The Principle of Progressive Realization

It takes consistent effort and adequate awareness of the local circumstances to translate the ICESRC principles into tangible realities. Hence, a core principle of the ICESCR is “progressive realization”, acknowledging that states may need time and resources to fully implement these rights. For Oman, this means continuous refinement of policies and legislation, adapting to evolving needs and building upon existing foundations to ensure sustainable progress in upholding economic, social, and cultural rights. Oman’s efforts are evident in the promulgation of several new laws targeting ICESCR rights since their 2020 ratification, which will be explored in the subsequent sections.

Right to Work

Article 6 of the ICESCR recognizes the right to work as a fundamental human right and emphasizes that everyone deserves the chance to earn a living through chosen employment with fair wages, safe conditions, and reasonable hours. Oman has made significant strides in advancing this right. Royal Decree 53/2023, promulgating the Labour Law, represents a crucial step in modernizing the labour sector. This legislation prioritizes fair employment practices, enhances worker protections, and promotes Omanisation. In an effort to ensure fairness, the new Labour Law has clarified wrongful dismissal cases, incorporating provisions that prevent discrimination, protect trade union activities, and safeguard against employer retaliation. These initiatives are designed to increase employment opportunities and ensure decent working conditions, aligning with the principles of article 6.

Right to Social Security

Article 9 recognizes the right of everyone to social security, including social insurance. Royal Decree 52/2023, promulgating the Social Protection Law, signifies Oman’s commitment to strengthening its social safety net. This law aims to expand coverage, streamline benefits, and improve the overall efficiency of social protection programs, ensuring that vulnerable populations have access to essential support. The law comprehensively addresses social services, providing support for vulnerable groups like the elderly, children, widows, orphans, and people with disabilities. A notable advancement is the law’s substantial improvement to maternity and paternity leave provisions, offering greater support to parents alongside coverage for other critical contingencies like workplace injuries and occupational illnesses. By focusing on vulnerable populations and ensuring access to essential support, Oman is making tangible progress in fulfilling the obligations of article 9.

Right to an Adequate Standard of Living

Article 11 involves ensuring that everyone has access to adequate clothing, food, and housing in addition to continuous improvements to living conditions. For Oman, the Social Protection Law stands as a cornerstone of the country’s commitment to addressing poverty and raising living standards, especially for vulnerable populations. Furthermore, to ensure the right to adequate housing, Royal Decree 42/2021 on Granting Government Land directly fulfills the ICESCR’s provisions by providing eligible Omanis with accessible land for residential purposes. This initiative sets Oman apart from many neighbouring countries, demonstrating a commitment to housing access that directly supports its citizens’ right to an adequate standard of living, particularly for low and middle-income families.

Right to Education

Article 13 ensures that education is available, accessible, and of high quality for all individuals. Oman has demonstrated a strong commitment to the right to education. In 2023, the enactment of the School Education Law and the Higher Education Law exemplify this commitment, which focus on enhancing educational quality, expanding access, and aligning education with the needs of the labour market. These laws address issues such as curriculum development and access to higher education, which Oman is striving to provide quality education for all its citizens.

Conclusion

Oman’s dedication to the ICESCR is evident in its proactive legislative measures and ongoing initiatives, demonstrating a commitment to ‘progressive realization’ across key economic, cultural and social rights.

Written by:

Noor Al-Rajhi

Noor is a legal intern at Decree. She has completed a vacation scheme in an international law firm and has experienced training in local and international law firms. She is interested in corporate law, international investment law, and dispute resolution. She holds an LLB from the University of Liverpool.

This blog post highlights the most important commercial laws that are fundamental for law graduates to learn about:

1. Commercial Companies Law:

The Commercial Companies Law determines the types of companies that may be registered in Oman, namely: general partnerships, limited partnerships, joint ventures, joint stock companies (public/closed), holding companies, limited liability companies, and one-person companies. The law provides the legal framework and requirements for establishing and forming these companies, the roles and responsibilities of company directors, the rights and obligations of shareholders, procedures for conversion, merger, dissolution, and liquidation of the company, as well as providing a concise legal framework for insolvency proceedings and company liquidation.

2. Labour Law:

The Labour Law governs the relationship between employers and employees and attempts to strike a balance for the legal protection of both parties. The law covers issues such as employment contracts, working hours, leaves, wages, occupational safety, termination of employment, and dispute resolution. A comprehensive understanding of labour law is crucial for law graduates aspiring to work in commercial law, as it enables them to advise on employment practices, compliance with Ministry of Labour directives, and managing workplace disputes.

3. Law of Arbitration in Civil and Commercial Disputes:

Given Oman’s growing focus on alternative dispute resolution, the Law of Arbitration in Civil and Commercial Disputes is critical as it provides the legal framework for arguably the most important mechanism for alternative dispute resolution: arbitration. Arbitration offers a flexible, confidential, and legally binding mechanism for settling disputes, making it an essential aspect of commercial practice in Oman, especially in sectors like construction, energy, and finance. The law outlines the rules and procedures governing arbitration agreements, the appointment of arbitrators, arbitration hearings, and the enforcement of arbitral awards. For law graduates, understanding arbitration laws is essential for advising clients on the most efficient and cost-effective dispute resolution mechanisms.

4. Personal Data Protection Law:

As Oman advances in digital transformation, the Personal Data Protection Law has become a crucial piece of legislation. This law sets regulations for the collection, processing, storage, and transfer of personal data. It imposes strict compliance requirements on businesses, including the need to obtain consent for data processing, implement security measures, and adhere to restrictions on cross-border data transfers. A solid grasp of the implications of this law is crucial for law graduates, especially those advising clients on data protection compliance and mitigating legal risks associated with data breaches or non-compliance with privacy regulations. The Personal Data Protection Law is particularly relevant in sectors such as banking, telecommunications, healthcare, and e-commerce that rely heavily on the processing of personal data.

Conclusion

The laws mentioned above are merely some of the key commercial laws that a commercial lawyer needs to know. The Omani legal system is continuously developing, and it is extremely important for all lawyers to stay up to date with new legal developments to be able to provide their clients with reliable legal advice. One of the easier ways to stay up to date with the latest updates in the Omani legal system is to simply follow Decree on LinkedIn and Instagram.

Written by:

Saja Al-Hosni

Saja is a legal intern at Decree. She has previously interned in an Omani law firm and in the University of Liverpool Law Clinic. She is interested in commercial, corporate, and international investment law. She holds an LLB from the University of Liverpool.

Understanding the Separation of Powers

Primarily, the separation of powers distributes government power among three branches: the executive, the legislative, and the judiciary. In Oman, the separation of powers is a fundamental aspect of the legal system, however, it is implemented with distinct characteristics that reflect the country’s unique cultural and political context. While the Sultan holds significant authority, as head of state, Oman has adopted a system which incorporates a form of separation among its government branches. 

The Basic Statute of the State serves as the constitution of the Sultanate of Oman, establishing the overarching legal foundation for governance. Although the term “separation of powers” is not used explicitly, the constitution outlines a structure for the separation of powers among the executive, legislative, and judicial branches, with the Council of Ministers, the Council of Oman, and the Supreme Judicial Council heading each of these branches respectively.

The Executive

The executive branch of the government is represented by the Council of Ministers who are responsible for implementing the pubic policies of the state. Article 51 of the Basic Statute of the State details additional responsibilities of the Council of Ministers, including debating proposals from the ministries, submitting recommendations to the Sultan, and overseeing the implementation of laws.

The Council of Ministers, as the head of the executive branch, is led by the Prime Minister who presides over the council sessions. While the role of the Prime Minister is technically separate from the role of the Sultan, currently the Sultan is the Prime Minister.

The Legislature

The legislative branch, represented by Majlis Oman (Council of Oman), is responsible for reviewing draft legislation. Majlis Oman only has the authority to suggest new laws or amendments to the Council of Ministers; it does not have the authority to enact actual laws. It is made of two bodies: the Majlis al-Dawla (State Council) and the Majlis al-Shura (Shura Council). The bicameral framework promotes wider representation and greater public consideration of legislative matters. You can learn more about the role of Majlis Oman by reading the Law of Majlis Oman.

The Judiciary

The judiciary’s function is one of the most significant aspects of the separation of powers. The judiciary in Oman, as stipulated in article 77 of the Basic Statute, is constitutionally independent. This means it has the authority to interpret and apply the law free from undue influence or interference from the executive (Council of Ministers) or the legislative (Majlis Oman) branches. The judicial branch is entrusted to interpret and apply laws, challenge executive actions, and ensure that individuals’ rights are protected.

The judiciary in Oman is represented by the Supreme Judicial Council., which was most recently re-established by Royal Decree 35/2022 and has the Sultan as its chairman.

Is There a True Separation of Powers?

While the Basic Statute of the State outlines a separation of powers between the executive, legislative, and judicial branches, the Sultan’s leadership of both the executive (as the Prime Minister of the Council of Ministers) and the judiciary (as chairman of the Supreme Judicial Council) raises questions about the true extent of this separation. In addition, regarding the legislative function, the Sultan plays a vital role in being the ultimate authority on all legal matters, as no law can be promulgated without a royal decree.

However, even though the Sultan has power over the three branches of the government, the extent to which the Sultan interferes with the operation of these branches in practice is extremely limited making the Sultan the ultimate guarantor of the principle of separation of powers in Oman.

You can learn more about the system of governance in Oman by reading the Basic Statute of the State on the link below:

Written by:

Noor Al-Rajhi

Noor is a legal intern at Decree. She has completed a vacation scheme in an international law firm and has experienced training in local and international law firms. She is interested in corporate law, international investment law, and dispute resolution. She holds an LLB from the University of Liverpool.

1. Free Trade Agreements:

Free Trade Agreements (FTAs) are treaties between countries that aim to reduce or eliminate barriers to trade, such as tariffs and quotas. These agreements also address non-tariff barriers, like regulatory standards, intellectual property protections, and services. FTAs play a significant role in fostering economic cooperation and increasing market access across borders. Oman is a member of several important FTAs, including the Oman-US FTA, which has been in effect since 2009.

2. Bilateral Investment Treaties:

Bilateral Investment Treaties (BITs) are agreements between two countries that outline the terms and conditions under which investments from one country will be protected when entering the other country. These treaties are crucial in promoting foreign investment by providing protections against expropriation, unfair treatment, and ensuring access to dispute resolution mechanisms like arbitration. In Oman, the government has signed multiple BITs to attract foreign investment and safeguard its economic interests, with the most recent being the Oman-Hungary BIT ratified in 2022. You can learn more about BITs by reading our blog post on the Key Provisions of Bilateral Investment Treaties.

3. Double Taxation Agreements:

Double Taxation Agreements (DTAs) are treaties between two or more countries designed to avoid the problem of double taxation on the same income. These agreements allocate taxing rights between countries and provide relief for taxpayers, typically through exemptions or tax credits. Oman has signed DTAs with several countries, such as the United Kingdom, France, and Germany, which help mitigate the risk of double taxation for individuals and businesses.

Conclusion

Understanding these three key international agreements is essential for law graduates seeking to navigate the complexities of global legal systems. Whether practising in international law or advising domestic clients on cross-border matters, a solid grasp of these treaties will enhance your legal expertise and open new career opportunities. For law graduates, knowledge of these agreements is particularly relevant in shaping Oman’s legal structure and ensuring its continued integration into the global legal landscape.

Written by:

Saja Al-Hosni

Saja is a legal intern at Decree. She has previously interned in an Omani law firm and in the University of Liverpool Law Clinic. She is interested in commercial, corporate, and international investment law. She holds an LLB from the University of Liverpool.

Formation and Framework

The Basic Statute of the State, often referred to as the Constitution of Oman, establishes the framework for forming the Council of Ministers and specifies its duties. It outlines the conditions for appointing the Prime Minister, deputy prime ministers, and other ministers, all of whom must be appointed by royal decree. While His Majesty Sultan Haitham Bin Tarik currently serves as the Prime Minister, the Basic Statute of the State provides a mechanism to appoint another individual to fulfil this role if necessary.

Key Duties of the Council of Ministers

As stipulated in article 51 of the Basic Statute of the State, the Council of Ministers is entrusted with a wide range of responsibilities, which can be categorised into three main areas:

Legislative Duties

One of the key responsibilities of the Council of Ministers is its legislative function. The Council of Ministers submits recommendations to the Sultan on matters of concern to the state, ensuring that key issues are addressed effectively. Additionally, it proposes draft laws and royal decrees, which are then issued by His Majesty after going through Majlis Oman. These legislative functions are fundamental in shaping the legal framework and maintaining the rule of law in Oman.

Setting State Policies

Another critical area of responsibility is setting state policies. The Council determines the general objectives and policies for comprehensive development, laying the groundwork for national progress. It also establishes the necessary procedures to implement these policies, ensuring their effectiveness. Furthermore, the Council debates development plans prepared by competent authorities, presenting them to Majlis Oman for review before submitting them to the Sultan for approval. Through these efforts, the Council of Ministers ensures that the policies are aligned with the public interest and national priorities.

Oversight Duties

Equally important are the Council of Minister’s oversight duties. The Council of Ministers oversees the functioning of the administrative apparatus of the state, ensuring that its various units perform their duties efficiently and in compliance with established laws and regulations. It monitors the implementation of laws, royal decrees, regulations, decisions, treaties, agreements, and court judgments, ensuring strict adherence to them. In addition, the Council of Ministers reviews proposals from ministries in their respective areas of competence, facilitating coordination and making informed decisions. These oversight responsibilities are crucial for maintaining efficiency, accountability, and transparency across the government.

These were some of the key duties of the Council of Ministers, you can read learn more about this extremely important government body by reading the Basic State of the State.

Written by:

Saja Al-Hosni

Saja is a legal intern at Decree. She has previously interned in an Omani law firm and in the University of Liverpool Law Clinic. She is interested in commercial, corporate, and international investment law. She holds an LLB from the University of Liverpool.

Pre-requisites

Before exploring the paths through which nationality can be obtained, it is important to note that the law in Oman does not generally permit a person to hold Omani nationality except by a specific royal decree permitting this. The law does not provide any details on the grounds for obtaining this royal exception, but this appears to be an extremely rare thing to obtain as only 18 number of people were allowed to simultaneously hold Omani with another one in the last 20 years.

Moreover, all applications to acquire Omani nationality must be submitted to the Ministry of Interior, which reviews and decides on them in accordance with the legal procedures and controls. Unlike most other government decisions, the decisions of the Ministry of Interior in this area are not subject to challenge through the administrative judiciary.

Nationality by Origin

Omani nationality can be acquired by origin, which is the most common and easiest way of getting a nationality. Whoever is born by an Omani father, be it in Oman or abroad, is deemed an Omani by origin.

The law states that those born by an Omani father and a non-Omani mother are deemed Omani by origin on the condition that the marriage has been approved by the Ministry of Interior. However, after the issuance of the Royal Decree 23/2023 regarding the Marriage of Omanis to Foreigners which removed the requirements to obtain government approval to permit an Omani to get married to a non-Omani, it is assumed that this requirement for the approval is no longer required for the Omani father to pass nationality to his children.

Moreover, whoever is born in Oman to unknown parents or born to an Omani Mother (in Oman or abroad) and his lineage to his father cannot be legitimately proven is deemed an Omani by origin and qualifies for obtaining Omani nationality.

Nationality by Reinstatement

Omanis who lose their nationality by renouncing it may obtain their Omani nationality again by reinstatement. This process requires the person to make an application and to meet several conditions, such as that he is of good behaviour and conduct, is habitual residence is in Oman or has returned to it, and declares in writing his desire to settle in it, and that he is free of communicable diseases.

Nationality by Grant

It is also possible for foreigners to obtain Omani nationality by submitting an application to the Ministry of Interior. The criteria for obtaining nationality here depend on whether the person is a foreigner, a foreign wife of an Omani person, a foreign widow or divorcee of an Omani, or a minor child of an Omani woman from her foreign husband.

For a foreigner who does not meet any of the other conditions, they are required to prove legitimate continuous residency in Oman for a period no less than 20 years (or 15 years if he is a man married to an Omani woman), they must be fluent in Arabic, and they must have a legitimate source of income to meet his needs and other conditions.

For a wife of an Omani, she must have a child from that husband, must speak Arabic, and must be married to him for a period no less than 10 years.

For a widow or divorcee of an Omani, she must also have a child from that husband, must not be married to a non-Omani, must speak Arabic, and must be resident in Oman for a continuous period of 15 years.

For a minor child of an Omani woman from a non-Omani husband, there are a different set of conditions including that the mother is widowed or divorced and that the child has lived in Oman for a period no less than 10 continuous years.

It is worth noting that meeting the prescribed criteria does not mean the automatic approval to obtain the nationality, as the Ministry of Interior would have decide on each case on its own. It is also worth noting that in all cases, it is possible to acquire an exemption by virtue of royal decree to obtain Omani nationality without complying with all the nationality criteria set by this law.

The Omani Nationality Law is a very interesting piece of legislation to read. You can read it in full in English on the link below:

Written by:

Amjad Al-Yahya’ei

Amjad is a legal intern at Decree. He has previously interned in an investment company and in the public utilities sector. He is interested in corporate law, investment law, and dispute resolution. He holds an LLB from the University of Liverpool.

The types of passports are determined by the Law of the Omani Passport. However, due to the fact that some types of passports are issued by the Foreign Ministry, and not the Royal Oman Police, certain provisions relating to those passports are also governed by the Law Governing the Foreign Ministry.

Ordinary Passports

The only substantive provision for obtaining an ordinary Omani passport is that the person making the application is an Omani national. Its period of validity is 10 years and it is issued by the Royal Oman Police. This is the most common type of passport that the majority of Omanis hold.

Diplomatic Passports

The diplomatic passport is the most powerful Omani passport, it is issued by the Foreign Ministry, and not the Royal Oman Police, and it is governed in detail by the Law Governing the Foreign Ministry. The law specifies categories of high-level government officials, including the prime minister, deputy prime ministers, high-ranking members of the royal family, ministers, diplomats, and other high-ranking government officials who qualify for obtaining this passport.

With the exception of high-ranking members of the royal family, the spouse and children of a holder of a diplomatic passport also qualify for obtaining a diplomatic passport.

Technically speaking, there is no legal requirement for an Omani diplomatic passport to be issued to an Omani national, so—in theory—if a non-Omani person qualifies and is appointed to a high-rank government position, that person would qualify for having a diplomatic passport.

Special Passports

Special passports are a unique category of passports that are not found in many countries around the world. In Oman, like diplomatic passports, these are issued by the Foreign Ministry and not the Royal Oman Police, and it is also governed in detail by the Law Governing the Foreign Ministry. They are primarily given to members of the royal family who do not qualify for diplomatic passports, members of the Council of Oman, undersecretaries, and other high-ranking government officials who do not qualify for diplomatic passports.

The spouse and children of a holder of a special passport also qualify—in certain cases—for a special passport.

Similar to diplomatic passports, there is no requirement for a holder of a special passport to be an Omani national, and—in theory—it can be given to non-Omanis who meet the criteria for having this passport.

Service (Mission) Passports

A service passport, formally named a mission passport in the Law of the Omani Passport, is another passport issued by the Foreign Ministry and not the Royal Oman Police, and it is also governed in detail by the Law Governing the Foreign Ministry. This passport is given to government officials on missions to represent the government in official meetings and conferences based on the recommendation of the head of the unit on which the government official works. Unlike diplomatic and special passports, the spouse and children of the holders of service passports do not qualify in any situation to hold this passport. However, similar to diplomatic passports, there is no requirement for a holder of a special passport to be an Omani national, and it can be given to non-Omanis who meet the criteria for having this passport.

Travel Documents

A travel document is a temporary passport-like travel document that is issued by the Royal Oman Police to non-Omanis who live in Oman and do not have a nationality to allow them to leave the country in certain circumstances.

Laissez Passer

A laissez passer is a temporary travel document given only to Omanis usually with the objective of allowing an Omani person who has lost his passport abroad to return home.

Objectives of Different Passports

While the objectives of a travel document and a laissez passer are obvious, the benefits of diplomatic, special, and service passports might not seem very obvious. A diplomatic passport can be understood to mean that a person enjoys a diplomatic status and therefore enjoys certain protections and immunities when traveling aboard in countries that recognise such products. However, a more practical value for all these passports is that Oman very frequently signs bilateral visa exemption agreements with other countries that specifically allow the holders of diplomatic, special, and service passports to travel to these countries without the need to obtain a visa. Examples of such countries include Switzerland, Italy, Greece, and many other countries to which an Omani person would require a visa to travel, but holders of diplomatic, special, and service passports would be able to travel on official business without the need to obtain a visa.

You can learn more about the Omani passport by reading the Law of the Omani Passport on the link below:

Written by:

Azza Al-Abri

Azza a legal intern at Decree. She has previously interned in the banking sector and in private practice. She is interested in corporate law. She holds a LLB from the University of Leeds.

The Omani Basic Statute of the State was first promulgated in 1996 by Sultan Qaboos by Royal Decree 101/96, as a gift to the people of Oman. The Basic Statute of the State provided a general legal framework upon which Oman operates, establishing its status and role as a constitution in Oman. However, since it is not formally called a constitution (or a Dostour in Arabic) and was promulgated merely by royal decree, some may doubt its legal status as the constitution.

To answer this question, this post will examine the Basic Statute of the State from a number of dimensions, namely, its name, its supremacy over other documents, its content, and its entrenchment, all of which are key attributes of constitutional documents.

Name of the Basic Statute of the State

Constitutions are commonly titled as constitutions, or the Dostour in Arab countries, to clarify their legal status. Therefore, since the Basic Statute of the State is not labelled as the Omani constitution, it can be perceived as a regular law. Nonetheless, this on its own should not be the determining factor for denying the Basic Statute of the State its constitutional status as not all internationally recognised constitutions are formally named as constitutions. For example, in Germany, the constitution is called the Basic Law for the Federal Republic of Germany. Furthermore, the term Dostour originates from the Farsi language, not Arabic, and therefore it is not unreasonable for an Arab country to choose not to name its constitution as a Dostour and use an alternative Arabic name for it.

Supremacy of the Basic Statute of the State

A key aspect of any constitution is that it is the most supreme document of the land. Oman’s Basic Statute of the State declares itself as the supreme legal authority in Oman in article 96 which explicitly mandates that all laws, decrees, and regulations must conform to its provisions, and in article 97 which mandates that no entity can issue any form of law that contradict the Basic Statute of the State. This is also confirmed in practice as every single royal decree that was issued after the promulgation of the Basic Statute of the State starts by referencing the Basic Statute of the State as the legal basis for issuing these royal decrees.

Contents of the Basic Statute of the State

Constitutions around the world are meant to outline the governance framework by which a government operates and set the fundamental rights that are guaranteed to the people. In Oman, the Basic Statute of the State carries out this exact function. Across the different Books of the statute, the Omani framework of governance and the branches of the state and their powers have been detailed to include the Sultan, Council of Ministers, Majlis Oman, and the judiciary. Each of these bodies echoes similar functions as the three main branches of the state (the executive, the legislature, and the judiciary) found in traditional constitutional charters. Furthermore, Book Three of the Basic Statute of the State grants the people various fundamental rights such as the right to life and dignity, the right to equality and security of life, the right not to be arrested, searched, detained, or imprisoned, the right not to be subject to torture, the right to freedom of religion, the right to freedom of opinion and expression, the right to private life, and many more. These elements reflect the key elements found in other constitutions around the world.

Entrenchment of the Basic Statute of the State

Constitutions are traditionally entrenched, i.e. difficult to change, by highly demanding repeal or amendment requirements to ensure the stability of the foundations of the legal system. The Omani Basic Statute of the State appears to lack this attribute, since article 98 of the Basic Statute of the State provides that its articles can be amended the same way they were promulgated, which is merely by a royal decree without any requirements for the change to go through Majlis Oman. However, even though issuing a royal decree can be seen as an easy thing to do, history demonstrates that the Omani Basic Statute of the State is not easy to amend since it has only been amended twice since its promulgation in 1996, the first was in 2011 when the entire Arab World was going through a massive wave of change during the Arab Spring, and in 2021 after Sultan Haitham came into power. Accordingly, even though the Basic Statute of the State might appear to be capable of amendment at any time, the history of Oman demonstrates that it is rarely ever amended and only in extreme circumstances.

Conclusion

To conclude, even though the Basic Statute of the State is not officially labelled as the Omani constitution, it enjoys many of the attributes of formal constitutions recognised around the world, especially in regard to the supremacy and contents of the document.

Being the most important legal document in the country, I highly recommend that everyone reads the Omani Basic Statute of the State, which is available for free in English at this link:

Written by:

Azza Al-Abri

Azza a legal intern at Decree. She has previously interned in the banking sector and in private practice. She is interested in corporate law. She holds a LLB from the University of Leeds.

While the exact provisions can vary, most BITs share several common elements, including the duty to offer foreign investors treatment that is not less favourable than the treatment offered to national investors or investors from other states (national treatment and most-favoured-nation treatment), offer investors fair and equitable treatment, protect their investments against expropriation, and give investors the right to use several dispute resolution mechanisms.

National Treatment and Most-Favoured-Nation Treatment

A key provision in BITs is that the state has a duty to treat foreign investors and their investments at a standard that is not less favourable than the treatment it offers its own national investors or the investors of any other state. This concept has a wide scope and can relate to matters such as legal protections and access to markets in a manner that prevents discriminatory practices that target foreign businesses, including the payment of taxes. The objective of this clause is to create a level playing field and promote fair competition.

Protection Against Expropriation

Expropriation relates to the confiscation by the government of the private property of others. BITs typically include provisions to protect investors from unlawful expropriation of their investment by the government and set conditions for permitting expropriation if it is done for a public purpose, is non-discriminatory, and adheres to due process. Additionally, any expropriation must be followed by prompt, adequate, and effective compensation. In addition to this being translated in article 24 of the Foreign Capital Investment Law, Oman has a comprehensive framework for this in the Law on the Expropriation for Public Benefit.

Dispute Settlement Mechanism

The most critical feature of a BIT is the dispute settlement mechanism that allows an investor to enforce their rights against the host country if the country fails to meet its obligations under the treaty. A standard BIT would allow the investor to make a claim at their choice of venue, including making a claim through an arbitration process before the International Centre for Settlement of Investment Disputes (ICSID).

Conclusion

BITs provide a powerful mechanism for protecting and enforcing the rights of foreign investors. Oman traditionally used to sign these treaties frequently with other states, but the number of new treaties has been declining with the most recent one being Oman-Hungary BIT which was ratified in 2022.

Written by:

Amjad Al-Yahya’ei

Amjad is a legal intern at Decree. He has previously interned in an investment company and in the public utilities sector. He is interested in corporate law, investment law, and dispute resolution. He holds an LLB from the University of Liverpool.

As an Omani law student in the UK, I wrote this blog post to examine the key differences between Omani and UK company legal forms.

General Concept of a Company

In Oman, the term “company” refers to any business vehicle other than a sole trader doing business as an individual in his or her personal capacity. Accordingly, a partnership, i.e. the legal form where two or more partners carry out an activity together with one or more of the partners having no limited liability, is considered a type of a company in Oman, is governed by the Commercial Companies Law, and is referred to as a Tadhamun Company (General Partnership) or Muhassa Company (Limited Partnership). The Omani concept of a company widens more as the Omani law considers a joint venture, merely a contract between two parties to carry out a joint project, to be a company form and regulates it under the Commercial Companies Law.

This differs from the UK, where the term “company” usually refers to a specific type of business vehicle with limited liability and a legal personality distinct from its shareholders. Other business vehicles, such as partnerships, are governed by a totally different set of legislation. The UK also does not consider venture capital a form of a company. However, the UK also has a hybrid business form between a company and a partnership called a Limited Liability Partnership that does not exist in Oman.

Limited Liability Companies

In Oman, the Commercial Companies Law has several types of what is generally considered a limited liability company, i.e. a legal form with a legal personality distinct from the shareholders who have limited liability towards the conduct of the business. These are the One Person Company (a limited liability company with one shareholder), a Limited Liability Company (a limited liability company with a maximum of 50 shareholders, and a Joint Stock Company (a limited liability company with a minimum capital of 2,000,000 Rial if the shares of the company are traded in the stock market or a minimum capital of 500,000 if the shares of the company are not traded in the stock market. The law also has specific rules for a holding company (a joint stock company created for the purpose of owning other companies).

In the UK, there is no distinction in the actual legal form identified by Omani law; all are merely referred to as a Limited Company. This company can be owned by one or multiple people, and there is no cap on the number of shareholders a company can have. The same applies in regard to publicly traded companies. A Limited Company can trade its shares on the stock market in the UK without having to adopt a different legal form.

Limited Liability Partnerships

Oman only has the traditional legal forms of a general partnership and a limited partnership in the area of partnerships. These forms also exist in the UK and offer a legal form jointly owned by the shareholders without offering limited liability except to limited partners in a limited partnership. However, the UK also offers a hybrid form between a company and a partnership called a Limited Liability Partnership (LLP) as a legal vehicle in which all the partners have limited liability, allowing them to manage the business directly without needing a board of directors. LLPs allow for a different tax treatment than an LLC, as the partnership is not subject to corporation tax and the partners are individually taxed through self-assessment tax returns as the profits are directly distributed among them.

Beyond UK Business Legal Forms

In addition to the standard limited company, partnerships, and limited liability partnerships, the UK also has several legal forms available for some specific purposes that are not necessarily profit-oriented, such as Community Interest Companies that prioritise community benefits over profit; Right to Manage Companies that are formed by leaseholders to manage their building; and UK Societas’ that provide a framework for operating across the UK and EU (formally known as Societas Europaea before Brexit).

Conclusion

Company Law is one of the critical areas of law for any person interested in corporate legal work. I highly recommend reading the Commercial Companies Law to learn about Omani company law. You can also read Decree’s Intel on the link below for an Overview of Types of Companies in Oman:

Written by:

Abdulrahman Al-Farsi

Abdulrahman Al-Farsi is a Junior Legal Researcher at Decree and a Final Year Law Student at the University of Liverpool.