The final Law Update of 2022 is here, and it’s packed full of articles. The double edition features two focus areas, first is a spotlight on Energy and Resources and second we feature a collection of articles on Transport and Logistics. The developments occurring in these sectors in the MENA region are unprecedented and our lawyers cover vast themes for you.
The Energy and Resources focus features topics such as diversifying energy resources, solar PV, mining in the Middle East, renewable energy and green hydrogen. From a transport perspective, we draw attention to the Bahrain metro project, discuss the challenges and remedies associated with the repossession of an aircraft, and there is advice on what to consider should a party vary the terms of a shipping contract.
This edition navigates you through updates from across jurisdictions such as, Oman, Jordan, Saudi Arabia, Egypt, Iraq, Qatar, and the UAE. Each article is timely and provides insights into legal issues and cases that are affecting these sectors across the region.Read the full edition
Establishment of special integrated logistics zones
A new regulation has been issued by royal decree for the establishment of special integrated logistics zones to attract foreign investment into the Kingdom of Saudi Arabia (KSA).
The first zone will be located at King Khalid Airport in Riyadh with the General Authority for Civil Aviation responsible for the management, development and supervision of the zone and the regulation of the activities conducted in the zone. Further zones may be created at other airports by way of a resolution issued by the Economic and Development Affairs Council at the recommendation of the General Authority for Civil Aviation.
Special tax rules will apply to activities conducted in the zone related to goods. There will be various tax incentives available to businesses that operate in these zones including:
The General Authority of Zakat and Tax (GAZT) will issue rules related to the application of income tax to businesses operating in the zone.
GAZT issues general VAT guide
GAZT has published a general VAT guide which deals with various VAT obligations of taxpayers in KSA including VAT registration, issue of tax invoices, recoverability of input VAT and submission of VAT returns.
We will be happy to share our international experience on similar free zones and discuss the regulation on the establishment of special integrated logistics zones regulation in further detail.
In relation to VAT, businesses are being actively audited by GAZT. In our experience, many clients were not properly prepared for the introduction of VAT and encountered difficulties in implementing VAT in a very short period of time. As a result, clients have taken incorrect positions in their VAT returns and are liable for substantial penalties. It is recommended that you take a proactive approach and undertake a health check to identify and rectify these errors going forward to minimise any penalty and reputational exposure.
Al Tamimi has a strong and dedicated tax team and can help you with all your tax requirements across corporate tax, withholding tax, VAT, excise tax and customs. Please do not hesitate to contact us if you require any assistance.