CR rules revamp to help business

BAHRAIN’S commercial registration rules are set for a massive makeover to cope with changes in the way business is now being conducted.

The 2015 Commercial Registration Law is under review by the Shura Council’s financial and economic affairs committee, whose members want to update procedures in line with international trade best practices.

New commercial rules were introduced in Bahrain at the end of 2018 to help move the country from a “dangerous” to “safe” category following observations by the Paris-based Financial Action Task Force, Middle East and North Africa Financial Action Task Force and The American Foreign Tax Compliance Act. They included amendments to the 2001 Companies Law through a royal decree by His Majesty King Hamad.

Commercial law changes witnessed administrative and commercial punishments increased on violations of commercial registrations (CRs) to prevent tax evasion, money laundering and the funding of terrorism.

“We are seeking an ambitious, visionary, forward-thinking makeover,” committee chairman Khalid Al Maskati told the GDN.

He believes commercial registration law was “rushed through” in 2015 and although loopholes were addressed and further amendments made in 2018, the world of trade, commerce, finance and economics has since moved on significantly.

“Due to Covid-19, Bahrain’s businesses are not just operating locally. Electronic trade is being carried out across the region and around the world and this means elevating our commercial registrations to international standards.”

He added that limitations to the business licensing system, Sijilat, would be worked on in co-ordination with the Industry, Commerce and Tourism Ministry, before the new term in October.

MPs in December rejected amendments to the law, originally proposed by the Shura Council, which would have obliged the ministry, rather than the applicant, to follow up approvals related to the issue of CRs.

The ministry asked legislators to rethink the amendments on the basis they appeared unclear and didn’t follow a cohesive progression. The amendments are now being reviewed by the committee.

“CRs are electronically processed and are out within minutes through Sijilat but it is associated activities and services, through other ministries and government bodies, that take a long time,” committee member Bassam Albinmohammed said.

“Let’s say having the government follow things is not feasible, but at least the process should be much faster now work is being carried out remotely,” he said.

“The mechanism is very slow, frustrating and inefficient. The revamps we intend to have for local CRs to be of recognised international standard and legal strength are being hindered by this.”

Industry, Commerce and Tourism Minister Zayed Alzayani said in December last year that there were 82,592 commercial registrations valid until September. He added there were 11,547 CRs cancelled and 10,260 opened from January to September.

Meanwhile, Parliament’s financial and economic affairs committee chairman Ahmed Al Salloom told the GDN: “Legislation needs to be comprehensive and cohesive and, yes, we believe there is a need to evolve.

“Sijilat has the potential to be much more and its proper progression has to come through the law governing it.

“We will co-ordinate with the Shura Council and the ministry concerned to reach an understanding on what needs to be done.”

 

Source: http://www.gdnonline.com/Details/836961/CR-rules-revamp-to-help-business

 

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