Qatar’s Cabinet has come up with a draft law to amend the commercial registration process, legislation that may make the road to launching a business here less arduous.
The law was issued during the council’s weekly meeting, which was presided by Prime Minister Sheikh Abdullah bin Nasser bin Khalifa Al Thani. According to the Qatar News Agency, the legislation would amend some provisions of Law No.25 of 2005 on the commercial register.
One change would include mandating a same-day decision for those who file complete applications with the Ministry of Economy and Commerce, building on recommendations previously issued by the Advisory Council.
However, QNA makes no mention about any other potential changes, or of a timeline for the new legislation to be enacted.
Hurdles abound
Entrepreneurs have long complained about the difficulties of registering a business in Qatar.
Requirements include having QR200,000 in a bank account, and all businesses must have signed a one-year lease on office space that has met Civil Defense approval, which could require a commitment of more than QR100,000 – discouraging home businesses.
For expatriates, there is the additional requirement of also having to bring on board a Qatari sponsor who typically owns 51 percent of the company.
Qatar’s relatively small customer base, long holdups at customs and the large amount of paperwork required can also discourage potential business owners.
Also, small business owners say that there is a culture gap in Qatar in terms of raising funds.
To set up a small or medium-sized enterprise (SME), entrepreneurs are reliant on getting funding from Qatari nationals. However, they say that many Qataris are not used to investing money in a hands-off way.
American businessman Abraham Kamarck previously told Doha News: “The idea of giving your money away and trusting someone else with it is very foreign here.”
Business support
There are a number of organizations in Qatar focused on supporting small businesses.
Enterprise Qatar, set up in 2011, provides a number of services for aspiring Qatari business people such as providing free office space, subsidies for consultancy services, professional legal services, financial consulting, performance advisory services and assistance with getting listed on the Qatar Exchange Venture Market.
It also runs the annual Al Fikra national business plan competition for Qatari start-ups.
However, while it offers prize money of up to QR140,000 and provide incubation support for two years, previous winners have said the support is not enough to fully get their businesses off the ground.
The 2011 runner-up Layla Al-Dorani, founder of vegan food supplier Raw ME, won QR30,000 in prize money. But she said the financial burden of setting up and running a new business was much higher, and she has worked two jobs to earn enough to fund her venture.
Silatech is another organization in Qatar which provides financial assistance as well as training and support to help young entrepreneurs make a success of their new business.
Bedaya Center, a joint initiative between Qatar Development Bank and Silatech, also offers support to SMEs in Qatar, linking would-be business people with established experts.
However, even they have faced problems during set up, as the Center’s entrepreneurship development manager Yasmeen Hassan, told Doha News it took them 10 months to get the necessary approvals.
Even when they are set up, owners of SMEs say they continue to face ongoing bureaucracy and financial pressures.
A businessman running a garage in the industrial area was quoted by The Peninsula earlier this year saying: “The unending wait to get fire and safety licenses is killing our businesses.”
He added: “There are instances where entrepreneurs had to wait 10 months to get a fire safety license. Waiting for such a long time to start a business means that the entrepreneur is losing big money against his establishment cost.”
Thoughts?
