Law issued to raised limit of foreign ownership
Qatar yesterday issued a law formally raising the limit of foreign ownership in the listed companies to 49 percent.
The move paves the way for more liquidity flow into the country’s stock market that has a capitalisation of $192.21bn.
The foreign ownership limit in most listed companies was 25 percent earlier.
Non-Qatari GCC nationals, who were previously treated as foreigners for the purpose of trading in Qatari stocks, are to be now treated as Qatari citizens.
This means their ownership of Qatari stocks will not be counted in as being part of foreign ownership.
“We have the biggest hindrance to promoting Qatar Exchange (QE) in a big way, removed,” was how stock and financial analyst, Bashir Al Kahlout, reacted.
Al Kahlout told this newspaper that QE would now become the GCC’s second-largest equity market (after Saudi Arabia’s).
About non-Qatari GCC nationals, he said they were until now treated as foreigners, so they shared the quota of stock ownership that was meant for foreigners.
Citing an example, he said suppose 80 percent shares of a listed company were held by Qataris and the remaining 20 percent by foreigners.
And non-Qatari GCC nationals might have had a share of five percent in this ownership.
“This means that foreigners actually had only 15 percent share in this company, not 20 percent,” he said.
With the passage of the law No. 9 of 2014, this five percent ownership of non-Qatari GCC nationals will now be shared by foreigners, he said.
Meanwhile, QNA said the Emir H H Sheikh Tamim bin Hamad Al Thani had issued Law No. 9 of 2014, which amends some provisions of Law No. 13 of 2000 regulating investment of non-Qatari capital in economic activity.
The law says that listed companies should seek approval from the Ministry of Economy and Commerce to amend their Articles of Association to raise the foreign ownership limit to 49 percent.
QNA said the legislation also provides for raising this percentage (49) for foreigners further with approval from the State Cabinet.
The law is to be effective from the date of issue and is to be published in the official gazette.
The Peninsula | www.arabianbusiness.com
