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May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
A Note From the Editors
Welcome to the Middle East Law Bulletin, ABA
International’s first and only law bulletin on legal
developments in the Middle East. The Bulletin welcomes
submissions on newsworthy or professionally significant
legal developments in the Middle East, whether they relate
to constitutions, legislative matters, administrative law or
court cases, or whether they bear on legal education, legal
practitioners, the practice of law or the development and
progress of national and regional bar associations or other
legal institutions. Submissions should principally be from
legal practitioners and academics whose practices,
academic endeavors and interests focus on the Middle
East. Submissions should be made to the editor Jim
Phipps at jphipps@aquastruct.com.
While this first edition is gloriously robust, not
every edition will be similar. Indeed, we anticipate that
many editions will be single article submissions,
highlighting, reporting on or analyzing developments as
the occur. The only inducements we can offer to those
submitting materials will be the opportunity to be
published in a newsletter reaching a significant number of
fellow practitioners and academics.
We hope you will decide to contribute to the
Bulletin and to become an active participant in the Middle
East Committee.
Legal Developments in 20061
The year 2006 in the Middle East will be
remembered for many significant legal developments. The
economy, much as in 2005, was a focus for most of the
countries in the Middle East. Iraq, Kuwait, Libya, Turkey,
and the U.A.E., for example, all passed legislation meant to
streamline and attract foreign investment.
In 2006, the trend toward democratization in the
region (as reported in 2003 to 2005) deepened. Popular
elections, some of which were monitored by European
Union observers such as in Yemen, were held.
Furthermore, Qatar announced it would hold legislative
elections in 2007, its first since 1970. Also, there were
public demonstrations and demands by the judiciary for
greater independence from the executive in Egypt,
Morocco, Iran, and Tunisia. In Iran, the bar association
struggled to maintain its independence from the judiciary.
Wars dominated many parts of the Middle East,
both ongoing clashes such those in Iraq, Sudan, and
Afghanistan, to new conflicts such as that between
Hezbollah and Israel. Many of those countries that were
not experiencing immediate conflict were recovering from
it by taking steps to revitalize their economies, such as in
Algeria and Eritrea.
While Kuwait passed laws to protect freedom of
press, critics argue that laws passed in Egypt and Jordan
which aim to give security forces broad powers to arrest
1 It goes without saying that the views and opinions expressed in this Bulletin are those of the concerned authors and not of their respective employers, the editors, the ABA, ABA International, the Middle East Committee or any of the members or leaders in any of these organizations.
Middle East Committee Welcome to the Middle East Law Bulletin! No. 01/2007
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
and detain individuals associated with terrorism curtail civil
liberties, much like critics in the United States argued when
the Patriot Act was enacted and later extended.
In this first edition of the Bulletin, individual
country reporters highlight what, in their view, are some of
the more dramatic legal developments in the countries
covered in this report. A special report is also provided on
Islamic Finance and on the Iranian Bar Association’s
struggle for independence from the executive.
* * *
Special Report: Islamic Finance∗
The year 2006 proved to be a year of growth and
expansion in Islamic Finance: New financial products have
been created; the largest sukuk to date was announced; and
new ways of tracking Islamic-compliant funds have been
implemented. “Islamic banking operations now exist in
about 100 countries across the world with estimated assets
of $300 billion and it is growing at a pace of over 15 per
cent a year with the growth rate set to continue.”2 For
instance, in Bahrain, the key projects of the Islamic
investment bank, Gulf Finance House, included the $1.3
billion Royal Metropolis in Jordan, the $3.8 billion
Legends in Dubai, the $1.4 billion Gateway to Morocco in
Morocco, and the $2.6 billion Energy City in Qatar.3
In the first quarter 2006, corporate bond
issuances totaled $10.2 billion, the most significant being
the Dubai Ports issuance of the largest sukuk to date, a 2-
year convertible $3.5 billion bond.4 Sovereign issuances in
2006 totaled $2.7 billion with an additional $6.7 billion
∗ Jennifer Riccio prepared this special report on Islamic Finance. 2 Islamic Banking Growing Fast, Bahrain Tribune, (June 11, 2006),available at: http://www.bahraintribune.com/ArticleDetail.asp 3 Islamic Banking Growing Fast, Bahrain Tribune, (June 11, 2006),available at: http://www.bahraintribune.com/ArticleDetail.asp 4 Mahmoud Amin El-Gamal, Overview of Islamic Finance, Occasional Paper No. 4, page 5 (August 2006), available at: http://www.treasury.gov/offices/international-affairs/occasional-paper-series/08042006_OccasionalPaper4.pdf
slated for the remainder of the year, which is up from $706
million in 2005.5
On June 19, 2006, the Lebanon-based investment
bank, BSEC (Bemo Securitisation), announced the pricing
of the first-ever Shariah-compliant gas-backed
securitisation.6 The $165.67 million sukuk originated from
the Texas-based East Cameron Partners (ECP).7 The
sukuk is the first-ever Islamic securitisation rated by S&P,
the first originating out of the United States, and the first
embedding Shariah-compliant hedges.8 The design is a
two-tier structure, “with a Purchaser SPV located in
Delaware to acquire the assets and an Issuer SPV located
in the Cayman Islands to issue the Sukuk to the capital
markets and use the proceeds to invest in the Purchaser
SPV by way of a Shariah-compliant Funding Agreement.”9
The Dow Jones Indexes and Citigroup Corporate
and Investment Banking launched The Dow Jones
5 Mahmoud Amin El-Gamal, Overview of Islamic Finance, Occasional Paper No. 4, page 5 (August 2006), available at: http://www.treasury.gov/offices/international-affairs/occasional-paper-series/08042006_OccasionalPaper4.pdf 6 East Cameron Gas Sukuka New Sukuk Innovation Comes To Market BSEC Announces The Successful Closing Of The First Ever Oil And Gas Shariah Compliant Securitisation, (June 19, 2006), available at: http://www.bemosecuritisation.com/highlights/files/MSG%200000%20ECP%20-%20PR%20-%20ENG%20-%2019%20June%2006.pdf 7 East Cameron Gas Sukuka New Sukuk Innovation Comes To Market BSEC Announces The Successful Closing Of The First Ever Oil And Gas Shariah Compliant Securitisation, (June 19, 2006), available at: http://www.bemosecuritisation.com/highlights/files/MSG%200000%20ECP%20-%20PR%20-%20ENG%20-%2019%20June%2006.pdf 8 East Cameron Gas Sukuka New Sukuk Innovation Comes To Market BSEC Announces The Successful Closing Of The First Ever Oil And Gas Shariah Compliant Securitisation, (June 19, 2006), available at: http://www.bemosecuritisation.com/highlights/files/MSG%200000%20ECP%20-%20PR%20-%20ENG%20-%2019%20June%2006.pdf 9 East Cameron Gas Sukuka New Sukuk Innovation Comes To Market BSEC Announces The Successful Closing Of The First Ever Oil And Gas Shariah Compliant Securitisation, (June 19, 2006), available at: http://www.bemosecuritisation.com/highlights/files/MSG%200000%20ECP%20-%20PR%20-%20ENG%20-%2019%20June%2006.pdf
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
Citigroup® Sukuk Index, the first index that measures the
performance of global bonds that comply with Islamic
investment guidelines and is made up of investment-grade,
U.S. dollar-denominated Islamic bonds.10 “The index
shares design criteria and calculation assumptions with the
broader Citigroup fixed-income index family, and its
screens for Sharia compliance that is consistent with those
of the Dow Jones Islamic Market (DJIM) Indexes.”11 To
be included in the index, a bond must comply with both
Shariah Law and the Bahrain-based Auditing &
Accounting Organization of Islamic Financial Institutions
(AAOIFI) standards for tradable sukuk; must have a
minimum maturity of one year; a minimum issue size of
US$250 million; and an explicit or implicit rating of at least
BBB-/Baa3 by leading rating agencies.12
On October 4, 2006, the Islamic Finance
Information Service (IFIS) announced the launch of the
first online Islamic Finance Shariah Supervisory Database
that will monitor and update the composition of Shariah
boards worldwide covering Regulatory Agencies, Islamic
banks, Islamic funds, or conventional institutions that
either dedicated Islamic windows or offered Islamic
products.13
Faisal Finance (Switzerland) S.A, was awarded a
full banking license by the Swiss Federal Banking
Commission and is now the first Islamic Private Bank to
be launched in Switzerland.14 The principal shareholder of
10 The Dow Jones Indexes Timeline, available at: http://www.djindexes.com/mdsidx/?event=showAboutUsTimeline 11 The Dow Jones Citigroup® Sukuk Index Overivew, available at: http://www.djindexes.com/mdsidx/?event=Sukuk 12 The Dow Jones Citigroup® Sukuk Index Overivew, available at: http://www.djindexes.com/mdsidx/?event=Sukuk 13 IFIS Launches Exclusive Online Islamic Finance Shariah Supervisory Database, (October 4, 2006), available at: https://site.securities.com/press_releases/index.html?pr=press20061004_3 14 Faisal Finance (Switzerland) Sa Becomes Faisal Private Bank (Switzerland) Sa, After Receiving A Full Banking License By The Swiss Federal Banking Commission, The International Islamic Finance Forum, (October 3, 2006), available at:
Faisal Private Bank is the Bahrain-based Ithmaar Bank
BSC, which launched its IPO on the Bahrain stock
exchange on February 19, 2006, with a total issued and
fully paid-up capital of Ithmaar is US$ 360,000,000.15
In November, the Dubai Islamic Bank announced
the creation of a new investment product; the Shariah-
compliant 3-year Capital Protected DFM (Dubai Financial
Market) Note, which will have a minimum investment of
$10,000 and will offer a maximum potential return of 12
percent per annum.
Current trends may indicate a continued
expansion of Islamic Finance in the world’s economic
markets.
* * *
Algeria∗
In 2006, Algeria continued to make efforts to
modernize and stabilize its economy and emerge from the
after effects of its ten year long bloody civil war in the
1990’s.1 The government granted amnesty to rebels of the
war who remained at large, able to hide in the deserts and
mountains which make up much of the southern portion
of the country.2 In an effort to foster stability, the
government also agreed to release at least one jailed
militant as part of its efforts at reconciliation.3 In
September, Rabah Kebir, a leader of one of the banned
http://www.iiff.com/index.cfm?page=news_details&category=1&id=173&menuid=2 15 Faisal Finance (Switzerland) Sa Becomes Faisal Private Bank (Switzerland) Sa, After Receiving A Full Banking License By The Swiss Federal Banking Commission, The International Islamic Finance Forum, (October 3, 2006), available at: http://www.iiff.com/index.cfm?page=news_details&category=1&id=173&menuid=2 ∗ Bernadette M. Chala serves as General Counsel to international business headquartered in Orange County, California. 1BBC News, Country Profile: Algeria (September 13, 2005), available at http://news.bbc.co.uk/2/hi/middle_east/country_profiles/790556.stm; see also, République Algérienne Démocratique et Populaire, available at http://www.el-mouradia.dz/. 2Ibid. 3BBC News, Islamist Leader Freed in Algeria (March 13, 2006) available at http://news.bbc.co.uk/2/hi/africa/4801318.stm.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
extremist Islamic Salvation Front (FIS) returned from a
self-imposed exile and even urged rebels still fighting the
state to disarm.4 However, Algeria continues to experience
some sporadic violence as a result of some militants’
continued refusal to disarm, especially in the more rural
regions of the country.5
Algeria has a vision for long term development,
including developing its marina and directing investment
not just to large scale projects but also to small and mid-
scale projects. The government has been proactive in
directing investment to other sectors of the economy, such
as telecommunications and tourism.6 These efforts are
being made to decrease the country’s reliance on oil and
gas exports. Algeria is the eleventh largest oil producer and
fourth largest producer of natural gas worldwide.7 For
instance, Algeria has used its dominance in oil and natural
gas production to foster relationships with European
countries, such as Italy and Germany.8 Algeria has also
worked to strengthen ties with France, the former colonial
power that used to rule Algeria.9 The relationship was
recently so strained that the two nations delayed signing a
proposed friendship treaty that was due to be signed at the
end of last year.10
4BBC News, Algeria: A Timeline (November 17, 2006), available at http://news.bbc.co.uk/2/hi/middle_east/country_profiles/811140.stm; BBC News, Algeria Amnesty Deadline Expiring (August 28, 2006), available at http://news.bbc.co.uk/2/hi/africa/5292500.stm. 5BBC News, Bomb Blasts Shake Algeria Towns (October 30, 2006), available at http://news.bbc.co.uk/2/hi/africa/6098136.stm. 6Reuters, Algeria Appeals for Arab Investment (November 19, 2006), available at http://asia.news.yahoo.com/061118/3/2t50p.html. 7Turkish Press, Germany and Algeria Agree to Build Cooperation in Energy Sector (November 16, 2006), available at http://www.turkishpress.com/news.asp?id=151486. 8Associated Foreign Press, German Energy Group E.ON Signs Liquid Gas Deal in Algeria (November 16, 2006), available at http://news.yahoo.com/s/afp/20061116/bs_afp/algeriagermanyeu_061116163823. 9Global Africa Network, Sarkozy Draws Cheers, Vitriol in Algeria (November 15, 2006), available at http://news.africast.com/africastv/article.php?newsID=60436. 10Ibid.
Algeria is also making attempts to decrease
unemployment. Currently, the government estimates that
employment is at 15.3 percent but the unemployment rate
for those under 30 years of age is closer to 70 percent.11
Continued progress in stabilizing the economy can be
reflected in Algeria’s use of recent high oil prices to repay
ahead of schedule its foreign debt to countries such as the
United States and Germany.12 Algeria has also chosen to
direct the money it has saved in interest payments toward
building and developing its infrastructure, with projects
such as improving and building a stable water supply.13
* * *
Egypt∗
In a step which disappointed political reformers,
April 2006 saw the Egyptian Parliament’s decision to
extend the country’s long standing emergency laws which
give the security forces broad powers to arrest and detain
individuals without charge. Parliament agreed to extend
the legislation, which has been in place since 1981, for
another two years16.
The same month saw public demonstrations in
Cairo in support of demands made by the country’s
judiciary for greater independence from the executive17.
Long standing demands presented by the Judges club, an
informal body which has led a series of challenges to the
Government, include a complete shift of authority from
the Ministry of Justice to the Judicial Council, which is the
11Associated Foreign Press, German Energy Group E.ON Signs Liquid Gas Deal in Algeria (November 16, 2006), available at http://news.yahoo.com/s/afp/20061116/bs_afp/algeriagermanyeu_061116163823. [Same as FN 8.] 12Ibid. 13Associated Foreign Press, Algeria Agrees Early Debt Repayment to Germany (November 15, 2006), available at http://news.yahoo.com/s/afp/20061115/wl_africa_afp/algeriaeconomydebt_061115215314. ∗ Llyr Rowlands, Associate at Hunton & Williams LLP, Washington DC and Judge Hesham Mourad, Bani Swaif First Instance Court, Egypt wrote the article on Egypt. 16 Egypt extends its emergency laws, BBC New, April 30, 2006, http://news.bbc.co.uk/2/hi/middle_east/4960332.stm 17 Press release from the UN News centre http://www.un.org/apps/news/story.asp?NewsID=18853&Cr=Egypt&Cr1
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
central structure for overseeing most judicial affairs; being
able to elect a number of Council members and
strengthening the Judges Club18. In June 2006, and in
response to these demands, the Egyptian Parliament
passed an amendment19 to the Judicial Authority Act20.
Whilst the amendments did not address all grievances,
there were some concessions for the judges, to include an
independent budget administered by the Judicial Council
and an even greater role for the Council in judicial affairs.
In criminal law and procedure, there were two
important developments during 2006. In July, Parliament
passed an amendment21 to the Penal Code22 abolishing
imprisonment for a number of offences relating to the
‘freedom of the press’, particularly the crime of ‘libel’.
Whilst the changes removed certain media curbs, the Penal
Code continues to mandate imprisonment for libeling the
President and foreign heads of state.
In the same month, Parliament also passed an
amendment23 to the Criminal Procedural law24, which
reduces the time-periods that an accused can be remanded
in custody awaiting trial. If the accused is acquitted at trial
the Prosecutor’s office is required to publish the acquittal
decision in two daily newspapers25. The amendment also
provides for alternatives to being remanded in custody,
such as home confinement or ordering the accused to
report to a police station at certain times.
Other developments include Egypt’s decision in
September 2006 to revive the civilian nuclear power
program it froze 20 years ago following the accident at the
Chernobyl plant, Ukraine. The Government plans to build
18 Unlikely reformers: Egyptian Judges Challenge the Regime by Professor Nathan Brown, Jurist Legal News and Research, June 8, 2006 19 Amendment No. 142/2006 20 Law No. 46/1972 21 Amendment No. 147/2006 22 Law No. 58/1937 23 Amendment No. 145/2006 24 Law No. 150/1950 25 Article 312 bis of the Criminal Procedural law (as amended)
a new nuclear power station at El-Dabaa, on the
Mediterranean coast, within the next 10 years26.
* * *
Eritrea∗
In Eritrea, border tensions with Ethiopia dominated
2006. The hostilities stem from Ethiopia's refusal to permit
the Ethiopia Eritrea Boundary Commission ("EEBC") to
physically demarcate the boundary delimited in the
EEBC's April 2002 decision, in large part because it
awards the disputed village of Badme to Eritrea.27 After
initial cooperation, Eritrea also raised obstacles to the
EEBC's work – in particular by restricting EEBC field
staff and UN peacekeepers.28 At the start of 2006,
observers reported that Eritrea and Ethiopia had amassed
250,000 and 130,000 troops, respectively, along the
border.29 Efforts by the Security Council30 and the EEBC31
failed to diffuse the crisis. In a November 27, 2006
statement, the EEBC announced the Parties had 12
months to demarcate their border.32 If in that time the
Parties fail to reach necessary agreement or enable the
Commission to resume its work, the boundary as
demarcated by the turning points setout in an annex to the
26 Egypt unveils nuclear power plan, BBC News, September 25, 2006,http://news.bbc.co.uk/2/hi/middle_east/5376860.stm ∗ Brian J. Vohrer, an attorney with the Washington, D.C. office of the law firm LeBoeuf, Lamb, Greene & MacRae LLP, prepared the report on developments in Eritrea. 27 Statement by the Eritrea-Ethiopia Boundary Commission, paras. 7 & 10 (Nov. 27, 2007), http://www.pca-cpa.org/ENGLISH/RPC/EEBC/Statement%20271106.pdf (hereafter "November 27 EEBC Statement"); Boundary Commission Calls Meeting to Resume Marking of Ethiopia-Eritrea Border, Associated Press, Mar. 9, 2006. By way of background, the Parties agreed to establish the EEBC to delimit and demarcate their shared border in the December 12, 2002 Algiers Peace Agreement. 28 November 27 EEBC Statement, para. 11. 29 War Talk puts Attention from Internal Woes; Ethiopia, Eritrea Peace in Danger, The Atlanta Journal Constitution, Jan. 1, 2006. 30 U.N. Security Council Resolution 1640 (Nov. 23, 2005); U.N. Security Council Resolution 1681 (May 31, 2006); U.N. Security Council Resolution 1710 (Sept. 29, 2006). 31 Ethiopia-Eritrea Border Talks End "without any progress"; BBC News, May 20, 2006; Ethiopia, Eritrea Tussle over Border Ruling: Meeting Fate Unclear, Jun. 14, 2006. 32 November 27 EEBC Statement, para. 22.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
EEBC statement "will automatically stand", and the EEBC
will consider its mandate complete.33 Both sides objected.34
In contrast, improved relations between Eritrea and
Sudan emerged in 2006 as the two States restored full
diplomatic relations, reopened their shared border, and
discussed cooperation on political, agricultural and
economic issues.35 Eritrea also successfully mediated a
peace agreement between the Sudanese Government
and the East Sudan Front.36 Eritrea's relations with
Yemen improved through new bilateral arrangements
and the establishment of a joint fisheries firm on the
basis of a 1999 arbitral award that delimited their
maritime boundary.37
On the economic front, Eritrea created a free port
zone at its expanded Massawa port to increase trade
with Middle East markets and spur business
development.38 The Government also sought to boost
enforcement of its foreign currency exchange
regulations and warned currency traders that violations
will be prosecuted.39 China emerged as a strong
partner in 2006 by providing a $22 million (USD) low-
interest loan to Eritrea to modernize its
telecommunications infrastructure and offering the
prospect of additional loan agreements.40 The two
33 Id. at para. 22. 34 Eritrea, Ethiopia Reject 'Paper Demarcation', Durham University International Boundaries Research Unit, Nov. 15, 2006, http://www.dur.ac.uk/ibru/news/boundary_news/?itemno=4886&rehref=%2Fibru%2F&resubj= Boundary+news%20Headlines. 35 Eritrea and Sudan Seek to Rebuild Bilateral Ties, World Markets Research, Jun. 13, 2006; Governing Parties in Eritrea, Sudan Sign Memo of Understanding, BBC News, Aug. 27, 2006. 36 President Commends Eritrea's Role in Resolving East Sudan Issue; AllAfrica Global Media, Nov. 16, 2006, http://allafrica.com/stories/200611160510.html. 37 Eritrea-Yemen set up Joint Committee in San'a on Bilateral Issues, BBC News, Aug. 15, 2006; Eritea, Yemen Sign Pact to Set up Joint Fishery Firm, BBC News, Nov. 11, 2006. 38 Eritrea Opens Free Port Zone, Xinhua News, May 23, 2006. 39 Eritrea Warns Illegal Currency Traders of Prosecution, Agence France Presse, Nov. 4, 2006. 40 Eritrea and China Conclude Loan Agreement, Africa News, Jul. 4, 2006.
countries also concluded a cooperation agreement in
the health sector.41
Eritrea's human rights record was again questioned
in 2006 as the organization "Reporters without
Borders" ranked the State among the worst violators
of press freedom and the U.S. Department of State
pointed to "numerous serious abuses" by the Eritrean
Government.42 The EU and the U.S. Department of
State reiterated particular concern for 11 members of
Eritrea's Parliament and a number of local journalists
detained since September 18, 2001.43
* * *
Ethiopia ∗
Numerous key legal developments occurred in
Ethiopia during 2006. Among these was important
legislation relating to economic development in the
country. A proclamation providing greater trademark
protection and setting forth registration procedures for
trademarks44 was passed that, among other things, ensures
that foreign parties enjoy the same trademark protection
rights as domestic parties.45 The Ethiopian Parliament also
promulgated new laws addressing agriculture and
biodiversity, key areas to Ethiopia’s largely agrarian
economy.46 In addition, new legislation was passed relating
41 Eritrea, China Conclude Cooperation Agreement, Africa News, Oct. 12, 2006. 42 Eritrea, Ethiopia Ranked Among Worst Press Violators, U.S. Fed News, Oct. 24, 2006. U.S. Dep't of State, Eritrea: Country Reports on Human Rights Practices – 2005 (Mar. 8, 2006), http://www.state.gov/g/ drl/rls/hrrpt/2005/61568.htm (hereafter "Eritrea Country Report"). 43 EU Comments on Political Prisoners in Eritrea, U.S. Fed News, Sept. 18, 2006; Eritrea Country Report. ∗ Thomas R. Snider is an attorney practicing in the International Law and Dispute Resolution Group at Hunton & Williams LLP in Washington, D.C. 44 See Trademark Registration and Protection Proclamation No. 501/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 37, July 7, 2006. 45 See id. at art. 3. 46 See Ethiopian Sugar Development Agency Establishment Proclamation No. 504/2006, FEDERAL NEGARIT GAZETA., 12th
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
to other fields of law, including labor law, social security,
and foreign relations,47 and Ethiopia ratified the
Comprehensive Nuclear-Test-Ban Treaty and the
Convention for the Safeguarding of the Intangible Cultural
Heritage during the year.48
Events stemming from the 2005 national elections
also continued to play a role on the Ethiopian legal scene
in 2006 with important constitutional issues having arisen
in the treason trial involving members of opposition
political parties accused of insurrection following the
elections.49 In addition, a key development occurred in
another unrelated trial at year’s end when an Ethiopian
court convicted former Ethiopian ruler Mengistu
Hailemariam in absentia of genocide and other charges
Year, No. 40, July 27, 2006; Ethiopian Organic Agriculture System Proclamation No. 488/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 21, Mar. 8, 2006; Access to Genetic Resources and Community Knowledge, and Community Rights Proclamation No. 482/2006, FEDERAL NEGARIT GAZETA., 13th Year, No. 13, Feb. 27, 2006; Plant Breeders’ Right Proclamation No. 481/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 12, Feb. 27, 2006, available at http://www.ethiopar.net/type/Amharic/hopre/bills/1998/481.ae..pdf. 47 See Labour (Amendment) Proclamation No. 494/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 30, June 29, 2006; Social Security Agency Re-establishment Proclamation No. 495/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 31, June 29, 2006; The Security Cooperation Between the Federal Democratic Republic of Ethiopia and the Republic of Yemen Agreement Ratification Proclamation No. 485/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 16, Feb. 20, 2006; Convention Between the Government of the Federal Democratic Republic of Ethiopia and Romania for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and on Capital Ratification Proclamation No. 486/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 19, Mar. 4, 2006. 48 See The Comprehensive Nuclear Test-Ban-Treaty Ratification Proclamation No. 493/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 29, June 16, 2006; Convention for the Safeguarding of the Intangible Cultural Heritage Ratification Proclamation No. 484/2006, FEDERAL NEGARIT GAZETA., 12th Year, No. 15, Feb. 20, 2006. 49 See, e.g., Betsy Pisik, Treason Trial of 129 Opponents Begins; Defendants Say Ruling “Already Given” by Meles, WASH. TIMES, Feb. 24, 2006, at A13.
related to the deaths of nearly 2,000 people during his time
in power.50
* * *
Iran*
A. THE NUCLEAR PROGRAM
Iran’s interaction with the International Atomic
Energy Agency (IAEA) and the United Nations Security
Council over its nuclear enrichment program dominated
headlines at home and abroad. In December 2006 the
Security Council voted unanimously to impose sanctions
on Tehran over its nuclear program.51 The sanctions focus
on a ban on trade in nuclear-related technology and a
freeze on some Iranian assets.52 Iran’s parliament, the
Majles, responded by passing a bill which calls for a review
of Iran’s cooperation with the IAEA.53 Members of the
Majles pointed out that in light of Iran’s full cooperation
with the IAEA thus far, including over 2000 hour/person
inspections at nuclear sites, that it was not logical to
continue cooperation with the agency.54
B. THE CENTENNIAL ANNIVERSARY OF THE IRANIAN
CONSTITUTIONAL REVOLUTION
In 2006 Iran celebrated the centennial anniversary
of the Iranian Constitutional Revolution of 1906-1911.
The Constitutional Revolution resulted in Iran’s first
written constitution. This constitution was founded on the
50 See Mengistu Found Guilty of Genocide, BBC NEWS, December 12, 2006, http://news.bbc.co.uk/ 2/hi/africa/6171429.stm. * Anahita Ferasat is a 2006 graduate of Loyola Law School in Los Angeles, where she was on the staff of the Loyola of Los Angeles International and Comparative Law Review, and she is now an associate at the law firm of Baker Olson LeCroy and Danielian in Glendale, California. 51 Iran to Revise IAEA Co-operation, BBC NEWS, Dec. 27, 2006, http://news.bbc.co.uk/2/hi/middle_east/6211561.stm.
52 Id. 53 Id. 54 (quoted from) Ala’eddin Borujerdi, head of the Parliamentary Commission for National Security and Foreign Policy. Iran Parliament Deplores UN Resolution as “Tyrannical, Unjust” Dec. 24 2006 BBC Monitoring Financial Times Information ACC-No. 12006122416-1359A-GNW www.lexis.com. Last visited Jan. 28, 2007.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
rule of fair and just laws, provided for a free press, and
encouraged respect for individual rights. The August 5,
1906 decree also called for the creation of an elected
parliament.55 In line with its celebration of the
Constitution Revolution, the Majles in 2006 passed the
Electoral System Bill, which removes the condition that
the president of Iran must be chosen from among Iran’s
distinguished religious and political figures.56
C. THE ECONOMY
In economic developments, Tehran said it would
shift its foreign currency reserves from the dollar to the
euro and would use the euro for future commercial
transactions overseas.57 Even though the currency move is
to apply to oil sales as well, it is expected that Iran will still
accept oil payments in dollars.58
D. HUMAN RIGHTS
The freeing of Iranian dissident Akbar Ganji was a
triumph for human rights activists around the world. Ganji
was jailed in 2000 when the regime claimed he was
defaming the regime and jeopardizing national security
based on his investigative articles that linked Iran’s
intelligence ministry to the killings of dozens of dissidents
during the 1990s.59 His incarceration garnered international
attention during his 73-day hunger strike which was
intended to protest his treatment and incarceration.60 Since
his release from prison Ganji has embarked on a world
tour to speak out on Iran’s human rights violations and to
accept awards for his journalistic heroism.61
55 Sean McCormack, Iran: Centennial Anniversary of the Constitutional Revolution http://www.state.gov/r/pa/prs/ps/2006/70005.htm August 4, 2006, Last visited Jan. 28, 2007. 56 Iran Full Text of Bill on Comprehensive Electoral System Oct. 24 2006 BBC Monitoring International Financial Times Information www.lexis.com, Last visited Jan. 28, 2007. 57 Dollar Dropped in Iran Asset Move, BBC NEWS, Dec. 18 2006, http://news.bbc.co.uk/2/hi/business/6190865.stm. 58 Id. 59 Washington Post. Free Thinker; Iranian Dissident Akbar Ganji, at Liberty to Speak his Mind, at Least Until He Goes Back Home, Aug. 14, 2006 Robin Wright. Section: Style; C01 (also from lexis.com) 60 Id. 61 Id.
E. FREEDOM OF PRESS
Several members of the Majles have expressed
unhappiness with recent government regulations
concerning the registration with a state organization of all
Iranian websites.62 Parliamentarians claim that the new
policy is redundant, as there is already a committee that
prepares a list of destructive sites every week, and that it
violates the rights of people. Censorship is on the increase
in Iran as some 10 million internet sites have been filtered
by the authorities, and the speed of the internet has been
significantly reduced.63
E. INDEPENDENCE OF THE BAR∗
The history of advocacy in Iran dates back to pre-
constitutional revolution (1903), when legal claims were
resolved by religious scholars.64 The Iranian Bar
Association was founded in 1912 and gained its
independence from the Judiciary in 1952, during the
administration of Prime Minister Dr. Mohammad
Mosadegh.65 This independence was destabilized for 18
years following the Islamic Revolution in 1979, during
which the Judiciary appointed two pre-revolutionary
attorneys to run the central Bar Association.66 The Bar
Association regained its independence through holding a
free election to elect its Board of Directors in 1997.67
Today, Iran has fifteen (15) provincial Bar Associations
62 Saeed Barzin, Unhappiness in Majlis About Website Registration and Filtering in Iran, BBC Monitoring, January 19, 2007 www.lexis.com. Last visited January 28, 2007. 63 Id. ∗ Baharak Keshavarz is an attorney practicing law in Iran and New York. She is a graduate of Tehran and Azad University in Iran and Pace Law School in New York. She is now working as a solo practitioner in New York and is an associate at the law Firm of “Keshavarz and Associates” in Iran. 64 Twenty Five Year Developments of Advocacy, Iran: Central Bar Association Publication, 1965, at 12. 65 Iranian Bar Association, 90 years of History, 50 Years of Independence, Iranian Bar Association website. http://www.iranbar.org/pltren1.php 66 Special Edition of Vekalat Magazine for the twenty third election of the Board of Directors of the Central Bar Association, Vekalat Magazine: Iran, March 2003, at 22. 67 Iranian Bar Association, 90 years of History, 50 Year of Independence, Supra.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
with about 25,000 attorney members and a union
coordinating among the provincial Bar Associations.68
The independence of the Bar was violated in 1997, when
the “Statue of the Procedure of Acquiring the Advocacy
License” was ratified and entitled the Disciplinary Court of
Judges to evaluate qualifications of the candidates running
for the Bar Association Board of Directors instead of the
Bar Association Supervisory Board.69
Article 187 of the Third National Development
Plan (2000-2004), vested the Judiciary with the authority to
grant law graduates permission to establish legal
counseling offices and represent people at courts.70
Accordingly, the independence of the Bar Associations
was violated once again by creation of a society whose
members are government lawyers and their licenses are
being renewed by the Judiciary.71 The term of the Third
National Plan was terminated in 2004 but the above-
mentioned society continues to operate in spite of the
ongoing opposition from the Bar Associations and even
some members of the Parliament and some individuals
within the Judiciary system.
One of the recent legal developments has been the
ratification of regulations for implementation of Article 31
and 32 of the “Statue to Amend Part of Justice
Administration Laws” in 2005, according to which,
representation of plaintiffs in civil cases by attorneys is
mandatory. 72 Implementation of this statue has been
expediting the court proceedings and has familiarized
individuals with their constitutional right of access to
68 Iranian Bar Association Union, [updated figures obtained from Mr. Bahman Keshavarz, president of the Central Bar Association on telephone interview dated November 26, 2006], Iranian Bar Association website. http://iranbar.org/ptitr.php#12 69 The Collection of the Laws and Statues of Advocacy, Iran: The Administration of Codification and Expurgation of the Laws and Regulations, Summer of 2003, at 116-117. 70 Id. at 135-136. 71 Id. at 230. 72 Keshavarz, Bahman, Chronology of Legal and Judicial Event in 2005, Iran: Special Edition of Shargh Newspaper, 2005, at 32.
justice, but the illegal Article 187, is still threatening the
existence of the Iranian Bar Associations and
independence of justice in Iran.73
* * *
Iraq∗
Iraq’s nascent government has begun the process
of producing the legislation that will determine the
country’s future development. The key pieces of Iraqi
legislation passed in 2006 were the Law on the
Commission for the Solution of Real Estate Disputes, the
Iraqi Investment Law, the Kurdistan Regional
Government (KRG) Oil Law, and the Iraqi Law of
Citizenship.
A. PROPERTY ISSUES:
This year saw the replacement of the Iraqi
Property Claims Commission with a new but similar entity
designed to address disputes over immoveable property.
The law on the Commission for the Solution of Real
Estate Disputes, which annulled CPA Regulation 12, was
published in the official Iraqi gazette No 4018 on 6 March
2006 and entered into force on the date of its
publication.74 This new commission shall be the body for
real estate issues including the confiscation of property for
political, racial, religious, or any other cases resulting of the
Ba'th regime's policies during the period of its rule
between 17 July 1968 and 9 April 2003.75 This new
Commission for Resolution of Real Property Disputes
(CRRPD) will strive to return real property or restore
73 Id. ∗ Dan E. Stigall is a United States Army Judge Advocate (JAG). J.D., Louisiana State University, Paul M. Hebert Law Center (2000); B.A., Louisiana State University (1996). 74 See Law on the Commission for the Solution of Real Estate Disputes, Iraqi Gazette No 4018 (6 March 2006). See also Niqash, “Law on the Commission for Solution of Real Estate Disputes”, available at http://www.niqash.org/content.php?contentTypeID=170&id=1638 (discussing the parameters of this legislation.) 75 See Law on the Commission for the Solution of Real Estate Disputes, supra note i.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
interests therein to the rightful party. In those cases in
which such restitution is not possible or appropriate, the
rightful owner, possessor or user may receive other types
of redress, such as monetary compensation from another
private party, or compensation awarded by the
Government of Iraq.76
B. INVESTMENT ISSUES:
An Iraqi Investment Law was also approved by
the Iraqi National Assembly on October 10, 2006 and will
likely come into effect after its approval by the president
and subsequent publication in the Iraqi Official Gazette.77
This new law will regulate the national and foreign
investment process in Iraq. The law creates a National
Commission for Investment, a single commission which
will focus on federal investment projects and will be
responsible for the formulation of the national policy for
investment, the development of investment plans and
controls on investments, and will monitors the application
of those controls.78 The law also creates separate
commissions in the regions and governorates which will
have powers to grant investment licenses, encourage
investment, and open branches in areas under their
jurisdiction in consultation with the National Commission
for Investment.79
C. OIL ISSUES:
Meanwhile, the Kurdish Regional Government
(KRG) and the Iraqi Central Government promulgated
competing draft oil laws. On 22 October 2006 the Iraqi
Kurdish government passed the Kurdistan Regional
Government (KRG) Oil Law, its own law governing the
76 See Commission for Resolution of Real Property Disputes (CRRPD) website, available at http://ipcciraq.org/en/index.php 77 See Iraqi Investment Law (draft) available at http://www.niqash.org/content.php?contentTypeID=169&id=1587. See also Niqash, “The Iraqi Investment Law at a Glance”, available at http://www.niqash.org/content.php?contentTypeID=169&id=1587 (discussing the main features of this proposed legislation.) 78 See Iraqi Investment Law (draft), supra note iv. 79 Id.
regulation of oil production in the Kurdish areas.80 This
law effectively asserts Kurdish dominion over Kurdish oil
and gas by designating the Kurdish Minister of Natural
Resources as “…the competent official of the Regional
Government to oversee and regulate Petroleum
Operations.81 The responsibilities of the Ministry include,
but are not limited to, the formulation, regulation and
monitoring of Petroleum Operation policies, as well as the
regulation, planning, implementation, supervision,
inspection, auditing and enforcement of all Petroleum
Operations by all Persons and all activities relating thereto,
including the marketing of Petroleum.”82 This Minister is
not part of the central government but “the person
appointed by the Prime Minister of the Kurdistan
Region”.83 Further buttressing Kurdish dominion over its
regional resources, the law states that states the KRG shall
directly receive its share of all revenue from current and
future petroleum operations in its area and will then share
any surplus revenue with other parts of Iraq. That revenue
may, alternatively, be received directly by the Government
of Iraq under a revenue sharing agreement.84
The Iraqi Central Government has very recently
completed a draft national law that will also address the
issue of oil on Iraq.85 The Iraqi Central Government’s
proposed law (known as the “National Hydrocarbon
Law”) states that the central government and regional
governments can negotiate contracts with foreign oil
companies, but that all contracts must also be approved by
80 See Niqash, “Draft of Kurdistan Oil Law Published”, available at http://www.niqash.org/content.php?contentTypeID=214&id=1627 (discussing the enactment of this legislation.) 81 See Kurdistan Regional Government Oil Law, Article 7, Section 1. 82 Id. 83 See Kurdistan Regional Government Oil Law, Article 2. 84 See Kurdistan Regional Government Oil Law, Article 5, Section 4. 85 See Barry Newhouse, Kurdish Officials Praise Iraqi Oil Draft Law, but Hurdles Remain (1 March 2006), available at http://voanews.com/english/2007-03-01-voa39.cfm
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
a council in Baghdad that is not yet created.86 The draft
reportedly does not address how the government will
divide the revenues from oil contracts among the central
and regional governments of Iraq.87 Khaled Salih, a
spokesman for the Kurdish regional government, has
indicated that a further agreement will be negotiated under
a "Revenue Sharing Law" that has not yet been approved
by the Iraqi Cabinet.88 According to Mr. Salih, once the
Cabinet has approved the revenue-sharing agreement, both
the agreement and the draft oil law will be sent together to
Iraq's parliament for approval.89
U.S. Ambassador to Iraq, Zalmay Khalilzad,
praised the National Hydrocarbon Law, stating that it
reaffirms that oil and gas resources are owned by all the
people of Iraq and contains a firm commitment to
revenue-sharing among regions and provinces on the basis
of population.90 In addition, it establishes a predictable
framework and processes for federal-regional cooperation
that demonstrate the government's commitment to
democracy and federalism, creates a principal policymaking
body for energy that will have representatives from all of
Iraq's regions and oil-producing provinces, and ensures
that all revenue from oil sales will go into a single national
account and that provinces will receive direct shares of oil
revenue.91 It also establishes international standards for
transparency and mandates public disclosure of contracts
and associated revenue and payments, measures which are
86 Id. 87 Id. 88 Id. 89 Id.
90 See Zalmay Khalilzad, A Shared Stake in Iraq's Future: How the Oil Agreement Points the Way Forward (March 3, 2007) available at http://usinfo.state.gov/xarchives/display.html?p=washfile-english&y=2007&m=March&x=20070303173414lnkais0.3565332
91 Id.
designed to build confidence in the new political order and
to counter corruption.92
At the time of the writing of this article, the
National Hydrocarbon Law is still in draft form and, in
order for it to take effect, will need to be enacted by the
Iraqi Council of Representatives.93 However, Ambassador
Khalilzad has indicated that it is likely to pass.94
D. CITIZENSHIP ISSUES:
The Iraqi Nationality Act (No. 26/2006) was
published in the Iraqi Gazette No. 4019, issued on 7
March 2006.95 This new law articulates how Iraqi
citizenship is acquired and lost. Every Iraqi person whose
citizenship was terminated for any political or sectarian,
reason or due to some form of discrimination may redeem
it by submitting a request for their Iraqi citizenship to be
renewed.96 Children of deceased Iraqi citizens who were
thusly stripped of their citizenship can obtain Iraqi
citizenship if they request it.97
According to the new law, to be considered as an
Iraqi, one must be born of an Iraqi father or mother, be
born in Iraq to unknown parents, or be a child found in
Iraq without father or mother. In those cases of an
otherwise stateless child, evidence of citizenship in another
country may invalidate the Iraqi citizenship.98 Likewise,
anyone born outside of Iraq to an Iraqi mother and
unknown father or Iraqi father is eligible for Iraqi
citizenship so long as he or she applies for citizenship
within one year of reaching the age of 18 and is within the
Iraqi territory when applying for citizenship99
92 Id. 93 Id. 94 Id. 95 See Niqash “Iraq Citizenship Law”, available at http://www.niqash.org/content.php?contentTypeID=169&id=1366 (discussing the enactment of this law.) 96 See Iraqi Nationality Act (No. 26/2006) (Iraqi Law of Citizenship), Article XIX. 97 Id., Article XIX. 98 Id., Article III. 99 Id., Article IV.
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Non-Iraqis can apply for Iraqi citizenship but they
must be at least 18 years of age, they must have entered
Iraq legally and be living in Iraq at the time they apply for
citizenship, and they must have been living in Iraq for no
less than 10 years prior to the application for citizenship.
Further, they must be of good moral character, not have
any felony or misdemeanor convictions, and must be free
of infectious diseases.100 Non-Iraqi women married to
Iraqi men may obtain Iraqi citizenship if they meet the
requirements set forth in the law (entering Iraqi legally, in
Iraq when they apply, free of infectious diseases, etc.) but
must only have resided in Iraq for three years.101 Non-
Iraqis who are granted Iraqi citizenship must take an oath
of loyalty to Iraq no later than 90 days from the date a
person was scheduled to obtain Iraqi citizenship.102 One is
only considered an Iraqi from the date the performance of
this oath.103 Palestinians are expressly forbidden from
applying for Iraqi citizenship. The articulated reason for
this prohibition is to encourage them to return to their
homeland.104
Finally, the government may terminate or cancel a
naturalized citizen’s Iraqi citizenship if it is proved that he
or she did or attempted any dangerous action against the
security of the country or provided false information about
himself or about his family upon submitting the request.
This provision of the law envisions a judicial proceeding of
some sort, noting that citizenship in such cases can be
terminated after announcement the verdict and after the
appeal.105
D. FEDERALISM ISSUES:
In October of 2006, the Iraqi Parliament
approved a law that allows provinces to unite to form
100 Id., Article V. 101 Id., Article VIII 102 Id. 103 Id. 104 Id., Article V. 105 Id., Article XV.
autonomous regions.106 This law allows that Regions may
be created by one of three ways: a request from one third
of the members in each of the Governorate Councils; a
request by one tenth of the voters in each of the
Governorates that seek to create the Region; or a request
by one third of the members of the Legislative Councils in
the political subdivisions wanting to merge.107 In the case
of a Governorate seeking to join a Region, the request
must be presented by one third of the members of the
Governorate Council together with the consent of one
third of the members of that Region’s Legislative
Council.108 In all cases, these requests are then presented
to the Council of Ministers which, in turn, refers the
matter to the High Commission for Elections which
conducts a referendum on the matter in the impacted
areas.109
If the referendum is successful and the majority of
voters support the request, then the results are announced
within 15 days of the vote.110 The Prime Minister then
issues a decree to form the new Region within a week.111 If
the referendum is not successful, it may be attempted
again after a year has elapsed from the date of the
declaration of the prior referendum.112 Once a new Region
is formed, it is temporarily governed by a Transitional
Legislative Council , which then drafts a permanent
constitution for the new Region.113
The new Regions formed pursuant to this
procedure are still governed by the Federal laws in force in
106 See Kirk Semple, In Victory for Shiite Leader, Iraqi Parliamenes Creating Autonomous Regions, New York Times (October 12, 2006).
107 See Law on the Operational Procedures for the Creation of Regions, Article 2, sections 1, 2, and 3. 108 Id. section 4. 109 Id. Article 4, section 1. 110 Id. Article 6. 111 Id. Article 8, section 1. 112 Id. Article 9. 113 Id. Article 20.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
Iraq as well as relevant Governorate laws.114 The
permanent constitution of the newly created region may
repeal former Governorate laws so long as it does not do
so in a manner inconsistent with the Federal
Constitution.115 The region also retains the rights
contained in article 121 of the Federal Constitution, which
states that the administrative, political, cultural and
educational rights for the various nationalities, such as
Turkmen, Caldeans, Assyrians, and all others, shall be
guaranteed.116
This law was backed by some Shi'ite majority
leaders who may wish to create a large, autonomous region
in oil-rich southern Iraq, but was boycotted by the
Accordance Front, the largest political bloc of the Sunni
minority, and passed without their approval.117
* * *
Jordan∗
During 2006, Jordan witnessed many legal developments.
However, three legal developments stood out and captured
the headlines. In 2006, Jordan an enacted anti-terror law.118
The law came as a response to the terrorist attacks on
three hotels in Amman in 2005.119 The passing of the anti-
terror law generated heated debate. Opponents of the law
predict that it would unnecessarily curtail individual
114 Id. Article 23, section 1. 115 Id. 116 Id. Article 23, section 2. See also Constitution of Iraq, Article 121, (“This Constitution shall guarantee the administrative, political, cultural and educational rights for the various nationalities, such as Turkmen, Caldeans, Assyrians and all other components. This will be organized by law. “) 117 See Reuters, Iraqi Parliament Approves Federal Law, (October 11, 2006), available at http://www.alertnet.org/thenews/newsdesk/IBO145418.htm ∗ Bashar H. Malkawi, Assistant Professor of Commercial Law, Hashemite University, Jordan. Dr. Malkawi holds an S.J.D from the American University, Washington College of Law, and an L.L.M from the University of Arizona. Email address: bmalkawi@hu.edu.jo. 118 See Anti-Terror Law No. 55 of 2006, Official Gazette No. 4790 (Nov. 1, 2006). 119 See The Economist, Caught in the Middle as Usual: Jordan (Nov. 12, 2005).
liberties.120 The anti-terror law criminalizes a wide range of
behavior as acts of terror, including “interacting” with any
terrorist group.121 The law also permits officials to conduct
surveillance of terrorism suspects and allows police to
detain suspects for 30 days without access to a lawyer and
without judicial review.
A new tax law has been drafted and set for vote pending
several readings in the Parliament.122 The proposed
changes to the tax law are intended to curb evasion,
improve tax collection, and ensure justice in taxpaying.
The new tax law harmonizes taxes and tightens penalties
for violations.123
Jordan’s labor law came under the spotlight, with calls for
reform. The U.S. National Labor Committee reported
foreign workers complains of despicable working
conditions in some factories, including 20-hour work days
and no pay for months, all in possible violation of the
U.S.-Jordan Free Trade Agreement.124 The report forced
Jordan to overhaul its inspection regime. For example,
Jordan increased the number of government inspectors
from 88 to 120.125 However, the steps taken by the
120 See Joshua Pantesco, Jordan Parliament Passes Contentious Anti-Terror Bill, available at <http://jurist.law.pitt.edu/paperchase/2006/08/jordan-parliament-passes-contentious.php> (last visited Oct. 30, 2006). 121 See Anti-Terror Law No. 55 of 2006, art. 3, supra note 1. 122 See Government Working on New Income Tax Law, Jordan Times (Apr. 25, 2006). 123 Currently, the tax law treats economic sectors differently. For example, industry is taxed at the rate of 15% of taxable income, banks and financial institutions are taxed at the rate of 35%, and insurance companies are taxed at the rate of 25%. See Income Tax Law No. 57 of 1985 and its amendments, Official Gazette No. 3343, art. 16.b (Oct. 1, 1985). The new tax law proposes to impose 20% tax on all economic sectors (with the exception of banks). Moreover, the law new tax law imposes fines and/or prison terms on violators of the tax law and considers tax evasion a crime against honor and integrity. See Draft Tax Law for the year 2006, arts. 12 & 34, available at <http://www.incometax.gov.jo/ incometax/main_menue/ legislations/an2.aspx> (last visited Nov. 3, 2006). 124 See Gary G. Yerkey, USTR Investigates Reports of Worker Abuse in Jordan in Violation of Free Trade Accord, 23 Int’l Trade Rep. (BNA) 774 (May 18, 2006). 125 See Gary G. Yerkey, Jordan Cracks Down on Firms Exploiting Foreign Workers in Violation of Trade Pact, 23 Int’l Trade Rep. (BNA) 1075 (July 13, 2006).
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
Jordanian government did not persuade U.S. worker and
trade associations who filed a complaint with the U.S.
government citing shortcomings in Jordan’s labor law.126
For instance, Jordan’s labor law permits only “Jordanian”
workers to apply for membership in a trade union.
* * *
Kuwait∗
Privatization of the Counter-Trade Offset Program
The Kuwait Ministry of Finance has transferred
the management of the Kuwait Counter-Trade Offset
Program (the “Program”) to the National Offset
Company(“NOC”), a private Kuwaiti company. The
privatization took effect on 2 September 2006. The
Minister of Finance, Bader Mishari Al Homaidhi, issued an
order providing that NOC would assume the management
responsibilities for the Program.127
Initiated in July 1992, the Program seeks to
promote the sustainability and expansion of the Kuwaiti
private sector through long-term, mutually beneficial,
collaborative business ventures between foreign
contractors of the Kuwait Government and Kuwait
businesses and private citizens in general. The Program
obliges foreign contractors to which it applies to perform
actions that will "offset" the outflow to such contractors
of money paid under certain Kuwait Government
contracts.
Freedom of Press
The Amir of Kuwait, Sheikh Sabah Al-Ahmad Al-
Jaber Al-Sabah, has ratified a bill passed in the Kuwait
National Assembly providing that newspapers in the
country may operate without censure.128 Since the
126 See Susan J. McGolrick, AFL-CIO, Textile Producers Accuse Jordan of Violating Trade Pact with U.S., 23 Int’l Trade Rep. (BNA) 1416 (Sep. 28, 2006). ∗ David Pfieffer of Bryan Cave LLP wrote the report on Kuwait. 127 Ministry of Finance Order No. 41 of 2006 Concerning the Transfer of Certain Offset Program Duties. 128 Law No.3 of 2006 Concerning Printed Materials and Publishing.
legislation took effect at least twelve newspapers have
applied for and obtained licenses to operate within Kuwait.
The Constitution of the State of Kuwait, which
was approved and promulgated in November 1962,
protects freedom of expression129 and the press130
generally, with some exceptions.
* * *
Libya∗
In July 2006, Libya's General People's Committee
(GPC)131 passed a decision132 providing for the creation of
a new type of Libyan company called a Mushtarika. A
follow-up GPC decision passed in November 2006133
makes a Mushtarika the only way134 in which foreign
natural and corporate persons can operate in Libya in
relation to certain specified sectors, including (a) the oil
field services industry, (b) contracting and civil works
including building and erection, (c) electricity, (d)
transportation and communications, and (e) industrial,
agricultural, marine, and livestock industries.
A Mushtarika allows foreigners to participate in a
majority stake of up to 65% of the company, thereby
allowing the foreign entity to maintain majority
shareholder control over the company for the first time.
Furthermore, a foreign company may select members of
the board of directors proportionate to the interest owned
by the foreign entity (up to the cap of 65%). This means
129 Constitution of the State of Kuwait, Article 36. 130 Ibid., Article 37. ∗ Martin Hunt & Feras Gadamsi of Bracewell & Giuliani LLP, and Tarek M. Eltumi of the Tumi Law Firm drafted the article on Libya. 131 One of the GPC's functions is to issue executive regulations. These executive regulations are secondary legislation that complement laws and show how they are to be applied. 132 GPC Decision No. 171/2006 Regarding the Executive Regulation to Law No. 21/2001 Regarding Commercial Activities As Amended by Law No. 1/2003. 133 GPC Decision No. 443/2006 Determination of Some Provisions Regarding Foreign Companies Practicing their Activities in Great Libyan Jamahiriya. 134 Article 3 of the GPC Decision No. 443/2006 allows the Secretariat of the GPC to grant special permission for companies in those sectors affected by this decision to organize differently for certain "projects of special nature."
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
the board of a Mushtarika company may be comprised of a
majority of foreign directors, provided that (1) the
chairman of the board is a Libyan national and (2) the
foreign company owns at least a majority interest in the
company. The minimum capital required to establish a
Mushtarika company is LYD 1 million (approx. $768,000),
at least a third of which must be fully paid up upon
incorporation, with the remainder being paid within 5
years of incorporation. The Company Registration
Department at the Ministry of Economy in Libya is already
accepting registration applications for the establishment of
Mushtarikas.
The GPC decision regarding Mushtarikas also
makes it easier for companies to operate on an equal
footing with national companies. Mushtarikas will be
granted preferences and incentives in order to (1) obtain
financing from banks, (2) receive rights for land use, (3)
establish factories and workshops, and (4) recruit and hire
skilled non-nationals for company projects where such
skilled workers cannot be sourced in the Libyan market.
* * *
Mauritania∗
On August 3, 2005, long time president Maaouya
Ould Sid Ahmed Taya was deposed in a bloodless coup
led by Colonel Ely Ould Mohammed Vall (alt. spelling Fal)
and the Military Council for Justice and Democracy
(MCJD).135 The MCJD dissolved the parliament,
suspended parts of the constitution, and formed a
transitional government.136 The international community
∗ Rebecca F. Rabb, third year law student, The Ohio State University Moritz College of Law, President of the Middle Eastern Law Students Association, and currently works for Nesbit Law Firm (an immigration law firm that focuses on French-speaking African clientele). 135 U.S. Department of State Country Reports on Human Rights Practices for 2005, Mauritania (Mar. 8, 2006), available at http://www.state.gov/g/drl/rls/hrrpt/2005/61581.htm. 136 Department of State International Religious Freedom Report for 2006, Mauritania (Sept. 15, 2006), available at http://www.state.gov/g/drl/rls/irf/2006/71313.htm.
has recognized the MCJD’s genuine steps towards
democracy, and criticism remains regarding the MCJD’s
failure to address corruption, past and ongoing human
rights violations against black Mauritanians, and the
disproportionate militarization of Mauritanian politics.137
The International Monetary Fund had planned to
remove Mauritania from the Multilateral Debt Relief
Initiative in December 2005, but found that the
government had adequately implemented sound
macroeconomic policies and remedial measures in order to
continue to qualify in 2006.138 Oil production provided a
good deal of the economic growth.139
In 2005, former oil minister Hmeida signed
additional amendments to the 2004 contract with
Australian Woodside Petroleum regarding the Chinguetti
oil deposit.140 The amendments decreased the Mauritanian
share in the oil revenue and lowered taxes.141 The MCJD
denounced the contractual amendments made with
Woodside Petroleum as illegal in January 2006, but
negotiated a settlement in July, after Woodside threatened
to compel international arbitration.142
On June 26, 2006 a constitutional referendum was
held, and Mauritanians approved of a new constitution by
a vote of 96%.143 The revised constitution limits the
137 See Boubacar N’Diaye, Mauritania, August 2005: Justice and Democracy, or Just Another Coup?, 105 AFR. AFF. 421, 434-39 (Apr. 21, 2006). 138 International Monetary Fund Country Report No. 06/272 (July 2006), available at http://www.imf.org/external/pubs/ft/scr/2006/cr06272.pdf. 139 Id. 140 Kate Askew & Violeta Ayala, Slick Operator, SYDNEY MORNING HERALD, June 3, 2006, available at http://www.smh.com.au/news/business/slick-operator/2006/06/02/1148956541283.html?page=fullpage#contentSwap2 141 Mauritania and Firm Row Over Oil, BBC NEWS, Feb. 6, 2006, available at http://news.bbc.co.uk/1/hi/business/4684836.stm. 142 Damian Sturzaker & Kim Middleton, Australia: The Importance of Carefully Managing Risk in Cross Border Investment, Mondaq Business Briefing (July 31, 2006), available at http://www.imakenews.com/iln/e_article000617573.cfm?x=b11,0,w. 143 Mauritania: Voters Embrace Pro-Democracy Reforms, IRIN NEWS, June 27, 2006, available at
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
president to a maximum of two consecutive five-year
terms of office fixes the maximum age of candidates at
seventy-five, and specifies that these provisions cannot be
changed in the future.144 Legislative elections were held in
November 2006, which resulted in a gain of representation
for certain opposition parties.145 Senatorial elections will be
held in January 2007, and the next presidential election is
planned for March 2007.146
* * *
Morocco∗
Constitutional Law: Moroccans are debating the
possibility of limiting the King’s constitutional powers.
Reformers hope to ensure more accountability and
independence of the legislative and judiciary branches of
government; opponents say that the King must retain his
political legitimacy as Monarch.147
Election Law: The government is delaying the formation
of electoral constituencies abroad, which would deny
participation in the 2007 elections to expatriates, who
make up 10% of the Moroccan population. Fear of an
Islamic Fundamentalist sweep is cited as the reason for the
delay.148
Migration Law: In July 2006, Morocco hosted nearly 50
countries for a conference on migration. Reducing illegal
http://www.irinnews.org/report.asp?ReportID=54238&SelectRegion=West_Africa&SelectCountry=MAURITANIA. 144 Mauritania Const. arts. 26-29, 99 (1991, as amended to 2006) available at http://www.oceanalaw.com/gateway/gateway.asp?ID=31&SessionID={0623D86E-1197-44B2-BECA-66A783C1E11B}. 145 Mauritania: Another Step in Democratic Transition, IRIN NEWS, Nov. 23, 2006, available at http://www.irinnews.org/report.asp?ReportID=56495&SelectRegion=West_Africa&SelectCountry=MAURITANIA. 146 Mauritania to Speed Up Democratic Transition, AGENCE FRANCE-PRESSE, Nov. 10, 2005, available at http://www.reliefweb.int/rw/RWB.NSF/db900SID/NKUA-6HZMZZ?OpenDocument. ∗ The report on Morocco was written by Carol Simpson Moncif. 147 Source: http://allafrica.com/stories/200611240089.html 148 Source: http://allafrica.com/stories/200610030002.html
migration and human trafficking throughout Africa and
Europe were major issues discussed.149
Trade Law: Legislators ratified a fishing ban treaty with
the EU. The number of EU fishing boats in Moroccan
waters will be reduced by 67%, and several at-risk species
will be protected.150
Family Law: The Family Solidarity Fund has been created
by the government to provide alimony when it has been
established that the debtor is unable to do so. If the ex-
wife was financially dependent on the husband and has no
income, the government will provide support to the
spouse and children.151
International Law: In May, the Justice Minister reported
on the steps that Morocco has taken to implement the
provisions of the International pact on Economic, Social
and Cultural Rights. Human rights, preservation of cultural
rights, and promotion of democracy were the key issues
scrutinized.152
* * *
Pakistan∗
The most significant legal development in
Pakistan has occurred in the field of criminal law,
specifically regarding rape laws under the Hudood
Ordinance.153 The Hudood Ordinance of 1979 was
intended to implement the Shari’a, or Islamic law, which
generally criminalizes and prescribes punishment for a
variety of acts such as theft, drinking alcohol, and
149 Source: http://state.gov/r/pa/prs/ps/2006/68996.htm 150 Source: http://www.middle-east-online.com/english/business/?id=18455 151 Source: http://www.justice.gov.ma/an/Actualites/Actualite.aspx?actualite=157&_=0 152 Source: http://www.justice.gov.ma/an/Actualites/Actualite.aspx?actualite=144&_=0 ∗ Sheheryar Sardar, a second year law student at Emory School of Law, wrote the report on Pakistan. 153 John L. Esposito, Women in Muslim Family Law 89 (Syracuse University Press, 2001).
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
adultery.154 Pakistan has a dual legal system consisting of
both Islamic and Civil law. The country’s lower house of
parliament has voted to excise and transfer the laws of
rape under the Ordinance, which is administered by the
Islamic courts, to the civil penal code.155 Once the upper
house of parliament approves the change, it will affect the
evidentiary standards associated with proving rape.
Under the Hudood Ordinance, a rape victim must
produce four Muslim adult male witnesses who must “give
evidence as eye-witnesses of the act of penetration
necessary to the offence.”156 If the victim is unable to
produce the witnesses, the alleged intercourse is assumed
consensual and thus, the victim is subject to punishment
under the crime of “zina,” or sexual relations outside of
marriage.157 The amendment, known as the Women’s
Protection Bill, will allow a victim to prove rape through a
variety of standard measures, including, but not limited to,
testimony without the required four Muslim male
witnesses and forensic evidence.158 However, a victim who
is unable to prove rape may still be prosecuted for
adultery; the coalition of religious parties, as members of
the National Assembly, incorporated it into the
amendment.159 Thus, the criminalization of adultery under
the Hudood Ordinance will remain in place. Nevertheless,
the amendment will provide for an individual charged with
adultery to post bail, a procedure the Hudood laws do not
provide.160
* * *
154 Id. 155 http://www.csmonitor.com/2006/1117/p07s02-wosc.html?s=u 156 Asifa Quraishi, Her Honor: An Islamic Critique of the Rape Laws of Pakistan from a Woman- Sensitive Perspective, (1997), http://www.crescentlife.com/articles/social%20issues/rape_laws.htm 157 Id. 158 http://www.theage.com.au/news/World/Pakistan-amends-rape-law-to-help-women/2006/11/16/1163266669406.html 159 Id. 160 http://hrw.org/english/docs/2006/11/14/pakist14576.htm
Palestine∗
Given the current political and military instability
of the West Bank and Gaza strip only a handful of laws
were enacted by the Palestinian Legislative Council (PLC)
during 2006.161 Of the laws enacted half call for the
creation of some form of independent body. For example,
Law No. 1 calls for the creation of an independent medical
and research council.162 Law No. 2 seeks to create a union
for Palestinian industrialists.163 Law No. 3 establishes an
independent higher constitutional court164 composed of a
chief justice, deputy chief justice, and seven other
justices.165 Two laws make minor revisions to existing
laws.166 The final law directs the Council of Ministers to
submit Public Budget Law of 2006 to the Legislative
Council.167 One of the more interesting laws has yet to be
∗ Hisham Kassim, B.A. University of Virginia 2003, J.D. expected University of Iowa College of Law 2007 (All Palestinian Laws and Bills are in Arabic translated by the author). 161 A total of six laws were passed during 2006. Palestinian Medical Council Law No. 1/2006, THE PALESTINIAN GAZETTE, January 16, 2006 (hereinafter Law No.1), General Union of Palestinian Industries Law No. 2/2006, THE PALESTINIAN GAZETTE, January 8, 2006 (hereinafter Law No. 2), Supreme Constitutional Court Law No. 3/2006, THE PALESTINIAN GAZETTE, February 13, 2006 (hereinafter Law No. 3), Amendments to the Provisions of the Elections Law No. 4/2006, THE PALESTINIAN GAZETTE, February 13, 2006 (hereinafter Law No. 4), Amendments to the Provisions Providing for the Sanctity of the Palestinian Flag Law No. 5/2006, THE PALESTINIAN GAZETTE, February 13, 2006 (hereinafter Law No. 5), and Submitting the Law of Public Budget to the Palestinian National Authority Law No. 6/2006, THE PALESTINIAN GAZETTE, March 29, 2006 (hereinafter Law No. 6). 162 Law No. 1, Section 2. 163 Law No. 2, Section 2. 164 Law No. 3, Section 1. 165 Id. at Section 2. 166 Law No. 5 makes minor aesthetic revisions to the dimension of the Palestinian flag as stipulated in Section 1 of the Sanctity of the Palestinian Flag Law No. 22/2005, The Palestinian Gazette, November 23, 2005. Law No. 4 adds an additional section to the Elections Law No. 9/2005, THE PALESTINIAN GAZETTE, June 18, 2005. Section 2.5 of Law No. 4 states that all elected members of the PLC will be become members of the Palestinian National Council and therefore must accept and abide by the Palestinian Liberation Organization’s Basic Law. 167 Law No. 6, Section 1.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
enacted and it is still in draft form.168 The bill will be
submitted to the Legislative Council by early December
2006.
The main purpose of the current bill is to create
an independent body to help identify and quantify the
damages done to Palestinian individuals and corporate
entities and their respective properties as a result of
Israel`s construction of a barrier (“Wall”) mostly built in
the Occupied Palestinian Territory (“OPT”), including
East Jerusalem.169 The construction of Israel’s separation
barrier was declared in violation of international law on
July 9, 2004 by the International Court of Justice ("ICJ").170
The ICJ ruled that Israel was under an obligation to return
all property seized as a result of the construction of the
wall and if such restitution is materially impossible then
Israel is to compensate the victims.171 The first step in
implementing the ICJ ruling was the creation of a registry
by the Secretary General of the United Nations to quantify
the damages caused by the construction of the wall.172 The
second step is the creation of a national registry in the
West Bank and Gaza to document and assess the damages
caused by the construction of the wall. It is believed that a
national registry will increase the efficiency and accuracy of
the claims. This bill, once enacted, will hopefully give force
to the ICJ ruling.
* * *
168 The Law Concerning the Establishment of the National Register for Identifying Damages Caused by the Establishment of the Separation Wall No. # (2006) (on file with the author) (hereinafter Law No. #). 169 Law No. #, Section 2.A. 170 Advisory Opinion, Legal Consequences of the Construction of a Wall in the Occupied Palestinian Territory, 2004 I.C.J. 131, para. 143 (July 9), available at http://www.icj-cij.org/icjwww/idocket/imwp/imwpframe.htm (last visited Mar. 1, 2005). 171 Id. at para. 153. 172 General Assembly, Letter dated 11 January 2005 from the Secretary General to the President of the General Assembly, ¶ 1, U.N. Doc. A/ES-10/294 (Jan. 13, 2005).
Qatar∗
The State of Qatar has announced that it will hold
legislative elections in early 2007, according to a statement
by Foreign Minister Hamad Bin Jasem Al-Thani.173 This
marks the first planned legislative elections to have been
held since 1970 when there were partial election
proceedings.174 For the past three decades, council
members have had their terms extended every four years
since.175 Qatar’s new constitution, which entered into force
on June 9, 2005, provides for a 45-member Consultative
Council, or Majlis As-Shura.176 The electorate, which
includes men and women, will elect two-thirds of this
Majlis As-Shura.177 The head of state, Emir Sheikh Hamad
bin Khalifa Al-Thani, will appoint the remaining fifteen
members.178 The electoral districts will be also be
delineated by the decree of the Emir.179 Members of the
Majlis al-Shura will serve 4-year terms and may be re-
elected.180 Candidates for office must be of Qatari descent,
at least 30 years of age, and fluent in the reading and
writing of the Arabic language.181
Earlier this year, a Qatari woman became the first
female to be elected to the Qatar Chamber of Commerce
and Industry, following a controversial election criticized
as being laced with irregularities, and opponents vowing a
∗ Salman Alam, a J.D. candidate in the class of 2007 at University of California, Hastings College of the Law, wrote the article at Qatar. 173 Arab Political Systems: Baseline Information and Reforms – Qatar (Carnegie Endowment for International Peace, Democracy and Rule of Law Project, Washington, D.C.), available at http://www.carnegieendowment.org/files/Qatar_APS.doc (last viewed November 21, 2006). 174The World Factbook, United States Central Intelligence Agency, available at https://www.cia.gov/cia/publications/factbook/geos/qa.html (last updated November 18, 2006). 175 Id. 176 Permanent Constitution of the State of Qatar art. 77. 177 Id. 178 Id. 179 Permanent Constitution of the State of Qatar art. 79. 180 Permanent Constitution of the State of Qatar art. 81. 181 Permanent Constitution of the State of Qatar art. 80.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
court battle.182 Political parties are still banned from
participation in Qatar.183 Qatar’s sole human rights
watchdog, the National Human Rights Committee, could
also be entitled to monitor the poll process next year.184 In
April 2003, 96.6 percent of the local population voted in a
referendum to approve the permanent constitution
sanctioning parliamentary elections.185
* * *
Saudi Arabia∗
Notable legal developments in Saudi Arabia from
2005-06 include the establishment of basic features of the
capital markets and several investment-related reforms, the
opening of the insurance markets, a new labor law,
accession to the World Trade Organization, and the formal
accession of King Abdallah to the throne.186
A. Capital Markets Developments
In May 2005, authority over raising capital in
existing companies and conducting IPOs was transferred
from the Ministry of Commerce and Industry to the
relatively new Capital Market Authority (“CMA”).187 The
CMA followed by issuing regulations on licensing
procedures for persons authorized to participate in the
182 Barbara Bibbo, First Woman Elected To Qatar Chamber, GULF NEWS (Qatar), May 18, 2006. 183 Barbara Bibbo, Democracy Comes Calling In Qatar, GULF NEWS, March 26, 2005. 184 Qatar Rights Watchdog 'May Monitor Elections,’ GULF NEWS, November 13, 2006. 185 Id. ∗ Ronald Pump of Johnson & Pump prepared the report on Saudi Arabia. 186 Additional laws passed during this period include the Sales in Installments Law, certain IP protections, environmental protection regulations, and new mining regulations. The Sales in Installments Law, approved provides that a buyer must pay at least 20% of the purchase price upon delivery, unless the seller presents a contractual guarantee as in a mortgage. Article 7 provides that neither seller nor buyer may rescind the installments payments after a majority of payments have been rendered, even if the buyer fails to deliver payments on a timely basis. Article 9 mandates certain accounting practices for sales in installments, and article 10 establishes penalties for violations of the law of up to SR 100,000 (around US $ 26,666). The penalty applies for anyone who engages in the profession of sales on an installment basis without a commercial license. 187 The Capital Market Authority was established by the Capital Market Law of 2003. It began operation in August 2004.
securities field and business regulations governing such
persons on June 28, 2005.188 No person may practice
trading, dealing, arranging, managing, or exercising custody
over securities in the Kingdom without a license,189 and
non-Saudis are prohibited from investing on the Saudi
stock market either directly or through an unauthorized
intermediary.190 Joint stock companies are also prohibited
from investing in other joint stock companies listed on the
stock market unless such deals are included in each
company’s objects, and are limited to only buying 10%
regulations.
New regulations on corporate governance were
issued by the CMA in 2006, which clarified shareholder
rights and responsibilities of corporate board members.
The CMA is currently considering regulations on
investment funds, mergers and acquisitions, authorizing
listed companies to purchase their own shares, and real
estate investment funds.191 The Ministry of Commerce
began receiving applications for licensing initial public
offerings in real estate on July 8, 2006.
B. Insurance
In 2004, the Cooperative Insurance Companies
Law required all insurance companies in the Kingdom to
188 In addition to filing an extensive license application, authorized persons must maintain a capital deposit in an amount that varies depending upon the type of license requested ($13.3 million for trading, but smaller amounts for consultants and advisors), and a valid commercial registration in the Kingdom. 189 Reports indicate that as many as 270 investment funds were operating without a license in Saudi Arabia. The CMA issued numerous warnings in 2005 for these funds, instructing them to either apply for a license or cease operations. As of November 2006, the CMA has licensed 35 persons as authorized to participate in securities transactions. 190 At this time, non-Saudi residents in the Kingdom are permitted to invest in the Saudi stock market only through a licensed investment fund. Trading through an unauthorized intermediary violates Saudi Arabia’s Fronting Law (also known as Anti-Covering Up Law). Non-Saudis may apply for licenses to deal and manage investments, and as of March 25, 2006, were technically authorized to trade on the stock market through banks, subject to terms and conditions. 191 A draft regulation on Real Estate Investment Funds was issued for public discussion on June 7, 2006. A draft regulation allowing listed companies to purchase up to 10% of their own shares was proposed to the Saudi Cabinet on June 20, 2006.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
file for a license from the Saudi Arabia Monetary Authority
(SAMA) or cease operations. In 2005, the deadline to file
passed, and numerous insurers who did not file before the
deadline were warned to cease operations. SAMA began
reviewing license applications in early 2005,192 and has
licensed several cooperative insurance companies with
mixed Saudi and foreign investment. SAMA has expressed
an intention to create a separate regulatory body to oversee
insurance in the Kingdom, modeled after the CMA.193
Also, in 2005, new regulations required local companies to
provide health insurance for expatriate employees as a
precondition for granting visas.
C. International Trade and Investment
In December 2005, the Kingdom became the
149th member of the World Trade Organization (WTO).
Under agreements negotiated prior to accession, the
Kingdom undertook numerous reforms, including opening
several closed sectors to foreign investment, altering
customs procedures, and implementing new laws and
procedures on intellectual property. The expatriate
business community expects additional implementing
resolutions to give effect to WTO agreements, particularly
the reduction or elimination of sponsor controls.
In March 2005, the Ministry of Commerce and
Industry announced several concessions to facilitate
foreign investment, including customs exemptions and
192 The Cooperative Insurance Companies Control Law requires applicants to possess capital of at least SR100 millions (US $ 26.6), to establish certain claims handling procedures, and to issue a series of periodic reports. 193 In Saudi Arabia, insurance, as generally practiced in Western jurisdictions, violates Islamic law and is therefore prohibited. However, most of the features of insurance are replicated through cooperative insurance societies. The Saudi Arabia Monetary Authority issued a new licensing regime in 2004, which effectively barred any unlicensed insurance firms from operation. The ban took effect in early 2005, and since that period, 16 new insurance companies have been licensed in addition to the National Company for Cooperative Insurance (NCCI), which operates pursuant to royal charter. Several press reports indicate that the government intends to establish a new entity to regulate the insurance sector modeled after the CMA.
more favorable real estate provisions relating to offices for
foreign entities.
D. Labor & Employment
A new Labor Law, issued August 2005 replaced the
Workmen and Laborers Law of 1969. Much of the new
law consists of reiterating regulations issued under the
previous law. However, certain new categories of laborers
are covered, new provisions and benefits for female
employees have been issued, additional regulations on
human resource management were enacted, new
provisions for workers with disabilities, and dispute
resolution procedures have been clarified in the new law.
On the other hand, the Ministry of Labor has undertaken a
variety of new procedures intended to curb the issuance of
work visas to foreign workers who comprise the bulk of
the labor force in Saudi Arabia.
E. Political Developments
In August 2005, King Abdallah ascended to the
throne, acquiring the formal powers he had exercised for
ten years. A new law of succession issued in October 2006
establishes a committee to determine the succession and a
medical review authority.
The first municipal council elections occurred in early
2005. A National Human Rights Commission established
in 2005 began reviewing allegations of human rights
abuses in the Kingdom.
* * *
Sudan∗
For three years the conflict in Darfur, located in
western Sudan, has persisted between the government-
backed militia, the Janjaweed, and three main rebel groups:
the Sudan Liberation Movement/Army (SLM/A), an
SLM/A splinter group, and the Justice and Equality
Movement.194 In 2004, a series of internationally-backed
∗ Bobbie Neal wrote the report on Sudan. *Bobbie S. Neal, a contract attorney with the Securities and Exchange Commission in Washington, D.C., prepared the report on developments in The Sudan.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
peace negotiations between the two sides began.195 On
May 5, 2006, the Sudan government and the largest rebel
group, the SLM/A, signed a peace agreement intended to
end the conflict.196
The Darfur Peace Agreement (DPA) provided for
the security of the region and for the sharing of power and
wealth between the two sides.197 The DPA called for a
ceasefire and required the government of Sudan to disarm
and withdraw the Janjaweed to restricted zones by
October, which would be followed by the demobilization
of the rebel troops.198 The agreement also provided for the
reintegration of rebel troops into the national army and
police forces, and gave greater representation to the rebel
groups in the national, state, and local governments, and
the transitional authority overseeing the DPA.199
Additionally, the DPA granted the people of Darfur the
right to elect their own leaders and to determine the status
of the region by 2010.200 Moreover, the agreement created
a compensation fund for victims, a reconstruction fund to
redevelop the region, and a commission to help displaced
persons return home.201
Although some progress was made, the refusal of
the other rebel groups to sign the DPA contributed to
delay in the implementation of the agreement and to
violations of its provisions by both sides.202 Neither
194 See BUREAU OF AFRICAN AFFAIRS, U.S. DEPT. OF STATE, BACKGROUND NOTE: SUDAN, http://www.state.gov/r/pa/ei/bgn/5424.htm (last update Nov. 2006). 195 See id. 196 See Darfur Peace Agreement, May 5, 2006, available at http://www.issafrica.org/AF/profiles/sudan/dpa05052006.pdf. 197 See id. at ch. 1-3. 198 See id. at ch. 3. 199 See id. at ch. 1, art. 6-16, ch. 3, art. 29. 200 See id. at ch. 1, art. 6. 201 See id. at ch. 2, art. 17, 19, 21. 202 See COMMUNIQUE OF THE THIRD MEETING OF THE DARFUR PEACE AGREEMENT JOINT COMMISSION (Nov. 12, 2006) available at http://www.iss.co.za/dynamic/administration/file_manager/file_links/DARFURCOM12NOV06.PDF?link_id=&slink_id=3851&link_type=&slink_type=13&tmpl_id=3; Lydia Polgreen, Shaky Peace in Darfur at Risk, as a New Confrontation Looms, N.Y. TIMES, Aug. 31, 2006, at A1; Craig Timberg, Rebels Say They May
signatory disarmed or withdrew and the fighting
continued.203 In November, the international community
pressured the Sudan government into agreeing, in
principle, to allow a United Nations/African Union
peacekeeping force into Darfur to enforce compliance of
the DPA, but no deployment date was set.204
* * *
Tunisia∗
A. Economic Reform
As part of Tunisia’s gradual move towards
economic liberalization, significant events this year
included finalizing the government’s largest privatization
effort to date in which it sold off 35 percent of the
national telecommunications company;205 passing a law
that requires most companies to establish an audit
committee to increase reliability of corporation
information and to thereby prompt more investment on
the local stock exchange;206 and proposing measures to
ease restrictions on currency transfers as part of a long-
term goal to make its Dinar fully convertible;207
Abandon Darfur Pact, WASH. POST, Sept. 14, 2006, available in 2006 WLNR 15913765. 203 See id. 204 See Robert F. Worth, Sudan Says It Will Accept U.N.-African Peace Force in Darfur, N.Y. TIMES, Nov. 17, 2006, at A3. See generally S.C. Res. 1706, U.N. Doc. S/RES/1706 (Aug. 31, 2006). ∗ Vonda K. Vandaveer, an attorney licensed in Washington, DC and in California, wrote the report on Tunisia. 205 See Tecom in the News, Malta Today, May 7, 2006, available at http://www.maltatoday.com.mt/2006/05/07/b2.html and ILFR1000, Country Reports, Tunis, Legislative Process, The Privatization Process, available at http://www.iflr1000.com/default.asp?page=38&CH=3&sIndex=2&CountryID=112 (last visited Nov. 29, 2006). 206 Loi No. 2005-96 du Oct. 18, 2005 Relative au Renforcement de la Securite des relations financiers. See also Oxford Business Group, On the Straight and Narrow, EMERGING TUNISIA 2006, at 179. 207 Speech by President Zine El Abidine Ben Ali on the Occasion of the 19th Anniversary of the Change, Carthage, Tunisia, Nov. 7, 2006, available at http://www.tunisiaonlinenews.com/nov06/071106.htm (last visited Nov. 29, 2006) and President Ben Ali Announces Wide Ranging Set of Measures to Promote Human Rights and Political Pluralism in Tunisia, Tunisia Online News, Nov. 7, 2006, http://www.tunisiaonlinenews.com/nov06/071106-1.htm. See also Oxford Business Group, Dealing with Dinars, EMERGING
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
B. Human Rights Issues
Praised as a leader in the Middle East for
promoting women’s rights, Tunisia took additional steps
forward with proposals to equalize the minimum age of
marriage for men and women to be 18 and to preserve a
woman’s right to live in the marital house during and after
divorce proceedings if she has custody of the children.208
Also this year, the government released a total of 1,712
prisoners, many of whom had been convicted under anti-
terrorism laws, but whom human rights groups alleged
were political prisoners.209
Tunisia, however, provoked outrage for its
continued repression of other rights. In particular, it
passed a law giving the government full control over the
judicial training institute, which the Tunisian Bar
Association said threatens the profession's
independence.210 In response to a sit-in protesting the law,
TUNISIA 2006, at 30-31. Central Bank of Tunisia, Current Events of the Central Bank, Nov. 15, 2006 and Nov. 1, 2006, available at http://www.bct.gov.tn/j2ee/siteprod/english/actualites/activites.jsp (last visited Nov. 30, 2006). 208 Le Chef de l'Etat préside la réunion du conseil des ministres - Examen du projet de loi de finances pour l'année 2007 http://www.infotunisie.com/2006/10/111006-4.html; Speech by President Zine El Abidine Ben Ali on the 50th Anniversary of the Promulgation of the Code of Personal Status, Carthage, Tunisia, August 12, 2006, available at http://www.tunisiaonlinenews.com/august06/120806.html. See also President Ben Ali Reaffirms Tunisia’s Commitment to the Code of Personal Status, Announces Measures Promoting Women Rights, Aug. 12, 2006, Tunisia Online News, http://www.tunisiaonlinenews.com/august06/120806-1.html (last visited Nov. 29, 2006). 209 See Ben Ali Pardons 55 Islamist Prisoners, Middle East Online, Nov. 6, 2006, http://www.middle-east-online.com/english/tunisia/?id=18165 and Ben Ali Frees 1,600 Prisoners, Middle East Online, Feb. 27, 2006, http://www.middle-east-online.com/english/?id=15851 (last visited Nov. 29, 2006). See also U.S. Dep’t of State, Bureau of Public Affairs, Press Release (March 1, 2006), United States Welcomes Tunisian Release of Political Prisoners, http://www.state.gov/r/pa/prs/ps/2006/62396.htm. 210 Loi No. 89-87 du 15 mai 2006 Portant Organisation de la Profession d'Avocat - Mise à jour - Loi No. 2006-30 du 15 mai 2006, available at http://www.jurisitetunisie.com/tunisie/codes/avocat/menu.html; See also IDHAE-European Bar Human Rights Institute, Alerte Urgente Advocats, Afrique du Nord et Moyen Orient,
police attacked the lawyers and raided the office of the bar
association’s president.211 Other criticisms arose when
Tunisia was elected to the U.N. Human Rights Council212
despite its record of rights abuses and when it closed its
embassy in Qatar in reaction to an interview shown on Al
Jazeera, which is based in Qatar, with a Tunisian human
rights activist who urged peaceful protests against his
government’s repression.213 Criminal charges were also
filed against the man in Tunisia for inciting civil
disobedience.214
* * *
Turkey∗
Throughout the year 2006, Turkey has been
striving to make progress towards its major political goal
of becoming a full member of the European Union
(“EU”). The EU opened the accession negotiations with
Turkey in October 2005 and the first stage of the so-called
Tunsie, May 11, 2006, available at http://www.idhae.org/idhae-fr-page4.1.tun12.htm (last visited Nov. 29, 2006). 211 See Cairo Institute for Human Rights Studies, Press Releases 2006, May 24, 2006, Tunisia: A Hysterical Escalation of Repression, available at http://www.cihrs.org/Press_details_en.aspx?per_id=94&pr_year=2006 and IDHAE-European Bar Human Rights Institute, Alerte Urgente Advocats, Afrique du Nord et Moyen Orient, Tunsie, May 11, 2006, available at http://www.idhae.org/idhae-fr-page4.1.tun12.htm (last visited Nov. 29, 2006). 212 See IFEX, Comuniqué de presse (May 9, 2006), Tunisia Does Not Merit a Seat on the U.N. Human Rights Council, Say IFEX-TMG Members, available at http://www.ifex.org/fr/layout/set/print/content/view/full/74296/; Thalif Deen UN Defies West in Vote for Human Rights Council, Inter Press Service, May 9, 2006, available at http://www.globalpolicy.org/reform/topics/hrc/2006/0509defies.htm (last visited Nov. 29, 2006). 213 See Tunisia: OLPEC Condemns Defamation Campaign Against Al Jazeera, IFEX Clearing House Press Release, Nov. 3, 2006, available at http://allafrica.com/stories/200611030740.html and Tunisia Closes Embassy in Qatar Over Al-Jazeera 'Hostile Campaign', Middle East Online, Oct. 25, 2006, http://www.middle-east-online.com/english/tunisia/?id=18001 (last visited Nov. 29, 2006). 214 See Tunisia Closes Embassy in Qatar Over Al-Jazeera 'Hostile Campaign', Middle East Online, Oct. 25, 2006, http://www.middle-east-online.com/english/tunisia/?id=18001 (last visited Nov. 29, 2006). ∗ The report on Turkey was contributed by Hakki Gedik, of Hergüner Bilgen Özeke, Istanbul, Turkey.
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
screening was completed in October 2006.215 For the most
part due to the political issues concerning Cyprus, Turkey’s
progress216 towards meeting its obligations and, ultimately,
the Copenhagen criteria217 for accession to the EU, has,
however, been perceived by the European Commission as
falling behind. As a consequence thereof, the European
Commission recently recommended inter alia that the
Intergovernmental Conference on Accession with Turkey
215 The basis for the accession negotiations are laid down in a document called Negotiation Framework for Turkey dated October 2005 (see http://europa.eu.int/comm/enlargement/docs/pdf/st20002_en05_TR_framedoc.pdf.) On 3 October 2005, the negotiations were symbolically launched and, on 20 October 2005, the screening was opened for some of the 35 chapter headings. Screening is the formal process of examination of the entire body of the laws of the EU by the Commission in order to identify with, and explain to, the Turkish authorities the legal framework and administrative capacities that need to be adapted so as to apply EU law as a Member State. The entire body of the laws of the EU is known as acquis communautaire. This includes all the treaties, regulations and directives passed by the European institutions as well as judgments (see http://europa.eu.int/comm/development/body/legislation/index_en.htm.) The screening will be conducted in two stages. During the first stage, the Commission would explain its acquis to Turkey, while in the second stage it would be Turkey’s turn to explain its laws. While the first stage of the screening process was completed within one year as scheduled, it is being followed by negotiations between the Commission and Turkey on a chapter-by-chapter basis. Negotiations on one chapter, science and research, were opened and provisionally closed in June 2006. 216 On 8 November 2006 the Commission approved the Strategy Paper and the candidate countries’ (Croatia, the former Yugoslav Republic of Macedonia, Turkey) and potential candidate countries’ (Albania, Bosnia and Herzegovina, Montenegro, Serbia and Kosovo under UN Security Council Resolution 1244) progress reports on their road towards the EU. For the Progress Report on Turkey, see http://ec.europa.eu/enlargement/pdf/key_documents/2006/Nov/tr_sec_1390_en.pdf.
217 In June 1993, the Copenhagen European Council recognized the right of the countries of central and eastern Europe to join the EU when they have fulfilled three criteria: (i) political: stable institutions guaranteeing democracy, the rule of law, human rights and respect for minorities; (ii) economic: a functioning market economy; (iii) incorporation of the acquis communautaire: adherence to the various political, economic and monetary aims of the European Union. The Madrid European Council, which confirmed these accession criteria in December 1995, moreover, emphasized that candidate countries must have created the conditions for their integration through the adjustment of their administrative structures. See also http://europa.eu.int/comm/enlargement/intro/criteria.htm.
should not open negotiations on eight chapters covering
policy areas relevant to Turkey’s restrictions as regards the
Republic of Cyprus until the Commission confirms that
Turkey has fulfilled its commitments.218
The pace of legislative changes seemed to have
slowed down compared to the preceding year. The
following attempts to report some of the most significant
pieces of legislation that have passed219 the Parliament as a
result of the continuing reform process: (i) the amendment
to Article 35 of the Title Deed Law220 governing real
property acquisitions by foreigners; (ii) amendments to the
Environmental Law221 revised with a view to draw level
with the EU legislation; (iii) the Corporate Tax Law222
revamping the entire corporate tax system; and, (iv) the
Law on the Administrative Auditing Authority223
introducing a Turkish ombudsman. One should, moreover,
bear in mind that, apart from the major bills introduced in
2005224, there are further bills introduced in 2006 and
pending enactment, e.g., the draft Law on Obligations225.
With the European Commission’s somewhat
unconstructive stance towards Turkey, a widening current
account deficit, presidential elections in May 2007 and
218 See the European Commission’s recommendation on the continuation of accession negotiations with Turkey, http://europa.eu/rapid/pressReleasesAction.do?reference=IP/06/1652&format=HTML&aged=0&language=EN&guiLanguage=en.
219 Only changes, amendments and enactments between 1 December 2005 and 30 November 2006 are taken into account.
220 Published in the Official Gazette No: 26046 on 7 January 2006 (on file with author.)
221 Published in the Official Gazette No: 26167 on 13 May 2006 (on file with author.)
222 Published in the Official Gazette No: 26207 on 23 June 2006 (on file with author.)
223 Published in the Official Gazette No: 26318 on 13 October 2006 (on file with author.)
224 See Jim Phipps et. al., International Legal Developments in Review: 2005, Regional & Comparative Law, Middle East, 40 (2) INT’L LAW. 597, 623-24 nn. 169-171 (2006).
225 See http://www.kgm.adalet.gov.tr/borclarkanunu.htm (in the Turkish language, on file with author.)
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
parliamentary elections in November 2007, and a more
volatile global economic environment, the coming year
appears to become rather challenging for Turkey. Still,
some high profile privatization (e.g., of the TEDA�
electricity distribution facilities, the national carrier Turkish
Airlines and the major state-owned financial institution
Halkbank) together with an IPO of the country’s – recently
privatized via block sale – fixed-line operator Türk
Telekom, promise to attract attention.
* * *
Yemen∗
A. Commercial Law Developments
In Yemeni commercial law this past year, there
were two key developments. First, Yemen adopted the
National Reform Act, a statute including measures to
respond to Yemen’s severe corruption problem, financial
disclosure requirements for public officials, and
procurement transparency requirements.226 Second,
Yemen took steps to expand its economic relationships
with other nations: Yemen signed an agreement with the
Gulf Cooperation Council of Arab Gulf Countries to
develop cooperation in various standardized fields and
received a commitment from donors of $4.7 billion at a
meeting sponsored by the Council;227 joined the Common
∗ Martin T. Lutz, a partner in the International Law and Dispute Resolution Practice Group at Hunton & Williams LLP, in Houston, Texas; Abdalla Al-Meqbeli, head partner at Abdalla Al-Meqbeli & Associates in Sana’a, Yemen; and Ariel B. Waldman and Justin Steven Rubin, attorneys in the Washington, D.C. office of Wilmer Cutler Pickering Hale and Dorr LLP; prepared the report on developments in Yemen. 226 Christian Chaise, Corruption runs parallel economy in impoverished Yemen, Agence France Press, May 7, 2006. 227 GCC and Yemen Sign Standardization MOU, Bahrain News Agency, November 8, 2006; Yemeni-Gulf Ministerial Meeting Commence its Activities, Yemen New Agency, November 1, 2006 (noting the commitment made by the GCC in December 2005); Donors Pledge Commitment to Yemen’s Development, World Bank Press Release, November 16, 2006. Press Release No: 2007/147/MENA, viewed at http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/MENAEXT/YEMENEXTN/0,.contentMDK:21131308~menuPK:310183~pagePK:2865066~piPK:2865079~theSitePK:310165,00.html
Market for Eastern and Southern Africa;228 entered into an
agreement with Eritrea to form a commercial fishing
concern;229 and made substantial progress towards a
bilateral agreement with Cuba.230
B. Constitutional and Democracy Developments
Yemen’s record in the past year with respect to
constitutional democracy was, once again, mixed. Yemen’s
President Ali Abdullah Saleh was reelected231 in an election
European Union observers judged to be generally well-
run,232 and the National Reform Act increased the
independence of the national judiciary and audit
institutions.233 However, Yemen’s freedom of speech
problems—particularly in the journalist context—remain
significant.. After criticizing government officials, a
newspaper editor was kidnapped.234 Another, after
reprinting cartoons of the Prophet Muhammad, was
imprisoned and his newspaper banned for six months.235
In recent years the legislative agenda in the
Republic of Yemen has largely been driven by Yemen’s
efforts to accede to The World Trade Organization
(“WTO”)236 and the Gulf Cooperation Council
228 Yemen to be supervisor member in CMESA, Yemen News Agency, November 18, 2006. 229 Yemen, Cuba to sign bilateral agreement in Sanaa, 25 November, BBC Worldwide Monitoring, November 20, 2006. 230 Shabait.com, Eritrea and Yemen Conclude Agreement on Establishment of Joint Fisheries Company, Africa News, November 10, 2006. 231 Donna Abu-Nasr, Yemeni Opposition Alleges Violation, Associated Press, September 21, 2006. 232 Id. 233 World Bank: Donors Pledge Commitment to Yemen’s Development, M2 Communications LTD, November 17, 2006. 234 Tevah Platt, He puts life on the line to report truth, Staten Island Advance, November 10, 2006. 235 Khaled Al-Mahdi, Yemen Jails Journalist Over Blasphemous Cartoons, Arab News, November 26, 2006. 236 The WTO established a Yemen Working Party in July of 2000 to work with the country to develop appropriate legal reforms as to trade, commerce, and investment information regarding the commitments made by Yemen. The status of progress toward meeting those commitments can be found on the WTO’s website at http://www.wto.org/english/thewto_e/acc_e/a1_yemen_e.htm (accessed December 4, 2006).
May 2, 2007 � Volume 1, Issue 1 � Middle East Committee
(“GCC”).237 In 2006, however, Yemeni politics was
dominated by the September presidential elections.
Consequently, after an active 2005 in which a number of
significant laws were adopted--e.g., Law 19/2005
amending Yemen’s competition law; Law 43/2005
pertaining to agencies and branches of foreign companies;
and Law 53/2005 amending Yemen’s Companies Law--
progress on reform measures in 2006 was more modest.
The two most significant pieces of 2006 legislation were:
Law 21/2006, which amended Yemen’s Anti Money
Laundering Law 35/2003 to create a committee of the
country’s major financial institutions to oversee laundering
controls, and to require that all money transfers of $1000
or more be registered with the Central Bank; and Law
29/2006, which required Yemen’s Islamic banks to
strengthen capital ratios, and increased the Central Bank’s
control over money flows, again as a means of preventing
money laundering.
With elections over, progress is expected soon on
several pieces of significant legislation now under
consideration in draft form: a new anti-corruption law
(which would establish an independent Supreme National
Authority for Fighting Corruption), a law regulating
government tenders, a law on leasing, and WTO-
compliant amendments to Yemen’s customs and
intellectual property laws.
In November of 2006, at the fourth meeting of
the Consultative Group of Yemen’s official donors, $4.7
billion was pledged by donor countries to aid in Yemen’s
reform efforts. In an effort to ensure that Yemen’s
lawmakers have additional incentive to proceed with the
reforms underway, the delivery of the funds will be
monitored by GCC parties and The World Bank, and
237 See, U.S. Commercial Service, Yemen Country Commercial Guide 2006, http://www.buyusa.gov/yemen/en/ccg.html (accessed December 4, 2006).
funding will be contingent on the extent to which Yemen
follows through on reform efforts currently underway.238
Editor-in-Chief James D. Phipps
Editor C. Scott Maravilla
Editor Anahita Ferasat
238 See, World Bank Press Release, “Donors Commit to Yemen’s Development (2006),” http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/MENAEXT/YEMEN EXTN/0,,contentMDK:21131308~menuPK:310183~pagePK:2865066~piPK:2865079~theSitePK:310165,00.html (accessed Dec 4, 2006).
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