Low No. 7 Promulgates Investment Law No. (10) new

Section: Exemptions, Advantages, and Facilities

Article 13 – Foreign Currency Account

(a) The investor may open, for the benefit of his project duly approved under the provisions of the Investment Law, an account in foreign currency with the Commercial Bank of syria.
Such account shall be credited with:

1. 100% of project capital paid in foreign currency and of loans obtained in foreign currency.
2. 75% of project income in foreign currency resulting from export of goods and services.
   The remaining 25% shall be sold to the Commercial Bank of Syria at the exchange rate referred to in Article 4 of these instructions.

The said account shall be debited with all amounts required to cover all foreign currency charges, needs, and requirements of the project, including but not limited to:

• Value of plants, machinery, equipment, vehicles, materials, and supplies necessary for establishment, operation, exploitation, development, and/or extension of the project.
• Raw, semi-processed, and auxiliary materials required for production.
• Spare parts and replacement of fully depreciated machinery.
• Reimbursement installments and interest due on loans obtained by the project in foreign currency.
• Interests, profits, and dividends permitted to be transferred abroad each year by non-resident syrian/" class="auto-internal-link">syrian investors and investors from Arab and foreign countries, as well as earnings permitted to be transferred abroad by non-syrians or assimilated employees of approved projects. Such transfers shall be made through the Commercial Bank of Syria, after due confirmation by the Office.
• Any amounts due by the project in foreign currency, supported by authenticated documents and checked by the Office and approved by the Exchange Office.
• Expenses payable in foreign currency within Syria.
• Insurance premiums payable in foreign currency.
• Indemnities and bonuses of non-Syrian company directors.

(b) The project shall bear complete responsibility for ensuring all its requirements in foreign currencies by lawful means.
No official authority in the Syrian Arab Republic shall bear any liability to provide any amount in foreign currency for the project or its owners.

Article 14 – Use of Foreign Currency

The investor may invest any amounts in foreign currency being in his possession inside the country or held abroad and brought to Syria by lawful means, through:

• Financing projects approved under the Investment Law, or
• Participating in the capital or buying shares in such projects

without being held criminally liable under any penal law.

Article 15 – Banking Procedures

(a) The bank shall keep investors’ funds deposited under Article 16(a) of the Investment Law at their disposal upon first request and take all necessary measures to ensure the same.
(b) The bank shall pay interest on amounts deposited in the project’s foreign currency account at rates in line with current international levels.
(c) The investor may deposit some assets in a time account in foreign currency with the Commercial Bank of Syria.
(d) Special cheque books shall be issued to investors with foreign-currency deposits, used only for the project’s benefit.
(e) The Commercial Bank of Syria shall ensure the transfer abroad of all charges, needs, and requirements of the project in foreign currency according to these rules.

Article 16 – Local Currency Loans

The investor may obtain loans in local currency for his project from state-owned banks, under the guarantee of his personal assets located in Syria, in accordance with the rules applied by those banks.

Article 17 – Independent Economic Entity

Each project shall be considered as an independent economic enterprise, regardless of the persons of its owners, and shall benefit as such from all exemptions, advantages, and facilities provided for in the Investment Law and detailed herein.

Article 18 – Import Privileges

(a) Notwithstanding any legal provisions to the contrary (import restrictions, monopolies, or foreign exchange controls), the project may import:

1. All its requirements of plants, machinery, equipment, tools, vehicles (including buses and micro-buses used for project service), and other materials and supplies required for the establishment, development, and/or extension of the project.
2. Tourist vehicles for the service of the project.
3. All materials and supplies required for the operation and exploitation of the project (raw, semi-processed, and processed materials, etc.).

The competent authority shall determine the number and types of transport means required according to criteria adopted by the Council.

(b) Project imports specified in item (1) of paragraph (a) shall be exempted from all fiscal and municipal taxes, custom duties, and other taxes and duties, provided they are used exclusively for project purposes.

(c) The project may not dispose of any imports specified in item (1) of paragraph (a) without prior Council approval and only after payment of all taxes and duties due on them in their current condition at the time of disposal, including capital gain tax (Article 32 of the Law).
Likewise, imports specified in items (2) and (3) of paragraph (a) may not be disposed of or used for purposes other than the project without Council approval and justification.

These provisions do not apply to packing materials (pallets, drums, etc.) or to manufacturing waste within internationally acceptable proportions.

For the purpose of applying Article 12(a) of the Investment Law, imports mean all plants, machinery, equipment, instruments, tools, vehicles, buses, micro-buses, and other imported materials and supplies necessary for project establishment, extension, or development, and disposed of to third parties, in whole or part, with Council approval.

Disposal by transfer of project ownership, in whole or part, after approval by the Council, shall be governed by Article 32 of the Investment Law.

Article 19 – Tax Exemptions

(a) Projects belonging to individuals or companies other than joint-sector companies — their profits and dividends — shall be exempted from all taxes on income and from taxes on real estates and fixed assets (including machinery) used exclusively for project purposes. This exemption shall last five years from the beginning of actual production or exploitation.

(b) Joint-sector projects established under the Investment Law, with public-sector participation not less than 25% of capital, shall take the form of corporations or limited-liability partnerships. Such joint-sector companies, their shares, funds, profits, and dividends shall be exempted from all income, real-estate, and fixed-assets taxes (including machinery) for seven years from the start of production or exploitation.

(c) Beginning of actual production or exploitation means the date when commercial production or exploitation begins.
(d) Establishment period means the day immediately following the date of publication of the order permitting the project in the Official Gazette (for the purpose of Article 14 of the Law).

Article 20 – Extension of Exemption Period

By resolution of the Council, the exemption period under Article 13 of the Investment Law shall be extended two additional years if the project’s exports of goods and services, transferred in foreign currency to Syria through its banking system, exceed 50% of total production during the exemption period.

Article 21 – Stamp Duty Exemption

Joint-sector companies established under the Investment Law in the form of corporations shall be exempted from stamp duties on the issue of their shares.