Legal System in Qatar

The State of Qatar is a hereditary emirate. The Al-Thani family has ruled the State since the mid 19th century. Its judicial history was influenced by a number of events starting with the Ottoman occupation of the region in the early 19th century. The Ottoman rulers established a system of justice based on the teachings of the Hanafi school of Islamic Law. As the Ottoman Empire started to lose its grip on its rule in Qatar and elsewhere in the Arabian Gulf, Qatar underwent a gradual shift towards the Hanbali school of Islamic Law under the influence of the then-emerging regional power, Saudi Arabia.

In 1916, Britain and Qatar signed a treaty by which Qatar became a British protectorate. Soon thereafter, the British established their own court system. While the local courts continued to administer a legal system based on the principles of Shariah, the colonial or civil courts enforced English statutes. This practice engendered the dual court system which prevailed in Qatar until recently.

In October 2003, Qatar enacted the new Judicial Law No. 10 for the year 2003, which revolutionized and unified the judicial system in Qatar. This law came into effect in October 2004.

In June 2004, the Emir promulgated the Constitution, which came into effect in June 2005. It describes the political system in Qatar as democratic and grants the Shoura (Advisory) Council extensive legislative and consultative authority.

The Constitution stipulates that Qatar is to be ruled by the Al-Thani family, and by male successors of Sheikh Hamad Bin Khalifa Al-Thani.

The foreign policy of Qatar is based on the principle of consolidating and promoting international peace and security.

The Constitution protects basic civil and human rights. It stipulates that all citizens are equal in general rights and duties. Additionally, all people are equal before the law, and there is to be no discrimination on grounds of gender, ethnic origin, language, or religion. It also provides for the right to individual privacy and privacy of family affairs and correspondence. The accused in a criminal legal action is deemed innocent until proven guilty and is entitled to be provided legal assistance necessary to enable the exercise of his rights of defense.

The Constitution provides the administrative framework for the governance of the State. The system of governance is based on the principle of separation of authorities in accordance with the provisions of the Constitution. Legislative authority is exercised through the Shoura Council, while executive authority is exercised by the Emir, who is to be assisted by the Cabinet.

The Constitution provides that judicial authority is to be exercised by the courts, and Judges are to be independent in the exercise of their judicial functions.

The Constitution states that legislative authority shall vest in the Shoura Council. A member of the Shoura Council may propose new legislation, which proposal is submitted to a committee within the Council. The committee studies and refers it back to the Council. If the Shoura Council accepts the proposal, the same is referred to in the form of a draft law to the Cabinet of Ministers for review and recommendations.

The Cabinet of Ministers may also submit legislative proposals to the Shoura Council for deliberations. Such proposals of the Cabinet of Ministers are not binding on the Shoura Council.

The Constitution provides that every draft law adopted by the Shoura Council has to be referred finally to the Emir for endorsement.

The Emir has the right to decline ratification of a draft law and return the same to the Council. If the Shoura Council readopts the rejected draft law by the majority of two thirds, the Emir shall endorse the law and promulgate it. Notwithstanding the foregoing, the Emir may suspend the implementation of such law for an indefinite period if, in his determination, doing so is in the best interest of the State.

The judicial system is organized and established by the Judicial Law, Law No. 10 of the Year 2003, in terms of which litigation is divided into three stages: the courts of the first instance, the courts of appeal, and the court of cassation.

Civil trials are based on written pleadings and rebuttals. Criminal trials are based mostly on oral arguments.

Proceedings in all courts are conducted in Arabic. Translators are provided for non-Arabic speaking litigants. Decisions of the lower courts can be appealed before the courts of appeal and then in most cases finally before the court of cassation.

The Law provides that the court of cassation shall have a technical office; one of its tasks would be to extract and publish legal principles established by the court. These principles will lead the lower courts to follow the decisions of the court of cassation.

In 2004, Qatar enacted a new Civil Law, providing in addition to its applicability in respect of limitation of time and territorial jurisdiction, important definitions such as of natural and juridical persons, and principles such as the legal capacity to sue and be sued. It provides guidelines for the establishment of contractual relations and obligations arising therefrom. It specifies basic elements of a contract such as consent, subject matter, and purpose of contracting. It also deals with annulment, construction and binding nature, effect, and cancellation of contracts.

The general principle of freedom and sanctity of contract is recognized, and a contract is treated as the law of the contracting parties. Natural and legal persons are free to agree on whatever they desire, provided that their agreement does not conflict with the law, public order, and morality. Oral contracts and contracts resulting from the conduct of parties are mostly recognized and are enforceable in court subject to meeting the standards of proof.

The Civil Law also deals with the interpretation of contracts, contractual responsibilities, liability for personal acts, and responsibility for acts of third parties, ownership responsibilities, surety, unjust enrichment, types of sale, lease, insurance, and rights attached to the property, land law, mortgage, wills, legacy, privileges, and gains. It also discusses performance, compensation and compulsory execution, assignment of rights, innovation, the impossibility of performance, and statutes of limitation.

The Commercial Law No. 28 of the Year 2006 regulates and deals with commercial activities, business agencies, commercial concerns, trade names, and competition, commercial contracts in general, the rights and obligations of the buyer and the seller, maritime sales, commercial agencies, commission agencies, and brokerage.

The Commercial Law also regulates banking transactions and commercial paper of various categories including bills of exchange, promissory notes, and cheques.

The Commercial Companies Law No. 11 of the Year 2015 regulates the structure and governance of companies. This Law provides that any company established in Qatar must be classified under one of the prescribed categories. The most common types of companies are limited liability companies and shareholding companies.

Under the said Law, an investor may register a limited liability company with a minimum of 2 and a maximum of 50 shareholders, and with a minimum authorized share capital of QR. 200,000. The entire share capital must be paid up in full prior to the incorporation of the company. The liability of a shareholder for the debts of the company is limited to its shareholding. A limited liability company may not engage in insurance, banking, or investment brokerage.

Public shareholding companies must have a minimum of 5 shareholders and capital sufficient to achieve its objectives, and where the said company wishes to offer its shares to the public, its capital must not be less than QR. 10,000,000. Public shareholding companies can only be incorporated by a decision issued by the Minister of Economy and Commerce. Public shareholding companies listed on the Doha Securities Market may offer up to 25% of their share capital for subscription by foreigners.  The shares of public shareholding companies are traded on the stock exchange market in Doha. Private shareholding companies must have a minimum of 5 shareholders and a capital of not less than QR. 2,000,000. The shares of a private shareholding company are not traded on the stock exchange market.

The Law regulating the participation of foreign capital in business provides that foreign investors may participate in all sectors, except commercial agencies and real estate trading.

The general rule is that 51% of the capital of a business venture is to be owned by Qatari citizens or by entities fully owned by Qatari citizens. However, the Law provides that foreign ownership may be increased from 49% to 100% through a decision passed by the Minister of Economy and Commerce under certain circumstances.

Under this law, the Minister can issue licenses to foreign companies engaged in executing contracts in the State of Qatar which facilitate the performance of a public benefit.

In general, any company wishing to import goods into Qatar for sale must hold an importer’s number.

The standard rate of customs duty according to the Customs Law is 5% of the value of the imported goods.

No duty is paid on goods imported from the mainland of any of the GCC countries.

It is customary to grant duty exemptions to major national projects. Contractors working on such projects can also benefit from such exemptions.

Subject to prior approval, items imported for temporary use and subject to re-export are exempt from customs duties. There is no duty on personal effects. The import and sale of pornographic material, alcohol, and pork-based products are prohibited. There are no export taxes in Qatar.

The maritime law of Qatar no. 15 of 1980 regulated different topics related to maritime navigation such as ownership of vessels, maritime lien, and seizure, sea mariners, voyage and time charter parties, carriage of goods or passengers by sea contract, maritime sales contract, maritime insurance, maritime accident…etc.

Any vessel owner, who would like to register the vessel in Qatar, must be Qatar national. Moral person vessels can also acquire the Qatari nationality subject to the conditions specified in the maritime law.

Besides the Qatari maritime law, there is other maritime-related legislation such as law no. (12) of 2019 about the maritime zones of Qatar specifies the different types of waters owned by the State of Qatar subject to the law of the sea. There is also law no. (8) of 2017 regulating the maritime business in Qatar, which obligates Qatari flagged vessels to gain a license before engaging in maritime activities in the Qatari waters.

Law No. 8 of 2002 governs the business of commercial agents. The basic principle of the Law is that commercial agency is restricted to Qatari nationals or companies wholly-owned by Qatari nationals

The agency agreement (agreed between the agent and the principal) must grant the agent exclusive rights over products and services specified in the agreement.

The Department of Commercial Affairs at the Ministry of Economy and Commerce is required to maintain a commercial agents’ register, wherein all agency agreements are registered.

Agency agreements are subject to the laws of Qatar and disputes relating thereto are subject to the jurisdiction of Qatari courts unless the parties agree otherwise.

The relationship between an employer (other than Government and its corporations) and its employee (skilled or unskilled) is regulated by the Labour Law. The Labour Law No. 14 of 2004 mandates that an employment contract must be drawn in the Arabic language. Another language may be used besides Arabic, but the Arabic text will prevail.

A working week may consist of up to six business days. Ordinary working hours may not be more than eight hours a day, except during the Islamic month of Ramadan in which the normal working hours are reduced to no more than six a day.

The term of an employment contract may be of indefinite duration or of a limited period, provided that the term does not exceed 5 years.

Any stipulations contrary to the provisions of the Labour Law are void unless more advantageous to the employee.

The Law provides a framework for forming worker’s committees in organizations in which the number of Qatari workers is not less than a hundred.

The law on Protection of Copyright and Neighbouring Rights No. 7 of 2002 confers protection upon authors of original literary and artistic works, irrespective of the value, quality, purpose, or mode of expression of such works. Protected works include books, lectures, musical works, photographic works, and computer software.

Every published, displayed or circulated work is required to be accompanied by a certificate of origin and a declaration (by the importer or owner) specifying the geographic area/place within which the display or circulation is authorized.

The economic rights of the author/owner are protected during the lifetime of the author, and for 50 years after his/her death. Moral rights are perpetual.

Anticipatory measures and sanctions for infringement of copyright include granting of injunctions; seizure of infringing copies; ordering of appropriate indemnification and seizure of profits gained from the infringement.

The Law on Trademarks, Commercial Indications, Trade Names, Geographical Indications, and Industrial Designs No. 9 of 2002 grants to owners the exclusive right to use their intellectual property. Registration confers upon owners the right to prevent third parties from using their intellectual property, or signs resembling them in such a manner that may likely mislead the public.

Under this Law, foreigners have the same rights as Qatari nationals, provided they are nationals or residents of states which grant reciprocal treatment to nationals of the State of Qatar.

A person found guilty of counterfeiting, imitating, fraudulently affixing/selling products/offering services of a registered trademark, geographical indication or industrial design may face imprisonment for up to 1 year and/or fines up to QR 30,000.

The Supreme Council for the Environment and Natural Resources was established in the year 2000 by virtue of Law No. 11 of 2000 to seek environmental conservation and promotion of endangered wildlife and the preservation of natural habitats in order to contribute to efforts to achieve sustainable development.

The Council may propose regulations and the conditions which should be met for establishing, producing, or making use of any facility or materials, or carrying out any activity which may lead to environmental pollution or endanger natural wildlife. It may also demand the withdrawal of the license of a breaching business or firm.

The Law also provides many preventive measures, Sanctions include confiscation, closing down of the place of business of the breaching entity, imprisonment of persons responsible, and imposition of fines.

It should also be noted that Qatar is a signatory to a number of environment-related conventions and protocols, including the Kuwait Convention and the Brussels Conventions of 1969 and 1971.

Although Qatar Lawyers Association was established in 2007 and an elected board of directors was appointed; however, the legal profession continues to be regulated by a committee headed by the Minister of Justice which regulates admission to the legal profession. Qatari nationals who possess law degrees from recognized universities and at least two years’ working experience are enrolled in the list of practitioners, whereas those with less than two years of experience are enrolled in the list of trainees.

Typical Qatari law firms are small in size and consist mainly of one or two Qatari attorneys, supported by experienced consultants from various backgrounds.

Pursuant to a decision of the Minister of Justice, a license to practice may be awarded to a limited number of foreign law firms whose international experience is considered important for the development of the State. The license determines the legal fields of practice and such licenses are valid for renewable periods of five years at a time.

Law No. 34 of 2005 regulates the establishment of Free Zones. Under this law, entities established in any of the Free Zones need not comply with the provisions of the Commercial Companies Law. For example, Free-Zone entities may not adopt one of the corporate forms prescribed in the Commercial Companies Law and they may be fully owned by non-Qataris. Furthermore, an entity licensed to work in or from one of the Free Zones is not required to obtain any other license or permission to carry out its activity.

Many incentives are granted to entities incorporated in the Free Zones; for instance, Free-Zone entities are not subject to taxation laws applicable in the State for a period of twenty years. The said period can be renewed for a similar period or more by a decision of the Council of Ministers.

Also, Free-Zone entities’ exports and imports are exempt from customs duties. Customs duties are levied on commodities exported from Free Zones into the State.

The Law describes Qatar Free Zones Authority as the authority competent to grant the relevant licenses to entities intending to carry on business in a Free Zone and requires the Qatar Free Zones Authority to appoint a Director for each Free Zone area and to supervise all Free Zone administrations.

Qatar Financial Centre (QFC) was established pursuant to Law No. 7 for the Year 2005. This law presents QFC as one of the leading locations for international finance and business designed to attract international banking, financial services, insurance, corporate head office functions, as well as other businesses.

QFC provides a distinguished investment environment for foreign investors in certain spheres of business provides a number of statutory guarantees therefor. Entities that are approved, authorized, or licensed to carry on their activities in and from the QFC will:

– Not be subject to nationalization or expropriation measures or any restriction on private ownership;

– Have the freedom to repatriate profits and realize investments;

– Have the freedom to recruit and employ employees of their choice on such terms as they wish to agree subject to the regulations of the QFC, and any international treaty obligations entered into by the State of Qatar in respect of the terms of employment of employees in the State;

– Not be subject to any taxes except those levied by or determined in accordance with the QFC regulations; and

– Be owned up to 100% by persons, companies, and other entities which are not nationals of, or residents in, the State.

The QFC Authority and the Regulatory Authority are the competent authorities to approve, authorize or license corporations, individuals, businesses, and other entities to incorporate or establish entities in the QFC or to carry on the permitted activities in or from the QFC and to determine the terms and conditions on which such approvals, authorizations or licenses may be issued.

The QFC Law specifies the activities which may be carried on in or from the QFC. Although these are mainly financial activities, the Council of Ministers may specify other activities to be licensed to be conducted in or from the QFC.