Middle East

A. The Role of the State6 The new ordinance stipulates that the state will hold a special share in the capital of banks and financial institutions, through which the state shall be represented in their governing bodies.7 However, the state will not have the right to vote in the corporate bodies of these banks and institutions.8 Ei addition, assets of a bank or financial institution can only be transferred to third parties upon authorization of the state.9 The new ordinance also provides that the transfer of shares and similar securities must be executed within national territory and the State has the right of first refusal on such transfers.10 Furthermore, if the transfer of any such shares or similar securities is not conducted in national territory and in accordance with Algerian laws and regulations, the transfer shall be null and void.11 B. Foreign Ownership Under Article 6 of the new ordinance, foreign ownership in any future opening of banks and financial institution incorporated under Algerian law will only be allowed through a partnership with a national resident.12 Most importantly, the ordinance stipulates that Algerian national ownership must represent at least fifty-one percent of the capital. [...] the new law however imposes a flat income tax rate for all employees earning more than YER 840,000 (US$3,940) per year.