Thursday 25 / April / 2024
Muscat: Plans are underway to create Oman’s first hidden trade law that aims to cut down on businesses that are owned by Omanis in name only, but actually have expat workers running and operating them.
The final draft of this hidden trade law is currently with the Majlis Al Shura’s Economic and Financial Committee, which has held discussions on changes that needed to be made to this draft sent to them by Oman’s Council of Ministers.
The Committee has made a number of amendments to some provisions of the draft law and decided to refer the draft law to the legal committee for review and legal drafting. “The Hidden Trade Bill is the first legal framework to deal with all aspects related to hidden trade, especially with regard to violations,” said the Oman News Agency.
“Within the framework of the committee’s study of the draft law, a working group has been formed to study the compatibility of the subject matter of the project that deals with creating this law, so that it ties in with the current economic situation of the Sultanate, and the existing economic and commercial laws in force, as there are already some economic laws that address this situation.”
“The team looked at the existing laws that addressed this situation in some neighbouring countries as well,” added ONA. “This was in addition to hosting a number of representatives of the relevant authorities involved in the creating of this law, including the Oman Chamber of Commerce and Industry, and the Ministry of Commerce and Industry.”
Shashwar Al Balushi, the head of Tanfeedh Labour Labs, and the CEO of the Oman Society of Contractors, said that companies that engaged in hidden trade often created their organisations as a front, but hired workers and then sent them out to look for their own employment, which is illegal.
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“Hidden trade is a situation where there is Omani who owns a company, but that company is owned by him on paper only, and he has nothing to do with the day-to-day running of this company,” he explained. “His company in this case is run by expats, while this local gets a lot of benefit from the company. The people who run the company must also be the same as those who benefit from it, and for that to happen, either the owner must be involved in the administration, or he must hire an Omani to manage it for him. Both the owner and the manager have to be registered with the Public Authority for Social Insurance.
“When neither of these happens, then a company is said to be engaging in hidden trade,” added Al Balushi. “There are, unfortunately, some pockets, where this practice is quite widespread. For example, many outlets in the food and restaurant business, or in the retail sector that operate this way. You also get certain companies that set themselves up as construction companies, but don’t actually perform any construction work.
“What they do instead, is hire some labourers, bring them to the country, and then release them and make them find their own work, while they are still on the visas of this company,” he went on to say. “This is extremely bad for in-country value, and detrimental to the overall economic and social development for the country, so this law will create a legal framework to stop hidden trade. Currently, we don’t have the legislation to prevent the creation of this sort of company, so that is why some people take advantage, but the new law, we hope, will stop this from happening.”
According to ONA, this meeting of the Shura Council was held during the first annual session of the ninth term of the body. It was headed by Sulayem bin Ali Al Hikmani, the chairman of the Majlis Al Shura’s Economic and Financial Committee, and in the presence of the other committee members.
