Qatar 'well-positioned' to attract FDI, stimulate business sector


(MENAFN- Gulf Times) Qatar’s investment
landscape is ripe for hosting a wide range of international companies, particularly American businesses, according to experts at international law firm, Crowell & Moring.
In this two-part exclusive interview, managing partner Charbel Maakaron and Robert Hager, who is also a partner in the firm and chairman of the American Chamber of Commerce in Qatar, shared their views on the progress Qatar has achieved in diversifying its economic portfolio and the legal
reforms implemented by the government
to further accelerate the inflow of foreign direct investment
s, among other key developments in the private sectors of both countries.

Gulf Times: What regulations is Qatar putting in place to stimulate the business sector?

Maakaron: Creating economic diversity is something that's been one of the key drivers and primary objectives of the Qatar National Vision 2030. It's therefore logical to see, as a consequence of that, a dynamic legal
framework that is conducive to bringing forward economic diversity.
In the last five years, I have seen a significant uptick in new legislation that is designed to serve that objective. For example, in 2019, Qatar revamped its regulations on foreign direct investment
to permit foreign investors to own up to 100% of their company's capital. Also, earlier this year we saw new regulations permitting foreign ownership of up to 100% in listed companies on the Qatar Stock Exchange. This was historically capped at 25%, so this is a major shift.
In 2020, we also saw the passing of the new public-private partnership (PPP) law, which also permits, within certain parameters, ownership of the PPP project by the foreign investor.
There are other important legislative changes that run alongside these developments. For example, there has been significant improvement with labour and employment rules, alongside immigration rules. Examples include the removal of the exit permit and the No-Objection Certificate (NOC), minimum wage protection rights, and improved protection and rights for the labour workforce.
These changes are notable in terms of attracting a capable workforce, retention of talent, allowing employees to move freely within and outside of Qatar, as well as within their organisation.
Qatar also introduced laws for businesses to compete and comply with the requirements of the digital age. For instance, we all recognise the importance of personal data. Qatar was the first GCC country to pass a Personal Data Protection Law in 2016. This law was gradually introduced and continues to develop, as we saw last year where 14 new guidelines were passed to support the implementation of the law.
Other notable legal
developments involve transparency and anti-money laundering. One manifestation of this is the recent introduction of ultimate beneficial ownership (UBO) disclosure form. When we set up companies in Qatar, we are now required to provide information about who is the UBO of that business. Earlier this week, we saw in the amendments to the Commercial Companies Law the introduction of new AML compliance requirements for companies operating in Qatar.

To what extent do you think these new regulations will attract foreign investment
s?

Maakaron: When you offer a legal
framework that's conducive for doing business, coupled with projects that are feasible, including the oil and gas
expansion and all the projects relating to infrastructure, technology
, and the World Cup, it’s natural that you will have interest, right?
The question becomes, how do you facilitate the transition of that interest into actual investment
in the country? I think Qatar has successfully addressed this in two ways. Firstly, by creating a reliable and advanced infrastructure, and secondly by reducing 'red-tape’ and bureaucracy to offer a seamless business environment. In addition, the Qatari government
has recently placed greater emphasis on digital platforms that makes it easy to overcome the inability to travel
or to be physically present at relevant ministries. This has been helpful from an administrative front as it allows investors to file applications and carry out business remotely.
Lastly, I should mention some of onshore and offshore business platforms that are also very well positioned to attract and grow much of Qatar’s FDI, such as the Qatar Financial Centre, which despite the pandemic is seeing impressive growth in the number of new registrants, and the new Qatar Free Zones, which despite its relatively young presence is growing in leaps and bounds, in sectors that are within the strategic focus of the Qatar Free Zones Authority (QFZA). These business platforms, alongside Qatar Media City and Qatar Science and Technology
Park (QSTP), are additional important drivers used by the state to attract FDI into Qatar.

What are the most prominent sectors in Qatar with US investment
s?

Hager: The oil and gas
and defence sectors are critical, as well as the technology
, healthcare and sport sectors. The education sector is an area we're particularly proud of. It's important that we have US educational institutions that provide opportunities for Qataris and for people in the region to learn best practices in different fields, whether it's engineering through Texas A & M University, diplomacy
through Georgetown University, medicine
with Weill Cornell, business with Carnegie Mellon University, or journalism with Northwestern University. We also enjoy the number of Qataris that come to the US for education. These are things that bring the countries closer together.
Qatar has a world-class airline that is connected to the whole world. People are coming here already and the next step is bringing them outside the airport, and that's where I think there's going to be many opportunities for US companies. Ownership is an important factor for US companies, and I think the changes in the law and establishment of free zones is going to encourage US business here.

What is the impact of the new foreign ownership law that allows up to 100% by non-Qataris?

Maakaron: Qatar ranks first today in the region on the Global Entrepreneurship Index, according to the Global Competitiveness Report issued by the World Economic Forum (
It was also among the world's top 20 business environment improvers in 2019, according to World Bank ( having moved up six spots, which is significant. This tells me that the new foreign investment
law is impactful.
All of the above combined with the new flexible legal
framework will increase Qatar’s ability to attract foreign investment
. You will also likely see growth in the SME sector, which is vital for any economy. For small and medium businesses, having the ability to set up on its own as a foreign-owned entity provides diversity to the SME sector, and creates a full cycle in terms of the project path in any sector.
Qatar has also taken major strides to become a regional business hub for multinational companies. Actually, us being here in Crowell’s regional offices in Doha is a testimony to Qatar’s ability to attract foreign businesses as the firm has chosen Doha as its investment
capital in the Middle East due to its confidence in the Qatari economy and strong belief in Qatar’s future growth prospects.

Can you provide an overview of the new real estate ownership law, and how it might attract more buyers into the Qatari real estate market
?

Maakaron: Foreign real estate ownership in Qatar has been growing in phases. It was already possible for investors to purchase real estate in certain areas and own usufruct rights – long leasehold. Recently, the law added new areas that allow foreign ownership, such as in West Bay, The Pearl, and Lusail, which are areas now evolving into major real estate centres in the country.
This initiative was also coupled with the possibility of attaining residency within certain parameters. I think this was done in a smart way because while it encouraging foreign investment
in real estate, limiting the areas for such investment
creates a balance by protecting the prices and preserving the market
balance for Qataris.    

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