Introduction
The Jordanian economy is majorly based on the investments from various Gulf countries as the country do not possess rich natural resources unlike neighboring countries. But, these investments have seen a sharp downfall due to the global slowdown and fall in oil prices. Jordan has introduced various investment laws during this period to gain the confidence of international investors and attract more investment in the country. The introduction of new regulations for Organizing Non-Jordanian investment during the last year is another important attempt to attain the objective of maximized foreign investment in Jordan. This article aims to highlight major provision of these regulations.
Major Provisions
The new regulations (Regulation no 77 of 2016) have been published in the official gazette on 16 June, 2016 replacing the old regulations (Regulation no. 47 of 2000). The prime objective for issuing these regulations is to design a specific framework for regulating and governing the economic activities foreign nationals shall be allowed to take in the country either wholly be foreigners or in partnership with nationals and to restrict participation of foreign investors in certain regulated activities.
As per the provisions of Article 3 of the new regulations a foreign investor may undertake any activity either wholly owned by himself or in partnership with Jordanian if it does not contravene with the public orders or morals, national security and public health.
Article 4 and 5 of the new regulation provides list of economic activities that can be undertaken only by Jordanians or foreign investor participation of less than 50 percent. Activities like maritime maintenance and maritime health services are included in this list.
Article 6 of the new regulations sets out the list of activities in which no foreign investment will be allowed. Activities like sale and trading of weapons, fireworks, crafting and handicraft activities form part of this list.
Article 9 of these regulations empowers the council of ministers to increase the limit for an ownership stake of foreign investor if these companies are not involved in the business mentioned therein.
The new regulations also remove the requirement of minimum share capital contribution for foreign investors. However, non-Jordanian investors will not be allowed to take advantage of this amendment.
Conclusion
The new regulations enhance business opportunities for Jordanians by removing the limits for minimum subscribed share capital and allow foreign participation in several activities to promote sustainable development for the nation. At the same time the new regulations do not compromise on the issues related to security and safety of the nation by restricting foreign participation in these activities. This is a welcome step and it shall help the Jordan to achieve the desired objectives.
