Policies Towards Foreign Direct Investment

In pursuit of its National Vision 2030, the government of Qatar has enacted reforms to incentivize foreign investment in the economy.  As Qatar finalizes major infrastructure developments in preparation for hosting the 2022 FIFA World Cup, the government has allocated USD 3.2 billion for new, non-oil sector projects in its 2020 budget.  The government also plans to increase LNG production by 64 percent by 2027.  Significant investment in the upstream and downstream sectors is expected.  In February 2019, national oil company Qatar Petroleum announced a localization initiative, Tawteen, which will provide incentives to local and foreign investors willing to establish domestic manufacturing facilities for oil and gas sector inputs.  Moreover, in July 2019, the Investment Promotion Agency was established to further attract inward foreign direct investment to Qatar.  These economic spending and promotion plans create significant opportunities for foreign investors.

In 2019, the government enacted a new foreign investment law (Law 1/2019) to ease restrictions on foreign investment.  The law, once executive regulations are issued, will permit full foreign ownership of businesses in most sectors with full repatriation of profits, protection from expropriation, and several other benefits.  Excepted sectors include banking, insurance, and commercial agencies, where foreign capital investment remains limited at 49 percent, barring special dispensation from the Cabinet.  The government is currently in the process of publishing regulations for the implementation of the new law.  Until its issuance, the old law requiring 51% Qatari partnership still applies (Law 13/2000).  Qatar’s primary foreign investment promotion and evaluation body is the Invest in Qatar Center within the Ministry of Commerce and Industry.  Qatar is also home to the Qatar Financial Centre, Qatar Science and Technology Park, Manateq (Qatar’s Economic Zones Company), and the Qatar Free Zones Authority, all of which offer full foreign ownership and repatriation of profits, tax incentives, and investment funds for small- and medium-sized enterprises.

When competing for government contracts, preferential treatment is given to suppliers who use local content in their bids.  To further boost local production amid an economic and political rift with neighboring Gulf countries, the government announced in October 2017 that it will favor bids that use Qatari products that meet necessary specifications and adhere to tender rules.  Participation in tenders with a value of QAR 5 million or less (USD 1.37 million) is limited to local contractors, suppliers, and merchants registered by the Qatar Chamber of Commerce and Industry.  Higher-value tenders sometimes do not require any local commercial registration to participate, but in practice certain exceptions exist.

Qatar maintains ongoing dialogue with the United States through both official and private sector tracks, including through the annual U.S.-Qatar Strategic Dialogue and official trade missions undertaken in cooperation with both nations’ chambers of commerce.  Qatari officials have repeatedly emphasized their desire to increase both American investments in Qatar and Qatari investments in the United States.

Limits on Foreign Control and Right to Private Ownership and Establishment

The government has recently reformed its foreign investment legal framework.  As noted above, full foreign ownership is now permitted in all sectors with the exception of banking, insurance and commercial agencies.  Law 1/2019 on Regulating the Investment of Non-Qatari Capital in Economic Activity (replacing Law 13/2000) stipulates that foreigners can invest in Qatar either through partnership with a Qatari investor owning 51 percent or more of the enterprise, or by applying to the Ministry of Commerce and Industry for up to 100 percent foreign ownership.  The Invest in Qatar Center within the Ministry of Commerce and Industry is the entity responsible for vetting full foreign ownership applications.  The law includes provisions on the protection of foreign investment from expropriation, the exemption of some foreign investment projects from income tax and customs duties, and the right to transfer profits and ownership without delay.

Another recent foreign investment reform is Law 16/2018 on Regulating Non-Qatari Ownership and Use of Properties, which allows foreign individuals, companies, and real estate developers freehold ownership of real estate in 10 designated zones and ‎usufructuary rights up to 99 years in 16 other zones.  Foreigners may also own villas within residential complexes, as well as retail outlets in certain commercial complexes.  Foreign real estate investors and owners will be granted residency in Qatar for as long as they own their property.  The Committee on Non-Qatari Ownership and Use of Real Estate, formed in December 2018 under the Ministry of Justice, is the regulator of non-Qatari real estate ownership and use.

There are also other FDI incentives in the country provided by the Qatar Financial Centre, the Qatar Free Zones, and the Qatar Science and Technology Park.  A draft Public-Private Partnership law to facilitate direct foreign investment in national infrastructure development (currently focused on schools, hospitals, and drainage networks) was approved by the Cabinet in April, 2019 and is pending the Amir’s final review.

U.S. investors and companies are not any more disadvantaged by ownership or control mechanisms, sector restrictions, or investment screening mechanisms relative to other foreign investors.

Other Investment Policy Reviews

N/A

Business Facilitation

Recent reforms have further streamlined the commercial registration process.  Local and foreign investors may apply for a commercial license through the Ministry of Commerce and Industry’s (MOCI) physical “one-stop shop” or online through the Invest in Qatar Center’s portal.  Per Law 1/2019, upon submission of a complete application, the Ministry will issue its decision within 15 days.  Rejected applications can be resubmitted or appealed.  In January 2020, MOCI announced it was studying the possibility of reducing the fees required to register companies, in addition to lowering tariffs and port fees to provide more incentives to the private sector.  For more information on the application and required documentation, visit:  https://invest.gov.qa 

The World Bank’s 2020 Doing Business Report estimates that registering a small-size limited liability company in Qatar takes eight to nine days.  For detailed information on business registration procedures, as evaluated by the World Bank, visit:   http://www.doingbusiness.org/data/exploreeconomies/qatar/ 

For more information on business registration in Qatar, visit:

• Ministry of Commerce and Industry’s Invest in Qatar Center:  https://invest.gov.qa 
• Qatar Financial Centre:  http://www.qfc.qa/ 
• Qatar Free Zones Authority:  https://fza.gov.qa/ 
• Qatar Science and Technology Park:  https://qstp.org.qa/ 
• Qatar Petroleum Tawteen Program:  https://www.tawteen.com.qa/ 
• Manateq: https://www.manateq.qa/ 

Outward Investment

Qatar does not restrict domestic investors from investing abroad.  According to the latest foreign investment survey from the Planning and Statistics Authority, Qatar’s outward foreign investment stock reached USD 109.9 billion in the second quarter of 2019.  In 2018, sectors that accounted for most of Qatar’s outward FDI were finance and insurance (40 percent of total), transportation, storage, information and communication (33 percent), and mining and quarrying (18 percent).  As of 2018, Qatari investment firms held investments in about 80 countries; the top destinations were the European Union (34 percent of total), the Gulf Cooperation Council (GCC, 24 percent), and other Arab countries (14 percent).

Qatar has 59 bilateral investment treaties (BITs), according to the United Nations Conference on Trade and Development (UNCTAD).  Twenty-five BITs are in force, namely with Armenia, Belarus, Belgium-Luxembourg Economic Union, Bosnia and Herzegovina, China, Costa Rica, Cyprus, Egypt, Finland, France, Gambia, Germany, Indonesia, Iran, Italy, Jordan, Montenegro, Morocco, Portugal, Romania, Russia, Singapore, South Korea, Switzerland, and Turkey.  The most recent BIT was signed with Rwanda in November 2018 but has not yet come into force.  A full list of current BITs with the State of Qatar can be found at:  http://investmentpolicyhub.unctad.org/IIA/CountryBits/171 

While Qatar has not entered into a bilateral investment or trade treaty with the United States, the two nations established a Trade and Investment Framework Agreement (TIFA) in 2004.  Additionally, as part of the GCC, Qatar has signed 12 treaties with investment provisions (TIPs), including one between the GCC and the United States in 2012, but this treaty has not yet entered into force.

Qatar does not have a double taxation treaty with the United States.  In January 2015, Qatar became the first GCC country to sign a Foreign Account Tax Compliance Act (FATCA) intergovernmental agreement with the United States.  In total, Qatar has over 80 agreements for the Avoidance of Double Taxation, including, most recently, with Ghana (November 2018) and Paraguay (March 2018).

Qatar has recently advanced its taxation regime.  In January 2019, the government established the General Tax Authority as the central tax collection and compliance function of the government.  In the same month, the government implemented the GCC 2016 Excise Tax Framework Agreement, imposing consumption-based excise taxes on select goods deemed harmful to human health, including tobacco (100% excise tax), sweetened carbonated drinks (50%), energy drinks (100%), as well as special-category goods such as alcoholic drinks (100%), and pork (100%).  The decision was promulgated in Law No. 25 of 2018 and it applies to both locally produced and imported goods.  As a GCC Member State, Qatar has agreed to introduce a common value-added tax (VAT) of five percent.  In 2017, Qatar approved a draft law on the proposed VAT, but has not committed to an implementation timeline.  To date, no VAT exists in Qatar.

Investment Incentives

Qatar does not impose a personal income tax and the new foreign investment law (Law 1/2019) offers a variety of other incentives to foreign investors, which may include the following:

• Exemption from 10 percent corporate tax for a period of up to 10 years.
• Allocation of land by way of a renewable rent for a period of up to 50 years.
• Exemption from customs duties on the imports of necessary machinery and equipment.
• Exemption from customs duties on imports of raw materials or half-manufactured goods necessary for production and not available in the local market, for industrial projects.

Some industrial projects can be established in designated industrial zones governed by the Qatar Free Zones Authority, and are offered the following incentives:

• Exemption from 10 percent corporate tax for a period of up to 20 years.
• Zero custom duties on imports.
• Potential access to a USD 3 billion government-backed fund.

The Ministry of Energy Affairs determines the amount of foreign equity and the extent of incentives for industrial projects, as stipulated by Law 8/2018.  In February 2020, and in line with the government’s efforts to improve the ease of doing business and  enhance the investment environment for owners of small and medium-size enterprises (SMEs), the Ministry of Commerce and Industry in co-operation with Qatar Development Bank, launched the ‘Land and Industrial Loan’ initiative, offering loans and industrial land to SMEs.

Foreign Trade Zones/Free Ports/Trade Facilitation

Qatar has several free zones and business facilitation options:

Qatar Financial Centre (QFC) is an onshore business platform that allows international financial institutions and professional service companies to establish offices in Qatar with 100 percent foreign ownership and full repatriation of profits.  Locally sourced profits are subject to a 10 percent corporate tax.  The QFC has its own independent regulatory regime based on English common law.  The QFC Regulatory Authority acts as the regulator for financial firms operating in the QFC.  The QFC Regulatory Tribunal and Qatar International Court hear and adjudicate cases, though these bodies’ judgments are only of value if enforced by Qatari courts against persons and assets in Qatar.  Goldman Sachs International, Mastercard Gulf, Uber, and Oracle are among the companies registered with QFC.

The Qatar Science and Technology Park (QSTP) is a hub designed to undertake research and development and facilitate the transfer of expertise and technology.  The hub offers grants and incubators to foreign and local innovators.  Licensed foreign companies are permitted 100 percent ownership and full capital and income repatriation benefits.  Companies operating at the QSTP can import goods and services duty free and export goods produced in the park are tax-free.  Firms at the park are also exempt from all taxes, including the 10 percent income tax.  The property of these businesses cannot be seized under any circumstance, but capital and other cash may be seized on the orders of a local court.  Microsoft, ExxonMobil, GE, Cisco, and ConocoPhillips are among QSTP member companies.

In 2018, the government created an independent Free Trade Zone Authority to oversee free zones in Qatar and offer opportunities and benefits to investors.  The Authority currently administers two such free trade zones:  Ras Bufontas near the country’s international airport and Um Alhoul adjacent to the country’s largest commercial seaport.  Additionally, in 2011, Qatar established Manateq, a state-owned company affiliated with the Ministry of Commerce and Industry, to manage and develop economic zones.  Manateq has oversight of one special economic zone (Al Karaana), four logistics parks (​Jery Al Samur, Al Wakra, Birkat Al Awamer and Aba Saleel​), four warehousing parks ​(Bu Fesseela, Bu Sulba, Umm Shaharaine 1, and Umm Shaharaine 2) and one industrial zone (Mesaieed).

In the last two years, the Ministry of Commerce and Industry has also aimed to introduce a public-private partnership (PPP) law to further attract foreign investors.  The draft law is currently under judicial review.

Performance and Data Localization Requirements

There are no laws that obligate the private sector to hire Qatari nationals, but the public sector and institutions working closely with the government on projects and joint ventures are required to hire Qatari nationals—these notably include energy companies operating in Qatar.  Workforce localization policy (known as “Qatarization”) in the public sector is a main focus of the country’s National Vision 2030 and foreign investors wishing to operate fully owned companies will be required to submit a “Qatarization” plan.  Employers are allocated visa slots for the hiring of specific nationalities and such positions are non-transferable without approval of the Ministry of Administrative Development, Labor, and Social Affairs.

While Qatar does not follow a forced localization policy, when competing for government contracts, preferential treatment is given to suppliers that use local content in bids.  Goods produced with Qatari content are also given a 10 percent price preference.  As a rule, participation in government tenders with a value of QAR 5,000,000 or less (equivalent to approximately USD 1.37 million) are limited to local contractors, suppliers, and merchants registered by the Qatar Chamber of Commerce, while tenders with a value of more than this amount do not require any local commercial registration to participate, but in practice certain exceptions exist.

In February 2019, national oil company Qatar Petroleum announced a localization initiative, Tawteen, which, among other things, will require all suppliers for Qatar Petroleum and its subsidiaries, as well as bidders for select contracts, to be assessed by a third-party auditor to determine their In-Country Value (ICV) score.  Qatar Petroleum and its subsidiary companies will assess the ICV score in addition to technical and commercial criteria when evaluating bidders.  The formula for calculating a company’s ICV score may be found here:  https://www.tawteen.com.qa/In-Country-Value-Policy/ICV-Formula-Calculation 

Performance requirements for foreign investment in Qatar do not exist.  Disclosure of financial and employment data is required, but proprietary information is not.

There are no known formalized requirements for foreign IT providers to turn over source code or provide access to surveillance.  The information and communications technology (ICT) sector is regulated by Qatar’s Communications Regulatory Authority, established as an independent body by Amiri Decree 42/2014, under the Ministry of Transport and Communications.  Qatar is the first Gulf nation to enact a Data Protection Law 13/2016, which requires companies to comply with restrictions relating to the collection, disclosure, and safekeeping of personal data.  The regulator responsible for enforcing the Data Protection Law is the Ministry of Transport and Communications.

Capital Markets and Portfolio Investment

Foreign portfolio investment has been permitted since 2005.  There is no restriction on the flow of capital in Qatar.  The Qatar Central Bank (QCB) adheres to conservative policies aimed at maintaining steady economic growth and a stable banking sector.  Loans are allocated on market terms, and foreign companies are essentially treated the same as local companies.

Currently, foreign ownership is limited to 49 percent of Qatari companies listed on the Qatar Stock Exchange.  Foreign capital investment up to 100 percent is permitted in most sectors upon approval of an application submitted to the Invest in Qatar Center under the Ministry of Commerce and Industry.  Foreign portfolio investment in national oil and gas companies or companies with the right of exploration of national resources cannot exceed 49 percent.

Almost all import transactions are controlled by standard letters of credit processed by local banks and their correspondent banks in the exporting countries.  Credit facilities are provided to local and foreign investors within the framework of standard international banking practices.  Foreign investors are usually required to have a guarantee from their local sponsor or equity partner.  In accordance with QCB guidelines, banks operating in Qatar give priority to Qataris and to public development projects in their financing operations.  Additionally, single customers may not be extended credit facilities by a bank exceeding 20 percent of the bank’s capital and reserves.  QCB does not allow cross-sharing arrangements among banks.  QCB requires banks to maintain a maximum credit ratio of 90 percent.  QCB respects IMF Article VIII and does not restrict payments or transfers for international transactions.

Qatar has become an important banking and financial services center in the Gulf region.  Qatar’s monetary freedom score is 72.6 out of 100 (“mostly-free”) and it ranks 28th out of 180 countries in the 2019 Index of Economic Freedom, according to the Heritage Foundation.  Qatar is ranked third in the Middle East/North Africa region in terms of economic freedom and its overall score is above the world average.

Money and Banking System

There are 17 licensed banks in Qatar, seven of which are foreign institutions.  Qatar also has 20 exchange houses, six investment and finance companies, 16 insurance companies, and 17 investment funds.  Other foreign banks and financial institutions operate under the Qatar Financial Center’s platform, but they are not licensed by the Qatar Central Bank (QCB) and are regulated by the Qatar Financial Center Regulatory Authority.  The country is home to the Qatar National Bank, the largest financial institution in the Middle East and Africa, with total assets exceeding USD 229.1 billion.

The QCB, as the financial regulator, continues to introduce incentives for local banks to ensure a strong financial sector that is resilient during economic volatility.  The QCB manages liquidity by mandating a reserve ratio of 4.5 percent and utilizing treasury bonds, bills, and other macroprudential measures.  Banks that do not abide by the required reserve ratio are penalized.  QCB uses repurchase agreements, backed by government securities, to inject liquidity into the banks.  According to QCB data, total domestic liquidity reached USD 158.8 billion in December of 2019.  The IMF estimated that 1.7 percent of Qatar’s bank loans in 2019 were nonperforming.  International ratings agencies have expressed confidence in the financial stability of the country’s banks, given liquidity levels and strong earnings.

Cryptocurrency trading is illegal in Qatar, per a 2018 Qatar Central Bank circular.  In January 2020, the Qatar Financial Centre Regulatory Authority (QFCRA) announced that firms operating under the Qatar Finance Center are not permitted to provide or facilitate the provision or exchange of crypto assets and related services.

To open a bank account in Qatar, foreigners must present proof of residency.

Foreign Exchange and Remittances

Foreign Exchange

Due to minimal demand for the Qatari riyal outside Qatar and the national economy’s dependence on oil and gas revenues, which are priced in dollars, the government has pegged the riyal to the U.S. dollar.  The official peg is QAR 1.00 per USD 0.27 or USD 1.00 per QAR 3.64, as set by the government in June 1980 and reaffirmed by Amiri decree 31/2001.

In implementing the provisions of Law No. 20/2019 on Combating Money Laundering and Terrorism Financing and following the issuance of Cabinet Resolution No. 41/2019, starting February 27, 2020, travelers to or from Qatar are required to complete a declaration form upon entry or departure, if carrying cash, precious metals, financial instruments, or jewelry, valued at fifty thousand Qatari Riyals or more ($13,7000).

Remittance Policies

Qatar neither delays remittance of foreign investment returns nor restricts transfer of funds associated with an investment, such as return on dividends, return of capital, interest and principal payments on private foreign debt, lease payments, royalties, management fees, amounts generated from sale or liquidation, amounts garnered from settlements and disputes, and compensation from expropriation to financial institutions outside Qatar.

In accordance with Law 20/2019 on Combating Money Laundering and Terrorism Financing, the Qatar Central Bank requires financial institutions to apply due diligence prior to establishing business relationships, carrying out financial transactions, and performing wire transfers.  Executive regulations for this law were published in December 2019 and they promulgate that originator information should be secured when a wire transfer exceeds QAR 3,500 (USD 962).  Similarly, due diligence is required when a customer is completing occasional transactions in a single operation or several linked operations of an amount exceeding QAR 50,000 (USD 13,736).

Qatar is a member of the Middle East and North Africa Financial Action Task Force (MENAFATF), a Financial Action Task Force-style regional body.  Qatar will undergo its next MENAFATF mutual evaluation in 2021.  In July 2017, Qatar signed a counterterrorism MOU with the United States, which includes information sharing, training, enhanced cooperation, and other deliverables related to combating money laundering and terrorism financing.

Sovereign Wealth Funds

The Qatar Investment Authority (QIA), Qatar’s sovereign wealth fund, was established by Amiri Decree 22/2005.  QIA is overseen by the Supreme Council for Economic Affairs and Investment, chaired by the Amir, and does not disclose its assets (independent analysts estimate QIA’s holdings at around USD 330 billion).  QIA pursues direct investments and favors luxury brands, prime real estate, infrastructure development, and banks.  Various QIA subsidiaries invest in other sectors, as well.

In September 2015, QIA opened an office in New York City to facilitate over USD 45 billion allocated for investments in the United States over the course of five years.  QIA’s real estate subsidiary, Qatari Diar, has operated an office in Washington, D.C. since 2014.

QIA was one of the early supporters of the Santiago Principles and among the few members who drafted the initial and final versions of the principles, and continues to be a proactive supporter of its implementation.  QIA was also a founding member of the IMF-hosted International Working Group of Sovereign Wealth Funds.  QIA fully supported the establishment of the International Forum of Sovereign Wealth Funds (IFSWF) and helped create the Forum’s constitution.

The State Audit Bureau oversees state-owned enterprises (SOEs), several of which operate as monopolies or with exclusive rights in most economic sectors.  Despite the dominant role of SOEs in Qatar’s economy, the government has affirmed support for the local private sector and encourages small and medium-sized enterprise development as part of its National Vision 2030.  The Qatari private sector is favored in bids for local contracts and generally receives favorable terms for financing at local banks.  The following are Qatar’s major SOEs:

Energy and Power:

• Qatar Petroleum (QP), its subsidiaries, and its partners operate all oil and gas activities in the country.  QP is wholly owned by the government.  Non-Qataris are permitted to invest in stock exchange listed subsidiaries, but shareholder ownership is limited to two percent and total non-Qatari ownership to 49 percent.
• Qatar General Electricity and Water Corporation (Kahramaa) oversees all water and electricity activities and is majority-owned by Qatari government entities.  Government officials signaled intentions to  privatize segments of the water and electricity sectors.  A first step in this direction occurred when the Ras Laffan Power Company, which is 55 percent owned by a U.S. company, was established in 2001.  As part of its National Vision 2030 to diversify the economy, Qatar will boost investments in renewable energy, led by Kahramaa, with a view to generate 10 GW of solar capacity annually, or the equivalent of 20 percent of Qatar’s electricity needs.

Aerospace:

• Qatar Airways is the country’s national carrier, wholly owned by the state.

Services:

• Qatar General Postal Corporation is the state-owned postal company.  Several other delivery companies are allowed to compete in the courier market:  Aramex, DHL Express, and FedEx Express.

Information and Communication:

• Ooredoo Group is a telecommunications company founded in 2013.  It is the dominant player in the Qatari telecommunications market and is 68 percent owned by Qatari government entities.  Ooredoo (previously known as Q-Tel) dominates both the mobile and fixed line telecommunications markets in Qatar.
• Vodafone Qatar, the only other telecommunications operator in Qatar at present, is owned by the semi-governmental Qatar Foundation, Qatari government entities, and Qatar-based investors.  In 2017, Vodafone Qatar announced that it achieved 21 percent market share in Qatar.

Qatari SOEs may adhere to their own corporate governance codes and are not required to follow the OECD Guidelines on Corporate Governance.  Some SOEs publish online corporate governance reports to encourage transparency, but there is no general framework for corporate governance across all Qatari SOEs.  When an SOE is involved in an investment dispute, the case is reviewed by the appropriate sector regulator.

Privatization Program

There is no ongoing official privatization program for major SOEs.  Qatar Airways executives state the government plans to take the company public within the next decade.

There is a general awareness in Qatar of responsible business conduct.  In 2007, Qatar created the Corporate Social Responsibility (CSR) Network, a research and reporting entity that publishes annual reports highlighting best practices and honoring CSR leaders in the country.  Many companies in Qatar publicize their CSR initiatives.

Sustainability is the focus of the National Development Strategy 2018-2022, released in March 2018; it is also an important goal of the National Vision 2030.  Law 30/2002 is the main legislation protecting the environment.  It prohibits the use of polluting equipment, machineries, and vehicles, and restricts the dumping and treatment of liquid or solid wastes to certain designated areas.  The law also limits emissions of harmful vapors, gases, and smoke by the energy sector.  This applies to all companies working in exploration and production of crude oil and natural gas.

The Ministry of Commerce and Industry has a dedicated Consumer Protection and Combating Commercial Fraud Department which has intensified its efforts in recent years by increasing the monitoring of records and inspection of stores and factories that sell or manufacture counterfeit goods.  The Ministry prosecutes violators when business misconduct is detected or reported and announces these violations publicly.  The Government of Qatar maintains a reporting regime for suspicious transactions and requirements for consumer due diligence and record keeping.

As an economy dependent on extractive industries, Qatar participates in the Extractive Industries Transparency Initiative (EITI).  Nonetheless, the Qatari government has not improved transparency regarding its management of the petroleum industry, as no regulatory body oversees resources extraction or revenue management.  Moreover, Qatar has no freedom of information law.

With regard to labor and human rights, Qatari law prohibits all forms of forced or compulsory labor and reserves two percent of jobs in government agencies and public institutions for persons with disabilities.  The law also prohibits employment of children under 16 years old.  The Ministry of Administrative Development, Labor, and Social Affairs (MADLSA); the Ministry of Interior; and the National Human Rights Committee (NHRC) conduct training sessions for migrant laborers to educate them on their rights in the country.  International media and human rights organizations continue to allege numerous abuses against foreign workers, including forced or compulsory labor, withheld wages, unsafe working conditions, and poor living accommodations.  In January 2018, the United States and Qatar signed a government-level memorandum of understanding to exchange expertise and foster capacity building in combating human trafficking.  In March 2019, the Department of Labor and MADLSA signed an MOU on labor, which focuses on two pillars:  labor inspections and protecting domestic workers’ rights in Qatar.

Some non-governmental organizations (NGOs) in Qatar focus on labor rights and often work in conjunction with the government.  Researchers from international NGOs such as Amnesty International and Human Rights Watch continue to visit and report on the country with limited interference from authorities.  International labor NGOs have been able to send researchers to Qatar under the sponsorship of academic institutions and quasi-governmental organizations such as the NHRC.

Corruption in Qatar does not generally affect business although the power of personal connections plays a major role in business culture.  Qatar is one of the least corrupt countries in the Middle East and North Africa, according to Transparency International’s 2019 Corruption Perceptions Index, and ranked 30 out of 180 nations globally with a score of 62 out of 100, with 100 indicating full transparency.

Qatari law imposes criminal penalties to combat corruption by public officials and the government practices these laws.  In recent years, corruption and misuse of public money has been a focus of the executive office.  Decree 6/2015 restructured the Administrative Control and Transparency Authority, granting it juridical responsibility, its own budget, and direct affiliation with the Amir’s office.  The objectives of the authority are to prevent corruption and ensure that ministries and public employees operate with transparency.  It is also responsible for investigating alleged crimes against public property or finances perpetrated by public officials.  Law 22/2015 imposes hefty penalties for corrupt officials and Law 11/2016 grants the State Audit Bureau more financial authority and independence, allowing it to publish parts of its findings (provided that confidential information is removed),which it was not previously empowered to do.

In 2007, Qatar ratified the UN Convention for Combating Corruption (through Amiri Decree 17/2007) and established a National Committee for Integrity and Transparency, (through Amiri Decree 84/2007).  The permanent committee is headed by the Chairman of the State Audit Bureau.  Qatar also opened the Anti-Corruption and Rule of Law Center in 2013 in Doha in partnership with the United Nations.  The purpose of the center is to support, promote, and disseminate legal principles to fight against corruption.

Those convicted of embezzlement and damage to the public treasury are subject to terms of imprisonment of no less than five and up to ten years.  The penalty is extended to a minimum term of seven and a maximum term of fifteen years if the perpetrator is a public official in charge of collecting taxes or exercising fiduciary responsibilities over public funds.  Investigations into allegations of corruption are handled by the Qatar State Security Bureau and Public Prosecution.  Final judgments are made by the Criminal Court.

Bribery is also a crime in Qatar and the law imposes penalties on public officials convicted of taking action in return for monetary or personal gain, or for other parties who take actions to influence or attempt to influence a public official through monetary or other means.  The current Penal Code (Law 11/2004) governs corruption law and stipulates that individuals convicted of bribery may be sentenced up to ten years imprisonment and a fine equal to the amount of the bribe but no less than USD 1,374.

The Procurement Law 24/2015 is designed to promote a fair, transparent, simple, and expeditious tendering process.  It abolishes the Central Tendering Committee and establishes a Procurement Department within the Ministry of Finance that has oversight over the majority of government tenders.  The new department has an online portal that consolidates all government tenders and provides relevant information to interested bidders, facilitating the process for foreign investors (https://monaqasat.mof.gov.qa ).

Despite these efforts, some American businesses continue to cite lack of transparency in government procurement and customs as recurring issues encountered in the Qatari market.  U.S. investors and Qatari nationals who happen to be agents of U.S. firms are subject to the provisions of the U.S. Foreign Corrupt Practices Act.

Qatar is not a party to the Organization for Economic Cooperation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials.

Resources to Report Corruption

In 2015, the Public Prosecution’s Anti-Corruption Office launched a campaign encouraging the public to report corruption and bribery cases, establishing hotlines and a tip reporting inbox and vowing to protect the confidentiality of submitted information:

Public Prosecution
Anti-Corruption Office
Hotlines:  +974-3353-1999 and +974-3343-1999
aco@pp.gov.qa

Qatar is a politically stable country with low crime rates.  There are no political parties, labor unions, or organized domestic political opposition.  The U.S government rates Qatar as medium for terrorism, which includes threats from transnational groups.

In June 2017,  Saudi Arabia, United Arab Emirates, Bahrain, and Egypt severed diplomatic and economic ties with Qatar.  This geopolitical rift did not alter the political and security environment for U.S. investors in Qatar.

U.S. citizens in Qatar are encouraged to stay in close contact with the State Department and the U.S. Embassy in Doha for up-to-date threat information.  U.S. visitors to Qatar are invited to enroll in the State Department’s Smart Traveler Enrollment Program to receive further information regarding safety conditions in Qatar:  https://step.state.gov/step/.

According to the World Bank’s Migration & Remittances Fact Book 2016, Qatar has the world’s highest migrant workers to population ratio, with foreigners making up around 90 percent of the country’s population.  Qatar’s labor force consists primarily of expatriate workers.  In the private sector, foreigners make up nearly 95 percent of the labor force per statistics published by Qatar’s  Planning and Statistics Authority.  Qatar’s resident population is estimated at 2.8 million as of February 2020, doubling in the last decade.  Qatari citizens are estimated to number approximately 300,000 – around 11 percent of the total population.  The largest group of foreign workers comes from the Indian sub-continent.  Men make up around 75 percent of the population.

Unemployment rates in Qatar are among the lowest in the world, with 0.1 percent unemployment rate for men and 0.4 percent unemployment rate for women as of the third quarter of 2019.  The Ministry of Administrative Development, Labor, and Social Affairs (MADLSA) regulates recruitment of expatriate labor.  Article 18 of Labor Law 14/2004, gives priority to hiring Qataris in the private sector, unless hiring non-Qataris is necessary.  Amiri Decree 44 for 2008, mandates that around 80 private companies  have no less than 20% Qataris in their workforce. The public sector and institutions working closely with the government on projects and joint ventures are  required to hire Qatari nationals, examples include energy companies operating in Qatar.

Labor Law 14/2004 largely governs employment in Qatar and provides for terminating  employment  without  requiring the terminating party to give reasons.  The law requires employers to pay employees due wages and other benefits in full, provided that employees performed expected work duties  during the notice period, which varies based on years of employment.  Companies registered with Qatar Financial Centre (QFC) are governed by the English common law, and labor issues are administered by QFC’s Regulation 10/2006.  The rules that govern recruitment and immigration of QFC employees differ from those that govern other expatriate employees in the country.

Law 12/2004 of Private Associations and Foundations and subsequent regulations grant Qatari citizens the right to form workers’ committees in private enterprises with more than 100 Qatari citizen workers.  Qatari citizens employed in the private sector also have the right to participate in approved strikes, but the restrictive conditions imposed by the law make the likelihood of an approved strike remote.  There are no labor unions in the country.  Non-citizens are not eligible to form worker committees or go on strike, though according to an agreement between the MADLSA and the International Labor Organization (ILO), joint worker committees including 50-50 representation of workers and employers exist in a small number of cases for all medium to large-sized companies.  Individuals working in the government sector, regardless of nationality, are prohibited from joining unions.  Over three-quarters of Qatari citizens are employed by the government.  Workers at labor camps occasionally go on strike over non-payment or delayed payment of wages, however, this practice is technically illegal.

Local courts handle disputes between workers and employers though the process is widely regarded as inefficient.  In an effort to speed up the process of resolving labor disputes, the government established  Labor Disputes Settlement Committees headed by a judge and representatives from the MADLSA.  As of March 2018, there are three such committees, all of which operate outside of the traditional Supreme Judicial Committee structure and are required to address any complaints within three weeks, though anecdotally we hear that a resolution can still take much longer than the three week window.

A new law that would increase the minimum wage to approximately USD 300 per month is currently being debated by the Shura Council.  At present, a recommended minimum wage of USD 195 per month exists, but is not enforced.  In addition, many embassies via bilateral work agreements set minimum wages for their citizens.  To combat the problem of late and unpaid wages, the government issued Law 1/2015 amending certain provisions of Labor Law 14/2004 on wage protection and mandating electronic payment to all employees subject to the local labor law.  The law does not apply to domestic workers.  The government requires all employers to open bank accounts for their employees and pay wages electronically through a system subject to audits by an inspection division at the MADLSA.  Employers who fail to pay their workers face penalties of USD 550 – USD 1,650 per case and possible prison sentences.  Those penalties are, however, rarely  implemented.  The system currently applies to over 1.4 million workers.

In an effort to eliminate forced labor, the government issued reforms to the sponsorship system (Law 21/2015), which  enables employees to switch employers at the end of their contract, without requiring employer’s  permission.  In September 2018, Qatar issued Law 13/2018, which allows workers  covered by the Labor Law  to leave the country without requiring exit permits from their employers.  A new law in 2020 will extend this mandate to domestic employees and government workers, who  now comprise  the majority of the workforce.  The Qatari Cabinet proposed in 2020 a new law to facilitate switching employers by abolishing the previous requirement for a no-objection certificate from the previous employer.  The law will not go into effect until the draft is  approved by the Shura Council and the Amiri Diwan.  The Labor Law prohibits the withholding of workers’ passports by employers and stiffens penalties for transgressors.

To protect workers from fraudulent employment contracts, the Ministry of Interior signed an agreement with a Singaporean company in November 2017 to establish Qatar Visa Centers (QVCs) with the goal of simplifying residency procedures for expat workers from India, Nepal, Sri Lanka, Pakistan, Bangladesh, Indonesia, the Philippines, and Tunisia, which together comprise 80 percent of Qatar’s workforce.  In partnership with both MOI and MADLSA,  contracted companies established QVCs in these countries to facilitate biometric enrollment, medical records verification, and  signing  work contracts before contracted workers enter Qatar.  To date, QVCs have been established in Sri Lanka, Pakistan, Bangladesh, Kenya, Philippines, Tunisia, and India.

Qatar is a member of the ILO and maintains that its labor law meets ILO minimum requirements.  In November 2017, Qatar made commitments to address some ILO complaints by launching a comprehensive three-year ILO technical cooperation program.  In 2018, the ILO opened a Doha office.

In January 2018, the Qatari Minister of Foreign Affairs signed an MOU with the U.S. Department of State during the U.S.-Qatar Strategic Dialogue.  The MOU laid out plans for cooperation in combating trafficking-in-persons, including strengthening the labor sector to reduce instances of forced labor.  In March 2019, the MADLSA signed a new MOU with the US Department of Labor to enhance cooperation in the fields of labor inspection and protecting domestic workers rights.