“The new CCL comes at a time when the sultanate is preparing for 2040 Vision, which focuses on enabling the private sector to take the lead in production processes and effectively contributing to the growth of the economy,” H E Abdullah bin Salim al Salmi, executive president of the CMA said at a press conference.
The new law will come into effect from April 1, 2019, and the old Commercial Companies Law, which was enacted in 1974, will cease to exist.
“We have one year time to issue the regulations in accordance to the new law. We are confident that we will issue new regulations governing all related matters including listings of new companies, sukuks and other debt funds,” H E Salmi said.
He said the new law addresses numerous matters regulating Oman’s capital market and provides for the main elements of building a robust capital market with a high-level of confidence and legislative and technological readiness.
H E Salmi said the new law conferred on CMA the whole powers to regulate the public joint stock companies since establishment, and supervise their work to ensure they conduct business in accordance with sound administrative rules to protect the shareholders.
H E Salmi explained that the new CCL copes with the recent developments in financial industry including providing Islamic finance products such as sukuk and Islamic investment funds.
As per the new law, a holding company will take the form of a joint stock company unlike the previous situation where the holding company had the options to be a limited liability company or a joint stock company.
With regard to professional firms, the CMA chief explained that the law includes a new Article on the professional firms such as accounting and law firms. The new law provides a sound legal basis for establishing professional firms and special rules will be issued for their regulation by the Council of Ministers.
H E Salmi pointed out that the new law organises all the procedures for establishment of public joint stock companies and reduces the terms required for this. “The CMA has the power to put in place the procedures required for establishment of such forms of commercial companies. This incentivises the companies, including family businesses, to transform into public companies.”