Representative Ofﬁce: The Reform of Ministerial Decision No. 396/2017
- Mathieu R. Faupin
- JAN 04,2018
"This is not a pipe." The famous quote by René Magritte below the pipe that he had painted could very much apply to the representative ofﬁce. Just as Magritte’s painting was a representation of a pipe and not a pipe that you could puff, the representative ofﬁce is not a company one can do business with.
One difference with Magritte’s Treachery of Images, though, is that a representative ofﬁce does not aim at misleading people, but at facilitating business in Qatar.
The Minister of Economy and Commerce created representative ofﬁces in Qatar through decision No. 142/2006. The purpose of a representative ofﬁce is to enable foreign companies to establish representation in Qatar, from which the foreign company will be able to carry out marketing activities only. Indeed, it is in its restrictions that the representative ofﬁce takes its full meaning. The representative ofﬁce may only represent and market products of the company it stems from.
"The establishment of a representative ofﬁce follows a derogatory procedure"
Because the representative ofﬁce derogates from the principles that govern the establishment of companies, the establishment of a representative ofﬁce follows a derogatory procedure. It occurs through an application to the Ministry of Economy and Commerce, which decides whether or not to grant the licence. Ministerial Decision No. 396/2017 On the Regulations and Procedures for Licensing the Opening of a Representative Ofﬁce has modiﬁed the procedure in order to ease the process. The number of required documents has therefore been reduced. The press statement of the Minister of Economy and Commerce says that:
“the initiative comes within the framework of the Ministry’s efforts to develop and improve the business sector through the modernisation of laws and procedures that will enhance the contribution of the private sector of the Qatari economy and provide an attractive investment environment for various economic and commercial projects.”
This statement underscores the resoluteness of the Government of Qatar to support the private sector, by continually improving the country’s business environment. It also sends a strong signal to foreign companies abroad and to foreign investors. The competent department at the Ministry of Economy and Commerce shall make a decision on the licensing application within 30 days of its submission. In the event of a rejection, the decision must be justiﬁed. If the applicant has not received any response from the Ministry within this 30-day period, the applicant must assume that its application has been rejected. The applicant may appeal the decision within 30 days after the rejection of its application.
These changes are welcome.
In a country where companies and business entrepreneurs sometimes express the feeling of being disoriented and unattended, the 30-day period gives the applicant a timeframe during which it is certain to receive a response. The justiﬁcation of a rejection will allow applicants to understand what is expected from the Ministry of Economy and Commerce and to correct their application. A faster process, better communication, and more transparency seem to be the objectives of this reform, which contributes to the dynamism of the Qatari business environment.