MENA BLR – Reduction in
Nominal Value of Shares (QSE)
Nov 27, 2017
In 2012, Law No. 10 of 2012 regulating Consultancy Services (“Consultancy Law”) was passed to outline the requirements for licensing entities providing consultancy services in the economic, commercial, and financial sectors. In addition to these consultancy sectors, the legalisation also regulates licensing of entities providing analysis, training, and feasibility studies services.
In addition to these consultancy sectors, the legalisation also regulates licensing of entities providing analysis, training, and feasibility studies services.
The said legislation allowed international consultancy firms an avenue to register branches in Qatar to conduct consultancy services.
The Consultancy Law also lists the requirements for employees of a consultancy firm to have at least ten years of post-qualification experience (that may be reduced depending on post-graduate studies), and be of good standing.
The Consultancy Law sets out the license period to be three years, with a renewable term.
With that said, on 12 September 2017, Ministerial Decisions No. 211 and 214 of 2017 (“Consultancy Decisions”) were promulgated in the Official Gazette. The Consultancy Decisions provided the application standard formats, which have to be filed with the concerned department at the Ministry of Economy and Commerce to license a consultancy firm.
The Consultancy Decisions have provided more clarity and structure in respect of the requirements for granting international consultancy firms an avenue to register branches in Qatar to conduct consultancy services.
The application process requires certain documents (such as attested constitutional documents) from the parent company in addition to proof of adherence to a set of threshold criteria, which include:
- Continuous operation of the parent company for a minimum of fifteen years.
- Operation of the parent company in a minimum of three countries.
These Consultancy Decisions serve as executive regulations to the Consultancy Law giving detailed information as to application forms and documentary requirements for foreign entities contemplating to set up a branch engaged in consultancy business in Qatar without being subject to the foreign investment restrictions on share ownership (i.e. the need for a Qatari partner).
Although the QFMA (or QSE) are yet to formally publish a notification or decision effecting the stock split, this promises to be a step in the right direction for the Qatari capital market.