Q&A: Building regulations and compliance in Qatar

Regulation and compliance

Licensing procedures

Do foreign designers and contractors need to be licensed locally to work and, if so, what are the consequences of working without a licence?

While contractors only need business or branch registration with the Ministry of Commerce and Industry, designers need to register and obtain a license to practice with the Ministry of Commerce. Municipality and Environment or Ministry of Trade and Industry (or both) or Qatar Financial Center (QFC). Designers incorporated outside the QFC are governed by the Engineering Act, which established a committee for the registration of engineers, local engineering consultancy offices and foreign engineering consultancy offices, which is the licensing authority. If a practicing designer or their engineers fail to obtain any of the required licenses, that designer will be subject to imprisonment and a fine. Subject to the approval of the Council of Ministers, non-Qatari natural or legal persons registered outside the QFC may practice the engineering profession without a license if they hold unique technical specializations that are not available in Qatar or are required in the development of experience. and techniques in Qatar.

Competition

Do local laws give any advantage to domestic contractors competing with foreign contractors?

Usually no, but some tenders issued by certain government entities may be exclusive to domestic contractors. Qatar’s laws encourage foreign contractors to operate in Qatar, while some of the major projects require international know-how, capacity and expertise, especially in view of the 2022 World Cup and in line with the Qatar National Vision of 2030.

Competition protections

What legal protections exist to ensure fair and open competition to obtain contracts with public entities and to prevent bid-rigging or other anti-competitive behavior?

Qatar ratified the United Nations Convention against Corruption in 2007 and the Arab Convention against Corruption in 2010. It also established the Qatar Administrative Control and Transparency Authority (QACTA). A public tender is subject to the principles of publicity of procedures, equality, equal opportunity, freedom of competition, transparency and optimization of resources, as set out in the law on tenders public. The State Audit Office and the Financial Tenders and Contracts Audit Department monitor and audit project finances to improve transparency principles. The Penal Code imposes penalties on public officials for rigging offers of imprisonment for a term not exceeding 10 years.

In addition, fair and open competition has been upheld by the provisions of the new Public-Private Partnership Law (Law No. 12 of 2020) which was enacted on May 31, 2020. This Law provides that all calls for Bids should be published in local or international newspapers, or on their websites and all bids should be posted on the Unified Government Procurement Website, and the selection of a successful bidder should be subject to the principles of transparency, free competition and equality of opportunity and treatment.

Corruption

If a contractor has illegally obtained the award of a contract, for example through corruption, will the contract be enforceable? Are those who give or accept bribes prosecuted and, if so, what are the penalties? Are facilitation payments permitted under local law?

Any contract that is proven to have been obtained or performed by the contractor using the fraud or corruption of a public official to harm the contracting governmental authority shall be deemed terminated. The corrupt and bribed are prosecuted criminally and liable to imprisonment not exceeding 10 years and a fine not exceeding what has been received or promised to pay. The public official is removed from office and fined the amount of the bribe. In addition, a public official involved in the preparation, management or execution of a commitment, an export, works or a company dealing with one of the authorities who obtains or tries to obtain for him -self or for others, directly or through an intermediary, or by any illegal means, a profit, a benefit or a commission is punishable by imprisonment for a term not exceeding 10 years. Facilitation payments are also considered bribes.

Report a bribe

Under local law, are employees of project team members required to report suspicions of or knowledge of bribery of government employees and, if so, what are the penalties for not reporting?

Any person who fails to report to the competent authorities, without cause, his knowledge of the crime of another or of a planned crime which could have been avoided, is liable to imprisonment, a fine or both. . The same penalty will apply to a public official who investigates crimes and neglects or delays reporting the crime to the proper authorities.

The Qatar Financial Center Employment Regulations include whistleblower provisions.

Political contributions

Is making political contributions part of business? If so, are there any laws that restrict the ability of contractors or design professionals to work for public bodies because of their financial support of candidates or political parties?

Qatar is a hereditary emirate; political parties do not exist.

Compliance

Is a construction manager or other construction professional acting as a representative or agent of a public entity on a project (and its employees) subject to the same anti-corruption and compliance rules as government employees? ?

The same anti-corruption rules applicable to public officials apply to professionals acting as a representative of a public body and to their employees. Any official or employee of a body of a public authority or of a company owned or controlled by the State who carries out an activity related to the public service and commissioned by a public official is considered to be a public official. Tender documents issued by the Public Works Authority include an anti-corruption and confidentiality statement to be signed by the parties.

Other international legal considerations

Are there other important legal issues that may present obstacles to a foreign entrepreneur attempting to do business in your jurisdiction?

A Unified Economic Register has been established within the Ministry of Commerce and Industry to improve the transparency of economic and financial transactions, by collecting basic information, data and documents relating to economic establishments, legal arrangements and non-profit organizations and the liberal professions, and the required information, data and documents relating to the real beneficiaries, in order to preserve them and make them available to the public and to the competent authorities.

Qatar – a low-tax country – offers an attractive tax regime for foreigners that benefits from the double taxation agreements the country has with more than 80 countries. Payments of dividends, interest, royalties and management fees outside of Qatar by Qatari companies are exempt from withholding tax, allowing tax-free repatriation of returns and profits to shareholders. Personal per capita income is tax exempt and corporations are subject to a tax rate of 10% of total state income, paid annually. More information can be found in the Income Tax Law No. 24/2018 and in the government portal (Hukoomi) at the following link: https://portal.www.gov.qa/wps/ portal/topics/Business+and +Finance/tax system and at https://www.qfc.qa/en/about-qfc/qfc-benefits.

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May 02, 2022

About Charles D. Goolsby

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