Welcome to the Saudi Arabia focus edition of Law Update.
One of the key markets in the Middle East and North Africa (MENA) that continues to lead from the front is the Kingdom of Saudi Arabia (KSA). As the largest country in the Middle East and the 18th largest economy in the world, the progress KSA continues to make is underpinned by its Vision 2030 that envisions developing the country as an investment powerhouse and hub that ultimately connects Asia, Europe, and Africa. Given Saudi Arabia’s significance to the regional economy, our team of experts have prepared a range of pertinent articles that provide insights into new laws, regulations, and the legal landscape in the Kingdom.
This edition will provide you with an up-to-date guide on matters such as; the framework issued by the Saudi Central Bank on IT governance, the anti-corruption landscape under Vision 2030; we also provide practical tips for dispute avoidance. This is only a snapshot; there are many more articles within the KSA focus section for you to read, which we hope you will find valuable and enjoyable.Read the edition
In spite of the hazardous and unusual situation in Iraq, there is a lot of interest from expatriate workers wanting to move to Iraq for work. This is evident by the millions of dollars invested in construction and reconstruction projects, as well the increasing number of foreign businesses setting up in Iraq
In order to facilitate the increasing number of expatriate workers in Iraq, the government has recently implemented a number of laws and regulations. Article 12 of the Iraqi Investment Law (the “Law”) No. 13 of 2006 gives the investors the right to employ expatriate workers and insures to the said workers’ right to reside in Iraq. In addition, it gives the workers the right to transfer their wages and salaries abroad and outlines the process of entering and exiting the country.
Owing to the laws and regulations that regulate the process of employment of the workers in Iraq – Chapter I (Employment) of Part II (Employment and Vocational Training) of the Iraqi Labour Code No. 71 of 1987 (the “Labour Code”) states that the ‘Department of Labour and Social Security in the Ministry of Labour and Social Affairs shall be responsible for organising the process of employing the workers’. This Law distinguishes between the Iraqi workers, expatriate workers with Arabic nationalities and the non-Arab expatriate workers. According to the Law, an employer is obliged to inform the labour office of the employment of Iraqi workers within a period not exceeding 10 days from the date of employment. The Law provides that in the case where the employer is employing expatriate workers with Arabic nationalities, he shall inform the labour office of that employment within a period not exceeding 30 days from the date of employment. However, in the case of non-Arab expatriate workers; the employer can employ the workers after obtaining a work permit in accordance with the conditions and the procedures determined by the instructions of the Minister of Labour and Social Affairs, stated herein.
Article 6 of Instructions No. 18 of 1987 states that:
First – Foreigner individuals, who are outside Iraq, and are interested in working in Iraq, should follow the following procedures in order to obtain a work permit:
Furthermore, Chapter I of Part II of the Labour Code outlines the imposed penalties applicable to the breach of this law.
Finally, it is worth mentioning that, and because of the current circumstances in Iraq, this matter faced two important incidents in the past two years. On February 9th, 2010, the Consulate Department of the Ministry of Foreign Affairs issued an official letter No. 65046 which provided, in accordance with the approval of the National Security Council and the General Commander of the Armed Forces, that no work visas are to be issued to expatriate workers of both Arab or non-Arab nationalities until further notice. Additionally, on February 8th, 2011, the Prime Minister’s Office issued an official letter numbered MRND/2/27/209 which included directions from the Prime Minister informing all the concerned parties in the state that they should refrain from granting any work permits to non-Arab expatriate workers unless they obtain an official consent from the Council of Ministers or National Security Council. This letter, however, did not address the employment of workers with Arab nationalities.
In light of the above, it is clear that the Iraqi government is aiming to rejuvenate the Iraqi economy by providing clear and outlined procedures for the employment of expatriate workers in the country. This is shown through the implementation of laws such as the Iraqi Investment Law No. 13 of 2006. However, it is clear that a lot of work is yet to be done as the current volatile economic and political situation doesn’t allow there to be a stable grounds for the importation of foreign workers. This is why until the Ministry of Foreign Affairs allows the recommencing of issuing work permits to Arab and non-Arab expatiate workers, investors are not going to be able to bring in foreign workers in the hope of improving the economic situation in Iraq.