The Qatari Laws stipulate a total local equity of not less than 51% in any commercial company and defines seven categories of business organisation, which can be established in Qatar with the exception of those categories mentioned in Law 13 of 2000 and Law 1 of 2010. It sets out the requirements in terms of shareholders, directors, minimum capital levels and incorporation procedures.
Forms of Business Organisation
It is the most basic form of commercial arrangement for two or more individuals to associate for the purpose of having a commercial activity in Qatar. The partners have unlimited liability and the trade name of the partnership company will reflect the names of the partners.
This is similar to a simple partnership. However, a joint partnership will have two classes of partners – joint partners and trustee partners.
It is an unincorporated entity without legal personality. However, it must specify its objectives, as well as the rights and obligations of the partners, and how profits and losses are to be distributed between the partners.
Non-Qataris may be partners of a joint venture, in which case the company can only carry out those activities permitted for non-Qataris under the country’s laws.
This is an entity comprised of two or more persons that associate to carry out a project. The joint venture company provided for in the law is an unincorporated entity without legal personality.
Public Shareholding Company (PSC)
The PSC is also known as a joint stock company or Qatari shareholding company. The law recognises different variants of the public shareholding company including:
• public shareholding company;
• private or closed public shareholding company.
Generally, only Qataris may be shareholders, but there are three exceptions to this rule:
• a national of another Arab country that has a relevant reciprocal agreement with Qatar;
• where foreign investment or experience is required, so long as the necessary licence has been granted by the Ministry of Economy & Commerce; and
• where the company has been incorporated under a special decree that allows for foreign shareholding.
A minimum of five shareholders is required. Shareholders are not liable for the company’s obligations, except to the extent of the total nominal value of their respective shareholding.
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