Legal Briefing- June 2017

Property

  • There is mounting frustration over high rents in Syria and the lack of legal remedies due to the liberal nature of the Landlord and Tenant Law, which does not cap prices. There is not much that municipalities can do in this respect except to register the lease agreements. The provincial authorities in Rural Damascus are looking to propose solutions to this problem to the higher authorities.
  • The Project 66 real estate development in southern Damascus founded in accordance with Legislative Decree 66/2012 was renamed ‘Marouta’. Developers in Marouta will have the freedom to design and construct as they see fit while complying with public safety standards. There will be no specific building code requirements for developers to comply with during the construction phase. A timeframe of five years was given to complete projects in Marouta.
  • Furthermore, the Commercial Bank of Syria (CBS) provided a SYP 2.2 billion loan as part of the SYP 20 billion facility to the Governorate of Damascus for the purposes of Project 66 to finance the infrastructure works. So far, SYP 8.4 billion was provided by the CBS.
  • The Governorate of Damascus continued with eviction orders pertaining to informal areas in Kafer Sousseh to facilitate the Marouta real estate development.

Commerce

  • Merchants in Damascus called for opening the imports market for clothing and reconsidering the pricing mechanism for imports.
  • The Ministry of Economy and Foreign Trade allowed countries and foreign companies participating in the Damascus International Fair to sell their products to consumers. They were thus given the right to sell products including items whose importation is restricted or limited to exclusive institutions. Exceptions to this decision included tobacco, cars, jewelry, ornaments of all kinds and used clothing. The products were covered by exemptions from taxes and duties similar to those goods originating from Arab states under the Greater Arab Free Trade Agreement and Iran. The 59th session of the Damascus International Fair was held from August 17th to 26th after a four-year hiatus.
  • The Competition Protection and Anti-Monopoly Commission said that as long as no one business dominates 30% or more of a market, its activities are legal and do not constitute anti-competitive behaviour.
  • 240 cars entered the free zones in Syria without import licenses.
  • Controversy surrounded the case that led to the closure of Qassioun Mall.

Industry

  • The Prime Minister told MPs in the People’s Assembly that the government issues new laws to support the economy, including by allowing industrialists to import petroleum products and granting exemptions from fines.
  • Industrialists continued to insist on the passage of the new Investment Bill.

Companies

  • There was a recent uptick in the number of commercial companies incorporated in Syria recently. Lebanese nationals make up a significant proportion of foreign investors incorporating companies in Syria at the present time.

Finance

  • The Prime Minister told the People’s Assembly that the government is working on the issue of non-performing loans and the new Customs Bill.
  • The Council of Ministers approved a plan by the Central Bank to resume lending by banks with 50% of loans for financing industrial, agricultural and touristic projects.
  • The Chairman of the Budget Committee in the People’s Assembly stressed the importance of raising wages and salaries in the 2018 National Budget.

Taxation

  • President Bashar Al-Assad issued Decree 172/2017 thereby formally reducing customs duties on raw materials and production lines for local industries by 50%.
  • Syrians could see a new taxation regime emerge soon. In addition, the People’s Assembly considered new legislation that would increase taxes, fees and fines. MPs considered a bill to amend Law 60/2004 on withholding tax that would omit the tax rate to be deducted from the amounts paid.
  • The Ministry of Finance completed work on the Real Estate Sales Tax Bill, which should be enacted soon. The Bill seeks to tax real estate sales using actual market prices as opposed to predetermined and outdated valuations that fall short of real prices. The new legislation once enacted will not apply to real estate development companies, which shall remain subject to the Income Tax Law.
  • Reports circulated that the Ministry of Finance was imposing an unlawful corporation tax on holding companies in an effort to shore up public revenues. Syrian law does not provide for a tax on holding companies.
  • The government is considering dismantling the General Commission for Taxes and Fees (GCTF) after 10 years due to unsatisfactory measures to collect taxes. In this respect, the Council of Ministers debated a bill to restructure the Ministry of Finance and bring the GCTF under its authority.
  • The Council of Ministers exempted public sector imports from Iran from customs duties, taxes and other fees for six months starting on July 1st. For instance, Ministry of Communications and Technology imports from Iran fell within this exemption.

Insurance

  • The Prime Minister chaired a meeting of the Syrian Insurance Supervisory Commission to study reforms to the insurance sector. The reforms include revising the distribution of compulsory insurance shares between public and private companies, health insurance coverage and so forth. The major initiative will be the new comprehensive Insurance Bill that covers the sector in full. The Bill was expected to be introduced for deliberations during the summer.
  • The government plans to withdraw compulsory insurance policies from private companies as of the beginning of next year. Only the state-owned Syrian Insurance Company will have custody over compulsory insurance policies as of then.

Public Procurement

  • The Public-Private Partnership Council granted its approval for a refinery project.

Electricity

  • The Ministry of Electricity planned to issue a decision exempting debtors who have not paid electricity bills from fines and interest payments for delays in settling their dues.

Telecommunications

  • The Ministry of Communications and Technology raised customs declaration fees for mobile phones to SYP 15,000.

Transport

  • The Ministry of Transport issued new procedures for the registration of motor vehicles in an effort to curb fraudulent ownership transactions.

Tourism

  • The Supreme Tourism Council approved the Amrit touristic project in Tartous to be undertaken in agreement with Cham Holding.
  • The Council of Ministers discussed a bill creating the General Commission for Tourism and Hotel Training, which enjoys financial and administrative independence. The new body is to be affiliated with the Minister of Tourism as per the provisions of the bill.

Health

  • Interest continued in the controversial case of Houda Al-Sayed, the former Deputy Minister of Health in charge of pharmaceutical affairs. Allegations of corruption against her followed a surge in pharmaceutical prices and shortages due to an abuse of position for personal gain. The financial gain allegedly came at the expense of Syrians who desperately needed medicine to survive. She received a dishonorable discharge and was subjected to a massive media campaign against her actions while in office.

Education

  • The Prime Minister decreed the closure of secondary school religious education institutions not sanctioned by the Ministry of Religious Endowments.

Local Councils

  • President Bashar Al-Assad issued Decree 168/2017 dissolving Fakhourah Town Council in Lattakia Province in accordance with the Local Administration Law.
  • President Al-Assad issued Decree 175/2017 dissolving Haffeh City Council in Lattakia Province as well.

Judiciary

  • The Minister of Justice unveiled a plan to amend laws to speed up the litigation process in courts. Part of the plan includes improving the livelihoods of judges, such as by increased compensation. According to the Minister of Justice, corruption is not just present in the judiciary but in other state institutions as well. He clarified that some judges are dismissed for unprofessional conduct. He reiterated that corruption increases in times of war. He also confirmed that 33 judges were martyred during the war and that the door was open to any judge who wished to return to the judiciary.
  • The Minister of Justice explained that there is a difference between freedom of political opinion and those who incite and commit acts of terrorism. The former is protected by the Constitution while the latter is a criminal act to sabotage the country.
  • The Minister of Justice further clarified that a special committee tasked with amending the Judiciary Law has completed its work. According to the bill, the Minister of Justice will no longer serve as the Vice-President of the Supreme Judicial Council and its members will be chosen by a vote.
  • Decree 165/2017 establishes a court of appeal as part of the judicial complex in Qatana in Rural Damascus.
  • A proposal was put forward to double the number of courtrooms in the Sharia Court in Damascus to provide for increases in cases of marriage and divorce. 1,200 cases a day are distributed to nine courtrooms with each court hearing around 140 cases. The pressure on the Sharia Court in Damascus is due to the displacement of a number of Syrian families to the capital from other regions in Syria. In addition to the burdens of more people in Damascus, there is also a rise in the rates of marriages and divorces during the conflict. The high rates of divorces are due in part because many women lost their husbands without knowing their fates so they filed for divorce on the grounds of absence. In cases of missing husbands, his family is requested to appear before the Sharia Court and if they do not, the judge relies on the testimony of witnesses. As such, there is much witness testimony these days. The pressure on the judiciary is also because the Sharia Court in Damascus is regarded as more flexible than others when requesting documents from parties to a case. Marital documents may have been misplaced or destroyed during the conflict so the Sharia Court requests alternative ones to prove the existence of a marriage. Due to the pressures on the Sharia Court, the result is lengthy litigation that requires more judges and courtrooms to speed up the process.
  • Statistics from the Ministry of Justice suggest that marriages of minors doubled to 14% during the war from seven percent before the conflict.
  • Work continues on the rehabilitation of the Palace of Justice in Homs.

Immigration

  • By June, 247 foreign women married to Syrian nationals had applied for Syrian nationality. More than 1,000 applications were submitted last year to the Immigration and Passports Department at the Ministry of Interior. Foreign women married to Syrian men are eligible for Syrian nationality but not foreign men married to Syrian women. A Syrian MP has thus stated that the current Nationality Law conflicts with the equality principle provided for in Article 33 of the Constitution. The problem is that women are not considered equal to men with respect to granting Syrian nationality to their foreign spouse and children. Consequently, the MP called for the Law to be amended accordingly. In 2011, a special committee was formed for this purpose to allow women to be able to pass on their nationality to their children but nothing came of it.
  • According to the Minister of Interior, the proposal to grant foreign husbands of Syrian wives the Syrian nationality is currently being studied.
  • 70% of Syrian children born in Lebanon since the beginning of the conflict in Syria do not have legal birth certificates.
  • The United Nations stated that half a million internally displaced Syrians and 260,000 refugees so far returned home in 2017 after the return of government control in various regions in Syria that were previously conflict zones.

Religious Affairs

  • Bishop Joseph Absi was elected as the Patriarch of the Greek Catholic Church of Antioch and the East.

Criminal Law

  • The Minister of Justice confirmed that 672 detainees were released from prison as part of efforts to support local reconciliations in all the provinces.

Government

  • President Bashar Al-Assad launched the National Initiative for Administrative Reform as he presided over a cabinet session in Damascus.
  • President Al-Assad issued Decree 176/2017 relieving the Director of the Central Supervisory and Inspection Agency of his duties.
  • President Al-Assad announced plans to revamp the activities of law enforcement agents in the Ministry of Interior to stop criminals circumventing the law.
  • President Al-Assad sent the top security chief to the city of Aleppo to crack down on lawless loyalist groups carrying out a spate of crimes.
  • In his constitutionally mandated role as Commander-in-Chief of the Syrian Armed Forces, President Al-Assad inspected Hmeimim base. In addition, Russian bases in Syria were leased to Moscow for 49 years and renewable for an additional period of 25 years by mutual consent of the Syrian and Russian governments.
  • General Mustafa Tlass, the Syrian Minister of Defence from 1972 until 2004, died in Paris. He previously served as an MP, the Deputy Minister of Defence and the Deputy Prime Minister.

Parliament

  • The People’s Assembly was back in session with a focus on finalizing its new Rules of Procedure, which are comprised of 289 provisions. The Articles were approved in tranches on a daily basis. An amendment to the Rules of Procedure submitted for debate, which received criticism, requires five MPs to propose questioning a minister and not one MP anymore. Another MP proposed an amendment to Article 247 of the Rules of Procedure on revoking the membership of an MP who insults national symbols. The proposal would replace the wording in Article 247 on insulting the state or the President of the Republic as grounds for revoking membership in the People’s Assembly. Therefore, the proposed amendment would make insulting national symbols the grounds for revoking membership. MPs also discussed the conditions that would give rise to extending Parliament’s mandate as contained in the Rules of Procedure. The two conditions include a state of war or the lack of an election of a new Parliament as provided for in the Constitution. The reformed Rules of Procedure granted the Speaker of Parliament more authority over parliamentary committee meetings and a bigger role in coordinating between committees and ministries and other public bodies as well. Despite all the deliberations, disagreements among MPs over the Rules of Procedure continued and especially over how they will affect the structure of some parliamentary committees.
  • The Minister of Finance and the Minister of Internal Trade and Consumer Protection reportedly fell ill during a parliamentary session.

International

  • The Trump Administration formally filed an appeal to the US Supreme Court to give legal effect to its travel ban, which affects Syrian nationals and those of five other countries. The US Supreme Court partially revived the Administration’s travel ban and plans to hear arguments in October. The ban now applies only to people who do not have a credible claim of a bona fide relationship with a person or entity in the United States. Syrians who have family in the US, actual work or educational reasons for travel are not banned. The ban will not apply to lawful residents or those who already have a valid visa to enter the US. Prospective tourists with no family connections to the US and refugees are most likely banned from entry. The partial ban took effect from June 29th and will last until October. Since five out of the nine justices on the Supreme Court are conservative and lean towards the views of the Republican Party, the chances are that they may approve the travel ban in the fall.

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