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Law No. 8 of 2016 On Regulating Practicing Economic Activities in Ras Al Khaimah

Law
Law No. 8 of 2016 On Regulating Practicing Economic Activities in Ras Al Khaimah We, Saud Bin Saqr Bin Mohamed Al Qasimi Ruler of Ras Al Khaimah After perusal of the Constitution of United Arab Emirates; And Federal Law No. 5 of 1975 on Commercial Register; And Federal Law No. 1 of 1979 on Regulating Industry Affairs; And Federal Law No. 4 of 1979 on Suppressing Cheating and Fraudulence in Commercial Transactions; And Federal Law No. 18 of 1981 on Regulating Commercial Agencies; And Federal Law No. 5 of 1985 on Promulgating Civil Transactions Code; And Federal Law No. 3 of 1987 on Promulgating Penal Code; And Federal Law No. 37 of 1992 on Trademarks; And Federal Law No. 18 of 1993 on Promulgating Commercial Transactions Code; And Federal Law No. 18 of 1995 on Simple Crafts; And Federal Law No. 7 of 2002 on Copyrights & Related Rights; And Federal Law No. 17 of 2002 on Regulating & Protecting Industrial Property of Patents & Industrial Drawings & Models; And Federal Law No. 1 of 2006 on Electronic Transactions & Commerce; And Federal Law No. 24 of 2006 on Consumer Protection; And Federal Law No. 4 of 2012 on Regulating Competition; And Federal Law No. 9 of 2014 on Amending Federal Law No. 4 of 2002 on Combating Money Laundry Crimes; And Federal Law No. 2 of 2015 on Commercial Companies; Federal Decree-Law No. 6 of 2015 on Establishing Federal Competitiveness and Statistics Authority; And Law of 1987 on Customs; And Law of 1981 on Ras Al Khaimah Municipality. And Law of 2000 on Free Zone, as amended; And Emiri Decree No. 31 of 2003 on Establishing Investment & Development Office In Ras Al Khaimah Government; And Law of 2004 on Operations & Activities of Ras Al Khaimah Free Zone Companies; And Notary Public Law of 2005, as amended; And Emiri Decree No. 2 of 2005 on Establishing Ras Al Khaimah Investment Authority; And Law No. 2 of 2007 on Establishing Environment Protection & Development Authority in Ras Al Khaimah, as amended; And Law No. 6 of 2008 on Regulating Real Estate Offices in Emirate of Ras Al Khaimah; And Emiri Decree No. 5 of 2009 on Establishing Ras Al Khaimah Competitiveness Office; And Emiri Decree No. 19 of 2011 on Controlling Membership of Joint Stock Companies Boards of Directors ; And Law No. 7 of 2012 on Establishing Executive Council in Emirate of Ras Al Khaimah; And Law No. 1 of 2013 on Human Resources, as amended; And Law No. 2 of 2013 on Regulating Ras Al Khaimah Chamber of Commerce & Industry; And Law No. 2 of 2016 on Ras Al Khaimah Studies & Statistics Center; And Law No. 4 of 2016 on Restructuring & Organizing Department of Economic Development; And Law No. 5 of 2016 on Promotional Campaigns & Special Offers For Commercial Advertising Purposes; And Law No. 6 of 2016 on Sale at Discounted Prices (Sale) & Clearances; And Law No. 7 of 2016 on Commercial Control & Protection on Economic Facilities; And based on what is required by public interest, we promulgated the following Law: Article 1 Definitions Words and phrases stated in this law shall have the meanings indicated against each of them, unless context requires otherwise: State: United Arab Emirates. Emirate: Emirate of Ras Al Khaimah. Ruler: His Highness Ruler of the Emirate. Council: Executive Council of the Emirate. Department: Department of Economic Development in the Emirate. Department President: President of Economic Development Department. Director-General: Director General of Economic Development Department. Economic Activity: Any commercial, industrial, occupational, professional, agricultural or service activity or any other activity aims at achieving profit that may be carried on in the emirate according to legislations in force. Competent Authority: Any local or federal authority that falls within the competences thereof by legislations in force, regulating and controlling an economic activity or more. Facility: Any company or establishment licensed to carry on the economic activity in the Emirate with exception of facilities not fallen within the competences of the Department according to applied laws in the State or Emirate. Branch: Place designated by the facility as a center to practice and carry on its activity away from its head office. Establishment: Facility owned by natural person to carry on the economic activity in the emirate and personality thereof shall not separate from its owner given that its financial liability is linked to him as he is responsible for all financial obligations incurred thereby towards third parties. Trade Name: Each name under which the trader carries on the commercial activity and the right to use it shall be limited to the holder thereof. License: The document under which the Department permits natural or legal person to carry on a specific activity. Trade Permit: A document includes approval granted by the Department to the facility to carry on marketing activity. Marketing Activity: The activity conducted by the facility to market its products and services by commercial advertisements and billboards or clearance offers, sale, promotional campaigns or exhibitions and conferences or other marketing activities. Professional or Occupational Activity: The activity carried on by a natural person or more which depends on his physical or mental effort or seeking the assistance of some tools and equipment with limited capital. Business Incubators: set of services and facilities and support mechanisms in technical, administrative and consulting fields, provided by a competent authority for limited period of time in order to encourage establishing and developing small and medium enterprises. Unified Register: The approved register with the Department to document data and information of establishments and companies. Competent Committee: Customer Complaints & Grievances Committee in Department of Economic Development. Service Agent: A local person whose job is limited to provide the necessary services to facilities without incurring any liability or financial obligations related to the business of the facility and the Service Agent may be a company provided it is holding the UAE nationality and all partners thereof shall be UAE persons. Article 2 Law Enforcement The provisions of this law shall apply to all facilities and business that are subject to the competence of the Department according to the laws in force in the State & Emirate. Article 3 Law Objectives This Law aims at achieving the following: 1- Regulate carrying on the economic activities in the Emirate and create stimulating environment for investment in various economic fields. 2- Create a single platform through which coordination among competent authorities shall be conducted to meet requirements needed to license carrying on the economic activities in the Emirate. 3- Raise economic growth rates in the Emirate. 4- Develop the economic environment in the Emirate through depending on information accuracy and transparency and provide the same by the latest technologies to enable investors to benefit therefrom. 5- Contribute to marketing and promotional plans and spread the economic and investment awareness and determine the available investment opportunities in the Emirate. Article 4 Department Competences For the purposes of achieving the objectives of this law, the Department shall regulate carrying on the economic activities in the Emirate, therefore, it is entitled to: 1- Develop necessary rules and controls to regulate granting licenses to carry on the economic activities in the Emirate and determine details and terms of these licenses and how to amend details stated therein within the framework of the legislations in force and in coordination with the competent authorities. 2- Regulate registering and recording facilities in the commercial register. 3- Register and keep trade names of the facilities. 4- License the economic activities in the Emirate according to the applied laws, systems and regulations in coordination with the competent authorities. 5- Set and classify the economic activities that may be carried on in the Emirate according to the latest internationally recognized systems and develop and update the same periodically in accordance with the needs of the economic activity and requirements of the economic development therein. 6- Issue trade permits for marketing activities according to the requirements and controls approved therewith in this regard. 7- Organize and determine working hours of the operating facilities in the Emirate according to the controls approved therewith in this regard. 8- Control and inspect intellectual property rights, combat commercial fraud, combat money laundry, manage commercial and consumer protection operations in the Emirate according to the laws in force in this regard and in coordination with the competent authority. 9- Control and inspect all facilities fallen within the competence of the Department to ensure their commitment to the laws and regulations in force in the Emirate. Article 5 Economic Activities Classification Economic activities licenses shall be granted in the fields related to trade, industry, agriculture, fishery, mining, services and other activities, according to Economic Activities Guide approved by the Department, taking into account the regulations and regulatory resolutions issued by Ministry of Economy, as well as international and global classifications issued in this regard. Article 6 Issue License No natural or legal person may carry on the economic activity in the Emirate before obtaining license to do so from the Department in accordance with terms and controls prescribed in Law no. 4 of 2016 on Restructuring and Organizing Department of Economic Development and the executive regulation thereof. Article 7 License Term 1- Facility License term shall be one Gregorian year which shall be renewable for similar terms and it is permissible, upon the request of the facility and approval of the Department and in coordination with the competent authorities, that the term of the license shall be more than one year and not more than five years. 2- The facility should renew its license within the last month from its expiry and this shall not prejudice the right of the Department to grant the facility a grace period according to the controls placed thereby in this regard. Article 8 Accept or Reject License Application The Department may, at its own discretion, accept or reject granting license for public interest requirements and in accordance with the provisions of applied laws within the State or the Emirate, provided that rejection decision shall be reasoned and the person, whose application had been rejected, is entitled to appeal before the competent committee in accordance with the controls stipulated in Law no. 4 of 2016. Article 9 Add Activity 1- Any new activity in the license may be added to the licensed activity through submitting an application to the Department by the license’s holder as per the form prepared for this purpose. 2- It is required in the activity to be added by the facility that it shall be homogeneous with the activities stated in the license in term of nature or specialty and in accordance with Homogeneous Activities Guide approved by the Department. Article 10 Amend License Details 1- It is not permissible to modify or change the legal form of the facility or make any amendment to the details of the license or dispose thereof by any type of legal dispositions except after submitting an application to amend or change or dispose the same to the Department by all partners or their representatives or holder of at least 75% of the shares unless there is a provision or agreement requires otherwise, or by the establishment’s owner or his representative or in case of rendering final judgments thereof. 2- In the event of approval, and according to controls placed by the Department in this regard and at the expense of the applicant, the Department shall publish brief of the amendment, change or disposition in daily newspaper issued in Arabic language for one time, and the Department shall be entitled to ask the applicant also to publish the same in a daily newspaper issued in English language as a precautionary procedure in case it deems this appropriate and serves public interest. Article 11 Object Amendment Each interested person may object making amendment or change or disposition with the competent committee within one week from the date of publishing in the newspaper, along with supporting documents attached thereto, including:  An official copy of final judicial judgment in a lawsuit related to the publishing company or establishment.  A certificate from the court of existence of lawsuit filed before the State’s courts related to the activity of the publishing company or establishment.  Urgent precautionary action writ issued by one court of the State against the publishing facility or partners’ shares.  Any documents that support the objection and accepted by the competent committee. The objection shall not be considered in the event of non-existence of grounds supported by documents and the competent committee may grant objection applicant a grace period not exceeding one week to submit the documents. Article 12 Prepare Memoranda of Association The Department shall be responsible for preparing and regulating forms of Memoranda of Association of all kinds of partnerships and concerned persons shall be entitled to amend or add in a way that does not deviate from or contradict with legislations and systems in force in this regard. Article 13 Represent The General Successor In The Facility If the title of the facility devolved, by way of inheritance or will, upon several heirs or legatees, they should select one of them to represent them in the facility and in case of non-agreement to nominate their representative, he should be appointed by judicial judgment. Article 14 Dispose of License It is permissible to dispose of the license by sale or relinquishing it in accordance with controls and procedures set by the Department. Article 15 Loss or Damage of License In case of loss or damage to the original license, the licensee, his agent or representative should submit an application to the Department to get substitute copy of the lost or damaged license after paying the due fees. Article 16 Non-Renewal of License In the event of not applying to renew the license, the annual fees of the license shall be collected for the entire delay period and the fees shall be calculated based on the value determined at the time of renewal in addition to a fine amounting to (100) dirhams for each month of delay. Article 17 Reconsider Licensing Some Activities 1- The Department may, by reasoned decision, and upon what the public interest requires, and in coordination with the competent authorities, deactivate license of some commercial, professional, industrial, agricultural and service activities for a specific period of time. 2- The Department may amend terms of commercial, professional, industrial, agricultural and service activities licenses in coordination with the competent authorities and in accordance with provisions of this law the executive regulation thereof. Article 18 Suspend or Deactivate License 1- License holder or manager in-charge or his representative may request from the Department to deactivate or suspend the license for one renewable year and the Department shall have the discretion to accept the application after payment of license suspension fees according to approved fees schedule if it found good reasons, also the Department shall be entitled to issue deactivation decision if required by the economic conditions or other reasons it deems. 2- In case of suspending or deactivating the license, the facility shall not be subject to license renewal fees and fines for the period of suspension or deactivation. Article 19 License Cancellation First: The Department is entitled to cancel the license for any of the following reasons: 1- If license holder did not apply to renew it for a period of two years from the date of its expiry or the license was not active as the facility was closed for two years. 2- If it is turned out that any of the details or documents contained in the license application is incorrect. 3- If the facility missed any of license terms and did not make regularization within the period determined by the Department for that. 4- If the facility practiced a prohibited activity according to provisions of applied laws, systems, regulations and resolutions. 5- If the facility committed fraud and concealment in the transactions without affecting the right of the Department and third parties to take all other legal procedures. 6- If required documents and approvals are not completed according to the rules and systems set by the Department in this regard. 7- Upon the request of the license holder after fees and fines had been paid, abated or exempted therefrom in accordance with controls set by the Department in this regard. Second: The Department shall publish cancellation decision within one month from the date thereof on its websites and a newspaper and shall paste cancellation decision at the Facility for two weeks. Third: Cancellation decision shall not result abating obligations of the license and the Department shall be entitled, and in coordination with the competent authorities, to take all necessary legal procedures and administrative measures to meet these obligations according to the legislations in force. Article 20 Facility Legal Form The economic activity shall be carried on in the Emirate through a facility that takes one of following legal forms: 1- Sole Establishment. 2- Civil Business Company 3- One form of commercial companies stated in Companies Law. 4- Branch of national or foreign company or one branch of the companies operating in the Free Zone of the Emirate. Article 21 Carry on Professional & Occupational Activities Subject to provisions stated in Federal Law no. 18 of 1995 on Simple Crafts, natural persons may carry on professional or occupational business through establishing a “Business Company” according to provisions of the legislations in force and systems issued by the Department in this regard and legal person may be a partner in the “Business Company” provided that nature of its activity shall be similar to the activity to be carried on. Article 22 Service Agent Non locals may carry on professional or occupational business provided that they have “National Service Agent” and Service Agent may be a legal person provided that all partners therein shall hold UAE Nationality according to the requirements and systems in force. Article 23 Make Service Agency & Business Company Contract. 1- The Department shall prepare a standard business company contract that conforms to provisions of Federal Civil Transactions Law. 2- The Department shall prepare a standard service agency contract that regulates the relationship between the Service Agent and Owner of the economic, professional or occupational business. 3- The Department shall prepare a special register in which names of Service Agents, establishment name, license number and registration date thereof and whatever necessary are recorded. Article 24 Service Agent Obligations & Liability 1- Obligations of Service Agent towards his client shall be limited to do the necessary and legal tasks that enable him to practice his economic activity in the Emirate. 2- The Investor shall be solely and fully responsible towards third parties for any debts and any legal commitments that may be due from him as date of signing service agent contract and which may be resulted from practicing his activity in the Emirate. 3- Service Agent may not be agent for more than three crafts licenses. Article 25 Service Agency Contract Expiry The Service Agent contract shall expire if any of the following matters occurs: 1- Expiry of its term unless the two parties agreed on renewal in writing for another term. 2- Death of one of the two parties. 3- Declare Investor’s bankruptcy. 4- Investor stopped the business officially. 5- Upon the request of the Investor or Service Agent, the Department shall terminate Service Agent contract if it found good reasons for this and the executive regulation shall regulate procedures and mechanism of terminating contract of Service Agent. Article 26 Foreign Companies Branches Subject to provisions of Federal Law no. 2 of 2015 on Commercial Companies, foreign companies may open one branch or more in the Emirate according to the following conditions: 1- Submit an application to open company’s branch to the Department as per the form approved for this, provided that it shall be signed by the concerned persons or the legal representative of the company. 2- Obtain approval of the Department on licensing the activity of the branch after obtaining license from Ministry of Economy. 3- Obtain approval of authorities related to the activity to be licensed as per its nature and legal form and such approval shall continue throughout the term of the license unless the related authority notifies the Department otherwise. 4- Existence of UAE Service Agent for the branch and if the Service Agent is a company, all partners shall be UAE citizens Article 27 Trade Name 1- The Department is entitled to change the trade name of the licensed facility if it is proved that such trade name does not conform to reality or leads to misleading or breaches the public order or morals or constitutes transgression on rights of third parties within the Emirate or abroad. 2- Each interested party is entitled to object the trade name and request changing it with the Competent Committee according to the controls set by the Department in this regard. Article 28 Location of Carrying On Economic Activity 1- The Department shall inspect and technically assess the locations of the facilities as per economic activities for the purpose of licensing or renewing or amending and it is required that this location shall commensurate with the activity to be licensed. 2- The location of the facility is the place in which it is allowed to carry on the activity and in case of expanding the location, approval of the Department should be obtained before making such expansion, but in the event that expansion requires finding other separate location, such location shall be considered other branch of the facility and should obtain license and it is not permissible to use this location for purposes other than those determined in the license. 3- Approval of the Department should be obtained and due fees should be paid for each warehouse or store belonging to the facility for which the license had been issued. 4- The warehouses or stores of the facilities shall be used for the purposes determined therefor and it is not permissible to rent them or allow using or utilizing the same for purposes other than those for which they had been allocated, without approval of the Department. Article 29 Exception From Location Condition Subject to what stated in article (28) of this law, the Department may issue licenses to carry on some economic activities determined by it for UAE citizens in their places of residence or through business incubators and the executive regulation shall regulate controls and procedures of issuing these licenses and how to control them. Article 30 Facility Obligations The Facility should commit to the following: 1- Legislations and laws in force in the Emirate. 2- Terms and controls of the licensed economic activity. 3- Notify the Department of any change or amendment to the details or documents based on which license had been granted, within one week from the date thereof, provided that this change or amendment shall conform to provisions of legislations in force in the State or Emirate. 4- Use its own trade name stated in the license granted thereto in all its transactions with third parties. 5- Enable the authorized employees of the Department to enter the facility and review details and records thereof which are necessary for them to do their duties. 6- Provide the Department with any information, details or statistics that it may request to help in achieving its objectives and exercising its competences stated in this law. Article 31 License Services Centers The Department shall, in coordination with competent authorities, establish unified platform as Facilities Licensing Service Center, through which the Department receives facilities licensing applications and deals with investors, professionals and craftsmen. Article 32 Use License System Within Free Zones The Department shall, upon the request of Free Zones Authorities, permit the later to use electronic programs and systems of facilities licensing in order to use them upon licensing the facilities operating within such zones, in a way that conforms with the procedures in force therein. Article 33 Regulate licensing of Facilities Operating In The Free Zone The licensed facilities in the free zones may open branches for them within the Emirate in accordance with procedures and controls set by the Department and in coordination with Free Zones Authorities in this regard. Article 34 Delegation of Competences The Department is entitled to delegate any of its competences stipulated in this law, in field of facilities licensing or renewing the same or others, to any public or private authorities, in order to facilitate and accelerate the procedures. Article 35 Trade Permit Granting Procedures A trade permit to carry on marketing activities shall be granted to facilities in the Emirate in accordance with the following procedures:  Trade permit application shall be submitted on the form prepared with the Department.  The Department shall consider this application to ensure that it meets all provisions and terms that regulate the type of the marketing activity required to be carried on, in coordination with the competent authorities.  The trade permit application shall be decided upon by the Department in accordance with the approved controls and conditions in this regard.  Term of the trade permit granted to the facility to carry on the marketing activity shall be according to number of terms approved with the Department in this regard. Article 36 Commercial Register 1- The Department shall have the competence to prepare and maintain the commercial register to record traders and all business companies licensed in the Emirate according to conditions and requirements stated in the Federal Commercial Register Law. 2- The trader, branch manager or commercial agent should apply, according to the conditions determined for recording, to enter in the commercial register each change or amendment to details stated in the register, within one month from the date of act or incident which gives rise to the change or amendment. 3- The Department shall have the competence, in case of receiving copy of the judgment or official notice from Execution Administration in Courts Department, to make entry in the commercial register by virtue of the following judicial judgments: a- Judgments of declaring or cancelling bankruptcy. b- Judgments of ratifying or nullifying composition of bankruptcy. c- Decisions of imposing interdiction on the trader or appointing trustee and proxies or dismiss them or lift interdiction. d- Judgments of dismissing those who are responsible for managing the company. e- Judgments of company’s dissolution or nullification and appointment and dismissal of liquidators. f- Judgments of rehabilitation. Article 37 Craftsmen Register The Department shall prepare craftsmen register and determine its details and procedures of registering therein and it shall notify Ministry of Social Affairs thereof and changes made thereto. Article 38 Register Shop Mortgage 1- Subject to provisions of Law no. 18 of 1993 on Promulgating Commercial Transactions Law, any act, which subject is mortgage of shop, should be authenticated and ratified by Notary Public and recorded in the commercial register in the Department, otherwise, it shall be void and the disposition should contain the following details:  Names, nationalities and places of residence of contracting parties.  Date and type of act.  Type and address of the shop and items agreed to be included in the act.  Price of material and intangible items, each of them separately, if the disposition is sale and the paid part thereof upon concluding the contract and how the remaining part shall be paid.  Agreements in respect of contracts and covenants related to the shop, if any.  Agreements related to Seller’s retention of rescission, termination or concession rights, if any. 2- The Department shall, upon the request and at the expense of the mortgagor, publish brief of mortgage contract twice in two daily newspapers in the Estate in Arabic and English languages with a period of one week between each of them. This published brief shall include names, nationalities and places of residence of the contracting parties, specify the shop, total price and empower creditors to object before the competent committee within ten days from publishing date. 3- Objection shall result in suspending registration procedures till it is decided upon by the competent committee which may direct the parties to resort to judiciary. 4- The Department shall get 2% of mortgage value as fees in order to register or renew the mortgage. Article 39 Electronic Extracts Authenticity All electronic deeds, records and documents extracted through the electronic programs and systems of the Department shall have the same authenticity of the official deeds, unless it is proved otherwise. Article 40 Fees Collection The Department shall collect fees from the facilities and branches thereof against licenses, permits and all services provided thereby pursuant to a resolution issued by the Ruler or Crown Prince, Chairman of Executive Council. Article 41 Regulate Electronic Commerce 1- The Department shall regulate the process of electronic trade transactions for the websites of companies operating in the Emirate to control carrying on trade activities through websites, according to the legislations in force. 2- The Department shall grant accreditation to electronic trade transactions. 3- The Department shall issue licenses to carry on electronic trading activities in coordination and cooperation with Telecommunications Regulatory Authority (Named now as Telecommunications & Digital Government Regulatory Authority). 4- The Department shall add licensed websites on the website of the Department. Article 42 Electronic Commerce Regulation Objectives Electronic commerce regulation in the Emirate aims at achieving the following: 1- Build up and enhance consumers’ confidence in companies’ websites. 2- Reduce fraud opportunities in electronic commerce. 3- Encourage websites within the Emirate to comply with the objective of the government to get the accreditation. 4- Subject companies that deal electronically to get the national link (ae.) from the empowered authorities within the State. 5- Increase volume of electronic commerce operations. Article 43 Terms of Obtaining License to Carry On Electronic Commerce. 1- Use the national domain (ae.) and hosting the website shall be within United Arab Emirates. 2- Sign an acknowledge to bear all liabilities towards rights of customers and consumers in respect of contents of what is displayed on the website. 3- The contents of the website shall be protected by encryption and electronic certificates belonging to trading and electronic commerce operations. Article 44 Block Content On The Website The Department is entitled, in coordination with Telecommunications Regulatory Authority (Named now as Telecommunications & Digital Government Regulatory Authority), to block the violating content on the website along with indicating the violation and in case of failure to do that, the Department is entitled to mention such violating content on its website till the violation is addressed. Article 45 Penalties Without prejudice to any more severe penalty stipulated by any other law, anyone violates the provisions of this law or resolutions issued thereunder, shall be punished by a fine not less than (200) dirhams and not exceeding (100.000) one hundred thousand dirhams. Article 46 Amicable Settlement 1- The Department may , upon the request of the violating authority, make amicable settlement with it according to the following terms:  Submit settlement application.  Pay at least )50%( of the fine imposed thereon.  The violating facility should not commit previously any similar violations during the last year of committing the violation to be settled amicably.  Any other terms set by the Department. 1- The facility should execute the terms of the amicable settlement during the period determined by the Department, otherwise the settlement shall be considered null and void. Article 47 Judicial Police Employees of the Department, designated by resolution from Crown Prince, Chairman of Executive Council, based on suggestion of the President of the Department, shall be empowered with capacity of law officer to inspect, control and prove acts that violate the provisions of this law as well as all applied laws within the State or Emirate or resolutions issued in implementation thereof and in order to do this, they shall be entitled to enter the economic facilities and make necessary reports in this regard in case of existence of violations and take necessary legal procedures and all local authorities and facilities in the Emirate should enable and cooperate with them in performing the works entrusted thereto according to the aforementioned laws. Article 48 Department Resolutions Grievance Each interested party may submit grievance in writing to Director-General against resolutions and procedures taken against him by the Department in implementation of provisions of this law within (30) days from the date of being aware of the resolution or procedure, before the competent committee according to the controls stipulated in Law no. 4 of 2016 on Restructuring & Regulating Department of Economic Development. Article 49 Regularization 1- The facilities that had been licensed before promulgation of this law should regularize their conditions in accordance with the provisions thereof during a period not exceeding one year from the date such law came into force and the Director-General may extend this period for other similar one. 2- Facilities licensed upon orders or instructions issued by His Highness the Ruler shall be excluded from the provisions of this law and rules set by the Department in this regard shall be applied thereto. Article 50 Executive Regulation Chairman of the Executive Council shall promulgate the executive regulation of this law. Article 51 Bylaws & Regulatory Resolutions The Director-General shall promulgate necessary bylaws and regulatory resolutions. Article 52 Repeal Previous Legislations Each text which provisions contradict with the provisions of this law shall be repealed. Article 53 Law Enforcement This law shall come into force as date of its promulgation and be published in the Official Gazette. Saud Bin Saqr Bin Mohamed Al Qasimi Ruler of Ras Al Khaimah Issued by us on this day, eleventh of Safar 1438 H. Corresponding to eleventh of November 2016 G.
  • Definitions 
    Words and phrases stated in this law shall have the meanings indicated against each of them, unless context requires otherwise:
    State: United Arab Emirates. 
    Emirate:  Emirate of Ras Al Khaimah.
    Ruler: His Highness Ruler of the Emirate.
    Council: Executive Council of the Emirate.
    Department:  Department of Economic Development in the Emirate.
    Department President: President of Economic Development Department.
    Director-General: Director General of Economic Development Department.  
    Economic Activity: Any commercial, industrial, occupational, professional, agricultural or service activity or any other activity aims at achieving profit that may be carried on in the emirate according to legislations in force.  
    Competent Authority: Any local or federal authority that falls within the competences thereof by legislations in force, regulating and controlling an economic activity or more. 
    Facility: Any company or establishment licensed to carry on the economic activity in the Emirate with exception of facilities not fallen within the competences of the Department according to applied laws in the State or Emirate. 
    Branch: Place designated by the facility as a center to practice and carry on its activity away from its head office.
    Establishment: Facility owned by natural person to carry on the economic activity in the emirate and personality thereof shall not separate from its owner given that its financial liability is linked to him as he is responsible for all financial obligations incurred thereby towards third parties. 
    Trade Name: Each name under which the trader carries on the commercial activity and the right to use it shall be limited to the holder thereof. 
    License: The document under which the Department permits natural or legal person to carry on a specific activity. 
    Trade Permit: A document includes approval granted by the Department to the facility to carry on marketing activity. 
    Marketing Activity: The activity conducted by the facility to market its products and services by commercial advertisements and billboards or clearance offers, sale, promotional campaigns or exhibitions and conferences or other marketing activities. 
    Professional or Occupational Activity: The activity carried on by a natural person or more which depends on his physical or mental effort or seeking the assistance of some tools and equipment with limited capital. 
    Business Incubators: set of services and facilities and support mechanisms in technical, administrative and consulting fields, provided by a competent authority for limited period of time in order to encourage establishing and developing small and medium enterprises.  
    Unified Register: The approved register with the Department to document data and information of establishments and companies. 
    Competent Committee: Customer Complaints & Grievances Committee in Department of Economic Development. 
    Service Agent: A local person whose job is limited to provide the necessary services to facilities without incurring any liability or financial obligations related to the business of the facility and the Service Agent may be a company provided it is holding the UAE nationality and all partners thereof shall be UAE persons. 

  • Law Enforcement
    The provisions of this law shall apply to all facilities and business that are subject to the competence of the Department according to the laws in force in the State & Emirate. 
     
  • Law Objectives 
    This Law aims at achieving the following:
    1- Regulate carrying on the economic activities in the Emirate and create stimulating environment for investment in various economic fields. 
    2- Create a single platform through which coordination among competent authorities shall be conducted to meet requirements needed to license carrying on the economic activities in the Emirate.
    3- Raise economic growth rates in the Emirate.
    4- Develop the economic environment in the Emirate through depending on information accuracy and transparency and provide the same by the latest technologies to enable investors to benefit therefrom. 
    5- Contribute to marketing and promotional plans and spread the economic and investment awareness and determine the available investment opportunities in the Emirate.
     
  • Department Competences
    For the purposes of achieving the objectives of this law, the Department shall regulate carrying on the economic activities in the Emirate, therefore, it is entitled to: 
    1- Develop necessary rules and controls to regulate granting licenses to carry on the economic activities in the Emirate and determine details and terms of these licenses and how to amend details stated therein within the framework of the legislations in force and in coordination with the competent authorities. 
    2- Regulate registering and recording facilities in the commercial register.  
    3- Register and keep trade names of the facilities. 
    4- License the economic activities in the Emirate according to the applied laws, systems and regulations in coordination with the competent authorities. 
    5- Set and classify the economic activities that may be carried on in the Emirate according to the latest internationally recognized systems and develop and update the same periodically in accordance with the needs of the economic activity and requirements of the economic development therein.
    6- Issue trade permits for marketing activities according to the requirements and controls approved therewith in this regard. 
    7- Organize and determine working hours of the operating facilities in the Emirate according to the controls approved therewith in this regard. 
    8- Control and inspect intellectual property rights, combat commercial fraud, combat money laundry, manage commercial and consumer protection operations in the Emirate according to the laws in force in this regard and in coordination with the competent authority.   
    9- Control and inspect all facilities fallen within the competence of the Department to ensure their commitment to the laws and regulations in force in the Emirate. 
     
  • Economic Activities Classification
    Economic activities licenses shall be granted in the fields related to trade, industry, agriculture, fishery, mining, services and other activities, according to Economic Activities Guide approved by the Department, taking into account the regulations and regulatory resolutions issued by Ministry of Economy, as well as international and global classifications issued in this regard. 
     
  • Issue License
    No natural or legal person may carry on the economic activity in the Emirate before obtaining license to do so from the Department in accordance with terms and controls prescribed in Law no. 4 of 2016 on Restructuring and Organizing Department of Economic Development and the executive regulation thereof.
     
  • License Term 
    1- Facility License term shall be one Gregorian year which shall be renewable for similar terms and it is permissible, upon the request of the facility and approval of the Department and in coordination with the competent authorities, that the term of the license shall be more than one year and not more than five years.  
    2- The facility should renew its license within the last month from its expiry and this shall not prejudice the right of the Department to grant the facility a grace period according to the controls placed thereby in this regard. 
     
  • Accept or Reject License Application 
    The Department may, at its own discretion, accept or reject granting license for public interest requirements and in accordance with the provisions of applied laws within the State or the Emirate, provided that rejection decision shall be reasoned and the person, whose application had been rejected, is entitled to appeal before the competent committee in accordance with the controls stipulated in Law no. 4 of 2016. 
     
  • Add Activity
    1- Any new activity in the license may be added to the licensed activity through submitting an application to the Department by the license’s holder as per the form prepared for this purpose. 
    2- It is required in the activity to be added by the facility that it shall be homogeneous with the activities stated in the license in term of nature or specialty and in accordance with Homogeneous Activities Guide approved by the Department. 
     
  • Amend License Details
    1- It is not permissible to modify or change the legal form of the facility or make any amendment to the details of the license or dispose thereof by any type of legal dispositions except after submitting an application to amend or change or dispose the same  to the Department by all partners or their representatives or holder of at least 75%  of the shares unless there is a provision or agreement requires otherwise, or by the establishment’s owner or his representative or in case of rendering final judgments thereof. 
    2- In the event of approval, and according to controls placed by the Department in this regard and at the expense of the applicant, the Department shall publish brief of the amendment, change or disposition in daily newspaper issued in Arabic language for one time, and the Department shall be entitled to ask the applicant also to publish the same in a daily newspaper issued in English language as a precautionary procedure in case it deems this appropriate and serves public interest.    
     
  • Object Amendment
    Each interested person may object making amendment or change or disposition with the competent committee within one week from the date of publishing in the newspaper, along with supporting documents attached thereto, including:
    An official copy of final judicial judgment in a lawsuit related to the publishing company or establishment. 
    A certificate from the court of existence of lawsuit filed before the State’s courts related to the activity of the publishing company or establishment.
    Urgent precautionary action writ issued by one court of the State against the publishing facility or partners’ shares.
    Any documents that support the objection and accepted by the competent committee. 
    The objection shall not be considered in the event of non-existence of grounds supported by documents and the competent committee may grant objection applicant a grace period not exceeding one week to submit the documents.  
     
  • Prepare Memoranda of Association
    The Department shall be responsible for preparing and regulating forms of Memoranda of Association of all kinds of partnerships and concerned persons shall be entitled to amend or add in a way that does not deviate from or contradict with legislations and systems in force in this regard. 
     
  • Represent The General Successor In The Facility
    If the title of the facility devolved, by way of inheritance or will, upon several heirs or legatees, they should select one of them to represent them in the facility and in case of non-agreement to nominate their representative, he should be appointed by judicial judgment. 
     

  • Dispose of License
    It is permissible to dispose of the license by sale or relinquishing it in accordance with controls and procedures set by the Department.
     
  • Loss or Damage of License
    In case of loss or damage to the original license, the licensee, his agent or representative should submit an application to the Department to get substitute copy of the lost or damaged license after paying the due fees. 
     
  • Non-Renewal of License
    In the event of not applying to renew the license, the annual fees of the license shall be collected for the entire delay period and the fees shall be calculated based on the value determined at the time of renewal in addition to a fine amounting to (100) dirhams for each month of delay. 
     
  • Reconsider Licensing Some Activities
    1- The Department may, by reasoned decision, and upon what the public interest requires, and in coordination with the competent authorities, deactivate license of some commercial, professional, industrial, agricultural and service activities for a specific period of time. 
    2- The Department may amend terms of commercial, professional, industrial, agricultural and service activities licenses in coordination with the competent authorities and in accordance with provisions of this law the executive regulation thereof. 
     
  • Suspend or Deactivate License
    1- License holder or manager in-charge or his representative may request from the Department to deactivate or suspend the license for one renewable year and the Department shall have the discretion to accept the application after payment of license suspension fees according to approved fees schedule if it found good reasons, also the Department shall be entitled to issue deactivation decision if required by the economic conditions or other reasons it deems.  
    2- In case of suspending or deactivating the license, the facility shall not be subject to license renewal fees and fines for the period of suspension or deactivation. 
     
  • License Cancellation
    First: The Department is entitled to cancel the license for any of the following reasons: 
    1- If license holder did not apply to renew it for a period of two years from the date of its expiry or the license was not active as the facility was closed for two years.
    2- If it is turned out that any of the details or documents contained in the license application is incorrect. 
    3- If the facility missed any of license terms and did not make regularization within the period determined by the Department for that. 
    4- If the facility practiced a prohibited activity according to provisions of applied laws, systems, regulations and resolutions.
    5- If the facility committed fraud and concealment in the transactions without affecting the right of the Department and third parties to take all other legal procedures.  
    6- If required documents and approvals are not completed according to the rules and systems set by the Department in this regard. 
    7- Upon the request of the license holder after fees and fines had been paid, abated or exempted therefrom in accordance with controls set by the Department in this regard.   
    Second: The Department shall publish cancellation decision within one month from the date thereof on its websites and a newspaper and shall paste cancellation decision at the Facility for two weeks. 
    Third: Cancellation decision shall not result abating obligations of the license and the Department shall be entitled, and in coordination with the competent authorities, to take all necessary legal procedures and administrative measures to meet these obligations according to the legislations in force.   
     
  • Facility Legal Form
    The economic activity shall be carried on in the Emirate through a facility that takes one of following legal forms: 
    1- Sole Establishment.
    2- Civil Business Company 
    3- One form of commercial companies stated in Companies Law. 
    4- Branch of national or foreign company or one branch of the companies operating in the Free Zone of the Emirate. 
     
  • Carry on Professional & Occupational Activities
    Subject to provisions stated in Federal Law no. 18 of 1995 on Simple Crafts, natural persons may carry on professional or occupational business through establishing a “Business Company” according to provisions of the legislations in force and systems issued by the Department in this regard and legal person may be a partner in the “Business Company” provided that nature of its activity shall be similar to the activity to be carried on. 
     
  • Service Agent
    Non locals may carry on professional or occupational business provided that they have “National Service Agent” and Service Agent may be a legal person provided that all partners therein shall hold UAE Nationality according to the requirements and systems in force. 
     
  • Make Service Agency & Business Company Contract.
    1- The Department shall prepare a standard business company contract that conforms to provisions of Federal Civil Transactions Law. 
    2- The Department shall prepare a standard service agency contract that regulates the relationship between the Service Agent and Owner of the economic, professional or occupational business.
    3- The Department shall prepare a special register in which names of Service Agents, establishment name, license number and registration date thereof and whatever necessary are recorded. 
     
  • Service Agent Obligations & Liability
    1- Obligations of Service Agent towards his client shall be limited to do the necessary and legal tasks that enable him to practice his economic activity in the Emirate. 
    2- The Investor shall be solely and fully responsible towards third parties for any debts and any legal commitments that may be due from him as date of signing service agent contract and which may be resulted from practicing his activity in the Emirate. 
    3- Service Agent may not be agent for more than three crafts licenses. 
     
  • Service Agency Contract Expiry
    The Service Agent contract shall expire if any of the following matters occurs: 
    1- Expiry of its term unless the two parties agreed on renewal in writing for another term. 
    2- Death of one of the two parties. 
    3- Declare Investor’s bankruptcy. 
    4- Investor stopped the business officially. 
    5- Upon the request of the Investor or Service Agent, the Department shall terminate Service Agent contract if it found good reasons for this and the executive regulation shall regulate procedures and mechanism of terminating contract of Service Agent. 
     
  • Foreign Companies Branches
    Subject to provisions of Federal Law no. 2 of 2015 on Commercial Companies, foreign companies may open one branch or more in the Emirate according to the following conditions:  
    1- Submit an application to open company’s branch to the Department as per the form approved for this, provided that it shall be signed by the concerned persons or the legal representative of the company. 
    2- Obtain approval of the Department on licensing the activity of the branch after obtaining license from Ministry of Economy. 
    3- Obtain approval of authorities related to the activity to be licensed as per its nature and legal form and such approval shall continue throughout the term of the license unless the related authority notifies the Department otherwise. 
    4- Existence of UAE Service Agent for the branch and if the Service Agent is a company, all partners shall be UAE citizens   
     
  • Trade Name
    1- The Department is entitled to change the trade name of the licensed facility if it is proved that such trade name does not conform to reality or leads to misleading or breaches the public order or morals or constitutes transgression on rights of third parties within the Emirate or abroad.   
    2- Each interested party is entitled to object the trade name and request changing it with the Competent Committee according to the controls set by the Department in this regard. 
     
  • Location of Carrying On Economic Activity
    1- The Department shall inspect and technically assess the locations of the facilities as per economic activities for the purpose of licensing or renewing or amending and it is required that this location shall commensurate with the activity to be licensed.
    2- The location of the facility is the place in which it is allowed to carry on the activity and in case of expanding the location, approval of the Department should be obtained before making such expansion, but in the event that expansion requires finding other separate location, such location shall be considered other branch of the facility and should obtain license and it is not permissible to use this location for purposes other than those determined in the license. 
    3- Approval of the Department should be obtained and due fees should be paid for each warehouse or store belonging to the facility for which the license had been issued. 
    4- The warehouses or stores of the facilities shall be used for the purposes determined therefor and it is not permissible to rent them or allow using or utilizing the same for purposes other than those for which they had been allocated, without approval of the Department. 
     
  • Exception From Location Condition
    Subject to what stated in article (28) of this law, the Department may issue licenses to carry on some economic activities determined by it for UAE citizens in their places of residence or through business incubators and the executive regulation shall regulate controls and procedures of issuing these licenses and how to control them.  
     
  • Facility Obligations
    The Facility should commit to the following:
    1- Legislations and laws in force in the Emirate.
    2- Terms and controls of the licensed economic activity.
    3- Notify the Department of any change or amendment to the details or documents based on which license had been granted, within one week from the date thereof, provided that this change or amendment shall conform to provisions of legislations in force in the State or Emirate. 
    4- Use its own trade name stated in the license granted thereto in all its transactions with third parties.
    5- Enable the authorized employees of the Department to enter the facility and review details and records thereof which are necessary for them to do their duties.
    6- Provide the Department with any information, details or statistics that it may request to help in achieving its objectives and exercising its competences stated in this law. 
     
  • License Services Centers
    The Department shall, in coordination with competent authorities, establish unified platform as Facilities Licensing Service Center, through which the Department receives facilities licensing applications and deals with investors, professionals and craftsmen. 
     
  • Use License System Within Free Zones
    The Department shall, upon the request of Free Zones Authorities, permit the later to use electronic programs and systems of facilities licensing in order to use them upon licensing the facilities operating within such zones, in a way that conforms with the procedures in force therein. 
     
  • Regulate licensing of Facilities Operating In The Free Zone
    The licensed facilities in the free zones may open branches for them within the Emirate in accordance with procedures and controls set by the Department and in coordination with Free Zones Authorities in this regard. 
     
  • Delegation of Competences
    The Department is entitled to delegate any of its competences stipulated in this law, in field of facilities licensing or renewing the same or others, to any public or private authorities, in order to facilitate and accelerate the procedures. 
     
  • Trade Permit Granting Procedures
    A trade permit to carry on marketing activities shall be granted to facilities in the Emirate in accordance with the following procedures: 
    Trade permit application shall be submitted on the form prepared with the Department.
    The Department shall consider this application to ensure that it meets all provisions and terms that regulate the type of the marketing activity required to be carried on, in coordination with the competent authorities. 
    The trade permit application shall be decided upon by the Department in accordance with the approved controls and conditions in this regard. 
    Term of the trade permit granted to the facility to carry on the marketing activity shall be according to number of terms approved with the Department in this regard. 
     
  • Commercial Register
    1- The Department shall have the competence to prepare and maintain the commercial register to record traders and all business companies licensed in the Emirate according to conditions and requirements stated in the Federal Commercial Register Law. 
    2- The trader, branch manager or commercial agent should apply, according to the conditions determined for recording, to enter in the commercial register each change or amendment to details stated in the register, within one month from the date of act or incident which gives rise to the change or amendment. 
    3- The Department shall have the competence, in case of receiving copy of the judgment or official notice from Execution Administration in Courts Department, to make entry in the commercial register by virtue of the following judicial judgments:
    a- Judgments of declaring or cancelling bankruptcy.
    b- Judgments of ratifying or nullifying composition of bankruptcy. 
    c- Decisions of imposing interdiction on the trader or appointing trustee and proxies or dismiss them or lift interdiction.
    d- Judgments of dismissing those who are responsible for managing the company.
    e- Judgments of company’s dissolution or nullification and appointment and dismissal of liquidators.
    f- Judgments of rehabilitation. 
     
  • Craftsmen Register
    The Department shall prepare craftsmen register and determine its details and procedures of registering therein and it shall notify Ministry of Social Affairs thereof and changes made thereto.
     
  • Register Shop Mortgage
    1- Subject to provisions of Law no. 18 of 1993 on Promulgating Commercial Transactions Law, any act, which subject is mortgage of shop, should be authenticated and ratified by Notary Public and recorded in the commercial register in the Department, otherwise, it shall be void and the disposition should contain the following details: 
    Names, nationalities and places of residence of contracting parties.
    Date and type of act.
    Type and address of the shop and items agreed to be included in the act. 
    Price of material and intangible items, each of them separately, if the disposition is sale and the paid part thereof upon concluding the contract and how the remaining part shall be paid. 
    Agreements in respect of contracts and covenants related to the shop, if any. 
    Agreements related to Seller’s retention of rescission, termination or concession rights, if any.
    2- The Department shall, upon the request and at the expense of the mortgagor, publish brief of mortgage contract twice in two daily newspapers in the Estate in Arabic and English languages with a period of one week between each of them. This published brief shall include names, nationalities and places of residence of the contracting parties, specify the shop, total price and empower creditors to object before the competent committee within ten days from publishing date. 
    3- Objection shall result in suspending registration procedures till it is decided upon by the competent committee which may direct the parties to resort to judiciary.  
    4- The Department shall get 2% of mortgage value as fees in order to register or renew the mortgage. 
     
  • Electronic Extracts Authenticity
    All electronic deeds, records and documents extracted through the electronic programs and systems of the Department shall have the same authenticity of the official deeds, unless it is proved otherwise. 
     
  • Fees Collection
    The Department shall collect fees from the facilities and branches thereof against licenses, permits and all services provided thereby pursuant to a resolution issued by the Ruler or Crown Prince, Chairman of Executive Council.  
     
  • Regulate Electronic Commerce
    1- The Department shall regulate the process of electronic trade transactions for the websites of companies operating in the Emirate to control carrying on trade activities through websites, according to the legislations in force.  
    2- The Department shall grant accreditation to electronic trade transactions.
    3- The Department shall issue licenses to carry on electronic trading activities in coordination and cooperation with Telecommunications Regulatory Authority (Named now as Telecommunications & Digital Government Regulatory Authority). 
    4- The Department shall add licensed websites on the website of the Department. 
     
  • Electronic Commerce Regulation Objectives
    Electronic commerce regulation in the Emirate aims at achieving the following: 
    1- Build up and enhance consumers’ confidence in companies’ websites. 
    2- Reduce fraud opportunities in electronic commerce. 
    3- Encourage websites within the Emirate to comply with the objective of the government to get the accreditation. 
    4- Subject companies that deal electronically to get the national link (ae.) from the empowered authorities within the State. 
    5- Increase volume of electronic commerce operations. 
     
  • Terms of Obtaining License to Carry On Electronic Commerce.
    1- Use the national domain (ae.) and hosting the website shall be within United Arab Emirates. 
    2- Sign an acknowledge to bear all liabilities towards rights of customers and consumers in respect of contents of what is displayed on the website. 
    3- The contents of the website shall be protected by encryption and electronic certificates belonging to trading and electronic commerce operations. 
     
  • Block Content On The Website
    The Department is entitled, in coordination with Telecommunications Regulatory Authority (Named now as Telecommunications & Digital Government Regulatory Authority), to block the violating content on the website along with indicating the violation and in case of failure to do that, the Department is entitled to mention such violating content on its website till the violation is addressed.  
     
  • Penalties
    Without prejudice to any more severe penalty stipulated by any other law, anyone violates the provisions of this law or resolutions issued thereunder, shall be punished by a fine not less than (200) dirhams and not exceeding (100.000) one hundred thousand dirhams.  
     
  • Amicable Settlement
    1- The Department may , upon the request of the violating authority, make amicable settlement with it according to the following terms:
    Submit settlement application.
    Pay at least )50%( of the fine imposed thereon.
    The violating facility should not commit previously any similar violations during the last year of committing the violation to be settled amicably.  
    Any other terms set by the Department. 
    1- The facility should execute the terms of the amicable settlement during the period determined by the Department, otherwise the settlement shall be considered null and void. 
     
  • Judicial Police
    Employees of the Department, designated by resolution from Crown Prince, Chairman of Executive Council,  based on suggestion of the President of the Department, shall be empowered with capacity of law officer to inspect, control and prove acts that violate the provisions of this law as well as all applied laws within the State or Emirate or resolutions issued in implementation thereof and in order to do this, they shall be entitled to enter the economic facilities  and make necessary reports in this regard in case of existence of violations and take necessary legal procedures and all local authorities and facilities in the Emirate should enable and cooperate with them in performing the works entrusted thereto according to the aforementioned laws.  
     
  • Department Resolutions Grievance
    Each interested party may submit grievance in writing to Director-General against resolutions and procedures taken against him by the Department in implementation of provisions of this law within (30) days from the date of being aware of the resolution or procedure, before the competent committee according to the controls stipulated in Law no. 4 of 2016 on Restructuring & Regulating Department of Economic Development. 
     
  • Regularization
    1- The facilities that had been licensed before promulgation of this law should regularize their conditions in accordance with the provisions thereof during a period not exceeding one year from the date such law came into force and the Director-General may extend this period for other similar one.  
    2- Facilities licensed upon orders or instructions issued by His Highness the Ruler shall be excluded from the provisions of this law and rules set by the Department in this regard shall be applied thereto. 
     
  • Executive Regulation
    Chairman of the Executive Council shall promulgate the executive regulation of this law. 
     
  • Bylaws & Regulatory Resolutions
    The Director-General shall promulgate necessary bylaws and regulatory resolutions.  
     
  • Repeal Previous Legislations
    Each text which provisions contradict with the provisions of this law shall be repealed.
     
  • Law Enforcement
    This law shall come into force as date of its promulgation and be published in the Official Gazette.

Classification
  • Civil Legislation
  • Economic Legislation
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