09 Jul Regulations of the Foreign Investment Capital Law
Regulations of the Foreign Investment Capital Law: Major responsibilities on law firms, and greater incentives for the foreign investor.
Further to rising expectations and anticipation caused by the Foreign Capital Investment Law issued under Royal Decree 50/2019 (the “FCI Law”) and its anticipated executive regulations. Grandiose aspirations that can suffice the needs of the foreign investor and the Omani market have been set. A saviour is set on the regulations of the Foreign Investment Capital Law issued under Ministerial Decision no 72/2020 (The “FCI Executive Regulation”). A shine of satisfaction is manifestly seen in the countenance of the Omani market and the foreign investors, as the new FCI Executive Regulations triumph came with bigger incentives and opportunities for the investor with a process that is set to be prompt and transparent.
There is no fabled way to regulate foreign investments, as this differs from a country to other. The Omani regulator granted the foreign investor the room to start the investment once an investment license is obtained (the “Investment License”). However, the Omani regulator wisely granted licensed offices, such as legal consultancy offices, administrative consultancy offices and financial consultancy offices, and banks (Hereinafter shall be referred to collectively as “Approved Applicant”) to inspect the Investment License, and confirm whether it’s in conformity with requirements. If the application meets the requirements, the Approved Applicant will issue its approval on the application, that should be valid for 6 months from the date of issuance. The concerned authority can object on the content of the application within 10 days from submitting it, provided that the objection is reasoned.
The inclusion of Approved Applicants (most importantly legal consultancies) is an educated step towards ensuring streamlined application in full conformity with the Law. This essentially distributes the responsibilities that are confined to the authorities to specialized consultancies that minimizes the pressure on the concerned authorities and ensures a timely and quality orientated approach.
The application for the Investment License shall contain the following:
1- The name of the foreign investor, his nationality, place of residence and bank details and the business activity that he wishes to conduct.
2- Past experiences of the foreign investor -if available-
3- The number of staff expected to be appointed in the Investment Project.
4- Timeline of executing the investment project, and the operation start date.
5- Feasibility study of the investment project.
6- The approval granted by the Approved Applicant – if available-
7- Any other details or document specified by the concerned authority.
The stark addition to the FCI Executive Regulation is that to the investor, the application will be made in just one place, which is the concerned authority, and if anything further is required, the concerned authority will contact other authorities to get their approval on the applications. This is the centre stone for the foreign investor who seeks to invest in Oman, as the process is simplified, and very clear, which gives him the comfort and eliminates the ambiguity that might be accompanied with any investment.
The Omani regulator further obliges the concerned authority to make its decision to the application of the Investment License within 14 days from the application date. Failure to do so will be considered as an approval to the application, and if the application was rejected, the rejection needs to be reasoned. The concerned authority is bound to issue the Investment License within 3 days from meeting the requirements set for the same.