Legal Briefing- January to February 2017

International Trade

  • Syria and Iran signed six contracts for cooperation in the fields of agriculture, animal resources, industry, oil and telecommunications for the purposes of a mobile network operator. The sixth contract relates to Iranian investment in one of the Syrian ports. Both countries signed the contracts on the basis of a joint economic cooperation agreement concluded more than a year ago. The signing of the contracts took place during the official visit of the Syrian Prime Minister to Iran. In addition, a new Iranian credit line to Syria worth $1 billion (US) was inked in Tehran to finance production and energy requirements following the visit of the Prime Minister.
  • New trade cooperation ties between Syria and Iraq will focus on restoring their land border route and facilitate banking transactions, which currently face obstacles.

Commerce

  • The Prime Minister stated that the government is working to update laws to restore production in the commercial, industrial and agricultural sectors. The government plans to amend legislation, open the border with Iraq, reduce electricity fees for industrial businesses, and address smuggling and non-performing loans. It also plans to protect local products and increase the importation of raw materials for the industrial sector not least by reducing customs duties on them. The government has prepared a clear list of imported items that include basic and essential raw materials for production. There are also calls for simplifying the exportation process and licensing procedures. Work is already underway on a number of projects and studies related to exports and exempting industrial equipment from customs duties.
  • Merchants in Damascus called on the Ministry of Economy and Foreign Trade to abolish import licenses and instead draw up lists of permitted and non-permitted goods.
  • Merchants are lamenting the lack of import licenses, which they feel is causing damage to the economy and encouraging further smuggling. The Minister of Economy and Foreign Trade said that the government has compiled a list of permissible imports comprised of basic goods and raw materials.
  • Merchants are complaining that regular changes to importation rules are causing confusion.
  • The Council of Ministers allowed industrialists to directly import petroleum products necessary for production and instructed the Ministry of Petroleum and Mineral Resources and the Ministry of Economy and Foreign Trade to set guidelines for this objective.
  • Legislative Decree 6/2017 merged three public entities into the Syrian Trade Establishment with the authority to directly import goods.
  • The Damascus Chamber of Commerce proposed incorporating a company to import diesel for industrial businesses.
  • A bill is being contemplated to promote reforms to consumer cooperatives to address potential abuses.
  • The Prime Minister affirmed the importance of amending laws to improve the operations of federations in various economic sectors.
  • The Ministry of Internal Trade and Consumer Protection is considering annexing the Competition Protection and Anti-Monopoly Commission and placing it under the jurisdiction of the Consumer Protection Directorate in the Ministry.

Industry

  • Aleppo MP Fares Chehabi called on Syrian industrialists to return home to improved conditions with new laws and regulations to follow soon.

Finance

  • During a meeting with the Central Bank, the Prime Minister touched on matters of privacy and loopholes in the banking sector as part of a policy review.
  • The Prime Minister chaired a meeting at the Ministry of Finance and decided to re-evaluate the administrative structures of financial institutions. He called for reforms to the Customs Directorate, developing public sector banks, an advanced and just tax system, further work on financial policies and automation. The Ministry of Finance is studying the possibility of using electronic stamps in official documents as part of financial reform policies. Moreover, 2017 is being seen as the year that governmental institutions embrace automation.
  • The Central Bank laid down procedures in a circular specifying the conditions under which bank deposits may be withdrawn upon the death of the depositor.

Taxation

  • Investors in the touristic sector are seeking an accommodation with the Ministry of Finance on how to best proceed on the issue of taxation. The Ministry of Finance and the Ministry of Tourism along with the Chamber of Tourism plan to draft an amendment to Article 6 of the Income Tax Law of 2006 as part of a committee. The changes to taxation in the touristic industry come in light of the sector’s decline during the conflict. In 2010, tourism accounted for 12% of GDP. The losses to tourism came third after the oil and industrial sectors since the conflict began.
  • According to the Minister of Finance, work is being undertaken on tax legislation to encourage taxpayers to pay their dues and not to evade their obligations.
  • Tax revenues received by the Large Taxpayers Unit in the Damascus Directorate of Finance climbed by 45% in 2016.

Investment

  • The Tartous branch of the Syrian Investment Agency approved five projects worth more than SYP 1.3 billion in 2016 under the Investment Law.

Employment

  • The Council of Ministers approved a bill exempting businessmen from interest payments and fines owed to the General Establishment for Social Security. The bill is intended to encourage the businessmen to pay the fees and to alleviate the pressures they face.

Tourism

  • The government plans to abolish the Supreme Tourism Council and transfer its authorities and competencies to the Supreme Investment Council. Such a move would be significant and it would indicate the direction of the government’s plans to set the stage for investments during the reconstruction period.

Transport

  • The new Civil Aviation Bill, which further liberalizes the air transport sector, will be enacted soon according to officials.

Telecommunications

  • A judicial source confirmed that around 1,500 mobile phones have been stolen in Damascus and its countryside since the beginning of 2017. 20,000 mobile phones were stolen in 2016 and 150,000 were stolen in total during the conflict, half of which were in Damascus and its countryside.

Local Councils

  • President Bashar Al-Assad issued a decree to dissolve Banias City Council in Tartous province.

Judiciary

  • The Ministry of Justice and the Ministry of Communications and Technology discussed the establishment of courts specialized in cybercrimes. Judges are currently being trained to adjudicate on cybercrimes.
  • There is controversy as a Sharia judge sought approval from the Ministry of Justice on an issue related to women working in restaurants, cafés and so forth. It is a time-honoured tradition and legal principle that a judge’s authority is never subjugated to that of a minister.

Media

  • The Public Prosecution Department in Rural Damascus warned against anyone engaged in journalism without a license from the Ministry of Information. After all, the penalty includes imprisonment. The warning appeared to be in response to the spread of fake news by individuals pretending to be journalists, which is having detrimental consequences in this conflict.
  • The Syrian Parliament, the People’s Assembly, unveiled its new press office.

Immigration

  • US President Donald Trump attempted to block Syrian visa holders and refugees from entering the United States through an executive order, which was overturned by the courts. An exception was initially made for Christian refugees.

Military

  • The government is considering further military service exemptions to encourage Syria’s youth to return home.
  • The government granted new benefits to the families of martyrs killed in action during the Syrian conflict.

Families

  • Judicial sources cited 40,000 divorce cases in Syria during 2016. There is no doubt that the increases are linked to the stresses caused by the Syrian conflict.

Crime

  • French prosecutors are investigating allegations that the cement giant Lafarge Holcim paid off ISIS in Syria to keep its operations going.
  • The Central Financial Supervisory Agency requested the Attorney-General of Damascus to file a lawsuit against an employee of the University of Damascus for embezzling SYP 1.7 million.
  • The Central Financial Supervisory Agency found that the former General Manager of the Real Estate Bank should be referred to the courts for irregularities in his performance.
  • A growing number of cases of counterfeit and forged Syrian Pound notes are being looked in to by criminal and judicial investigators seeking to punish criminals. The investigations are also being extended to fake foreign currencies and gold.
  • Legislative Decree 11/2017 extended the General Amnesty Law provided for in Legislative Decree 15/2016 until June 30, 2017. The general amnesty was granted to armed individuals who turned themselves in to the authorities and laid down their arms and to those who set their hostages free.

International

  • Russia proposed a draft constitution for Syria comprised of 85 articles to speed up agreement on a political transition. It provided for a seven-year term for the President of the Republic with a maximum limit of two terms. The powers of the presidency would be reduced so they could be shared with the Parliament. The President would additionally lose the authority to disband the Parliament. The Parliament on the other hand would be a bicameral legislature with two houses and would have the authority to impeach the President as well as appoint some key officials and judges. It could also decide on matters of war and peace. As for appointments to the Council of Ministers, they would be based on proportional representation for ethnic and religious groups. Russia also called for ‘cultural autonomy’ for ethnic Kurds in postwar Syria and full state authority in its draft constitution. The proposed constitution included a ban on the participation of the Armed Forces in public life. The sources of international law such as treaties and conventions would take precedence over Syrian domestic law according to the text. Lastly, the draft did not provide for the Sharia as the basis for legislation.
  • The United States sanctioned a further 18 Syrians, including a prominent security official and six institutions linked to the Armed Forces. American sanctions also targeted a Syrian foreign exchange company.
  • The United Nations allegedly sanctioned North Koreans in Syria.

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