FAQ

1. What are the benefits of authorisation by the QFC?

   The QFC offers a world class legal and business environment with regulations that allow 100% ownership and complete repatriation of profits. Firms incorporating in the QFC will find it to be a simple and straight forward process, and will enjoy a tax holiday until April 2008, after which a tax rate of up to a maximum of 10% will apply. We aim for a true partnership with our clients and we link our success with their prosperity. Business can be transacted in Qatar and outside Qatar, in the local currency or in foreign currency.

2. Who is eligible to apply?

   The QFC Law, Number 7 of 2005 (Schedule 3), prescribes a range of activities that may be conducted in or from the QFC. These are called "Permitted Activities". Such activities are those most commonly recognised as financial services, as well as a number of related and corporate management or headquarters activities.

3. What types of activities are permitted?

   Within the range of Permitted Activities are two sub-classifications: Regulated Activities and Non-Regulated Activities. The former are activities which include those financial services (such as banking, insurance or securities businesses) that require close and continuing scrutiny to ensure prudential soundness and the proper conduct of such businesses. Non-Regulated businesses require less supervision and may include such activities as ship broking and shipping agents, classification and investment grading, company headquarters, management offices and treasury operations, professional services such as audit, accounting, tax, consulting and legal services, and holding companies.

4. What is the QFC's position on Islamic Finance?

   Islamic Finance is a regulated activity within the QFC. The QFC Regulatory Authority has produced a rulebook governing the activities of licensed companies providing Islamic financial services. These rules allow for either wholly Islamic institutions or Islamic windows for conventional financial institutions to be licensed. Firms so licensed can conduct the full range of regulated Islamic activities such as commercial Islamic banking, Islamic funds management and Islamic Investment banking. The QFC Regulatory Authority is a member of the Accounting and Auditing Organisation for Islamic Financial Instutions, based in Bahrain, and the Islamic Financial Services Board, based in Kuala Lumpur.

5. Can a company licensed to provide conventional financial services from the QFC also provide Islamic financial services?

   An authorised firm must not hold itself out as conducting Islamic financial business unless its authorisation includes an endorsement from the QFC Regulatory Authority authorising it to conduct Islamic Financial Business. An authorised firm may apply to the Regulatory Authority for an endorsement to conduct Islamic financial business or to vary such an endorsement.

6. Does the QFC have a Shariah Board?

   No. An authorized firm must have a Shariah Supervisory Board, consisting of at least 3 members, who should be competent to perform their functions taking into account their qualifications and previous experience. It must also have systems and controls in place to ensure that its operations comply with Shariah principles at all times.

7. Will banks or other businesses who do not locate in the QFC be excluded from participating in the energy and other expansion projects?

   No, but over and above the advantages that the QFC offers for new participants in Qatar's economy, there will be an obvious advantage afforded those who operate 'on the ground' in Qatar.

8. How do companies apply?

   The QFC operates a streamlined application process for those seeking to establish in the Centre. The process has been designed so that the applicant firm simply needs to make one submission. Depending upon whether the applicant wishes to conduct regulated or non-regulated activities, the application process should take about 90 days subject to the nature of business for which the license is sought.

9. What is the management structure of the QFC?

   Within the QFC are the Qatar Financial Centre Authority and the Qatar Financial Centre Regulatory Authority.

   The Qatar Financial Centre Authority is chaired by the Minister of the Economy and Commerce of the State of Qatar, and its operations are overseen by a Board of Directors. The Chief Executive and Director General of the Qatar Financial Centre Authority is Stuart Pearce, who is also a member of the Authority's Board.

   The Qatar Financial Centre Regulatory Authority is a fully independent body which is chaired by Phillip Thorpe, and which reports to Qatar's Council of Ministers.

   The Qatar Financial Centre Regulatory Authority's primary mission is ensuring the integrity, transparency and efficiency of transactions subject to the QFC Law. It does this by ensuring that entities that conduct regulated activities are fit and proper, that they maintain appropriate financial resources and do not create undue risks to the safety and soundness of the financial system in Qatar or to their clients and their assets, and that customers are provided appropriate disclosures. It maintains a risk based supervisory model and conducts investigations and brings enforcement actions when the QFC's financial services regulations have been violated.

   The Qatar Financial Centre Authority is responsible for Business Development, Operations, and Corporate Communications and Marketing of the QFC. It's Legal Department is responsible for developing, administering and enforcing QFC legislation that is not administered by the Regulatory Authority, such as the QFC Employment and Immigration Regulations.
   

10. What legal reforms have you put in place?

    The Government wanted to create an entirely new legal environment with laws that would best serve financial institutions and their customers doing business in Qatar. As a consequence, a full suite of new commercial and civil laws has been enacted, with these laws being modeled on those currently in use in major market jurisdictions.

    In cases where there is any conflict with local Qatari law, the laws, rules and regulations of the QFC will prevail.

    To give effect to these laws, the Government also has provided for a QFC "Commercial Court", the QFC Tribunal, that will have jurisdiction over disputes arising within the QFC.

    Court proceedings will be in English, following common law precedent, and will have clear and readily understood procedures. In addition the legal structure provides for arbitrations and other forms of dispute resolution; a specific Arbitration Regulation has been enacted for this purpose.
    

11. Why does the region need another financial centre?

    There is no limit to the number of centres the region can support. But the QFC is based on a very different model to counterparts in either Dubai or Bahrain. The QFC's primary goal is to attract leading international banks and predominantly financial companies to participate in the growth of Qatar. It is a vital catalyst for the future of Qatar, and therefore the future of the wider region. Three principal factors set the QFC apart:

    a. The QFC is a completely onshore centre whose activities are fully integrated into those of the State as a whole and its legal and regulatory structures are based on best practices in centres such as New York and London.

    b. The fact that the QFC Regulatory Authority is an independent regulatory body which regulates firms that conduct financial services in or from the QFC. It has a broad range of regulatory powers to authorise, supervise and, when necessary, discipline firms and individuals. The QFC Regulatory Authority regulates firms using principle-based legislation of international standard.

    c. The fact that there is real business to be done based on substantial natural resources and a huge investment programme, ranging from infrastructure and energy-based project finance to a programme of diversification and international trade.
    

12. Will the QFC support or compete with Qatar’s local banking sector?

    The QFC's principal objective is to help grow the capacity of Qatar's financial sector. In so doing it will help to introduce higher standards, but will also help to introduce potential new business and partnership opportunities for local banks.

13. If my company had to engage in litigation over a dispute arising in the QFC, how could I be sure my case would be dealt with impartially?

    The QFC Tribunal is completely independent of the existing legal system, with the head of the Court appointed by the Qatar Council of Ministers. That appointee is expected to be a senior judge from a major common law jurisdiction. The proceedings and procedures will be equivalent to those in any leading financial centre.

    The legal environment will provide for the enforcement of judgments from the QFC Tribunal in Qatar and through Qatar's relationships in other jurisdictions with reciprocal agreements. This is expected to give not only certainty but reliable enforceability to firms who have the need to litigate or arbitrate with their customers or counterparties.