|
LEGISLATION
Legal Framework
Bahrain provides a supportive business environment for private sector enterprise, characterized by minimal bureaucracy. Central to Bahrain's role as commercial hub is the fact that the government allows 100 per cent foreign ownership of companies, a policy unique to the region. The absence of restrictions and trade controls on private enterprise and freedom from exchange control on the repatriation of capital, profits and dividends, are also part of a policy geared to attracting foreign participation in the economy.
Bahrain's formal legal system is the oldest in the Gulf, dating back to the 1920s. Acknowledging the importance of a sound and comprehensive legal framework that facilitates business, Bahrain has established several laws that cover different aspects of business, and ensure that the rights of the international investor are protected. Perhaps the most important laws to investors are a new Commercial Companies Law that came into effect in January 2002, and the various Intellectual Property laws.
The New Commercial Companies Law
The introduction of the limited liability sole proprietorship, which allows a single investor to own a Limited Liability company;
The introduction of simplified procedures that allow companies to change their legal form;
The introduction of articles relating to the establishment and regulation of holding companies;
The ability to establish joint stock companies through a Ministerial resolution rather than an Royal Order, as previously required;
The increase of capital requirements for Limited Liability and Joint Stock companies.
The Intellectual Property laws
The Intellectual Property laws cover trademarks, patents, designs and copyrights. Patent and Design Regulations were introduced in 1955 and amended in 1977, with new legislation expected to be introduced by 2002. Modifications were made to both the Trademark Law and the Copyright Law in 1993. Bahrain has been a member of both the Paris Convention and the Berne Convention since 1996.
A new anti-money laundering law, in line with the Financial Action Task Force's Forty Recommendations on Money Laundering, came into effect in 2001.
Laws governing electronic transactions and the opening of the telecommunications market are currently being drafted.
The GCC Commercial Arbitration Center, which was established in 1995, provides the private sectors in the GCC countries with a quick mechanism by which commercial disputes can be resolved. The services offered by the Center include conduct of commercial arbitration in accordance with the Center's rules and regulations. Ad hoc arbitration or arbitration under the rules and regulations of other arbitrage institutions is also administered by the Center.
|
