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Following completion of a study conducted by the Omani Ministry of Health and an international insurance company, the Council of Ministers of the Sultanate of Oman issued its decision number 26/2017 and tasked the Capital Market Authority of Oman (the “CMA”) to prepare and implement a compulsory unified medical insurance scheme regulation to govern the medical insurance granted to all private sector employees in Oman. In implementation of the aforementioned decision, the CMA issued the Unified Health Insurance Policy (the “UHIP”) on 24 March 2019 by virtue of its decision no. 34/2019.

The CMA provided that the new insurance scheme will emphasise on the fairness of the insurance clause for all parties involved in the insurance process, and ensure that the insurance premium will not cause additional burden or  expensive  financial cost on the employers through the limitation of the insurance companies’ profit margins; thus making the scheme more affordable for a wider base of employers. In this respect, Moody’s stated that due to the possible limitation of insurers’ profit margins, it is likely that, following implementation of the compulsory health insurance scheme, a number of such insurers may lose high profit margin business opportunities.

The UHIP constitutes part of the mandatory health insurance plans being rolled out by the government of Oman for private sector workers in Oman, and will be governed by and subjected to special regulations the preparation of which is currently being undertaken by the CMA. It is not yet clear what impact will the implementation of the new health insurance scheme have on existing private insurance schemes that offer benefits higher than those provided under such a new scheme, however it is possible that a downsizing of the insurance benefits would be interpreted as amendment to employment agreements which employers will not be able to implement without obtaining their employees’ approval. The situation will become clearer following issuance of the regulations governing the UHIP, which is expected to take place this year.

The article has been prepared by Al Busaidy, Mansoor Jamal & Co.

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Read more here.

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Over 130 members and guests enjoyed the OABC’s largest-ever Taco Tuesday at the Deputy Chief of Mission‘s Residence on April 16th. Ms. Stephanie Hallett graciously hosted the annual event. In her opening remarks, the DCM discussed the Embassy’s connection with the OABC and the growth of the OABC over the past year.

The Kempinski Hotel Muscat generously supplied the tacos and a team of expert chefs, as well as 5 raffle vouchers for lucky members. Other sponsors included Oman United Agencies, Häagan-Dazs Oman (what a hit!), Grand Hyatt Muscat (margarita machine), Sundus Rotana Muscat, Al Falaj Hotel – Muscat, Travel Point Oman (raffling off a one-day luxury yacht rental!), Muscat Pharmacy, Casa Yoga Oman, and BombaBurrito, who generously donated a surprise for all: every attendee present won a “Meal for two voucher” at Bomba Burrito in Muzn Mall.

Thank you to all who attended and especially to our host and sponsors.

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Dozens of OABC members came to Mumtaz Mahal on March 17 for a drop in business lunch with the OABC team.  OABC Premium Member Asha Enterprises LLC sponsored the event, which showcased the restaurant’s fantastic views and delicious lunch options. Rebecca Olson, Executive Director, and Meruyert Shagmanova, Corporate Coordinator handed out this new document and explained benefits to members.  Attendees enjoyed networking outdoors on the patio and left with a better idea of how to access their benefits and connect further with the organization.

Thank you again to Asha Enterprises LLC and Mumtaz Mahal’s team for a lovely lunch!  If you missed it, remember, OABC members receive 15% off the total bill at both Mumtaz Mahal and Woodlands.
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The procedural law of all Omani-seated arbitrations is Royal Decree No. 47/1997 (as amended) promulgating the Civil and Commercial Disputes Arbitration Law (the Arbitration Law).  This is a detailed law substantially based on the UNCITRAL Model Law on International Arbitration.  Below, we summarize some of the important provisions of the Arbitration Law.

The arbitration agreement

Arbitration agreements must be, or deemed to be, in writing.  A record signed by two parties or contained in messages or telegrams, or other means of written communication exchanged by the two parties may constitute an arbitration agreement. Failure to do so will lead to the invalidity of the arbitration agreement.  Parties entering into an arbitration agreement must have sufficient capacity to enter into it.  Arbitration clauses are usually agreed amongst the contracting parties in their contract and relate to future disputes.  They are considered as independent agreements and are unaffected by the invalidity, revocation or termination of the main contract.  Parties may always enter into a submission agreement for present disputes.  Submission agreements are generally more detailed as opposed to arbitration clauses.

The existence of an arbitration agreement constitutes a defence on the part of the respondent if a claimant submits a claim before Omani courts. The respondent must raise the existence of the arbitration agreement before it submits its defence.  Failure to do so will lead to the Omani courts assuming jurisdiction to hear a dispute amongst the parties, despite the existence of the arbitration agreement.

The Tribunal

In their arbitration agreement, parties must agree whether one arbitrator or more will hear a dispute amongst them, which must always be an odd number.  The Arbitration Law sets the default number of arbitrators to three in the absence of party agreement to the contrary.  The Arbitration Law sets out the requirements an arbitrator must possess, including the default procedure for the appointment of an arbitrator in the absence of the parties’ agreement.

The Arbitral Procedure

Generally, parties have the freedom to agree on the procedure(s) to be adopted by the Tribunal.  Natural justice principles, such as the right to a fair hearing and the rule against bias must be applied.  Parties must be treated equally and each one of them must be given an equal and full opportunity to present its claim.

The arbitration process is deemed to have commenced on the date the respondent receives the notice of arbitration from the claimant, unless the parties agree on a different date.  The default language of the arbitral procedure is Arabic, unless the parties agree otherwise.  It is international good practice for the parties and the arbitrator(s) to hold a procedural hearing at the outset of the arbitration to agree on all procedural matters relating to the arbitral procedure, including the timetable for the submission of pleadings, hearing dates, etc.  It is important for the parties to agree on the procedure otherwise the default provisions of the Arbitration Law will apply which may not always be in the best interests of the parties.

The Award

The default timeframe under the Arbitration Law for the Tribunal to issue a final award is twelve months from the date the arbitration procedure commenced, unless the parties agree otherwise.  Failure to comply with the timeframe, whether agreed between the parties or under the default provisions of the Arbitration Law, entitles either party to approach Omani courts to either extend the timeframe for rendering a final award or terminate the proceedings.

Awards are passed by majority of votes if the dispute is heard by more than one arbitrator.  During the arbitral process, Tribunals may issue a number of awards all of which are considered as final on the issues each award determines.  Alternatively, a final award may be issued resolving all claims (and counterclaims, if any) submitted to arbitration.  Issued awards must satisfy the formalities set out in the Arbitration Law.

Risk of invalidity of an award and enforcement

Unlike in litigation proceedings, the losing party has limited recourse to challenge an award.  Article 53 of the Arbitration Law lists the grounds an award may be set aside.  The losing party may submit an application to the court to set aside the award within ninety days of the date the award was notified to the losing party.

The winning party may commence enforcement procedures of an award after the period of ninety days mentioned above has expired, subject to the winning party satisfying the formalities set out in the Arbitration Law.  An award issued in Oman may be enforced in any country which is a signatory of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) and in which the losing party has assets.

Role of Omani Courts in Omani-seated arbitrations

The role of Omani Courts in Omani-seated arbitrations is limited and it is mostly supportive and supervisory.  Omani Courts may interfere in Omani-seated arbitrations in the following instances:

  • Stay of court proceedings
  • Temporary or preventive measures
  • Appointment of the Arbitral Tribunal
  • Where the arbitral procedure is contravened
  • Challenge to the Tribunal’s jurisdiction
  • Impossibility to perform tasks or Tribunal’s failure to undertake tasks
  • Enforcement of orders
  • Failure of witness(es) to attend hearings when ordered
  • Tribunal’s failure to issue the award within the agreed time
  • Deposit of the award with the Secretariat of the Omani Courts
  • Invalidity claim
  • Enforcement of an award
  • Stay of enforcement proceedings
  • Challenge of an order rejecting enforcement of an award

The author is Maria Mariam Petrou, Senior Associate at SASLO.

SASLO is a pre-eminent law firm in Oman, providing legal services to the local and international business community since being founded by Said Al Shahry in 1992. The firm prides itself in representing a prestigious clientele, whether they operate locally or globally and whether they are market leaders or smaller firms. It remains the only Muscat based law firm with well-established branch offices in Salalah, the capital of the fast developing Dhofar Governorate in the south of the country, and Sohar, the industrial hub of the Batinah coast.

SASLO is a full service commercial law firm, and thus offers the full spectrum of commercial law services meeting the requirements of commerce and industry. These requirements range across: corporate transactions for both private and listed companies; financing and security transactions for banks, airlines, shipping companies, developers, manufacturing companies and others; infrastructure projects; the full range of commercial agreements; and dispute resolution, arbitration and litigation services. These services are provided through SASLO’s two principal departments, Company/Commercial and Dispute Resolution, which are supported by strong administrative departments. SASLO is unique in offering a blend of highly experienced senior Omani and foreign lawyers with extensive local and international expertise.

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The Oman American Business Center (OABC) introduced 36 U.S. franchises to Omani investors and entrepreneurs at a two-day event at the Crowne Plaza Muscat, Oman Convention and Exhibition Centre (OCEC), between April 7-8.

Delegates presented brands new to Oman, and connected with attendees during one-on-one meetings on the second day of the event. Opportunities presented included fast casual dining establishments, restaurant experiences, kids’ education, entertainment, fitness, technology, health and more.

Asha Enterprises and Clyde & Co. sponsored the event. Asha Enterprises had experts present to connect with potential franchisees to discuss specific costs and requirements for fit-out and interior design. Joycia Young, Partner at Clyde & Co Dubai, presented legal steps to opening a franchise, as a top franchise law expert in the region.

Joel Stewart, Founder of Integrity Commerical and Omar Al Haza’a, CEO and Founder of Franchise Arabia, partnered with the OABC to invite US companies to the event. “The Oman-US Free Trade Agreement and the positive economic outlook for the Sultanate make this country a key market and country of interest for the brands I represent,” said Stewart.

“I’m very grateful to the OABC for facilitating the first event of its kind in Oman — I was surprised by the new concepts and opportunities presented, and I see a lot of potential for a number of them to succeed in Oman,” says MaanAlasfoor, OABC Member and Business Development Manager at Global Reliance Line.

“As the official affiliate of the US Chamber of Commerce in Oman, we are always looking for new ways to connect Omani and US businesses and to highlight opportunities that could facilitate commercial development between both nations,” says Rebecca Olson, Executive Director at the OABC. “We look forward to hosting similar events in the future.”

From Times in Oman.

Find Clyde & Co. presentation here, more pictures here.

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The Oman American Business Center (OABC) organised a legal update event for its members and special guests, in collaboration with Clyde & Co. and KPMG, at the Intercontinental Hotel Muscat on Wednesday, March 20th.

Legal experts of Clyde & Co offered detailed presentations on recent changes to legislation in Oman. Taimur Malik, Regional Partner, together with Associates Fatma Makki and Zahir Al Sulaimani, discussed the newly adopted 2019 Oman Commercial Companies Law.

Marla Valdez, Board Member of the OABC and Managing Partner at Clyde & Co Oman, covered details of the Minerals Wealth Law. Executive Regulations to the Tax Law were presented by Ashok Hariharan, Partner and Head of Tax at KPMG Lower Gulf, and Meenakshi Sundaram, Tax Director of KPMG in Oman.

“The Oman tax landscape is undergoing a considerable change to not only deal with the need to enhance tax revenues, but also to cope with the global tax developments, including the need for companies having offshore structures to have economic substance,” said Hariharan, following his presentation.

“It is also important for businesses to consider the possible implications of the recent inclusion of Oman in the blacklist re-leased by EU, and the consequent likely outcome of Oman agreeing to introduce legislation to facilitate automatic exchange of information with other countries,” he added.

Sundaram’s presentation pointed out that “The recent changes to the Executive Regulations to the Tax Law provides much needed clarification on several tax matters, including the most important withholding tax rules. Businesses should carefully evaluate the tax implications and ensure appropriate compliance with the regulations.”

“We are thankful to OABC Premium Member company Clyde & Co, not only for sharing their expertise and knowledge, but for recommending these topics in the first place, rightly expecting that the Oman business community would have questions about recent changes,” said Rebecca Olson, Executive Director at the OABC.

KPMG has done an excellent job on the tax side, clearly outlining new regulations for our company members working in a variety of sectors. We thank both companies for their fantastic work and sponsorship for the event,” Rebecca Olson added.

Marla Valdez, Managing Partner at Clyde & Co in Muscat, said: “The recent adoption of the new laws demonstrates the Government’s understanding that Oman’s legal and regulatory framework needs to evolve in order to attract new investments, while also protecting the public’s interest. Investments need certainty, and the mining industry for instance had somewhat stalled while investors waited for the new law to be adopted. This is a welcome development and we expect to see further announcements on the regulatory front to support Oman’s Vision 2040.”

From Times of Oman.

Find more photos here.

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Around 80 OABC members recently came together to clean up waste at the beach behind Azaiba Clothing Factory in Muscat. With around 442 kg of plastic, glass and fishing nets among the trash that members picked up.

We would like to thank Harub Dental Surgery for the sponsorship and all the support. The campaign received support from Saba Muscat Trading Co. by providing the special eco-friendly reusable cups.

 

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Twenty Northeastern University students representing family businesses from around the world, together with professors, panellists, and OABC board members, participated in the Oman Family Business Forum, organised by the Oman American Business Center at the Grand Hyatt Muscat on March 4. The event, which ended with a special dinner reception at the residence of U.S. Ambassador Marc J Sievers, was sponsored by Daud Group of Companies.

Members of the OABC participated in two panel discussions, both designed to encourage and impart knowledge to the students, who are about to graduate and enter their own family businesses.

The first panel invited executives from top companies in Oman to share about their experiences in serving a family business as a career, including lessons learned during times of transition to new or younger leadership. The second panel, with next-generation leaders from Oman’s top companies, focused on innovation and the impact that these young leaders have been able to make since graduating and entering the family business.

“Family is of utmost importance in Omani society, and it’s our job to help prepare and assist the next generation of leaders,” says Ali Daud, CEO and President of Daud Group of Companies.

“In addition, young people inspire us every day with their energy, innovative minds, and unique outlook. We are excited to support the students’ learning experience in partnership with the OABC.”

“We are thrilled with the willingness of our members, each of whom are busy executives, to offer their time and support during a critical point in these students’ lives,” says Rebecca Olson, Executive Director of the OABC. “Providing a space for the exchange of ideas and the building up of understanding is a key objective of the OABC. We are grateful for the opportunity to host these students and also to discuss a topic of such great importance and interest to the Oman business community.”

From Oman Observer.

Find more photos here.