Contracts are the foundation of business relationships, outlining rights, obligations, and expectations between parties. However, despite careful planning and collaboration, disputes can arise, leading to costly and time-consuming legal battles. That’s where a well-crafted Alternative Dispute Resolution (“ADR”) clause comes into play. ADR refers to the different ways people can resolve disputes without a trial. Common ADR processes include mediation, arbitration, and neutral evaluation. In this article, we will explore the significance of including an ADR clause in contracts and how it can provide a fair and efficient means of resolving conflicts.

Firstly, an ADR clause helps reduce the cost of disputes. It is commonly known that litigation is often the default path for resolving disputes; however, this can be an expensive and lengthy process. Therefore, a well-drafted ADR clause offers an alternative by providing a clear roadmap for resolving conflicts outside of the courtroom. By specifying a preferred method of dispute resolution, such as mediation or arbitration, parties can save significant time, money, and resources.

Furthermore, an ADR clause serves to maintain control and confidentiality. In fact, one of the key advantages of including an ADR clause is that it allows parties to maintain control over the resolution process. Unlike litigation, where decisions are made by a judge, ADR methods enable the parties to choose a neutral third party or panel to oversee the process. This allows for greater flexibility, confidentiality, and the ability to craft solutions that best suit the specific circumstances of the dispute.

Moreover, an ADR clause aids in preserving business relationships. In business, maintaining positive relationships is crucial for long-term success. Engaging in a public and adversarial court battle can strain relationships and damage reputations. An ADR clause encourages parties to resolve conflicts amicably, preserving working relationships and promoting future collaboration. It shows a commitment to finding common ground and finding mutually beneficial solutions rather than resorting to litigation.

Additionally, an ADR clause facilitates speed and efficiency. Indeed, disputes can be time-consuming, diverting valuable resources and attention away from core business activities. With a well-defined ADR clause, parties can establish a timeline and procedure for resolving conflicts, ensuring a more efficient and timely resolution. ADR methods, such as mediation or arbitration, typically offer streamlined processes that prioritize a swift resolution.

It is noteworthy that an ADR clause is the result of a tailored process to fit the dispute. As every dispute is unique, a one-size-fits-all approach may not be the most effective solution. An ADR clause allows parties to tailor the process to the specific needs of their dispute. They can choose the most suitable method, select a qualified neutral party with expertise in the relevant field, and set guidelines for the proceedings. This flexibility helps ensure a more targeted and effective resolution.

As well, an ADR clause is important in international contracts. In today’s globalized business landscape, contracts often span international borders. In such cases, an ADR clause becomes even more critical. It helps parties navigate differences in legal systems, languages, and cultural norms. By specifying a method of dispute resolution that is recognized and enforceable internationally, such as arbitration under a respected institution like the International Chamber of Commerce (“ICC”) or the London Court of International Arbitration (“LCIA”), parties can ensure that their disputes are resolved in a neutral and impartial manner. In other words, including an internationally recognized method of dispute resolution, such as arbitration under a renowned institution, provides parties with confidence and a familiar framework for resolving cross-border conflicts.

In conclusion, an ADR clause is a powerful tool that empowers parties to address conflicts in a fair, efficient, and mutually agreeable manner. By proactively including this clause in contracts, businesses can minimize the risk of costly litigation, preserve relationships, and maintain control over the resolution process. Whether it’s through mediation, arbitration, or another alternative method, the inclusion of a well-crafted ADR clause demonstrates a commitment to resolving conflicts with confidence and integrity.

Wadhah Talib Yahya Al-Hinai is an Omani lawyer with a background in legal research and academia. Currently serving as a Legal Researcher at the Legal Affairs Department of Sultan Qaboos University, he also lectures on Business Law at the College of Economics and Political Sciences of the same university. Passionate about law and education, Wadhah is dedicated to advancing legal knowledge and nurturing the next generation of legal professionals.

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In today’s interconnected business landscape, where information flows rapidly and collaborations thrive, maintaining confidentiality has become more critical than ever. For individuals and organizations alike, protecting sensitive information is vital for maintaining trust, fostering innovation, and preserving competitive advantage. This article explores the importance of confidentiality clauses in contracts and their role in safeguarding valuable assets and maintaining healthy business relationships.

Firstly, confidentiality clauses safeguard secrecy. It is of common knowledge that confidentiality clauses, often in the form of non-disclosure agreements (“NDAs”), play a crucial role in legal agreements by establishing a framework for protecting sensitive information shared between parties. These clauses outline the expectations and responsibilities of each party regarding the handling of confidential information. They require both parties to maintain the confidentiality of the information and refrain from disclosing it to unauthorized individuals or entities. This helps organizations safeguard their proprietary knowledge, trade secrets, client data, financial information, and other confidential matters from being disclosed or misused. Incorporating confidentiality clauses in contracts not only protects sensitive information but also helps build trust between parties by ensuring that the information shared is kept confidential and secure.

In addition, confidentiality clauses preserve trust and reputation. In fact, confidentiality clauses are essential components of agreements that help build and maintain trust between parties. These clauses serve to explicitly outline the obligations and expectations regarding the handling of confidential information, ensuring that sensitive data is treated with the utmost care and discretion. By clearly defining the scope of confidentiality and the consequences of breaching it, these clauses create a framework for trust. Parties can be confident that their sensitive information will be protected, which can foster a culture of trust and reliability. When individuals and organizations consistently uphold these standards, they enhance their reputation as trustworthy and reliable business partners, which can lead to more successful and mutually beneficial relationships.

Moreover, confidentiality clauses protect intellectual property. Indeed, Intellectual property (“IP”) constitutes a significant asset for many companies. Whether it involves patents, trademarks, copyrights, or trade secrets, preserving the confidentiality of IP is essential for maintaining a competitive edge. Confidentiality clauses ensure that sensitive information related to IP remains secure, preventing unauthorized disclosure, replication, or misuse that could potentially undermine an organization’s market position.

Furthermore, confidentiality clauses encourage open communication. By providing a secure environment where sensitive information can be shared without fear of unauthorized exposure, these clauses facilitate the exchange of ideas, insights, and knowledge, enabling innovation to flourish. Knowing that their confidential information is protected, individuals and organizations are more likely to engage in meaningful collaborations that drive progress.

It is also worth noting that confidentiality clauses mitigate legal risks. Indeed, in an era of increasing data breaches and cyber threats, organizations face significant legal risks when confidential information falls into the wrong hands. Confidentiality clauses serve as proactive measures to mitigate such risks. By establishing clear guidelines for the handling of sensitive data, these clauses provide a legal framework that can be invoked in the event of a breach, empowering the affected party to seek legal recourse and potential damages for any resulting harm.

Finally, confidentiality clauses strengthen business relationships. Confidentiality clauses are not just about protecting assets; they are also about fostering strong business relationships. By explicitly addressing the importance of confidentiality, parties demonstrate their commitment to maintaining the privacy and trust necessary for successful collaboration. This shared understanding helps build enduring partnerships based on mutual respect, integrity, and shared interests.

In conclusion, confidentiality clauses in contracts serve as powerful tools for protecting sensitive information, preserving trust, and nurturing healthy business relationships. By incorporating these clauses, individuals and organizations can shield their intellectual property, mitigate legal risks, encourage open communication, and safeguard their reputations. In an age where information is a valuable currency, prioritizing confidentiality through well-drafted confidentiality clauses is a proactive step towards ensuring the long-term success and prosperity of any business endeavor.

Wadhah Talib Yahya Al-Hinai is an Omani lawyer with a background in legal research and academia. Currently serving as a Legal Researcher at the Legal Affairs Department of Sultan Qaboos University, he also lectures on Business Law at the College of Economics and Political Sciences of the same university. Passionate about law and education, Wadhah is dedicated to advancing legal knowledge and nurturing the next generation of legal professionals.

An employee’s right to peacefully strike plays a fundamental role in advocating for their rights and improving their work conditions. The newly released Labour Law, promulgated by Royal Decree 53/2023, boldly emphasises the rights of employees and employers in strikes and closures. It achieves this by dedicating the entirety of Section 2 of Part 8 of the Labour Law (Articles 128-136) to such matters.

The rights of employees to strike in Oman are by no means newly introduced rights. The previous Labour Law lightly touched on the laws and regulations in the settlement of labour disputes between employers and employees. This along with the Ministry of Labour Ministerial Decision 294/2006 formed the previous statutory basis for the laws and regulations of strikes and closures.

As per the new Labour Law, in order to legally strike, employees must adhere to certain stipulations set forth by the legislator. Article 129 stipulates that employees wishing to strike or their union representatives must notify in writing the employer and all relevant authorities, including the Collective Labours Dispute Committee, at least three weeks before the specified strike date. The written notice must include the reason for the strike and the demands of the striking parties. Additionally, the declaration of the strike must receive approval from three-quarters of the members of the general assembly of the union for the strike to proceed.

However, there are limitations to employees’ rights to peacefully strike. If the strike threatens public interest, then it will be considered unlawful. Accordingly, article 128 outlines that striking employees are prohibited from inciting strikes in establishments that provide public or essential services. This includes oil instillations, petroleum refineries, ports, airports, public transportation, and any other establishments that are deemed to provide a public service by the Minister of Labour.

In line with the limitation of the employees rights to strike, a concerning aspect is that any employee that implements their right to strike shall be considered to have taken that striking period as a period of leave without pay, as specified in article 131. This is likely to deter the majority of employees from acting on their rights to strike in cases of labour disputes. Additionally, article 130 conditions that employees must call off strikes if collective labour dispute settlement procedures begin between the employees and employers.

The legislator has also imposed stricter penalties on any employees who violate article 145 of the Labour Law by obstructing or disrupting the workplace during a strike. Any striking employees who violate this provision shall be subject to either imprisonment for a period ranging from one to six months, a fine ranging from 500 OMR to 3,000 OMR, or both penalties.

The above limitations demonstrate the legislator recognising and protecting the rights of employers in regard to strikes.

The legislator has similarly imposed certain rules and regulations on the rights of employers in regard to closures. In order for employers to legally impose closures during strikes they must adhere to certain stipulations set forth by the legislator. As such, article 133 specifies that an employer has the right to completely or partially, when necessary, close their establishment to defend their interests. Employers must also notify striking employees or their labour unions, as well as any and all relevant authorities, of the closure at least three weeks in advance, providing the date and reasoning behind it, as prescribed in article 134.

However, just as employees’ rights to strike are limited, employers’ rights to closures are also restricted. Article 135 limits the rights of employers to closures by prohibiting employers from closing down establishments that provide public services including oil facilities, petroleum refineries, ports, airports, public transportation, or any other establishments that are deemed to service the public by the Minister of Labour. In addition, article 132 holds that employers must immediately stop the closure if the disputing parties agree to begin dispute settlement procedures, and are prohibited from shutting down the establishment during the settlement stages.

To counteract employers’ closure rights, the legislator mandates under article 136 that all closure days are considered paid working days for employees. Article 145 of the Labour Law also imposes strict penalties on any employers who violate the rights of the employees under articles 128, 129, 132, 134, and 135. Violating parties shall be subject to either imprisonment for a period ranging from one to six months, a fine ranging from 500 OMR to 3,000 OMR, or both penalties.

This demonstrates that the new provisions pertaining to strikes and closures introduced in the Labour Law have not only acknowledged the rights of employees to strike but have also placed a parallel emphasis on recognising the rights of employers when it comes to managing such strikes and closures.

Budoor Al Suwaid is a recent graduate with an LLM in Commercial and Corporate Law from Queen Mary, University of London. Prior to that, she received her LLB Laws degree from City, University of London.

With the promulgation of the newly revised Majlis Al-Shura Elections Law, the country has taken steps forward towards a more robust framework for the elections of Majlis Al-Shura. The addition of detailed provisions for electronic voting will hopefully increase the accessibility of voting polls and puts it at the tip of our fingers, while the Electoral Grievance Committee will provide candidates as well as voters with a mechanism to voice grievances. This new law is a noteworthy legal development, but it still missed an opportunity to further improve voter representation through the introduction of ranked choice voting.

The new Shura Elections Law was promulgated in July 2023, and repeals the Shura Elections Law of 2013. The law does not make fundamental changes to the manner in which Shura elections are conducted, and instead makes a number of specific changes including new provisions to facilitate electronic voting as well as new provisions for the establishment of a new Electoral Grievance Committee to rule on complaints made against the preliminary lists of candidates and voters.

However, no change took place in regard to the mechanism for resolving a tie in elections, which I think is an issue that could have been reconsidered to further improve the election framework in Oman. Currently, as outlined in article 44 of the Shura Elections Law, when there is a tie between two candidates, both are put into a lottery to decide on who becomes the representative, and in wilayat that have two seats both are admitted into the majlis. However, while this clause does provide a solution to contested election results, it comes at the expense of greater representation. 

The missed opportunity can be showcased through an example, if candidates A, B, C, and D, are all running for a wilayat with a single seat and the first election results in candidate A receiving 30% of the votes, candidate B receiving 30%, candidate C receiving 10% and candidate D receiving the remaining 20%, even if the voters that voted for C and D could have preferred candidate A as a second choice, the clause would call for candidate A and B to be entered into a lottery in which one of them will be picked at random. This would mean that while 60% of the population would have preferred candidate A over candidate B, both A and B would have a 50% chance of winning the election in the event of a tie. (A lot of probability, I know.) 

This is an issue that election committees face all over the world and thanks to the commonality of the problem, Oman has many approaches to pick from. For instance, ranked choice voting calls for voters to not only choose a first choice but a second choice as well. Doing so means that if we take our previous example, as there was a tie between candidates A and B, the second choice of C and D voters are calculated to declare candidate A the winner with 60% of the votes. This mechanism would lead to a more representative election result while remaining inexpensive to implement, as the only change that would be made is the addition of an extra box in the ballot tickets. 

The new Shura Electoins Law has made voting more accessible with the introduction of electronic voting. It has also increased the rights of candidates to contest elections which are accused of irregularities through the formation of the Electoral Grievance Committee. Future reforms would benefit from considering whether the tie-breaker clause can be improved.

Faris Al-Said is a Philosophy and Politics Graduate from the University of Reading currently pursuing a career in International Relations.

The recently issued Social Protection Law confirmed the importance that Oman gives to persons with disabilities by providing several rights and benefits to this vulnerable social group. These rights and benefits include providing a monthly guaranteed financial subsidy to every person with a disability and also allowing persons with disabilities to retire 10 years earlier than persons without disabilities. These fundamental rights granted by this new groundbreaking law are not the first or the only rights granted by Omani law to persons with disabilities as the Omani legal system has long recognised the need to provide them with special protections to address the inequality they face due to their disability. This post will highlight some of the other Omani laws that recognise the rights of the disabled.

The Basic Statute of the State

From the outset, the Omani Basic Statute of the State, i.e. the Constitution, recognises the rights of the disabled as a constitutional right under article 15 as it stipulates that the government shall provide care for children, persons with disabilities, the youth, and young individuals. This makes the protection of the disabled a constitutional fundamental right.

The Law on the Care and Rehabilitation of the Disabled

In addition to this, Oman has a dedicated law titled the Law on the Care and Rehabilitation of the Disabled promulgated by Royal Decree 63/2008, which defines key terms related to disabilities and outlines the responsibilities of the Ministry of Social Development and other government bodies in providing care and rehabilitation services. The law focuses on healthcare, education, vocational rehabilitation, employment opportunities, establishment of rehabilitation centres, and issuance of rehabilitation certificates.

The Law of the Child

In addition to this standalone Law on the Care and Rehabilitation of the Disabled, many other Omani laws have dedicated provisions relating to the protection of persons with disabilities. For example, Article 15 of the Law of the Child requires competent state bodies to take preventive and remedial measures for disability detection and appropriate treatment and to promote equality and non-discrimination based on various grounds, including disability. Article 52 of this law also guarantees the care and rehabilitation of disabled children in accordance with the Law on the Care and Rehabilitation of the Disabled.

The Labour Law

The Labour Law has long recognised the rights of the disabled and the need for integrating them, and this was reconfirmed in the newly issued Labour Law of 2023 which stipulates in article 24 that an employer who employs 40 or more workers must commit to hiring qualified disabled Omanis for jobs suitable to their conditions, within the limits of the ratio set by the ministerial decision.

The School Education Law

The School Education Law promulgated by Royal Decree 31/2023 also mandates in Article 34 that the Ministry of Education shall construct and maintain government school buildings that meet specific standards and requirements, and this includes ensuring suitable facilities and provisions for students with disabilities.

Telecommunication Service Regulation for the Disabled

It is also worth noting that the Telecommunications Regulatory Authority also issued Decision 41/2014 issuing the Regulation of the Provision of Telecommunication Services for the Disabled, which requires telecommunication licensees to offer various services, including interconnection services, voice, SMS, multimedia, video calling and data services, emergency call services, and directory services, to enhance accessibility for individuals with disabilities.

Conclusion

There is no doubt that the Oman legal system has put a significant amount of effort in supporting and integrating persons with disabilities. However, it is important to recognise that a lot of work is still required to fully realise the rights of the disabled as noted in a number of UN reports on Oman’s implementation of the Convention on the Rights of Persons with Disabilities. Such issues that Oman is required to work include additional work in the area of education to ensure an inclusive educational environment and providing specialised training for educators are vital for empowering individuals with disabilities through education; additional work in the area of employment as integrating persons with unique and different disabilities remains a challenge; and additional work in the area of physical accessibility as creating an environment that is accessible to all individuals, regardless of disability, requires significant financial investments.

Duniya Al-Nabhani is a Law Master’s student and an SQE Candidate at the University of Law. She has previously completed legal work experience in private practice and in-house legal teams.

Similar to most jurisdictions around the world, the enforcement of foreign judgments is a complicated matter in Oman in the absence of a bilateral treaty for the mutual recognition of judgments. Under Omani law, the enforcement of civil and commercial judgments is governed by article 352 of the Civil and Commercial Procedures Law promulgated by Royal Decree 29/2002. This article examines one of the key elements required by article 352: reciprocity in the enforcement of Omani judgments in the jurisdiction from which the judgment sought to be enforced is made.

The principle of reciprocity as a general concept is widely recognised and considered in public international law along with the principles of national treaty (the principle that foreigners must be given the same treatment as nationals) and most favoured nation treatment (the principle that foreigners must be given the same treatment given in the country to foreigners of a third country if this treatment is better).

The principle of reciprocity simply requires a state to provide foreigners a certain treatment if the home country of these foreigners provides the same treatment to the nationals of the first-mentioned state. For example, if Oman followed the principle of reciprocity in regard to entry of nationals without a visa with Country X, the nationals of Country X will be allowed to enter Oman without a visa if Country X allows Omani nationals to enter Country X without a visa.

There are many rationales for adopting the principle of reciprocity as this principle allows the state to bargain with other states to provide special treatment for its own nationals by providing this same treatment to the nationals of these other states, which can provide opportunities for both the nationals of Oman and the nationals of these other states in a way that contributes to the realisation of the better well being of all parties involved, increased exchanges in all aspects of life between them, including that of foreign investment.

In regard to the recognition of foreign judgments, the Civil and Commercial Procedures Law provides in article 352 a number of conditions before Omani courts are permitted to recognise and enforce such judgments, namely:

1. That the judgment is issued from a competent judicial authority and that the judgment is final.
2. That the litigants in the dispute were properly notified of the lawsuit and they were properly represented in it. 
3. That the judgment does not involve a matter that violates Omani law.
4. That the judgment does not contradict a previous judgment issued by Omani courts and that it does not prejudice public order or morals.
5. That the country from which the judgment is made accepts enforcing Omani judgments.

The existence of a requirement of reciprocity appears at the first instance to be a logical and a reasonable requirement to have, especially if Oman is motivated by the desire to provide those with Omani judgments in their favour to also have their judgments enforced in other countries. This requirement has also been confirmed by the Supreme Court in a number of its judgments.

Notwithstanding the motivations behind this requirement, its application in real life appears to be challenging and operates as an obstacle to the enforcement of legitimate judgments that ought to be enforced. Conceptually, this requirement places a significant burden on the judge as it requires him to be aware of the position of a foreign legal system in regard to the enforcement of Omani judgments, which is not only difficult to determine, but is probably a position that does not exist at all if no Omani judgment was ever presented to that foreign legal system to test its enforceability. Furthermore, this requirement may carry political aspects as it becomes subjective and reliant on the existence of bilateral relations between the two countries in a manner that does not necessarily contribute to protection of the rights of the litigants or the realisation of justice.

While it might be easy to argue that the first four elements of article 352 should be sufficient to allow a court to recognise a foreign judgement, the practical reality of the differences between the legal systems of countries all around the world makes it difficult to figure out a quick and systematic approach for recognising foreign judgments by local courts, in Oman or elsewhere, and that is the very reason why states signed multilateral and bilateral treaties for judicial cooperation and the recognition of foreign judgments such as the Riyadh Agreement and the Judicial Cooperation Agreement between Oman and India.

Dr Bader Al-Maskari is the Assistant Dean of Postgraduate Studies and Research at the College of Law in Sultan Qaboos University. Dr Bader is also a member of Sultan Qaboos University Research Council and has published articles in a variety of local and international academic journals as well as traditional newspapers. He holds a PhD in Private International Law from the University of Leicester in the United Kingdom, and he is admitted to appear before courts of appeal in Sultanate of Oman.

The energy sector is one of the most critical industries in any country and is considered by many as the bloodline of new economies. This sector is not concerned only with the introduction of energy, but covers a variety of issues such as the exploration and extraction of fossil fuel, the transport, storage, and distribution of energy to both industrial and household consumers through pipelines or LNG ships, transport through transmission and distribution networks, and access by power generators and end-users. As the Sultanate of Oman, through the Ministry of Energy and Minerals and other stakeholders, plan for the energy transition and the future of the energy sector, it is important to reflect on what energy law means and the guiding principles that Oman should recognise when developing its energy policies and laws.

It is not easy to define what energy law exactly means, as it is a multi-dimensional set of rules and policies that govern the use and development of the sources of energy, their facilities, their pricing, and their wider impact on the society, the economy, and the environment. In regard to specific goals, one might argue that the goal of energy law is to improve the efficiency of the use of natural resources in the production of energy, govern project finance and other financing structures relating to the development of energy facilities, enhance the safety and reliability of the transportation and delivery of power to consumers, regulate the pricing of power services provided to the public, encourage or discourage the use of specific types of energy resources, and creation of international markets that improve the pricing and allocation of natural resources.

The scope of energy law in regard to industrial sectors is also extremely wide, and covers everything from natural gas, oil, and coal, to electricity, solar, hydropower, nuclear power, wind, and biofuels. It can also relate to power efficiency, preservation, demand response, and other measures that affect power consumption. All these different sectors can be interconnected and interdependent, and can also compete with each other in certain contexts. For example, natural gas is a natural fuel resource used to produce electricity and at the same time it competes directly with electricity as a source for commercial or home heating. Therefore, regulatory measures applied to one energy sector can often have consequences for another energy sector.

Attempting to regulate such a complex and multi-faceted sector is not an easy task for any government, and requires a logical framework that acknowledges the complexity of the issues at hand, the competing interests within the sector, and the larger implications of this sector on the economy, society, and the environment. As Oman moves forward in developing its regulatory framework in the area of energy, it is useful for us to reflect on the Seven Principles of Energy, which were developed by Heffron, McCauley and de Rubens in 2018 as guiding principles for understanding energy law:

Principle 1: Natural Resources Sovereignty

Stemming from UN General Assembly resolutions in 1962 and 1974, energy law should be based on the recognition that all states have an inalienable right to freely dispose of their natural wealth and resources in accordance with their national interests, and that no state should be subjected to economic, political, or any other type of coercion to prevent the free and full exercise of this inalienable right. This connection between energy and sovereignty is not only important for energy rich countries, but it also needs to be recognised as such as in energy importing and consuming states.

Principle 2: Access to Modern Energy Services

Access to energy needs to be recognised as a prerequisite for development, and energy should be regulated with the objective of ensuring access to modern energy services to meet the basic needs of society and stimulate social and economic development.

Principle 3: Energy Justice

Energy must be regulated in a way that achieves a fair global energy system in regard to both benefits and costs of energy services while contributing to a more representative decision-making process.

Principle 4: Prudent, Rational and Sustainable Use of Natural Resources

This principle stems from various UN instruments and should be understood to allow the ecosystem to adapt naturally to climate change, ensure the continuity of food production, and enable economic development in a sustainable manner.

Principle 5: Protection of the Environment, Human Health, and Combating Climate Change

The link between energy and the environment and their impact on human health and climate change cannot be understated, and energy regulations must recognise the close interconnection between environmental law and energy law when designing and developing energy law policies.

Principle 6: Energy Security and Reliability

Understandably, policy systems around the world now consider energy security as a core aspect. This is usually reflected in two ways: The importance of continuous availability of energy at a reasonable cost, and the continuity of demand for energy products within the country.

Principle 7: Resilience     

The final principle of energy regulation is resilience, which requires regulators to look at resilience of the energy sector to ensure availability of energy supply when faced with disasters through planning, infrastructure, response strategies, and integration between the public and private sector.

These seven principles should provide a starting point for any regulator in Oman when evaluating and developing any energy-related law or policy. Such principles, without a doubt, might compete against each other depending on the circumstances of the region, the economy, and Oman’s aspirations.

Dr Saud Al-Farsi is Director of Legal Opinions and Senior Advisor in the Ministry of Justice and Legal Affairs. He has about 20 years of experience working in the area of legislation, legal opinions, international agreements, and government contracts. He is a subject matter expert in nuclear energy law as well as AML/CFT. Dr Saud is also a lecturer at a number of universities and colleges in Oman. He holds a PhD in Nuclear Law from Leeds Beckett University in the United Kingdom.

The mining industry in the Sultanate of Oman is diversifying and developing at an appreciable pace. The Ministry of Energy and Minerals (MEM) has deployed a new strategy to expand the mining sector by recently granting Minerals Development Oman (MDO), a strategic government-owned investor, concessionary exploration-to-mining rights over areas covering 21,500²km. This blog post aims to explain to readers the importance of the said concession agreements, their purpose, comparative advantage to the conventional licensing mechanism, and strategic importance to investors and to Oman. 

Exploration for minerals entails undertaking several activities to determine whether there are minerals under the ground. Investors use exploration to identify whether minerals in a specified area can be extracted at a commercial level. Mining may only then be possible. Exploration may include mapping, surveying the ground from the surface or air, testing water and soil samples, and drilling. All our consumable items began life as a mineral. This includes our power supplies, mobile phones, computers, and cars. Therefore, successful exploration and mining leads to high profit for a mining company. For a nation, it leads to well paid jobs, new infrastructure leading to regional economic development, and increased government profits that pave the way to social priorities such as education, healthcare, and poverty alleviation.

Generally, explorers of minerals need to apply for an exploration licence which gives them sole rights to search a specific mineral within the specified area. This type of exploration and prospecting licence is available in Oman for an initial period of one year, and it may be renewed for similar periods up to three years. However, there are no guarantees since licence holders may not be able to hold on to their licences if MEM believes that they have not met their obligations. A drawback for the licence holders is that an exploration licence does not permit drilling, nor guarantees that an exploitation licence will be granted. Essentially, licensing for exploration is required under the Mineral Resources Law before gaining the licence for drilling. Similarly, a licence for drilling is required prior to obtaining the licence for exploitation. The Mineral Resources Law does however provide preferential treatment towards licence holders of exploration and drilling to receive subsequent licences subject to applying within three months. Yet again, there are no guarantees of receiving the drilling or exploitation licences for the same explored area since MEM may reject the quarterly and final reports submitted by the exploring company per article 37 of the Mineral Resources Law. 

The Mineral Resources Law also offers exploration, drilling, and exploitation rights by way of concession agreements. One of the comparative benefits of concession agreements is that they provide exploration rights for larger areas exceeding five square kilometres. Whereas licence holders cannot generally exploit minerals in areas larger than this range subject to the MEM’s discretion. Additionally, the period of concession agreements vastly differs from the standard licences. The latter only offers one year exploration with further renewals up to three years. Exploitation is offered for a maximum of five years. In comparison, concession agreements for larger areas may be granted for periods between 20 and 30 years.  Importantly, and in line with the longer periods, a concession may be granted for both, the exploration and exploitation concurrently. This requires risk management and the confidence of domestic and international investors and other stakeholders. The MEM meets these criteria by requiring higher level of financial and technical competency from investors.

Concession agreements are of great strategic importance to Oman because they will stimulate local value addition to the Sultanate through exploitation of mineral resources and establishment of downstream processing facilities for catering to local and global markets. Unlike the upstream sector where the objective is to extract the minerals economically to be used as raw materials, the downstream sector transforms this raw material to value added products for delivery to the end consumer. To that end, MDO is progressing in the downstream sector with a variety of projects including titanium dioxide, ferro-alloys, silicon, and magnesium metal projects. Given that each stage further down the chain adds value to the product, it requires adoption of established mining and processing technologies to achieve a competitive advantage. The granting of the 12 concession agreements to MDO by the royal decrees published on 4^th December 2022 has allowed MDO to meet these challenges by launching Airborne Geophysical Surveys followed by Geo-Chemical studies over large areas. These studies have the potential of identifying several minerals in areas where MDO has been granted the 12 concession areas. Importantly, the studies will allow the collection, analysis, and interpretation of historical and present information through a structured and stage wise exploration programme. This process is crucial because it improves the stakes of converting a prospect to a profitable mine. 

Many companies suffer the dilemma of spending a bulk of their resources either on exploration or exploitation. The lack of balance between the two becomes obvious in the form of long-term loss over time. Concession holders in Oman benefit by receiving exploration and exploitation rights simultaneously. This advantage allows them to focus and equally distribute their resources between the two. The large areas and longer periods allow companies to set long term goals while periodically targeting smaller sites and collecting geological data for the benefit of all stakeholders. The companies and the government benefit by profiting, and in the long run, the nation benefits from opportunities that would eventually open such as employment, better infrastructure, and regional development.

Amira Taqi is a corporate and commercial lawyer with extensive experience advising public and private organisations in the telecom, banking, and mining sectors. She has over 10 years of experience as a legal advisor and in-house counsel and currently leads the legal team at Minerals Development Oman where she had worked on the recently issued royal decrees approving the mining concession agreements.

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