lR.
0ategories oI oIIers oI units
0fferlng cf unlts oan be made by elther
a publlo cffer cr prlvate plaoement. Bcth
types cf cffers oan cnly be made by a
fund manager.
^ fund manager must be an ^uthcrlsed
lerscn belng duly authcrlsed tc oarry cn
managlng aotlvltles under the ^lR and
ls respcnslble fcr the admlnlstratlcn,
oustcdy and management cf the assets
cf an lnvestment fund. Unlts are defned
as belng the lnterests cf unlthclders ln
an lnvestment fund ocnslstlng cf unlts.
Pr|vate P|acements
^n cffer cf unlts ln an lnvestment fund
ls a prlvate plaoement lf the amcunt
payable by eaoh perscn tc whcm the cffer
ls made ls nct less than S^R cne mllllcn
and the perscn must fall wlthln cne cf the
oategcrles stlpulated ln the lFR.
The CM^ must be advlsed cf an lntentlcn tc
cffer unlts ln an lnvestment fund thrcugh
prlvate plaoement. Thls nctlfoatlcn must
be ln wrltlng and submltted at least 15
days prlcr tc the prcpcsed date cf the
cffer. lnoluded ln the nctlfoatlcn must
be a lrlvate llaoement Memcrandum
(llM) cr cther cfferlng dcouments
used ln ocnneotlcn wlth the cffer.
^t the tlme cf submlttlng the nctlfoatlcn
the fund manager must alsc pay the
presorlbed fees. The llM must be
apprcved by the CM^ befcre the cfferlng
cf unlts oan take plaoe.
Pub||c 0ffer
^n cffer cf unlts ln an lnvestment fund
ls a publlo cffer lf lt dces nct fall wlthln
cne cf the stated oategcrles fcr a prlvate
plaoement.
0nly an ^uthcrlsed lerscn oan make
applloatlcn tc the CM^ fcr a publlo cffer
cf unlts. The applloatlcn must state all
matters relevant tc the lnvestment fund
and alsc lnolude detalls cf the fund
manager`s crganlsatlcn alcng wlth the
ocmpllanoe and admlnlstratlve systems
used.
^t the tlme cf submlttlng the applloatlcn
the fund manager must alsc pay the
presorlbed fees. The publlo cffer must be
apprcved by the CM^ befcre the cfferlng
cf unlts oan take plaoe.
0eneral obligations on Iund
managers
The lFR ocntalns general prcvlslcns that:
- lmpcse dlsolcsure and repcrtlng
cbllgatlcns cn fund managers;
- ocver the management cf the
lnvestment fund; and
- stlpulate gcvernanoe requlrements cf
the fund manager.
Foreign investment Iunds
lnvestment funds establlshed ln KS^
may be apprcved by the CM^ tc cperate
as an lnternatlcnal fund. ln suoh oases
fund managers shculd be aware cf thelr
addltlcnal respcnslbllltles under the lFR.
0verseas investment Iunds
Lssentlally the lFR regulates lnvestment
funds establlshed ln KS^ and managed
by a fund manager. Hcwever, when
apprcvlng the marketlng cf an cverseas
fund ln KS^, lt ls llkely that the CM^ wlll
requlre that the safeguards ocntalned
ln the lFR be lnocrpcrated tc ensure
lnvestcr prcteotlcn.
^ny unlts ln a fcrelgn lnvestment fund
shculd be marketed cr advertlsed ln
KS^ vla an ^uthcrlsed lerscn, unless
suoh aotlvlty ls ocvered by any cf the
exemptlcns ln the SBR cr the lFR.
There wlll need tc be a lcoal manager whc
ls an ^uthcrlsed lerscn. Management
funotlcns oan be cutscuroed tc an entlty
cutslde cf KS^ but a resldent manager ls
stlll requlred.
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^ perscn authcrlsed by the CM^ tc oarry cn a seourltles buslness.
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ln 2001 a deolslcn cf the Ccunoll
cf Mlnlsters allcoated the Supreme
Locncmlo Ccunoll (Ccunoll) wlth the
fcllcwlng respcnslbllltles:
- Determlnlng whloh gcvernmental
aotlvltles shculd be prlvatlsed;
- Develcpment cf a strateglo plan and
tlmetable fcr prlvatlsatlcn;
- Supervlslcn cf the prlvatlsatlcn
prcgramme;
- Mcnltcrlng the lmplementatlcn cf
prlvatlsatlcn; and
- Ccllabcratlng wlth the relevant
gcvernment agenoles.
Ccmpcsltlcn cf the Ccunoll lnoludes
the Klng cf Saudl ^rabla, the Mlnlster
cf water and Lleotrlolty, the Mlnlster
cf Locncmy and llannlng and cther
prcmlnent mlnlsters.
Under the ausploes cf the Ccunoll a
lrlvatlsatlcn Ccmmlttee has ncw been
establlshed tc oarry cut day tc day
funotlcns and tasks neoessary fcr the
Ccunoll tc aohleve lts respcnslbllltles
and exerolse lts dutles ln relatlcn tc
prlvatlsatlcn. The Ccunoll has defned
prlvatlsatlcn as fcllcws:
Privatisaticn is the prccess cf
transferring the cwnership cr
management cf pub|ic enterprises,
prcjects, and services tc the private
sectcr, re|ying cn market mechanisms
and ccmpetiticn, thrcugh a number
cf methcds inc|uding ccntracts
fcr managing, cperating, |easing,
fnancing, cr se||ing a|| cr part cf the
gcvernment's assets tc the private
sectcr."
Regulatory Framework oI
Privatisation
The Ccunoll deolared ln lts strateglo plan
that they wlll be develcplng a separate
and unlque regulatcry framewcrk fcr
eaoh cf the prlvatlsed seotcrs. Thls wlll
be partloularly applloable ln seotcrs
where cne entlty enjcys rlghts that may
enable lt tc have a mcncpcly ln the
market cr ocntrcl a large pcrtlcn cf lt.
^ gccd example cf thls oan be seen ln
the eleotrlolty market where mcst reglcns
Privatisation Of State Owned Assets in the
Kingdom of Saudi Arabia
By Fahad ^l Malkl
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The Klngdcm cf Saudl ^rabla (KS^) dces nct have a slngle law regulatlng the prlvatlsatlcn cf state cwned
assets. Hcwever, ln 1997 the Ccunoll cf Mlnlsters speolfed elght key cbjeotlves cf prlvatlsatlcn and
determlned the prlnolples tc be taken lntc aoocunt tc aohleve these cbjeotlves. The drlve fcr prlvatlsatlcn ls
based cn the ratlcnale that greater partlolpatlcn and effolenoy wlll develcp frcm ensurlng the prlvate seotcr
has an lnoreased share ln state cwned assets.
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are servloed by a slngle prcvlder whclly
cwned by the gcvernment.
The Ccunoll has reocmmended varlcus
prcpcsals tc crganlse and supervlse
the prlvatlsed seotcrs.The mcst
suooessful and mcst ocmmcnly adcpted
reocmmendatlcn ls tc set up a separate
regulatcry agenoy fcr eaoh servloe ln a
partloular seotcr.
^n example cf twc supervlscry authcrltles
that have been establlshed are:
- The Ccmmunloatlcn and lnfcrmatlcn
Teohnclcgy Ccmmlsslcn (respcnslble
fcr the teleocmmunloatlcns and
lnfcrmatlcn teohnclcgy lndustry); and
- The Lleotrlolty and CcCeneratlcn
Regulatcry ^uthcrlty (respcnslble
fcr regulatlng the ocgeneratlcn cf
eleotrlolty, desallnated water and
steam).
Seotcrs tc be lrlvatlsed:
ln 2002 the Ccunoll lssued a strateglo
plan fcr prlvatlslng the fcllcwlng
gcvernment servloes:
- water and sewerage thrcugh the
Natlcnal water Ccmpany.
- Sallne water ocnverslcn (desallnatlcn)
thrcugh the Saudl water Ccnverslcn
Cccperatlcn.
- Teleocmmunloatlcns thrcugh selllng
the Ccvernment`s shares ln the Saudl
Teleocmmunloatlcn Ccmpany.
- ^vlatlcn and alrpcrt servloes by
prlvatlslng the Ccvernmentcwned
Saudl ^rablan ^lrllnes and alrpcrts
ln KS^, espeolally lnternatlcnal
termlnals.
- Rallrcads.
- Rcads:
Managlng, cperatlng, and maln
tenanoe cf exlstlng hlghways.
Bulldlng and cperatlng new
hlghways.
- lcstal servloes.
- Craln sllcs and dcur mllls.
- Seapcrt servloes.
- lndustrlal oltles servloes.
- Ccvernment shares ln ocrpcratlcns,
lnoludlng Saudl Lleotrlolty Ccmpany,
banks, Saudl Baslo lndustrles
Ccrpcratlcn, Saudl ^rablan Mlnlng
Ccmpany (Ma`aden), Saudl
Teleocmmunloatlcns Ccmpany, and
gcvernment shares ln dcmestlo cll
refnerles.
- Ccvernment shares ln jclnt
lnvestment ocmpanles wlth ^rab and
lslamlo ocuntrles.
- Ccvernment cwned hctels.
- Spcrts olubs.
- Munlolpallty servloes suoh as:
Bulldlng and cperatlng
slaughterhcuses.
Bulldlng and cperatlng publlo
markets and shcpplng oenters.
Bulldlng, cperatlng, and
malntalnlng publlo parks.
lubllo transpcrtatlcn and revenue
oclleotlcn.
Cleanlng and waste management
servloes.
- Lduoatlcnal servloes suoh as:
Bulldlng and malntalnlng
eduoatlcnal bulldlngs.
lrlntlng cf eduoatlcnal bccks.
Sohccl transpcrtatlcn thrcugh
a gcvernmentcwned ocmpany
respcnslble fcr sohccl
transpcrtatlcn.
Student hcuslng.
Rentlng and cperatlng publlo
sohccl and unlverslty faollltles.
- Scolal servloes suoh as:
Managlng and cperatlng scolal
welfare lnstltutlcns.
Reorultment servloes fcr Saudl
natlcnals ln the prlvate seotcr.
- ^grloulture servloes suoh as health
lsclatlcn sltes, veterlnary servloes,
dlagncstlo labcratcrles and ollnlos.
- Medloal servloes suoh as:
Bulldlng and cperatlng medloal
faollltles.
latlent transpcrtatlcn servloes.
Regulatory regime Ior
Electricity and Water
ln reoent years the eleotrlolty and water
seotcrs have undergcne slgnlfoant
recrganlsatlcn and ncw ocme under the
amblt cf the new Mlnlstry cf water and
Lleotrlolty.
The Lleotrlolty and CcCeneratlcn
Regulatcry ^uthcrlty (LCR^) has been
lntrcduoed tc aot as a regulatcr cf the
eleotrlolty seotcr (lnoludlng ocgeneratlcn
cf water) and has been tasked tc
faollltate a ocmpetltlve market fcr the
extra supply cf eleotrlolty. LCR^ has
respcnslblllty fcr ocgeneratlcn prcduots
cf eleotrlolty, desallnated water and
steam. The Mlnlstry has retalned a
regulatcry funotlcn fcr the remalnder cf
the water seotcr.
The Lleotrlolty Law, lssued by Rcyal
Deoree ln 2005, prcvldes the framewcrk
under whloh the Mlnlstry and LCR^ must
oarry cut thelr aotlvltles. Thls law sets
cut the general alms cf the eleotrlolty
seotcr restruoturlng and prcvldes the
Mlnlstry wlth authcrlty tc fcrmulate
pclloles, develcp plans and prcgrammes
relatlng tc the eleotrlolty seotcr.
The Lleotrlolty Law prcvldes fcr the
funotlcns cf LCR^ that lnolude the
enfcroement cf the Lleotrlolty Law and
lloenslng cf eleotrlolty related aotlvltles.
LCR^ ls alsc empcwered tc revlew tarlffs
and ln ocnjunotlcn wlth the Mlnlstry
prcmcte ocmpetltlcn leadlng tc an
eleotrlolty market.
Steps in the Privatisation
Process
The baslo steps fcr the Saudladcpted
mcdel cf prlvatlsatlcn cf a publlo prcjeot
cr enterprlse are as fcllcws:
- The relevant gcvernment agenoy,
under the dlreotlcn cf the lrlvatlsatlcn
Ccmmlttee, oarrles cut the fcllcwlng:
Ccnduots a study cn the fnanolal
and cperatlcnal pcsltlcns cf the
entlty and any subsldlary seotcrs;
lrcvldes justlfoatlcns fcr
prlvatlsatlcn;
Detalls returns;
States any alternatlves and
cbstaoles; and
lrcvldes a feaslblllty study and
analysls.
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The relevant agenoy then submlts
the results cf thcse studles and lts
reocmmendatlcns tc the lrlvatlsatlcn
Ccmmlttee.
- The lrlvatlsatlcn Ccmmlttee makes
lts reocmmendatlcn tc the Ccunoll.
- lf a deolslcn tc prlvatlse the aotlvlty
ls lssued, the gcvernment agenoy
respcnslble fcr supervlslng thls
aotlvlty prepares an lmplementatlcn
prcgram fcr prlvatlsatlcn, based
cn the prcpcsed studles. ^fter the
Ccunoll apprcves lt, the prcoedures
and measures requlred tc ocmplete
the prlvatlsatlcn prcoedure are
lmplemented.
- The relevant gcvernment agenoy,
under the supervlslcn cf the
lrlvatlsatlcn Ccmmlttee, manages
the prcgramme fcr prlvatlsatlcn ln
occperatlcn wlth cther gcvernment
agenoles. Fcr example, fcr the
eleotrlolty seotcr there ls the Mlnlstry
cf water and Lleotrlolty and Lleotrlolty
and CcCeneratlcn ^uthcrlty.
Methods oI Privatisation
There are varlcus methcds cf
lmplementlng prlvatlsatlcn. They
may lnolude a transfer cf cwnershlp,
ocntraotlng cut cf management cper
atlcns, leaslng, llls, sale vla publlo
subsorlptlcn cr sale tc a prlnolpal
lnvestcr.
The ocrreot methcd and extent cf
prlvatlsatlcn ls oarefully ocnsldered
befcre ocmmenolng any lmplementatlcn
prcoess. 0ften a ocmblnatlcn cf methcds
are used tc maxlmlse the ohanoes cf a
suooessful transltlcn.
ln KS^ there are varlcus methcds cf
prlvatlsatlcn. Laoh methcd ls adcpted
based cn the ocmpetltlveness cf the
seotcr, the preparatlcn cf the market,
the wllllngness cf the tender, and cther
faotcrs. Ccmmcn methcds cf prlvatlsatlcn
ln KS^ are as fcllcws:
1ransIer oI ownership
Transfer cf cwnershlp oan coour thrcugh
elther a sale tc the prlvate seotcr vla
publlo subsorlptlcn cr tc a prlnolpal
lnvestcr.
Llther the entlre entlty cr scme cf lts
shares are scld tc the prlvate seotcr
by prlvate treaty cr by cfferlng them fcr
publlo subsorlptlcn. Thls has already
coourred wlth the part share sales cf The
Saudl Baslo lndustrles Ccmpany and the
Saudl Teleocmmunloatlcn Ccmpany.
Management contracts
Thls methcd ls usually used when the
gcvernment has substantlal lnvestments
and assets ln a prcjeot whloh lt dces nct
wlsh tc ocnvey tc the prlvate seotcr and
a hlgh level cf expertlse ln management,
cperatlcn and marketlng ls requlred. The
ocntraotcr wlll take cver a mcnltcrlng
rcle and be respcnslble fcr the day tc
day cperatlcns. The ocntraotcr wlll nct
assume the ocmmerolal rlsk (lcsses)
whloh remaln wlth the gcvernment.
Thls apprcaoh has been adcpted by the
gcvernment ln prlvatlslng the water seotcr
where management rlghts have been
scld tc lnternatlcnal lnstltutlcns repcrtlng
tc the newly establlshed Natlcnal Saudl
water Ccmpany.
Leasing contracts
ln thls type cf prlvatlsatlcn methcd a
gcvernment entlty leases assets and/cr
faollltles tc a prlvate seotcr lnvestcr at an
agreed rate fcr an agreed perlcd.
ln thls arrangement the gcvernment
malntalns cwnershlp cf the assets. The
terms cf the lease are oarefully ocnsldered
and speolfed ln a ocmprehenslve
ocntraot. There ls lnoentlve fcr the prlvate
lnvestcr tc malntaln the assets ln gccd
ocndltlcn as the lnvestcr assumes all
ocmmerolal rlsks asscolated wlth the
venture and cn explratlcn cf the leaslng
term assets must be returned ln gccd
ocndltlcn. ln addltlcn, the lnvestcr ls
usually respcnslble fcr the emplcyment
cf staff and related matters.
^ leaslng ocntraot was the methcd used
ln the pcrts lndustry when the Saudl
lcrts ^uthcrlty prlvatlsed 27 pcrts and
related servloes.
Build 0wn 0perate 1ransIer
(B001") and Private Public
Partnerships (PPP")
ln thls fcrm cf prlvatlsatlcn the lnvestcr
ls respcnslble fcr managlng the
oapltal, cperatlcns and expendltures.
lmplementatlcn cf thls arrangement ls
mcre ocmplloated as there are large
amcunts cf fnanolng lnvclved and the
slze cf the prcjeots ls ocnslderable.
^n example cf prcpcsed gcvernment
expendltures ln KS^ oan be seen
wlth reoent anncunoements where
the gcvernment has stated that lt
wlll be lnvestlng USD 400 bllllcn cn
lnfrastruoture and USD 32 bllllcn ln the
eleotrlolty seotcr. whlle there are several
fcrms cf fnanolng ocntraots the twc mcst
pcpular ln KS^ are B00T and lll. Thls
ls the ocmmcn methcd ln KS^ fcr pcwer,
water and desallnatlcn plants.
Under a B00T arrangement the prlvate
seotcr lnvestcr ls glven a ocnoesslcn
tc fnanoe, bulld, cwn, and cperate the
gcvernment enterprlse. ^t the end cf
the ocnoesslcn lt transfers the entlre
cperatlcn and assets tc the gcvernment.
lll ocntraots are partnershlps between
the gcvernment and prlvate seotcr
lnvestcrs. Thls methcd ls the mcst
ocmmcn ln KS^, espeolally ln the
water and eleotrlolty lndustrles. lt has
already been used fcr the Sallne water
Ccnverslcn Ccrpcratlcn (SwCC). The
SwCC was fcrmerly kncw as the Sallne
water Ccnverslcn ^uthcrlty and has
respcnslblllty fcr slx desallnatlcn plants
establlshed thrcugh llls.
The Mlnlstry cf water and Lleotrlolty
anncunoed that fcr prlvatlslng the water
seotcr they wlll adcpt the lll mcdel (alsc
referred tc as l3). ^oocrdlng tc press
releases frcm the Mlnlstry, thls ls the
preferable apprcaoh fcllcwlng analysls cf
the varlcus methcds cf prlvatlsatlcn.
Under eaoh lll the Saudl gcvernment
may cffer tax deduotlcns cr guaranteed
annual revenues fcr exlstlng prcjeots.
The gcvernment may alsc partlolpate ln
the prcjeots ln klnd cr thrcugh grants cr
subsldles.
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Business Structures
in the Kingdom of Saudi Arabia
By Clenn Lcvell
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The prlnolpal leglslatlcn gcvernlng the
fcrmatlcn and gcvernanoe cf ocmpanles
ln the Klngdcm cf Saudl ^rabla (KS^)
ls the Ccmpanles Law lssued by
Rcyal Deoree Nc.6, 1965. whlle nc
regulatlcns have been lssued ln relatlcn
tc the Ccmpanles Law there have been
a number cf amendments made vla
Rcyal Deorees. ln addltlcn, the passlng
cf cther mcre speolfo laws supplement
the regulatcry framewcrk that a ocmpany
must cperate under.
The Ccmpanles Law states that the
fcllcwlng ocmpanles may be fcrmed:
- Ceneral lartnershlps (jclnt llablllty
ocmpanles);
- Llmlted lartnershlps (partnershlp ln
ocmmendum ocmpanles);
- lartnershlp ocmpanles;
- 1clnt Stcok ocmpanles;
- lartnershlps llmlted by shares (stcok
ocmmandlte ocmpanles);
- Llmlted Llablllty Ccmpanles;
- varlable oapltal ocmpanles; and
- Cccperatlve ocmpanles.
wlth the lntrcduotlcn cf the Fcrelgn
lnvestment Law ln 2000 fcrelgners
(cther than KS^ cr CCC natlcnals) may
ncw reglster an lnvestment vehlole ln
KS^ prcvlded a lloense ls cbtalned frcm
the Saudl ^rabla Ceneral lnvestment
^uthcrlty (S^Cl^).
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0eneral Partnerships (1oint
Liability 0ompanies)
^ general partnershlp has twc cr mcre
partners whc are jclntly llable fcr the
partnershlp debts. The name cf the
partnershlp must be asscolated tc cne cr
mcre cf the partners and ocupled wlth the
buslness aotlvltles cf the partnershlp.
Unless ctherwlse prcvlded fcr ln the
artloles cf asscolatlcn, a partner oannct
transfer cr rellnqulsh thelr shares wlthcut
the apprcval cf the cther partners. There
are alsc restrlotlcns cn partners belng
lnvclved ln any cther aotlvltles slmllar
tc that cf the partnershlp. ^ppclnted
managers may be cne cf the partners
and the artloles cf asscolatlcn shculd
stlpulate what funotlcns are permltted
beycnd what ls rcutlne partnershlp
management.
Unless stated dlfferently ln the artloles
cf asscolatlcn, a general partnershlp ls
termlnated lf cne cf the partners:
- Dles;
- ls prchlblted frcm aotlng as a
partner;
- ls deolared bankrupt cr lnsclvent;
- wlthdraws frcm the partnershlp
lndefnltely.
The lcsses, prcfts and shares cf the
partners are determlned at the end cf the
fnanolal year and based cn the prcft and
lcss aoocunt cf the partnershlp.
Limited Partnerships
(partnership in commendum
companies)
^ llmlted partnershlp ls made up cf twc
grcups cf partners. 0ne grcup must have
at least cne aotlng partner perscnally
llable fcr the partnershlp debts. The
cther grcup must have at least cne
sllent partner llable fcr partnershlp debts
llmlted, and prcpcrtlcnal tc, that partner`s
share cf oapltal ln the partnershlp.
The name cf the partnershlp ls tc be
ocmpcsed cf cne cf the names cf
the aotlng partner(s) ocupled wlth the
aotlvltles cf the partnershlp.
The sllent partner oannct lntervene
ln external management funotlcns
and partlolpatlcn ls llmlted tc lnternal
management as stlpulated ln the artloles
cf asscolatlcn. Fallure tc cbserve thls
wculd mean the sllent partner`s llablllty
ls nc lcnger llmlted tc thelr share cf
oapltal and they beocme perscnally llable
fcr partnershlp debts.
Partnership 0ompanies
^ partnershlp ocmpany ls a prlvate
arrangement and dces nct have the bcdy
ocrpcrate perscnallty llke many cther
ocmpanles. lt oannct lssue shares and
the cperatlng requlrements are slmllar tc
that cf a general partnershlp.
The artloles cf asscolatlcn must speolfy
lts purpcse, the partner`s rlghts and
cbllgatlcns and hcw prcfts and lcsses
are dlstrlbuted.
1oint Stock 0ompanies
There are twc types cf jclnt stcok
ocmpanles under the Ccmpanles Law.
There ls the publlo ocmpany (scmetlmes
oalled an cpen jclnt stcok ocmpany)
cr the prlvate ocmpany (scmetlmes
oalled a olcsed jclnt stcok ocmpany).
The wcrds cpen and olcsed refer tc the
ocmpany`s ablllty tc cffer lts shares fcr
publlo subsorlptlcn.
The oapltal cf a publlo jclnt stcok ocmpany
must nct be less than Saudl Rlyals (S^R)
10 mllllcn whlle the oapltal cf a prlvate
jclnt stcok ocmpany must nct be less
than S^R twc mllllcn. The value cf eaoh
share ls tc be nct less than S^R 50.
lf the fcunders cf a publlo ocmpany
are nct entlrely underwrltlng the share
lssue themselves then a publlo cffer fcr
subsorlptlcn must be made wlthln the
tlmeframe and manner stlpulated ln the
Ccmpanles Law.
The mlnlmum number cf partners ln a jclnt
stcok ocmpany ls fve wlth eaoh partner
havlng a llmlted llablllty equal tc that
cf thelr share ocntrlbutlcn. There ls nc
maxlmum number cf partners. Cenerally
the ocmpany name must nct lnocrpcrate
the name cf a natural perscn.
Tc avcld delay ln fcrmatlcn cf the ocmpany
the artloles cf asscolatlcn are requlred tc
fcllcw the mcdel lssued by the Mlnlstry
cf Ccmmeroe and lndustry. Changes tc
the mcdel artloles may cnly be made
fcr reascns aooeptable tc the Mlnlster.
^t the tlme cf applylng fcr reglstratlcn cf
the ocmpany a detalled feaslblllty study
ls requlred that cutllnes the prcjeoted
vlablllty cf the ocmpany.
The ocmpany ls admlnlstered by a
bcard cf dlreotcrs ocnslstlng cf at least
three perscns. Laoh dlreotcr must cwn
ocmpany shares cf nct less than S^R
10,000 and these shares must be
depcslted and held wlth an apprcved
bank fcr the mlnlmum hcldlng perlcd
speolfed ln the Ccmpanles Law.
^lthcugh the bcard cf dlreotcrs has very
brcad pcwers tc manage the ocmpany,
they wlll be held jclntly llable fcr damages
emanatlng frcm thelr mlsmanagement cf
ocmpany. Scme dlreotcr remuneratlcn
amcunts are regulated (fcr example,
payments are llnked tc a peroentage cf
ocmpany prcfts).
Laoh year the ocmpany must set aslde
10 cf lts annual net prcfts as a
statutcry reserve untll 50 cf lts oapltal
ls reaohed. lf ocmpany lcsses amcunt tc
75 cf the ocmpany oapltal the bcard cf
dlreotcrs must ocnvene an extracrdlnary
meetlng tc ocnslder future ocntlnuatlcn
cr dlssclutlcn cf ocmpany.
1clnt Stcok Ccmpanles have regulated
prcoedural and fnanolal repcrtlng
requlrements tc bcth sharehclders and
the gcvernment regulatcr. The measure
cf gcvernment supervlslcn ls greater fcr
a publlo jclnt stcok ocmpany.
The fcllcwlng jclnt stcok ocmpanles
oannct be establlshed wlthcut frst
reoelvlng a lloense lssued by Rcyal
Deoree:
- ^ franohlsed ocmpany;
- ^ ocmpany managlng a publlo utlllty;
- ^ ocmpany subsldlsed by the state;
- ^ ocmpany ln whloh the state cr
cther publlo ocrpcrate bcdles are
partlolpatlng ln;
- lnsuranoe ocmpanles; and
- ^ ocmpany that praotloes banklng
funotlcns.
Partnership Limited by
Shares (stock commandite
companies)
^ partnershlp llmlted by shares ls made
up cf twc grcups. 0ne grcup must lnolude
an aotlng partner whc ls perscnally llable
fcr the partnershlp debts. The cther grcup
must lnolude at least fcur sharehclder
partners whc are llable fcr partnershlp
debts tc the extent cf thelr prcpcrtlcnate
share oapltal.
The oapltal cf the partnershlp must nct
be less than S^R cne mllllcn ln equal
shares wlth eaoh share havlng a value
cf nct less than S^R 50. The same
management prcvlslcns exlst as fcr the
general partnershlps.
Fcllcwlng lnocrpcratlcn cf the partnershlp
a sharehclder general assembly must
appclnt a ocntrcl ocunoll ocmprlslng at
least three sharehclders. The ocntrcl
ocunoll must mcnltcr partnershlp
buslness and express lts cplnlcns
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cn lssues presented by the general
manager.
Unless stated dlfferently ln the artloles
cf asscolatlcn, a partnershlp llmlted
by shares ls termlnated lf cne cf the
partners:
- Dles;
- ls prchlblted frcm aotlng as a
partner;
- ls deolared bankrupt cr lnsclvent;
- wlthdraws frcm the partnershlp
lndefnltely.
Limited Liability 0ompanies
^ llmlted llablllty ocmpany must have
between twc and 50 partners whc are
llable fcr ocmpany debts tc the extent
cf thelr sharehcldlng. The shares are nct
publloly tradable. The mlnlmum oapltal
amcunt cf S^R 500,000 ls dlvlded lntc
shares cf equal value. where a fcrelgn
lnvestcr (cther than KS^ cr CCC natlcnals)
ls lnvclved there ls nc mlnlmum level
cf oapltal as the amcunt ls set by the
apprcprlate lloenslng authcrltles.
Thls type cf ocmpany oannct ocnduot
buslness that ls cf an lnsuranoe, savlngs
cr banklng nature. Ccmpany artloles cf
asscolatlcn are requlred that must be
slgned by all the partners. The ocmpany
oapltal must be depcslted ln an apprcved
bank prlcr tc lnocrpcratlcn and the bank
wlll hcld thls oapltal untll reglstratlcn ls
ocmplete.
^ share reglstry must be malntalned and
statutcry preemptlve rlghts exlst fcr any
dlspcsltlcn cf shares. The ocmpany oan
be managed by cne cr mcre managers cr
a bcard cf dlreotcrs as stlpulated ln the
ocmpany artloles cf asscolatlcn.
0noe the number cf partners exoeeds
20 a ocntrcl ocunoll ls requlred tc
be appclnted. Thls ocntrcl ocunoll ls
ocmpcsed cf at least three partners.
The funotlcn cf the ocntrcl ocunoll ls the
same as that fcr a partnershlp llmlted by
shares.
Laoh year the ocmpany must set aslde
10 cf lts annual net prcfts as a
statutcry reserve untll 50 cf lts oapltal
ls reaohed. lf ocmpany lcsses amcunt tc
75 cf the ocmpany oapltal the managers
must ocnvene a meetlng wlth all partners
tc ocnslder future ocntlnuatlcn cr
dlssclutlcn cf ocmpany.
Variable 0apital 0ompanies
Laoh ocmpany struoture mentlcned
abcve ls entltled tc stlpulate ln lts
artloles cf asscolatlcn that lts oapltal
may be lnoreased by new payments frcm
the exlstlng, cr new, partners. lt may alsc
prcvlde fcr a reduotlcn ln oapltal shculd
cne partner reocver thelr share value.
Thls type cf ocmpany must have a oapltal
amcunt cf nc mcre than S^R 50,000
upcn lnocrpcratlcn. The oapltal may be
ralsed cn an annual basls prcvlded eaoh
ralse ls nc mcre than the stated lnltlal
oapltal amcunt.
ln addltlcn tc the prcvlslcns ocntalned
ln the artloles cf asscolatlcn fcr the
ocmpany, the ralslng and deoreaslng cf
oapltal ls nct subjeot tc any ocndltlcns cr
speolal prcoedures.
Unless the artloles cf asscolatlcn prcvlde
ctherwlse, a ocmpany ls nct termlnated lf
cne cf the partners:
- ls dlsmlssed;
- ls prchlblted frcm aotlng as a
partner;
- ls deolared bankrupt cr lnsclvent;
- wlthdraws frcm the ocmpany
lndefnltely.
0ooperative 0ompanies
^ jclnt stcok ocmpany cr a llmlted llablllty
ocmpany may be lnocrpcrated as a
occperatlve ocmpany lf the ocmpany
alms, wlth the jclnt effcrts cf the
partners, tc aohleve:
- ^ reduotlcn ln ocst, purohase, cr sale
prloe cf oertaln prcduots cr servloes,
thrcugh the ocmpany praotloe cf a
prcduoer cr stcok brcker;
- lmprcvlng quallty cf prcduots cr
servloes prcvlded by the ocmpany tc
the partners cr thcse prcvlded by the
partners tc ocnsumers.
wlth the exoeptlcn cf the Ccmpanles
Law prcvlslcns tc the ocntrary, and
cther laws that prcvlde fcr thls type cf
ocmpany, the ocmpany ls subjeot tc the
abcve prcvlslcns relatlng tc a jclnt stcok
ocmpany cr llmlted llablllty ocmpany.
The share value must be between ten
and ffty Saudl Rlyals.
The ocmpany ls able tc beneft frcm all
prlvlleges presorlbed fcr occperatlve
scoletles and the Mlnlstry cf Ccmmeroe
and lndustry has the same pcwer ln
ocntrclllng and dlssclvlng the ocmpany
as the Mlnlstry cf Labcur and Scolal
^ffalrs has pursuant tc the occperatlve
scolety`s law.
^ lloense tc lnocrpcrate ls requlred frcm
the Mlnlster cf Ccmmeroe and lndustry.
The ocmpany ls tc be managed by a
bcard cf dlreotcrs cf nc less than three
perscns whc are nct remunerated fcr
thelr wcrk.
The partners may reoelve a peroentage
cf the net prcfts ln aoocrdanoe wlth the
ocnstltutlcn prcvlded suoh prcfts are
nct mcre than 6 cf the pald oapltal.
lrcvlded the ocmpany ls able tc meet
lts prcft dlstrlbutlcn cbllgatlcn, eaoh
year 10 cf lts remalnlng prcfts are tc
be set aslde as reserve untll the reserve
amcunt reaohes the oapltal amcunt.
Foreign Investment
0ompanies
^ fcrelgn lnvestcr may ocnduot buslness
ln KS^ by establlshlng cne cf the fcllcwlng
ocmpany struotures:
- Llmlted Llablllty Ccmpany;
- 1clnt Stcok Ccmpany;
- Branoh;
- Teohnloal Solentlfo Servloes 0ffoe;
- Tempcrary Ccmmerolal Reglstratlcn;
- lnfcrmal arrangements may lnolude
dlstrlbutcrshlps, agenoles and
franohlses.
Fcrelgn lnvestcrs (cther than KS^ cr CCC
natlcnals) oan usually cwn up tc 100
cf the oapltal but exoeptlcns dc exlst
and there are restrlotlcns cn the type cf
buslness aotlvlty the ocmpany oan engage
ln. Capltal amcunts and sharehcldlng
requlrements dlffer dependlng cn the
type cf ocmpany and the prcpcsed
aotlvltles lt lntends tc undertake.
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The Capltal Market ^uthcrlty (CM^),
establlshed by the Capltal Market Law,
lssued by Rcyal Deoree Nc. (M/30) dated
2/6/1424 H, ls the regulatcr cf oapltal
markets ln the Klngdcm cf Saudl ^rabla
(KS^). lt ls respcnslble fcr lssulng the
rules and regulatlcns fcr the prcmctlcn cf
oapltal markets, lnvestcr prcteotlcn and
oreatlng an apprcprlate oapltal markets
lnvestment envlrcnment.
The CM^ lssued Clroular Nc. 2282008
cn 18
th
^ugust, 2008 (08/17/1429)
('`the Clroular``) allcwlng fcrelgn lnvestcrs
tc exeoute under oertaln terms and
ocndltlcns equlty swap agreements ln
respeot cf llsted Saudl Shares. The
olroular permlts cnly CM^ ^uthcrlsed
lerscns tc enter lntc Swap ^greements.
The pclloy ls deslgned tc prcvlde ancther
fcrelgn lnvestment methcd cther than
thrcugh ncmlnee arrangements and
lnvestment Funds fcr fcrelgn lnvestcrs.
CM^ ^uthcrlsed lerscns whc have
suooessfully exeouted Swap ^greements
lnolude Mcrgan Stanley and HSBC.
Salient Features oI Swap
Agreements
Tc lnvest ln Saudl shares fcrelgn
lnvestcrs slgn an equlty swap agreement
wlth an ^uthcrlsed lerscn cn the terms
and ocndltlcns speolfed ln the Clroular.
Suoh Swap agreements shculd nct have
a term greater than fcur years frcm the
date cf exeoutlcn.
The CM^ preserves the rlght tc request
^uthcrlsed lerscns tc dlsocntlnue
enterlng lntc swap agreements and
may lmpcse qualltatlve cr quantltatlve
llmltatlcns cr requlrements cn eaoh
agreement cr cn the ultlmate benefolal
lnvestcrs.
Swap Agreements Allow Foreign
Investors Access To KSA Shares Under
New CMA Policy
By Najeeb Maabreh
KS^ 0f floe
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Suoh agreements must lnolude a olause
that glves the ^uthcrlsed lerscns all
vctlng rlghts pertalnlng cr attaohed tc the
underlylng shares.
^ swap agreement must be fully ocvered
thrcugh buylng the underlylng shares
and pursuant tc ltem 10 cf the olroular,
an ^uthcrlsed lerscn must malntaln
systems and ocntrcls whloh are adequate
tc ensure the lmplementatlcn cf the swap
agreement terms and ocndltlcns and tc
ensure lts valldlty.
^oocrdlng tc ltem 11 cf the olroular, an
^uthcrlsed lerscn must avcld oredlt rlsk
that may arlse frcm the slgned swap
agreements, and shculd nct purohase
the underlylng shares prlcr tc reoelvlng
thelr value, frcm the lnvestcr.
Responsibilities and
0bligations oI Authorised
Persons
^n ^uthcrlsed lerscn:
- Must submlt a ocpy cf the standard
swap agreement, and evldenoe cf
lts adherenoe tc the ocndltlcns
and requlrements stated ln the
Clroular and a deolaratlcn ocnfrmlng
ocmpllanoe wlth all ocndltlcns and
requlrements stated ln the Clroular;
- Has tc ensure full ocmpllanoe wlth
the requlrements cf the ^ntlMcney
Launderlng Law and lts lmplementlng
regulatlcns and the rules lssued
by the CM^ relatlng tc ^ntl Mcney
launderlng and Terrcrlst Flnanolng
and any cther related laws and
regulatlcns; and
- Must nctlfy the Ccrpcrate Flnanoe
Department cf CM^ cf swap
agreements slgned by the ^uthcrlsed
lerscn. lnfcrmatlcn as tc the
benefolary`s name, ocuntry cf crlgln,
underlylng shares and quantlty must
be submltted cn a mcnthly basls.

1he Relationship between
Foreign Investors and Saudi
0ompanies listed on the Saudi
Stock Exchange (1A0AW0L)
^ fcrelgn lnvestcr whc ls a party tc a
swap agreement dces nct reoelve any
vctlng rlghts ln the underlylng shares.
Hcwever the ^uthcrlsed lerscn ls nct
permltted tc exerolse any vctlng rlghts cn
the shares.
Responsibilities and
0bligations oI Foreign
Investors
Fcrelgn lnvestcrs oan cnly enter lntc swap
agreements wlth ^uthcrlsed lerscns
fcr seourltles llsted cn the Tadawul.
The swap agreement shculd lnolude a
olause settlng cut the CM^ llmltatlcns
and ocntrcls.
Ncnresldent fcrelgn lnvestcrs must:
- Dlsolcse tc the ^uthcrlsed lerscn the
scuroe cf the funds whloh they want
tc lnvest ln the T^D^wUL;
- Lnsure full ocmpllanoe wlth the
requlrements cf the antlmcney
launderlng law and the rules
ocnoernlng terrcrlst fnanolng; and
- lmplement the requlrements
and prcvlslcns under the swap
agreements, tc pay fully fcr the
underlylng shares befcre any
transaotlcn oan be entered lntc by the
^uthcrlsed lerscn.
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0n 28
th
Ncvember 2008 the Mlddle Last Buslness lntelllgenoe
magazlne repcrted that the Saudl Capltal Market ^uthcrlty has
uncffolally suspended all new lnltlal publlo cfferlngs (ll0s)
due tc fears that allcwlng addltlcnal ocmpanles cn tc the market
wlll oause exlstlng stcok prloes tc fall even further dcwn.
Slnoe the Saudl stcok market ls dcmlnated by retall lnvestcrs,
the market cften experlenoes heavy selllng cf shares ahead
cf an ll0 as lnvestcrs try tc ralse funds tc lnvest ln new
ocmpanles. Nc new ll0s, even lssues by gcvernmentrelated
entltles, are llkely tc coour cn the Saudl stcok exohange untll
the market shcws slgns cf reocvery. 0n 23
rd
Ncvember 2008
the Saudl stcok market hlt a fveyear lcw after lcslng almcst 60
peroent cf lts value thls year.
Draft Anti Money Laundering & Combating
Terrorism Financing Rules
0n 18
th
Ncvember 2008 the Saudl ^rablan Mcnetary ^genoy
(S^M^) lssued draft regulatlcns relatlng tc relnsuranoe
aotlvltles. The regulatlcns prcvlde general prlnolples and
mlnlmum standards tc be met by lnsuranoe and relnsuranoe
ocmpanles. The cbjeotlve cf the regulatlcns ls tc prcmcte
hlgh standards cf relnsuranoe praotloes wlthln the lnsuranoe
lndustry. The regulatlcns shculd be read ln ocnjunotlcn wlth
the Law cn Supervlslcn cf Cccperatlve lnsuranoe Ccmpanles
and lts lmplementlng regulatlcns.
Ccmments ln relatlcn tc the draft are tc be submltted tc Mr.
Mchammad ^. ^l Shayea, Dlreotcr cf lnsuranoe Supervlslcn at
S^M^ wlthln 60 days. ^ ocpy cf the draft ls avallable cn the
S^M^ webslte http://www.sama.gcv.sa
The Saudl Fccd and Drug ^uthcrlty (SFD^) was establlshed
by the Ccunoll cf Mlnlsters Resclutlcn Nc. (1) dated 07/
01/1424 H (ocrrespcndlng tc 10
th
Maroh, 2003), tc ensure
safety cf fccd and drugs fcr man and anlmal, and safety
cf blclcgloal and ohemloal substanoe as well as eleotrcnlo
prcduots. SFD^ ls respcnslble fcr regulatlng, cverseelng, and
ocntrclllng fccd, drug, medloal devloes and settlng mandatcry
standard speolfoatlcns whether they are lmpcrted cr lcoally
manufaotured, as well as ocnsumer awareness. SFD^ ls
regulated under the SFD^ ^ot.
The SFD^ lmplementlng Regulatlcns (the Regulatlcns`)
lssued by Rcyal Deoree Nc. M/6 dated 25/1/1428
(ocrrespcndlng tc 12
th
February, 2007) has reoently
ocme lntc fcroe by publloatlcn ln the cffolal gazette dated
Ncvember 14
th
, 2008. The Regulatlcns set cut an exhaustlve
llst cf the SFD^`s authcrltles and respcnslbllltles. The SFD^
wlll be alsc respcnslble fcr lloenslng oertaln types cf fccd,
drug and eleotrcnlo prcduots. ^oocrdlngly, lmpcrters wlll ncw
alsc be requlred tc cbtaln a lloense frcm the SFD^ prlcr tc
lmpcrtatlcn.
Saudi Market Regulator Suspends IPO Listings
0n 29
th
Ncvember 2008 the Saudl ^rablan Mcnetary ^genoy
(S^M^) lssued draft ^ntlMcney Launderlng & Ccmbatlng
Terrcrlsm Flnanolng Rules. These rules prcvlde detalled
prcvlslcns speolfo tc the lnsuranoe lndustry. The cbjeotlves
cf the rules are tc prcmcte hlgher standards fcr ldentlfylng
mcney launderlng and terrcrlsm fnanolng rlsks and hcw
tc deal wlth suoh coourrenoes. The rules shculd be read
ln ocnjunotlcn wlth The Cccperatlve lnsuranoe Ccmpanles
Ccntrcl Law and lts lmplementlng regulatlcns, alcng wlth the
Law cf Ccmbatlng Mcney Launderlng.
Ccmments ln relatlcn tc the draft are tc be submltted tc Mr.
Mchammad ^. ^l Shayea, Dlreotcr cf lnsuranoe Supervlslcn
at S^M^ wlthln 30 days. ^ ocpy cf the draft ls avallable cn
the S^M^`s webslte http://www.sama.gcv.sa
Draft Reinsurance Regulations
The Implementing Regulations of the Saudi
Food and Drug Authority (SFDA) are now in
Force
KSA Legal News
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^ ocexlstenoe agreement ls an
agreement between twc cr mcre partles
agreelng tc the ocexlstenoe cf thelr
slmllar trademarks wlthcut any llkellhccd
cf ocnfuslcn; allcwlng the partles tc
set the rules by whloh trademarks oan
peaoefully ocexlst. The ocexlstenoe may
be cn the basls cf gecgraphloal dlvlslcn
where the trademark may be used cr cn
the basls fcr whloh gccds and servloes
the trademarks may be used.
Scme ocmpanles ohccse tc enter lntc
a ocexlstenoe agreement wlth thelr
ocmpetltcrs as a sclutlcn fcr trademark
ocndlots and a way tc avcld lltlgatlcn.
Hcwever, thls cptlcn shculd be oarefully
ocnsldered as lt may nct always prcve tc
be the best ohcloe.
The valldlty cf a ocexlstenoe agreement
may be ohallenged, lf the agreement
ocnoerns trademarks that may oause
ocnfuslcn tc ocnsumers and where thls
ocnfuslcn may lead tc harm. Fcr example
lf the ocnfuslngly slmllar trademarks
are used fcr medlolne, ln thls oase the
ocnfuslcn may harm ocnsumers and
therefcre a ocexlstenoe agreement may
be lnvalldated.
The reascn behlnd thls ls the funotlcn
cf the trademark as a scuroe ldentlfer
and a quallty lndloatcr. wlth vlew cf
these funotlcns cf trademarks, the maln
purpcse cf the trademarks laws and
related laws ls tc prcteot ocnsumers
agalnst ocnfuslcn abcut the scuroe cf
gccds cr servloes, but there ls alsc a
seocndary purpcse tc prcteot trademark
cwners whc lnvested ln thelr brand
and prcteot thelr trademark agalnst
unauthcrlsed use. ln thls regard, the
trademarks laws treat a trademark as
prcperty cf lts cwner whc retalns the
rlghts tc explclt the mark freely lnoludlng
by enterlng lntc ocexlstenoe agreements.
Hcwever, when the trademark cwner`s
rlght tc enter lntc suoh agreement
ocntradlots wlth lnterest cf ocnsumers,
then the cwner may be deprlved cf thls
rlght. Thls ls pcsslble when elther mark
ls nct reglstered and the use cf cne mark
oauses publlo ocnfuslcn.
Therefcre, lf a ocexlstenoe agreement
was ohallenged befcre the ocurt by an
lnterested party, the ocurt may deolde tc
lnvalldate the agreement lf the ocexlstlng
arrangement vlclates the law suoh as
oauslng ocnsumer ocnfuslcn. Hcwever,
thls wlll malnly depend cn a number
cf faotcrs lnoludlng what the gccds cr
servloes the trademarks are used fcr,
the target ocnsumers and hcw strcng the
respeotlve trademarks are.
ln addltlcn, a ocexlstenoe agreement
may alsc result ln trademark dllutlcn,
partloularly when the marks lnvclved
are slmllar tc a hlgh degree, whloh may
eventually prevent the prcteotlcn cf the
ocnoerned trademark. Fcr example, lf a
ocmpany has a ocexlstenoe agreement
wlth cther entlty and wanted tc cbjeot
tc a use cr reglstratlcn by a thlrd party
cf an ldentloal cr ocnfuslngly slmllar
trademark, the thlrd party may use the
ocexlstenoe agreement tc establlsh that
thls trademark ls dlluted, espeolally lf
the agreement ls ln respeot tc slmllar
gccds, and therefcre nc lcnger dlstlnotlve
encugh tc ldentlfy lts scuroe.
0n the cther hand, a ocexlstenoe
agreement may have an lmpaot cn the
ocmpany`s buslness plans and may
llmlt lts ohanoes cf expanslcn lntc
new buslness llnes that dld nct exlst
at the tlme cf enterlng the agreement.
Furthermcre, ocexlstenoe oculd put cne
trademark cwner lntc a dlffoult sltuatlcn
tc dlstlngulsh lts prcduots frcm that
cf the ocunterparty espeolally lf bcth
trademarks are ln respeot cf the same
prcduots cr servloes, therefcre, requlrlng
a hlgher budget tc lnolude strcng
advertlslng oampalgns and lmprcvement
cf prcduot quallty.
ln ocnoluslcn, althcugh ocexlstenoe
agreement may be a gccd cptlcn tc
ohccse as lt helps buslnesses tc shape
thelr cwn buslness plans and destlny, and
llmlts dlsputes leadlng tc lltlgatlcn, the
deolslcn tc enter lntc these agreements
shculd be studled oarefully agalnst the
ocnoerns ralsed abcve. ^ trademark
cwner, befcre enterlng lntc ocexlstenoe
agreements, needs tc assess the
strength cf lts trademark, the slmllarlty
between the respeotlve trademarks and
ocnsequently hcw muoh ocnfuslcn oculd
coour by thls ocexlstenoe, ln addltlcn tc
the pctentlal buslness llnes lt envlslcns
enterlng.
trademark disputes?
By Rasha ^l ^rdah
ll/lT lraotloe
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'Related rlghts` ls a term ln ocpyrlght
law, and ln mcst olvll law jurlsdlotlcns
that lnoludes the rlghts cf perfcrmers,
phcncgram prcduoers, brcadoastlng
crganlsatlcns, flm prcduoers, dlreotcrs,
eto. Lgypt prcvldes prcteotlcn tc
ocpyrlghts and related rlghts thrcugh
lts Law Nc. 82 cf 2002 cn lntelleotual
lrcperty (whcse ohapter lll deals
wlth Ccpyrlght and Related Rlghts;
herelnafter 'Lgypt`s Ccpyrlght Law`).
Lgypt ls party tc: the wcrld lntelleotual
lrcperty 0rganlsatlcn Ccnventlcn ('wll0
Ccnventlcn`), the Berne Ccnventlcn fcr
the lrcteotlcn cf Llterary and ^rtlstlo
wcrks ('Berne Ccnventlcn`), the
Ccnventlcn fcr the lrcteotlcn cf lrcduoers
cf lhcncgrams ^galnst Unauthcrlsed
Duplloatlcn cf Thelr lhcncgrams ('Ceneva
lhcncgrams Ccnventlcn`), the wcrld
Trade 0rganlsatlcn whloh ocmprlses cf
an lntelleotual prcperty agreement; the
^greement cn Trade Related ^speots
cf lntelleotual lrcperty Rlghts (TRllS
^greement). Lgypt alsc has a oclleotlng
scolety by the name cf 'Scolety cf
^uthcrs, Ccmpcsers and lubllshers cf
the ^rab Republlo cf Lgypt` (S^CLR^U).
0wners oI Related Rights
Lgypt`s Ccpyrlght Law ldentlfes the
fcllcwlng as the related rlghts hclders:
- ^uthcrs (dlreotcr, soenarlcwrlter,
adapter, dlalcgue wrlter, ocmpcser
cf the muslo espeolally made fcr
the flm, authcr cf exlstlng adapted
wcrks);
- lerfcrmers; and
- Brcadoasters.
Protected Economic Rights
The related rlght hclders enjcy the
fcllcwlng eocncmlo rlghts under the
Lgypt`s Ccpyrlght Law:
- ^uthcrs` eocncmlo rlghts lnolude:
any fcrm cf wcrk explcltatlcn
and partloularly: reprcduotlcn
rlght; adaptatlcn and translatlcn
rlght; dlstrlbutlcn rlght; rental and
lendlng rlght; publlo perfcrmanoe
rlght; brcadoastlng rlght; rlght cf
ocmmunloatlcn tc the publlo, rlght cf
maklng avallable tc the publlo;
- lerfcrmers` eocncmlo rlghts lnolude:
any fcrm cf wcrk explcltatlcn and
partloularly: rlght cf: ocmmunloatlcn tc
the publlo; brcadoastlng rlght; fxatlcn
and reprcduotlcn rlght; rental and
lendlng rlght; rlght cf maklng avallable
Protection of Copyrights and Related
Rights in Egypt
By Falsal Daudpcta
ll/ lT lraotloe
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tc the publlo. These prcvlslcns dc nct
apply tc the fxatlcn cf perfcrmanoes
lnoluded ln an audlcvlsual fxatlcn,
unless ctherwlse agreed. Unless
ctherwlse agreed, perfcrmers are
granted cnly a remuneratlcn rlght
fcr dlreot cr lndlreot use cf prcgrams
publlshed fcr ocmmerolal purpcses cf
brcadoastlng cr ocmmunloatlcn tc the
publlo; and
- Brcadoasters` eocncmlo rlghts
lnolude: any fcrm cf explcltatlcn cf
the perfcrmanoe and partloularly:
rlght tc authcrlse the ocmmunloatlcn
tc the publlo cf thelr brcadoasts
by all means, the fxatlcn and the
rebrcadoastlng as well as the
reprcduotlcn, sale and rental cf
fxatlcns cf thelr brcadoasts. Unless
ctherwlse agreed, brcadoasters are
granted a remuneratlcn rlght cnly
fcr dlreot cr lndlreot use cf prcgrams
publlshed fcr ocmmerolal purpcses cf
brcadoastlng cr ocmmunloatlcn tc the
publlo.
Protected Moral Rights
The related rlght hclders enjcy the
fcllcwlng mcral rlghts under the Lgypt`s
Ccpyrlght Law:
- ^uthcrs` mcral rlghts lnolude: rlght
tc olalm authcrshlp; rlght tc cbjeot tc
mcdlfoatlcn, rlght cf dlsolcsure cnly
wlth judlolal authcrlsatlcn: rlght cf
wlthdrawal; and
- lerfcrmers` mcral rlghts lnolude: rlght
tc olalm authcrshlp; rlght tc cbjeot tc
mcdlfoatlcn.
Assignability oI Economic and
Moral Rights
Under the Lgypt`s Ccpyrlght Law:
- ^n authcr oan asslgn hls/her
eocncmlo rlghts durlng hls/her
llfetlme as well as after hls/her
death. whereas an authcr`s mcral
rlghts are nct transferable durlng hls/
her llfetlme, but transferable after
hls/her death by applloatlcn cf the
law;
- ^ perfcrmer oan asslgn hls/her
eocncmlo rlghts durlng hls/her
llfetlme as well as after hls/her
death. whereas an authcr`s mcral
rlghts are nct transferable durlng hls/
her llfetlme, but transferable after
hls/her death by applloatlcn cf the
law; and
- ^ brcadoaster`s eocncmlo rlghts are
transferable.
lt ls alsc lmpcrtant tc ncte that nc olear
guldellnes exlst ln Lgypt`s Ccpyrlght
Law wlth respeot tc exlstenoe cf any
presumptlcn cf asslgnment cf rlghts tc
the prcduoer, cr fcr remuneratlcn fcr
prlvate ocpylng.
0uration oI Economic and
Moral Rights
Under the Lgypt`s Ccpyrlght Law:
- ^uthcrs` eocncmlo rlghts are valld fcr
50 years after the last ocauthcr`s
death. whereas, an authcr`s mcral
rlghts survlve ln perpetulty;
- lerfcrmers` eocncmlo rlghts are
valld fcr 50 years after fxatlcn cf the
perfcrmanoe, and falllng fxatlcn, 50
years after perfcrmanoe. whereas,
a perfcrmer`s mcral rlghts survlve ln
perpetulty; and
- Brcadoasters` eocncmlo rlghts
are valld fcr 20 years after frst
brcadoastlng.
InIringement and Remedies
Under the Lgypt`s Ccpyrlght Law the
fcllcwlng aots ocnstltute lnfrlngements cf
ocpyrlghts and related rlghts:
- ^ny lnfrlngement cf rlghts prcteoted
by law (eocncmlo and mcral rlghts as
hlghllghted abcve);
- lmpcrt cr expcrt cf lnfrlnglng ocples;
- luttlng lntc olroulatlcn, sale, lease cf
lnfrlnglng ocples;
- Unlawful dlsolcsure;
- ^otlcns ln bad falth agalnst teohnloal
prcteotlcn devloes; and
- Manufaoturlng, lmpcrtlng fcr sale
cr rental cf any element deslgned
fcr the purpcse cf enabllng the
olroumventlcn cf teohnclcgloal
prcteotlcn measures.
Under the Lgypt`s Ccpyrlght Law the
remedles agalnst lnfrlngements lnolude
olvll and orlmlnal aotlcns leadlng tc: (1)
lmprlscnment fcr at least cne mcnth
(at least three mcnths ln the oase cf
reoldlvlsm); (2) Flnes; (3) Selzure; (4)
Drawlng up cf a detalled desorlptlcn cf
wcrk, perfcrmanoe cr brcadoast; (5)
Suspenslcn cf prcduotlcn, exhlbltlcn,
publloatlcn cr reprcduotlcn cf the wcrk,
perfcrmanoe cr brcadoast; (6) Selzure
cf reoelpts cf unlawful explcltatlcn; (7)
Selzure cr destruotlcn cf lnfrlnglng cbjeots
and materlals used fcr thelr prcduotlcn;
(8) Clcsure cf establlshment fcr nc
lcnger than slx mcnths; (9) ^llcoatlcn cf
damages (materlal and mcral prejudloe);
and (10) lublloatlcn cf the judgment.
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The Federal Deoree Nc: 52 cf 2007 cf the
CCC unlfed Trademarks ^ot fcr the CCC
natlcns CCC Trademarks ^ot fcrmallsed
the mutual effcrts cf Culf Ccunoll States
tc regulate a unlfed law ln the reglcn. The
lmplementatlcn cf the CCC Trademarks
^ot, when lt ocmes lntc effeot, shall
olarlfy the status cf unreocrded lloense
agreements and prcvlde an adequate
resclutlcn tc several ocntrcverslal lssues
coourred ln the U^L Trademarks reglme.
There ls amblgulty ln the U^L Trademarks
Law wlth regard tc trademarks subjeot
cf a lloense. ln absenoe cf reocrdlng
tc the lloense, lt remalns lndefnlte ln
praotloe whether the Lloensee use cf
the mark wlll be ocnsldered adequate
tc keep the trademark`s reglstratlcn
allve and tc fcrm evldenoe cf genulne
use fcr reglstered marks. Unfcrtunately,
the U^L Federal Trademarks Law Nc
37 cf the year 1992; and all fcllcwlng
amendments, U^L Trademark ^ot dces
nct present a orystal olear answer tc
thls prcblematlo lssue. Rather, the U^L
Trademark ^ot substantlally requlres
fulflllng the reocrdlng fcrmallty and
negleots the partles` rlghts tc utlllse
unreocrded lloense agalnst thlrd party
olalms. The U^L Trademark ^ot ln ^rtlole
31 stlpulates:
The lloense agreement fcr the use
cf the trademark shall be reocrded
ln the Reglster; the lloense shall have
nc effeot agalnst thlrd partles unless
lt has been reocrded ln the Reglster
and publlshed as presorlbed ln the
Regulatlcn.
The language cf artlole 31 ls very brcad;
an abandcnment cf the lloenscr`s rlghts
ln malntalnlng her trademarks, allve
based cn the lloensee exoluslve use
fcr the trademark oculd be lmplled frcm
the abstraot wcrdlngs hereln. Therefcre,
lt may be reocmmended tc reocrd
trademark lloenses ln crder tc rely cn
the lloensee use as a basls tc ocunter a
oanoellatlcn aotlcn fcr ncn use.
lursuant tc artlole 22 cf the U^L
Trademarks ^ot, the ocmpetent olvll
ocurt may crder, at the request cf any
lnterested party, the oanoellatlcn cf a
trademark reglstratlcn lf prcven that lt
has nct been used ocntlnucusly fcr fve
years. ln oanoellatlcn aotlcns based cn
ncn use, the cwner cf the scught mark
shall have the burden tc prcve aotual
use ln crder tc dlsmlss oanoellatlcn
olalms. Due tc the brcad language cf
artlole 31, lt remalns unolear whether
lloenscrs were ellglble tc prcve thelr use
thrcugh lloense arrangements unless,
suoh arrangements are cffolally reocrded
befcre the U^L trademarks cffoe.
^s a matter cf faot, the majcrlty cf
trademark cwners ln the U^L negleot the
reocrdlng fcrmalltles cf lloensed rlghts.
Nct cnly tc avcld several ocnsequenoes
related tc the pcsttermlnatlcn prcoess,
but alsc due tc the lengthy frustratlng
fcrmalltles fcr reocrdlng whloh may take
up tc cne year befcre belng ocmpleted.
The CCC Trademarks ^ot resclves the
amblgulty ln the U^L Trademarks ^ot fcr
thls partloular debatable lssue. lt olearly
prcvldes Lloenscrs wlth the rlght tc rely
cn unreocrded lloense ln prcvlng the
marks usage. The sald law requlres a
wrltten lloense agreement ln malntalnlng
the trademarks use lnstead cf requlrlng
absclute reocrdlng fcrmallty. ^rtlole 32
cf the CCC Trademarks ^ot stlpulates
Trademarks Lloense ls requlred tc be ln
wrltlng ln crder tc be valld and reocrdlng
the lloense cf trademarks usage ls nct
mandatcry tc valldate the lloense.
^rtlole 32 cf the CCC Trademarks ^ot
glves a olear sclutlcn tc cne cf the
mcst ocntrcverslal lssue that ocnoerns
trademarks users whc were merely uslng
thelr brands thcugh lcoal entltles ln the
U^L. ln addltlcn, lt wlll be ocnsldered
a prcmlslng mllestcne tc lmprcve the
trademarks explcltatlcns praotloe ln the
U^L wlth safeguardlng the hclders` rlghts.
ln faot, trademarks` cwners have aoqulred
frcm the new law a olear meohanlsm
tc malntaln the valldlty cf trademark
reglstratlcns agalnst oanoellatlcn olalms
fcr ncn use.
GCC Trademarks Law Resolves
Uncertainty Over Use By Licensee
By Munlr Subch
ll/lT lraotloe
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ln 2002, atar repealed the 1978
Trademark Law wlth the enaotment cf
Law Nc (9) cf 2002 cn Trademarks,
Ccmmerolal lndloatlcns, Trade Names,
Cecgraphloal lndloatlcns and lndustrlal
Deslgns (Law Nc (9) cf 2002 ).
The regulatlcns, whloh are due pursuant
tc Law Nc (9) cf 2002, are stlll nct
prcmulgated, and therefcre reglstratlcn
cf trade names ls ourrently nct pcsslble
ln atar, hcwever aoocrdlng tc ^rtlole (33)
cf the Law Nc. (9) cf 2002, the cwner cf
the trade names assumes prcteotlcn cf
lts trade names even lf these are nct
reglstered.
Reglstratlcn cf a trade name dces nct
ln ltself prevent ancther perscn frcm
reglsterlng that trade name as a trade
mark. Unless the cwner cf the buslness
name oan shcw that he has bullt up
suffolent reputatlcn ln the name, he wlll
nct be able tc prevent ancther perscn
uslng lt as a trade mark.
How existing law assists in
this area?
The prcvlslcns cf ^rtlole (33) cf the Law
Nc (9) cf 2002 stlpulates that the trade
name shall be prcteoted ln aoocrdanoe
wlth the prcvlslcns herecf even lf lt ls
nct reglstered and ^rtlole (36) cf the
same law prcvldes that The cwner cf
the trade name shall have the rlght tc
prevent cthers frcm uslng lt cr uslng any
slmllar slgn that may mlslead cr ocnfuse
the publlo wlth regard tc the prcduots
cr related servloes demcnstratlng
that the prcteotlcn cf the trade name
by the law ls nct llmlted tc preventlng
cthers frcm uslng lt but the preventlcn
ls alsc extended tc ocver the use cf a
slmllar name. The law lntends tc prcteot
the trade name cwner agalnst llllolt
ocmpetltlcn and prcteot the ocnsumers
agalnst any ocnfuslcn between twc
slmllar labels fcr twc dlfferent prcduots.
Therefcre, the use cf a slmllar trade
name whloh may mlslead cr ocnfuse
ocnsumers ls a prchlblted aot. Tc assess
whether the name has any dlstlngulshed
partloularlty, we shculd ocnslder all the
elements that ocmpcse the name ln
questlcn: the purpcse cf thls test ls nct
tc fnd cut whether the name, letters cr
terms used are the same cr slmllar tc
thcse used fcr ancther name, but tc
assess the general lmage memcrlsed
by the publlo as a result cf the letters,
symbcls cr deslgns ocmpcslng the name
ocmpared wlth the lmage cf the cther
name, dlsregardlng the faot that bcth
names may have ocmmcn elements,
unless thcse elements are equally able
tc make any ocnfuslcn.
Therefcre, desplte there belng nc
regulatlcns tc permlt trade name
reglstratlcn ln atar, Law Nc. (9) cf 2002
cffers scme prcteotlcn, and glves the
trade name cwner the rlght tc prevent
cthers frcm uslng the same cr slmllar
trade name.
Trade Name Protection in Qatar
By Fadl Sabsabl
atar 0ffoe
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Mcst fnanolal lnstltutlcns and buslnesses
use seourltlsatlcn tc fund thelr cperatlcns
and tc lmmedlately reallse the value cf a
oashprcduolng asset. The pccl cf assets
ls usually ocmpcsed cf assets suoh as
lcans, but oan alsc be trade reoelvables
cr leases. ln mcst cf the oases the
crlglnatcr cr prcvlder cf assets ls
expeotlng a regular stream cf payments
cver thcse assets. By pccllng the assets
tcgether, the payment streams oan be
used tc suppcrt lnterest and prlnolpal
payments cn seourltles.
0ne cf the benefts fcr the crlglnatcr frcm
seourltlslng assets ls that the crlglnatcr
reoelves full value fcr assets rather than
an extended payment stream spread cut
cver tlme cr payment whloh ls deferred
cver a lcng perlcd. Thus the crlglnatcr
wlll lnvest thls sum cf revenue reoelved
frcm the seourltlsed assets tc fund
further grcwth ln lts asset bcck. Thls
supplements the need fcr the crlglnatcr
tc ralse funds by mcre tradltlcnal
methcds.
^lsc, seourltlsatlcn struoture permlts
frms tc effeotlvely mcve and hcld thelr
assets cff balanoe sheet. Thls generates
hlgher leverage and greater eocncmles
cf soale.
The ocmblnatlcn cf seourltlsatlcn
teohnlques wlth oredlt derlvatlves and
rlsk transfer devloes allcws varlcus
market partlolpants tc develcp lnncvatlve
methcds cf transfcrmlng rlsk and tc tap
lntc seotcrs whloh were ctherwlse nct
cpen tc them.
^ ocmpany that wants tc cbtaln
fnanolng thrcugh seourltlsatlcn beglns
By Talal Bljjanl,
Banklng & Flnanoe lraotloe
atar 0ffoe
Islamic Securitisation
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by ldentlfylng assets that oan be used
tc ralse funds. These assets typloally
represent rlghts tc payments at future
dates and are usually referred tc as
reoelvables.
The rlsk that these payments may nct
be made cn tlme ls an lmpcrtant faotcr
ln valulng the reoelvables. ^s lcng as
the crlglnatcr oan reascnably predlot
the aggregate rate cf default, lt oan
seourltlse even thcse reoelvables that
present scme rlsk cf unoclleotlblllty. ^
statlstloally large pccl cf reoelvables due
frcm many cbllgcrs, fcr whloh payment
ls reascnably predlotable, ls generally
preferable tc a pccl cf a smaller number
cf reoelvables due frcm a few cbllgcrs.
^fter ldentlfylng the assets tc be used ln
the seourltlsatlcn, the crlglnatcr transfers
the reoelvables tc a newly fcrmed speolal
purpcse ocrpcratlcn, trust, cr cther
legally separate entlty cften referred tc
as a speolal purpcse vehlole, cr Slv.
The transfer ls lntended tc separate the
reoelvables frcm the rlsks asscolated wlth
the crlglnatcr. Further lt wlll be lmpcrtant
tc the crlglnatcr that the reoelvables are
nc lcnger treated as belng cn lts balanoe
sheet. Fcr thls reascn, the crlglnatcr
wlll cften struoture the transfer sc that
lt ocnstltutes a true sale, a sale that ls
suffolent under bankruptoy law tc remcve
the reoelvables frcm the crlglnatcr`s
bankruptoy estate.
The Slv lssues seourltles ln the
oapltal markets tc ralse funds ln crder
tc purohase thcse reoelvables. The
Slv, hcwever, must be struotured as
bankruptoy remcte tc ensure that
the purohasers cf these seourltles see
thelr lnvestment as belng agalnst the
reoelvables cnly and nct subjeot tc the
rlsk cf fallure cf the Slv. 0therwlse the
ratlngs cf the lssuer cf oapltal market
seourltles wlll be adversely affeoted.
Bankruptoy remcte ln thls ocntext
means that the Slv ls unllkely tc be
adversely affeoted by a bankruptoy cf the
crlglnatcr.
ln seourltlsatlcn, the crlglnatcr partly
deocnstruots ltself by separatlng
oertaln types cf hlghly llquld and exoellent
quallty assets frcm the rlsks generally
asscolated wlth the crlglnatcr. lt oan
then use thcse assets tc ralse funds ln
the oapltal markets at a lcwer ocst than
lt, wlth lts asscolated rlsks, oculd have
ralsed the funds dlreotly by lssulng mcre
debt cr equlty. The crlglnatcr retalns the
savlngs generated by these lcwer ocsts,
whlle lnvestcrs ln the seourltlsed assets
beneft by hcldlng lnvestments wlth lcwer
rlsk.
1
The questlcn remalns whether thls type
cf struoture ls Sharla Ccmplalnt. Thus
oan lslamlo fnanolal lnstltutlcns and
lslamlo banks rely cn thls type cf ocmplex
struoture and beneft frcm lt?
lslamlo seourltlsatlcn ln general fcllcws
the same prlnolples and struotures
cf the ocnventlcnal seourltlsed prc
oess. Hcwever there are varlcus key
restrlotlcns arlslng under lslamlo
prlnolples. These fcr example lnolude
the prchlbltlcn cf lnterest, the lnablllty
tc engage ln exoesslve speoulatlcn cr
rlsktaklng, llmltatlcns cn the use cf the
sale cf fnanolal assets and thelr use as
ocllateral, and the exoluslcn cf oertaln
lndustrles llke thcse lnvclvlng alochcl,
gambllng, cr pcrk.
The maln ocnoern cf lslamlo lnstltutlcns
relates mcre tc the lslamlo aooeptablllty
cf the seourltlsatlcn buslness; thelr
fcous ls mcre cn the ocntent cf the pccl
cf assets rather than the prcoess cf
pccllng thcse assets. lslamlo lnstltutlcns
tend tc ensure that eaoh and every asset
ln the pccl ls Sharla ocmplalnt. Slnoe the
ocnoern ls cn the nature cf eaoh asset cn
lts cwn and nct cn the pccl as a whcle,
mcst ocmmcnly seourltlsed western
assets may nct be aooeptable fcr an
lslamlo seourltlsatlcn. The assets ln
western seourltlsed pccls are lnvarlably
lnterestbearlng debt lnstruments, suoh
as oredlt oard reoelvables, mcrtgages, oar
lcans eto. ^s lslam dces nct permlt the
use cf lnterest these wculd nct ncrmally
be aooeptable. lt ls therefcre lmpcrtant
fcr lslamlo banks tc ocnoentrate
cn crlglnatlng thelr cwn lslamloally
aooeptable assets. Sharla ocmplalnt
assets lnolude leaslng, equlty cwnershlp,
ljara and murabaha ocntraots.
There ls nc dcubt that lslamlo lnstltutlcns
oan greatly beneft frcm the seourltlsatlcn
prcoess. ^s lslamlo fnanoe tends tc
relate tc asset fnanolng, asset baoked
seourltlsatlcn ls the rlght prcduot fcr
lslamlo lnstltutlcns, as lcng as these
assets are struotured ln aoocrdanoe wlth
lslamlo prlnolples.
The baslo prlnolples cf ocnventlcnal
seourltlsatlcn oan be applled fcr lslamlo
purpcses lf the struoture meets the
fcllcwlng ocndltlcns:
- The reascn tc ralse funds under
seourltlsatlcn shculd be lslamloally
aooeptable;
- Credlt enhanoement, llquldlty prcvlder
and restrlotlcns cn prepayments;
all must be struotured ln an lslamlo
permlsslble fcrm.
- There shculd be a sharlng cf rlsk
and return unllke ocnventlcnal
seourltlsatlcn; seourltlsatlcn under
lslamlo Law bars lnterest lnocme
and must be struotured ln a way
that rewards lnvestcrs fcr thelr
dlreot expcsure tc buslness rlsk, le
lnvestcrs reoelve a share cf prcfts
ocmmensurate tc the rlsk they take
cn ln lleu cf predetermlned lnterest.
- The pccled assets must nct be debt
lnstruments, be asscolated wlth
unethloal cr explcltatlve cperatlcns
cr wlth speoulatlcn and unoertalnty
(gharar) frcm ncnprcduotlve
lnvestments;
- lnvestcrs must be ocnveyed wlth a
suffolent element cf cwnershlp.
2
lslamlo Seourltlsatlcn ls sc far grcwlng and
expeoted tc grcw cn an lnoreased basls
ln many ocuntrles. CCC ocuntrles have
the largest pctentlal fcr seourltlsatlcn.
^ssets have been seourltlsed ln KS^,
Bahraln, U^L, and Kuwalt. The mcst
seourltlsed assets are resldentlal
mcrtgages as well as autc lcans and
ocnsumer fnanoe. lt ls expeoted that the
types cf assets that wlll be seourltlsed
wlll beocme mcre dlverslfed ln the
future when the market beocmes used
tc the meohanlsms and struotures.
lslamlo seourltlsatlcn wlll never cver
take ocnventlcnal seourltlsatlcn. we wlll
always see ocnventlcnal seourltlsatlcn
slde by slde wlth lslamlo seourltlsatlcn.
3

ln brlef lslamlo seourltlsatlcn ls mcre
prudent and less aggresslve than ocnven
tlcnal seourltlsatlcn beoause cf the rlsk
sharlng prlnolples lald dcwn under lslamlo
fnanolng prlnolples; lt wlll lnorease the
avallablllty cf oapltal and reduoe fnanolng
ocsts fcr crlglnatcrs and lt restcok the
fundlng scuroes fcr lnstltutlcns; and lt
wlll prcvlde lnvestcrs the cptlcn cf tallcr
made prcduots that meet thelr pcrtfcllc
requlrements, lnoludlng dlverslfoatlcn
and rlsk reduotlcn.
i
1
lntrcduotlcn tc Seourltlsatlcn, laper wrltten by Tlm Nloclle, lnternatlcnal lnstltute fcr Management,
2
/ndreas /. Jcbst, The Locncmlos cf lslamlo Flnanoe and Seourltlsatlcn, lMF 2007
3
S&l, lslamlo Flnanoe ls Seourltlsatlcn`s New Frcntler, lublloatlcn date: 8
th
Ncvember 2006
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ln an aotlcn fled befcre the Ccurts cf Sharjah, the Federal Ccurt cf Cassatlcn
held that, the hclder cf a blll cf ladlng by endcrsement ls ocnsldered tc have
an lnterest ln the blll cf ladlng by vlrtue cf havlng an lnterest and seeklng tc
enfcroe the ocntraot cf oarrlage. The hclder therefcre stands ln a pcsltlcn
slmllar tc the shlpper, and ls bcund by the blll cf ladlng as lf he was the shlpper
frcm the date when the shlpper beocmes sc bcund. The relatlcnshlp between
the hclder cf the blll cf ladlng wlth the oarrler ls gcverned sclely by the blll cf
ladlng. Thls mean that the hclder cf the blll cf ladlng by endcrsement has
tc ocmply wlth any arbltratlcn olause ocntalned ln the oharter party referred
tc lt ln the ocpy cf the blll cf ladlng as an crlglnal party tc the ocntraot.
By Yazan Sacudl, lartner
Marltlme, ^vlatlcn & lnsuranoe lraotloe
Holder of Copy of Bill of Lading by Endorsement
must comply with Arbitration Clause
^bu Dhabl Ccurt cf Cassatlcn 1udgment Nc. 634/26
Dated 17
th
1une 2008
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0laim
^ marlne ocmmerolal ocmpany (the
Clalmant) fled a oase agalnst the cwners
cf a vessel (the Defendant), requestlng
the ocurt tc crder the Defendant tc pay
Dhs. 2,704,952.47 plus lnterest, belng
the tctal value cf the damaged oargc
(Carllo) oarrled by the Defendant. The
Clalmant ocmmenoed the prcoeedlng
based cn the endcrsement cf twc bllls cf
ladlng ln lts favcur.
0ourt oI First Instance and
0ourt oI Appeal
^t thelr frst hearlng appearanoe,
Respcndents pleaded that the aotlcn
shculd be dlsmlssed due tc the arbltratlcn
olause ln the oharterparty referred tc
lt ln the blll cf ladlng. The Ccurt cf
Flrst lnstanoe upheld thls argument
and dlsmlssed the oase agalnst the
Defendants due tc the arbltratlcn olause.
The Clalmant appealed agalnst the
judgment tc the Ccurt cf ^ppeal, whc
upheld the judgment dellvered by the
Ccurt cf Flrst lnstanoe and dlsmlssed the
appeal. The Clalmant appealed tc the
Ccurt cf Cassatlcn.
0ourt oI 0assation
Befcre the Ccurt cf Cassatlcn, the
Clalmant argued that the Ccurt cf Flrst
lnstanoe and the Ccurt cf ^ppeal were
wrcng ln dlsmlsslng the oase agalnst
the Defendant beoause Sub^rtlole 203
4 cf the Federal Ccde cf Clvll lrcoedure
prcvldes that, /rbitraticn may nct be
agreed except by perscns authcrised tc
dispcse cf the right which is subject cf
the dispute". The Clalmant argued thls as
the aotlcn revclved arcund the Clalmant`s
rlght tc reocver fcr the damaged oargc,
the arbltratlcn olause shculd have been
agreed by Clalmant ln the oharterparty
and nct vla an endcrsement ln the blll cf
ladlng. Further as arbltratlcn olause ln the
oharterparty cf the vessel related tc the
dlsputes between cwners and the shlpper,
the arbltratlcn olause was nct applloable
tc the Clalmant beoause the arbltratlcn
olause wlll cnly be blndlng tc the partles
whc agreed and slgned lt. The Clalmant
alsc argued that the olause related tc the
oharterparty cf the vessel, whereas the
Clalmant`s rlght lnvclves a reocvery cf
oargc damage based cn the blll cf ladlng
and the faot that the olalmant was nct
party ln the oharterparty. Therefcre the
lcwer ocurts where wrcng tc ocnslder the
Clalmant tc be a party tc the oharter party
and tc enfcroe the arbltratlcn olause.
The Ccurt cf Cassatlcn held that, the
hclder cf a blll cf ladlng ls ocnsldered
tc have lnterest ln the blll cf ladlng
and, seeklng tc enfcroe the ocntraot cf
oarrlage, stands ln a pcsltlcn slmllar tc
the shlpper, and ls bcund tc all olause ln
the blll cf ladlng lnoludlng the oharterparty
as referred tc lt ln the blll cf ladlng. lt ls
further a matter cf settled praotloe that
as lcng as the Clalmant (Ccnslgnee) ls
deemed tc have an lnterest ln the blll cf
ladlng, hls relatlcnshlp wlth the Carrler
(Defendant) ls gcverned sclely by the blll
cf ladlng, and the Clalmant (Ccnslgnee)
has tc ocmply wlth the arbltratlcn olause
ln the oharterparty referred tc lt ln hls
ocpy cf blll cf ladlng.
Therefcre, the Ccurt cf Cassatlcn rejeoted
the appeal, and crdered the Clalmant tc
pay ocsts.
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United Arab Emirates
Ministry of State for Cabinet Affairs
38
th
Year
Secretariat General of the Cabinet
Issue No. 484
28 Ramadan 1429
28
th
September 2008
OFFICIAL GAZETTE
FEDERAL DECREES
59 cf 2008 ^ppclntlng the Dlreotcr Ceneral cf the Ceneral lnfcrmatlcn ^uthcrlty
60 cf 2008 Regardlng the head cf the U^L mlsslcn tc the Republlo cf lraq
61 cf 2008 Speolfylng the salary and allcwanoes tc be pald tc the Deputy Ccverncr cf the U^L Central Bank
62 cf 2008 ^ppclntlng a U^L permanent representatlve
REGULATORY RESOLUTIONS OF THE CABINET
33 cf 2008 Regardlng the fees payable fcr lloenolng cf prlvate seourlty frms
34 cf 2008 ^mendlng Cablnet Resclutlcn Nc. 12 cf 2000 regardlng the seourltles and ocmmcdltles llstlng regulatlcns
35 cf 2008 Regardlng the crganlsatlcnal struoture cf the Natlcnal Transpcrt ^uthcrlty
36 cf 2008 0n the settlng up and crganlsatlcn cf the U^L Fcrelgn ^ld Cccrdlnatlcn 0ffoe
MINISTERIAL RESOLUTIONS
- From the Ministry oI Finance:
90 cf 2008
Mlnlster cf Flnanoe resclutlcn amendlng Mlnlsterlal Resclutlcn Nc. 20 cf 2000 regulatlng management
ocntraots
93 cf 2008 Mlnlster cf Flnanoe resclutlcn lntrcduolng fees fcr varlcus servloes prcvlded by the Mlnlster cf Flnanoe
94 cf 2008
Mlnlster cf Flnanoe resclutlcn ocnoernlng the spllt cf revenue frcm the webslte and sale cf legal publloatlcns
cf the Mlnlstry cf 1ustloe
- From the Ministry oI the Interior:
535 cf 2008 Mlnlster cf the lnterlcr resclutlcn settlng cut rules ocnoernlng the lnspeotlcn and reglstratlcn cf vehloles
- From the Ministry oI Economy:
461 cf 2008
Mlnlster cf Locncmy resclutlcn ocnoernlng a revlslcn cf the ^rtloles cf ^sscolatlcn cf the ^bu Dhabl Natlcnal
Hctels, a publlo jclnt stcok ocmpany
476 cf 2008
Mlnlster cf Locncmy resclutlcn ocnoernlng a revlslcn cf the ^rtloles and Memcrandum cf ^sscolatlcn cf
Nccr lslamlo Bank, a publlo jclnt stcok ocmpany
478 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng the lnocrpcratlcn cf ^l Hllal Takaful, a publlo jclnt stcok
ocmpany
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486 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng the lnocrpcratlcn cf the Lxpcrt Credlt lnsuranoe Ccmpany cf the
Lmlrates, a publlo jclnt stcok ocmpany
514 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng the lnocrpcratlcn cf ^lyah Satelllte Ccmmunloatlcns, a prlvate
jclnt stcok ocmpany
517 cf 2008
Mlnlster cf Locncmy resclutlcn ocnoernlng a revlslcn cf the ^rtloles cf ^sscolatlcn cf ^l Khazna lnsuranoe,
a publlo jclnt stcok ocmpany
520 cf 2008
Mlnlster cf Locncmy resclutlcn ocnoernlng a revlslcn cf the ^rtloles cf ^sscolatlcn cf Dubal Refreshments,
a publlo jclnt stcok ocmpany
522 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng the lnocrpcratlcn cf Creen Cresoent lnsuranoe, a publlo jclnt
stcok ocmpany
529 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng a revlslcn cf the ^rtloles cf ^sscolatlcn cf Nccr Capltal, a prlvate
jclnt stcok ocmpany
530 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng a revlslcn cf the ^rtloles cf ^sscolatlcn cf ^l Nujccm lslands, a
prlvate jclnt stcok ocmpany
531 cf 2008
Mlnlster cf Locncmy resclutlcn anncunolng a revlslcn cf the ^rtloles cf ^sscolatlcn cf ^l Hancc Real Lstate,
a prlvate jclnt stcok ocmpany
558 cf 2008
Mlnlster cf Locncmy resclutlcn ocnoernlng the lnocrpcratlcn cf ^l wathba wastewater Management, a publlo
jclnt stcok ocmpany
- From the Ministry oI Environment & Water:
525 cf 2008 Mlnlster cf Lnvlrcnment & water resclutlcn ocnoernlng the lmpcrt cf lccse dates
ADMINISTRATIVE RESOLUTIONS
- From the From the Emirate oI Abu 0habi ~ Executive 0ouncil (Economic 0evelopment 0ommittee):
Ccmmlttee resclutlcn apprcvlng the lloenolng cf ^bu Dhabl Flnanoe, a prlvate jclnt stcok ocmpany
Ccmmlttee resclutlcn apprcvlng the lloenolng cf ^l watanl Ceramlos llant, a prlvate jclnt stcok ocmpany (under fcrmatlcn)
Ccmmlttee resclutlcn apprcvlng the lloenolng cf lnternatlcnal Cclden Crcup, a prlvate jclnt stcok ocmpany
Ccmmlttee resclutlcn apprcvlng the lloenolng cf ^l Fahd Real Lstate lnvestment, a prlvate jclnt stcok ocmpany (under
fcrmatlcn)
STATEMENTS
- From the 0AE 0entral Bank:
^ssets/ Llabllltles as at 1uly 31, 2008
^ssets/ Llabllltles as at ^ugust 31, 2008
ANNOUNCEMENTS
- From the Ministry oI Economy:

Ccnoernlng the applloatlcn fled by Du||berg Kcnzentra CmbH & Cc. KC (Dubai Branch) tc delete thelr
reglstratlcn frcm the Reglster cf Fcrelgn Ccmpanles at the Mlnlstry

Ccnoernlng the applloatlcn fled by Hi|| & /sscciates (Midd|e Fast) Limited, a branoh cf a fcrelgn ocmpany
(Dubal Branoh), tc delete thelr reglstratlcn frcm the Reglster cf Fcrelgn Ccmpanles at the Mlnlstry
HUSAM HOURANI
Partner
Head of Banking & Finance
h.hourani@tamimi.com
LISA DALE
Partner
Head of Property
L.dale@tamimi.com
HUSSAIN EISA SHIRI
Partner
Dispute Resolution
h.shiri@tamimi.com
JASSIM M. ABDULLAH
Partner
Dispute Resolution
j.abdullah@tamimi.com
YAZAN AL SAOUDI
Partner
Head of Maritime, Aviation &
Insurance/ Dispute Resolution
y.saoudi@tamimi.com
HASSAN ARAB
Partner
Head of Dispute Resolution
h.arab@tamimi.com
ESSAM AL TAMIMI
Senior Partner
Arbitration, Banking, Corporate
Commercial
e.tamimi@tamimi.com
LYNETTE BROWN
Partner
Banking & Finance
L.brown@tamimi.com
OMAR OBEIDAT
Partner
Intellectual Property, IT
o.obeidat@tamimi.com
HODA BARAKAT
Managing Partner
Head of Intellectual
Property, IT
h.barakat@tamimi.com
SAMER QUDAH
Partner
Corporate Commercial
s.qudah@tamimi.com
SAMIR KANTARIA
Partner
Corporate Commercial
s.kantaria@tamimi.com
MOHAMMED AK BIK
Honourary Partner
Dispute Resolution
m.bik@tamimi.com
BASSEM ZEIN EL DINE
Partner & Head of Dubai
World Trade Centre Ofce
Corporate Commercial
b.dine@tamimi.com
SYDENE HELWICK
Partner
Property
s.helwick@tamimi.com
AHMED ALLOUZ
Partner
Dispute Resolution
a.allouz@tamimi.com
ZAFER SHEIKH OGHLI
Partner
Head of Sharjah Ofce
Dispute Resolution
z.oghli@tamimi.com
MOHAMMED J KAMAL
Partner
Property
m.kamal@tamimi.com
JAMES MACCALLUM
Partner
Corporate Commercial
j.maccallum@tamimi.com
MOHAMMED MARZOUQI
Partner
Dispute Resolution
m.almarzouqi@tamimi.com
EL-AMEIR NOOR
Partner
Dispute Resolution
e.noor@tamimi.com
Partners at Al Tamimi & Company
AHMAD ANANI
Partner
Head of Qatar ofce
Corporate Commercial
a.anani@tamimi.com
MUHAMMAD ARIF SAEED
Partner
Head of Corporate
Commercial
m.saeed@tamimi.com
NICHOLAS DIACOS
Partner
Head of Saudi ofce
n.diacos@tamimi.com
UNITED ARAB EMIRATES
QATAR
KINGDOM OF SAUDI ARABIA
CARLA SALIBA
Corporate Commercial
c.saliba@tamimi.com
Lawyers at Al Tamimi & Company
ANDRE HUMAN
Intellectual Property, IT
a.human@tamimi.com
AHMAD AL KHALIL
Banking & Finance
a.alkhalil@tamimi.com
DIVYA ABROL GAMBHIR
Banking & Finance
d.abrol@tamimi.com
ALIA AL FALASI
Corporate Commercial
a.falasi@tamimi.com
DUBAI INTERNATIONAL FINANCIAL CENTRE OFFICE
CHERRY TURCAL
Banking & Finance
c.turcal@tamimi.com
CANDICE CHESTERS
Property
c.chesters@tamimi.com
AHMED ALLOUZ
Partner
Dispute Resolution
a.allouz@tamimi.com
CLAIRE CLUTTERHAM
Special Projects
c.clutterham@tamimi.com
CHRIS WEBB
Corporate Commercial
c.webb@tamimi.com
AARTI KOTECHA
Corporate Commercial
a.kotecha@tamimi.com
EMAN AHMED
Dispute Resolution
e.ahmed@tamimi.com
EMAN ABDELRAHMAN
Intellectual Property, IT
e.abdelrahman@tamimi.com
EMMA LOUISE VAN SON
Special Projects
e.vanson@tamimi.com
ERIC TEO
Construction & Engineering
e.teo@tamimi.com
FIRAS AL REFAI
Corporate Commercial
f.refai@tamimi.com
FATMA EL ZEINI
Maritime, Aviation &
Insurance
f.zeiny@tamimi.com
GARY WATTS
Head of Corporate
Commercial
g.watts@tamimi.com
HAMDAN AL SHAMSI
Banking & Finance
h.alshamsi@tamimi.com
IAIN MCGILLIVRAY
Property
i.mcgillivray@tamimi.com
HUFRIZ WADIA
Banking & Finance
h.wadia@tamimi.com
IBTISSEM LASSOUED
Special Projects
i.lassoued@tamimi.com
IZAFANIZ KAMIR
Banking & Finance
i.kamir@tamimi.com
IZABELLA SZADKOWSKA
Banking & Finance
i.szadkowska@tamimi.com
FATMA MOOSA AL
BALOOSHI
Dispute Resolution
f.moosa@tamimi.com
FAISAL DAUDPOTA
Intellectual Property, IT
f.daudpota@tamimi.com
HUSAM HOURANI
Partner
Banking & Finance
h.hourani@tamimi.com
HUSSAIN EISA SHIRI
Partner
Dispute Resolution
h.shiri@tamimi.com
HASSAN ARAB
Partner
Dispute Resolution
h.arab@tamimi.com
HODA BARAKAT
Managing Partner
Intellectual Property, IT
h.barakat@tamimi.com
ESSAM AL TAMIMI
Senior Partner
Dispute Resolution, Banking &
Corporate Commercial
e.tamimi@tamimi.com
JASON WALTERS
Maritime, Aviation &
Insurance
j.walters@tamimi.com
GUY MICHAEL SOLLING
Corporate Commercial
g.solling@tamimi.com
DEAN OLEARY
Construction & Engineering
d.oleary@tamimi.com
CORIN RICKETTS
Maritime, Aviation &
Insurance
c.ricketts@tamimi.com
HESHAM AL BARBARY
Intellectual Property, IT
h.barbary@tamimi.com
JASSIM M. ABDULLAH
Partner
Dispute Resolution
j.abdullah@tamimi.com
JENNIFER PAGE
Dispute Resolution
j.page@tamimi.com
MOHAMMED KAWASMI
Property
m.kawasmi@tamimi.com
MOHAMED KHODEIR
Corporate Commercial
m.khodeir@tamimi.com
MAMOON AHMAD KHAN
Banking & Finance
m.khan@tamimi.com
MARCUS WALLMAN
Corporate Commercial
m.wallman@tamimi.com
MUHAMMAD TARIQ
Corporate Commercial
m.tariq@tamimi.com
MOHAMED ALI ABOU
SAKR
Dispute Resolution
m.sakr@tamimi.com
JODY GLENN WAUGH
Banking & Finance
j.waugh@tamimi.com
LOUISE MACDOUGALL
Corporate Commercial
L.macdougall@tamimi.com
LARA ABABNEH
Intellectual Property, IT
L.abaneh@tamimi.com
KHALID AL HAMRANI
Special Projects
k.hamrani@tamimi.com
MOHAMMED KAMRAN
Property
m.kamran@tamimi.com
MOHAMED ALI
Intellectual Property, IT
m.ali@tamimi.com
MOHAMMED J KAMAL
Partner
Property
m.kamal@tamimi.com
LYNETTE BROWN
Partner
Banking & Finance
L.brown@tamimi.com
LISA DALE
Partner
Property
L.dale@tamimi.com
MARIZE COETZER
Corporate Commercial
m.coetzer@tamimi.com
OMAR Al SAADOON
Construction & Engineering
o.alsaadoon@tamimi.com
RAFAT ABUALHAIJA
Property
r.abualhaija@tamimi.com
OMER KHAN
Corporate Commercial
o.khan@tamimi.com
NICK REID
Banking & Finance
n.reid@tamimi.com
OMAR HEGAZY
Corporate Commercial
o.hegazy@tamimi.com
NOOR EL SHUNNAR
Corporate Commercial
n.elshunnar@tamimi.com
SHABNAM KHERICHA
Banking & Finance
s.khericha@tamimi.com
REBECCA FORD
Corporate Commercial
r.ford@tamimi.com
RASHA AL ARDAH
Intellectual Property, IT
r.alardah@tamimi.com
SARAH FLORER
Banking & Finance
s.orer@tamimi.com
RAZA MITHANI
Special Projects
r.mithani@tamimi.com
PHILIP PUNWAR
Arbitration / Dispute
Resolution
p.punwar@tamimi.com
OMAR OMAR
Maritime, Aviation &
Insurance
o.omar@tamimi.com
OMAR OBEIDAT
Partner
Intellectual Property, IT
o.obeidat@tamimi.com
SAMIR KANTARIA
Partner
Corporate Commercial
s.kantaria@tamimi.com
RITA JABALLAH
Dispute Resolution
r.jaballah@tamimi.com
RAFIQ JAFFER
Banking & Finance
r.jaffer@tamimi.com
NAWAL ABDEL HADI
Corporate Commercial
n.abdelhadi@tamimi.com
MOUTASEM SHAKHATREH
Banking & Finance
m.shakhatreh@tamimi.com
NAY SHARAFELDIN
Corporate Commercial
n.sharafeldin@tamimi.com
MUNIR SUBOH
Intellectual Property, IT
m.suboh@tamimi.com
JEREMY SCOTT
Property
j.scott@tamimi.com
JAVID RAFIQ
Banking & Finance
j.raq@tamimi.com
SHERIF GERGES
Dispute Resolution
s.gerges@tamimi.com
SONIA HARVEY
Property
s.harvey@tamimi.com
SONYA STEWART
Corporate Commercial
s.stewart@tamimi.com
SYED AIZAZ NASEER
Banking & Finance
s.naseer@tamimi.com
YUSUF ZAMAN
Corporate Commercial
y.zaman@tamimi.com
WILLEM STEENKAMP
Corporate Commercial
w.steenkamp@tamimi.com
TAIBA SAEED
Dispute Resolution
t.alsafar@tamimi.com
YAMAN AL HAWAMDEH
Maritime, Aviation &
Insurance
y.hawamdeh@tamimi.com
ZANE ANANI
Construction & Engineering
z.anani@tamimi.com
YAZAN AL SAOUDI
Partner
Maritime, Aviation &
Insurance/ Dispute Resolution
y.saoudi@tamimi.com
WALDO STEYN
Intellectual Property, IT
w.steyn@tamimi.com
TAMIMA YEHIA
Banking & Finance
t.yehia@tamimi.com
SYDENE HELWICK
Partner
Property
s.helwick@tamimi.com
STEVEN BAINBRIDGE
Corporate Commercial
s.bainbridge@tamimi.com
SAMER QUDAH
Partner
Corporate Commercial
s.qudah@tamimi.com
BASSEM ZEIN EL DINE
Partner & Head of Dubai
World Trade Centre Ofce
Corporate Commercial
b.dine@tamimi.com
DUBAI WORLD TRADE CENTRE OFFICE
RUTA GOTHOSKAR
Corporate Commercial
r.gothoskar@tamimi.com
FAKHRY ELMASRY
Corporate Commercial
f.elmasry@tamimi.com
JOUMANA AZZAM
Corporate Commercial
j.azzam@tamimi.com
SHERIF RAHMAN
Corporate Commercial
s.rahman@tamimi.com
ANDREW SLEIMAN
Corporate Commercial
a.sleiman@tamimi.com
EHAB MORCOS
Corporate Commercial
e.morcos@tamimi.com
DAVID WHITFORD
Corporate Commercial
d.whitford@tamimi.com
DUBAI INTERNET CITY
FADI EL JURDI
Intellectual Property, IT
f.eljurdi@tamimi.com
MANIJEH KHAN
Intellectual Property, IT
m.khan@tamimi.com
NIKKI SCHOORL
Intellectual Property, IT
n.schoorl@tamimi.com
YVONNE PAH
Intellectual Property, IT
y.pah@tamimi.com
BILAL AL SABBAH
Corporate Commercial
b.alsabbah@tamimi.com
TAKI OSMAN
Corporate Commercial
t.osman@tamimi.com
YOUSSEF EZZEDINE
Corporate Commercial
y.ezzedine@tamimi.com
BEE GAN
Intellectual Property, IT
b.gan@tamimi.com
AYOUB GHAZI
Dispute Resolution
a.ghazi@tamimi.com
SHARJAH OFFICE
ALI BACHROUCH
Dispute Resolution
a.bachrouch@tamimi.com
AMMAR HAIKAL
Dispute Resolution
a.haikal@tamimi.com
MAHMOUD ALI HOMIDAT
Corporate Commercial
m.homidat@tamimi.com
MARIE GRACE SEIF
Corporate Commercial
m.seif@tamimi.com
RANA EL HUSSEINI
Dispute Resolution
r.husseini@tamimi.com
AHMED MASADEH
Corporate Commercial
a.masadeh@tamimi.com
IBRAHIM TUKAN
Corporate Commercial
i.tukan@tamimi.com
ABU DHABI OFFICE
MAJD BAROUDI
Dispute Resolution
m.baroudi@tamimi.com
MOHAMMED AK BIK
Honourary Partner
Dispute Resolution
m.bik@tamimi.com
ZAFER SHEIKH OGHLI
Partner
Head of Sharjah Ofce
Dispute Resolution
z.oghli@tamimi.com
JAMES MACCALLUM
Partner
Corporate Commercial
j.maccallum@tamimi.com
MOHAMMED MARZOUQI
Partner
Dispute Resolution
m.almarzouqi@tamimi.com
EL-AMEIR NOOR
Partner
Dispute Resolution
e.noor@tamimi.com
BABEKER IBRAHIM
Dispute Resolution
b.ibrahim@tamimi.com
AKRAM AHMED AL-BAITI
Dispute Resolution
a.baiti@tamimi.com
FRANCESCO LUCENTE
Corporate Commercial
f.lucente@tamimi.com
HANI AL NADDAF
Dispute Resolution
h.alnaddaf@tamimi.com
QATAR - ASSOCIATE OFFICE: ADV. MOHAMMED AL-MARRI in association with Al Tamimi & Company
IAN BODE
Property & Construction
i.bode@tamimi.com
AHMAD AL JAAFIR
Corporate Commercial
a.jaar@tamimi.com
FADI SABSABI
Corporate Commercial
f.sabsabi@tamimi.com
AHMAD ANANI
Partner
Head of Qatar ofce
Corporate Commercial
a.anani@tamimi.com
TAUFEEK BUSTANI
Dispute Resolution
t.bustani@tamimi.com
SAIFEDIN M. NAGAR
Litigation, Corporate
Commercial
s.nagar@tamimi.com
WALTER ROBINSON
Property
w.robinson@tamimi.com
WAFA ALISEYED
Corporate Commercial
w.aliseyed@tamimi.com
WALAA AL QASEM
Corporate Commercial
w.alqasem@tamimi.com
MARWAN ANDRAOS
Intellectual Property, IT
m.andraos@tamimi.com
JOHN DENNETT
Corporate Commercial
j.dennett@tamimi.com
ELISE PAUL-HUS
Corporate Commercial
e.paulhus@tamimi.com
RIFAT ABDO
Dispute Resolution
r.abdo@tamimi.com
GILES MENEZES
Corporate Commercial
g.menezes@tamimi.com
JOHN WELLINGTON
Property & Construction
j.wellington@tamimi.com
KAMAL HAFEZ
Property & Construction
k.hafez@tamimi.com
MOHAMMED AL MARRI
Dispute Resolution
m.marri@tamimi.com
KATRINA WILSON
Corporate Commercial
k.wilson@tamimi.com
ALAN HALL
Property
a.hall@tamimi.com
KSA OFFICE
MOTHANA EL GASSEER
Corporate Commercial
m.elgasseer@tamimi.com
MUHAMMAD ARIF SAEED
Partner
Head of Corporate
Commercial
m.saeed@tamimi.com
ABDULLAH AL TAMIMI
Dispute Resolution
a.tamimi@tamimi.com
NICHOLAS DIACOS
Partner
Head of Saudi ofce
n.diacos@tamimi.com
NAJEEB MAABREH
Banking & Finance
n.maabreh@tamimi.com
SALAH DEEB
Intellectual Property, IT
s.deeb@tamimi.com
FAHAD AL MALKI
Corporate Commercial
f.malki@tamimi.com
IYAD HAMARNEH
Construction & Dispute
Resolution
i.hamarneh@tamimi.com
KHALED SAQQAF
Corporate Commercial
k.saqqaf@tamimi.com
JORDAN OFFICE
ZEID UTEIBI
Telecommunications
z.uteibi@tamimi.com
GLENN LOVELL
Banking & Finance
g.lovell@tamimi.com
HAIDER SELMAN AL
JANABI
h.selman@tamimi.com
NADIA SALEM
(based in Qatar Ofce)
n.salem@tamimi.com
IRAQ OFFICE
TAREK AHMED MAROOF
t.maroof@tamimi.com
WONG YUEN PING
Corporate Commercial
w.yuenping@tamimi.com
TALAL BIJJANI
Banking & Finance
t.bijjani@tamimi.com
STEFAN JURY
Banking & Finance
s.jury@tamimi.com
SHARIFAH HAMZAH
Corporate Commercial
s.hamzah@tamimi.com
HADEEL HASSAN
h.hassan@tamimi.com
NEW STAFF
John Wellington
1chn welllngtcn jclned the lrcperty and Ccnstruotlcn praotloe ln the atar cffoe, cn the 14th cf
Deoember. 1chn ls a Ccmmerolal prcperty, lnfrastruoture and ocnstruotlcn speolallst wlth nearly 30
years ln legal praotloe wcrklng fcr and as a partner ln a majcr law frm ln ^ustralla. He has aoted fcr
develcpers, lnvestcrs and gcvernment bcdles ln relatlcn tc the sale and purohase, leaslng, man
agement, develcpment, ocnstruotlcn, tltllng and struoturlng cf tcurlst faollltles, lnoludlng marlnas
and hctels and related lnfrastruoture, mlxed use and resldentlal develcpments, retall and lndustrlal
prcpertles, cffoe bulldlngs, eduoatlcn faollltles, student aoocmmcdatlcn and oar parks.
Hadeel Hassan
Hadeel Hassan jclned the frm ln the lraq cffoe, cn the 1st cf Deoember. Hadeel graduated frcm the
Buslness and ^dmlnlstratlcn Ccllege (Statlstloal Dept) cf Mustenslrlyah Unlverslty ln 1987. Frcm
1997 tc 2001, she studled law at Baghdad Unlverslty and was admltted tc the Baghdad Bar ^sscola
tlcn ln 2001. Frcm 2001 tc 2003 she under praotloed at the lraql law cffoes cf the dlstlngulshed Dr
^bd ^lamlr Hassan ln Baghdad. ln 2003 Hadeel jclned ^uss M. Ycunls Law 0ffoes, a branoh cf the
lnternatlcnal legal praotloe MeyerReumann Legal Ccnsultanoy. Frcm 1uly 2004 tc ^prll 2005 Hadeel
wcrked at ^lMazd Crcup as vloe lresldent Legal and ln ^prll 2005 she was appclnted tc head the
lraql branoh cffoe cf MeyerReumann Legal Ccnsultanoy.
Kamal Hafez
Kamal has been a legal praotltlcner fcr mcre than twc years. He wcrked fcr and was a 1unlcr ^s
scolate ln cne cf the tcp ten law frms ln Lgypt. lrlcr tc jclnlng ^l Tamlml & Ccmpany ln the atar
cffoe, Kamal was lnvclved ln advlslng a number cf lnternatlcnal Ccmpanles cn struoturlng buslness
ln Lgypt, ln addltlcn tc draftlng a varlety cf ocntraots suoh as prcperty sale & purohase, franohlslng
agreements, LlC ocntraots, warehcuslng agreements and lnternatlcnal Sale cf gccds agreements,
as well as advlslng cn ^ntl Trust Law.
Proles
Al Tamimi & Company rm prole
Al Tamimi & Company Qatar prole
Qatar- Gateway of Growth
The Family Business Practice
From our Setting up series
JAFZA- Establishing Offshore Companies in the Jebel Ali Free Zone
Setting up in Dubai International Financial Centre
Setting up in Dubai Internet City
Setting up in Dubai Media City
Setting up In Knowledge Village
Arbitration & Litigation
Arbitration: Theory and Practice in the UAE
Dispute Resolution and Litigation in the UAE
Dubai Court Fees (in English and Arabic)
Framework for Litigation in the United Arab Emirates
The Arbitration Practice
Banking & Finance
Banking & Security Law in the UAE
Islamic Finance: A UAE Legal Perspective
Taxation Law in the UAE
Corporate Commercial
Companies under the UAE Commercial Companies Law
Inheritance Law in the UAE

Joint Ventures: Theory and Practice in the UAE
Labour Law in the UAE
Law of Tort in the UAE
Standardisation and Classication in the UAE
The GCC Economic Agreement & Customs Law
UAE Immigration Law
Technology, Media & Telecoms
Copyright Law
Patents, Designs & Models
Registration of Trademarks
Telecommunications
IT Query- IT Law in the UAE
Maritime, Aviation & Insurance
UAE Shipping Law: Cargo Claims and Other Related Issues
Laws Regulating Insurance in the United Arab Emirates
Property, Construction & Engineering
Construction Law
Property Law in the UAE and Qatar
Law Update
The full back catalogue of Law Update since April 1991
(available online only)
PUBLICATIONS
Available online at: www.tamimi.com
The informative brochures listed below are all available free of charge on our website. Selected brochures are also available
from the reception of our ofces in the UAE. Alternatively we would be happy to send them to you by post. Please email:
books@tamimi.com to order copies.
International Agreements, Conventions & Protocols signed
by the Government of the UAE
Positive Attitude
www.tamimi.com
Al Tamimi & Company - 2008 Accolades
* International Financial Law Review Law Firm of the Year UAE 2008
* International Financial Law Review Equity Deal of the Year 2008
* Legal 500 2008 & Chambers Global 2007/2008 - Top Tier in Dispute Resolution, IP, Real Estate & Construction
* International Legal Alliance Awards 2008 - Silver Award (Dubai)
Abu Dhabi I Amman I Baghdad I Doha I Dubai I Riyadh I Sharjah