President of the Republic, Recalling the rules of the Constitution and Approval by the People's Assembly in its session held on 25.4.1991, issues:
Article One
This law bears effects on the money invested by Syrian Arab citizens, both residents and expatriates, and citizens of Arab and foreign countries, in investment projects within the framework of the state general socio-economic development plans and the general policy of the state.
Article Two
The following terms used in the application of the rules of this law shall mean the following:
a- Council = Higher Council of Investment
b- Council Chairman = Chairman of the Higher Council Investment.
e- Bureau = Bureau of Investment
d- Project = Project undertaken by a natural person or a leg person with a local or foreign capital, or both, and governed by the rule of this law
e- investor Natural or legal person who obtains a license to set a project in accordance with the rules of this law
f- Authority in charge = Public authority concerned
g- Foreign fund = Fund primarily supplied from abroad by Syria, Arab or foreign citizens.
Chapter I: Fields of investment Article Three
Rules of this law shall be applied to economic and social development projects approved by the council in the following fields:
a- agricultural projects, both vegetation and livestock, including various agricultural products manufacturing projects
b- industrial projects allowed to both private and joint sectors
e- transport projects
d- projects approved by the council to be governed by the rules of this law
Article Four
When approving projects, the following points shall be taken into consideration:
a- to be in line with the aims of the state development plans
b- to use as much as possible the local resources available for the national economy
e- to contribute to increasing the gross national product and employment opportunities
d- to lead to increasing exports and rationalising imports
e- to use up-to-date machines and technologies which are suitable for the national economy needs
f- that the stable assets which would be invested in the project, including machines, tools, equipment, apparatus, means of transport (non-tourist) and all other production means definitively imported to be used exclusively in the project, shall not be less than ten million Syrian Pounds. This amount can be modified by a decision passed by the Council of Ministers.
Chapter II: The Higher Council of Investment Article Five
(a) A higher council of investment shall be founded, comprising:
- the Prime Minister as chairman
- The Deputy Prime Minister for Economic Affairs as vice-chairman
- The Deputy Prime Minister for Services Affairs
- The Minister of Agriculture and Agrarian Reform
- The Minister of Transport
- The Minister of Supply and Internal Trade
- The Minister of Economy and Foreign Trade
- The Minister of Industry
- The Minister of State for Planning Affairs,
- The Minister of Finance as members.
- The Director of Investment Bureau as a deciding member
(b) The chairman of the council may invite to the council's meetings experts and other people concerned with the subjects under discussion by the council, provided that they have no right to vote.
Article Six
The council shall have the following powers:
a- approving for the natural and legal persons to initiate development projects governed by the rules of this law and the authority charge shall subsequently issue the relevant licenses.
b- specifying the state's contribution to the capitals of the joint-stock companies.
c- issuing licenses for setting up joint-stock, share-holding and limited liability companies governed by the rules of paragraph (a) of this article, as per a decision passed by the Prime Minister.
d- entrusting concerned authorities with preparing initial economic feasibility studies for the development projects failing within the fields specified by this law.
e- adopting the assessment of foreign funds, prepared by the authority in charge.
Article Seven
The council shall convene at a call by its chairman once every two months, at least, and whenever necessary.
Article Seven
Article Eight
By a decision by the Prime Minister, an investment bureau affiliated to the Deputy Prime N4iiiister for Economic Affairs shall be set up and assigned with preparing and referring to the council the projects submitted to it by the concerned authorities. It shall also be assigned with following up the implementation of decisions passed by the council, receiving the investor's complaints and working to settle them. It shall also discharge all tasks entrusted to it by the council.
Article Nine
All statements and special data offered by the investors on their
projects shall not be for publication or circulation.
Chapte III: Franchises, privileges and facilities Article Ten
According to rules of this law, all projects approved enjoy exemptions, privileges, facilities and guarantees.
Article 11
Projects approved to be set up according to the rules of this law may Import:
a- all requirements of machines, vehicles, apparatus, equipment, means of transport, buses and mini-buses, that are needed to serve the projects, and other materials necessary for setting up, expanding and developing these projects.
b- cars.
c- all materials and requirements necessary for running these projects. The concerned authority determines the quantity and sort of various means of transport mentioned in paragraphs (a) and (b) of this article and according to the rules determined by the council.
The import processes mentioned in the previous paragraphs are carried out irrespective of the rules prohibiting and restricting imports and irrespective of the rules of importing directly from the country of origin and the rules of hard currency regulations.
Article 12
(a) Imports quoted in paragraph (a) of Article (11) of this law are exempted from all taxes and fiscal stamp, local and customs duties and otherwise, provided that they are exclusively used to serve the goals of the project, and that they cannot be relinquished to a third party except by the council's consent and after paying the taxes and duties levied on them in their present condition.
(b) The project's imports specified in paragraphs (b) and (c) of Article (11) of this law cannot be relinquished or used in service of other purposes than the project, except by an approval by the council.
Article 13
(a) Joint-stock companies approved according to the-rules of this law, together with their shares, funds, profits and dividends, are exempted from all taxes levied on income and real estates owned by the companies to achieve their purposes and fulfill their tasks, for seven years right from the date of actual production or investment according to the nature of the project.
(b) Projects related to individuals or non-joint-stock companies licensed according to rules of this law, together with their profits and dividends, shall be exempted from all taxes imposed on income and from the real-estate taxes on the buildings owned for realizing the project's objectives and tasks, for five years right from the date of actual production or investment, according to the nature of the project.
Article 14
In case the time spent on establishing the project approved according to the rules of this law exceeds three years, then this period shall be deducted from the duration of tax exemption quoted in paragraphs (a) and (b) of Article (13) of this law.
Article 15
By a decision of the council, an additional period of two years may be added to the duration of exemption quoted in Article (13) of this law, should the total revenues in foreign currencies actually transferred into the Syrian Arab Republic through its banks and realized by the project's exports of merchandises and services exceed 50 % of the total production of the project during the original period of exemption.
Article 16
(a) In addition to the facilities given by the rules and regulations in force on foreign currencies, the investor may open in favor of his project, which is approved according to the rules of this law, an account in foreign currency at the Commercial Bank of Syria, recording on the credit side:
1- 100 % of payments made in foreign currencies of the project's capital and of the loans granted to the project in foreign currencies.
2- 75 % of the total foreign currencies realized from the revenues of exports and services of the project.
On the debit side of the afore-mentioned account, are recorded funds necessary for covering the project's liabilities, requirements and needs of foreign currencies, including the payments allowed to be transferred to the favor of Syrian expatriates, citizens of Arab and foreign countries and non-Syrian persons or the like, working in project, according to rules of this law.
(b) Regardless of any text in force, the investor may use his foreign currency funds in financing projects licensed to be set up according the rules of this law, or contribute to the capital or buy shares of these projects.
Article 17
(a) The Bank shall put the investor's funds deposited at it accord to the rules of paragraph (a) of Article (16) of this law at the disposal and at the request of the investor, and the Bank shall take necessary procedures to achieve this.
(b) The Bank shall calculate interest for the foreign currency fu deposited at it in favor of the project's account and in harmony the current interest rates. Article 18
Investor may borrow local currency from the state's banks in favor of his project and against guarantees of his own funds according to the rules in force at these banks.
Chapter IV Joint-ventures Article 19
(a) Joint-stock companies licensed by the rules of this law, in which the public sector takes part at 25 % at least of the capital, take the form of a society anonym share-holding company or a limited liability company.
(b) Founders shall set a draft for the company's bylaws in conformity the nature of its being . This bylaws is issued by a decision by the Prime Minister after it is approved by the council.
Article 20
(a) The joint-stock company will have a board of directors in which Share-holders are represented according to the Percentage of their Subscription in the company's capital, The concerned authority shall name the public sector representatives at the board of directors at the same percentage of this sector's share in the capital.
(b) The board of directors shall appoint the company's director-general, who cannot hold his post together with the chairmanship or membership of the board of directors.
Article 21
(a) With exception from the rules of Law No. 134 of 1958 and the Legislative Decree No. 49 of 1962 and their amendments, the board of directors shall draw out the company's personnel bylaws taking into account the rules of the Labor Law No. 91 of 1959 and its amendments. This bylaws is issued by a decision by the Prime Minister.
(b) The board of directors shall issue the financial bylaws and the accounting system for the company, according to the relevant models prepared by the Minister of Finance.
(c) The company's other regulations shall be issued by a decision by the board of directors.
Article 22
The joint-stock companies coming to being according to the rules of this law shall be exempted from the stamp tax levied on the share issuance.
Chapter V Special rules on investment of external funds
Article 23
External funds shall include:
b- foreign currency transferred from abroad by Syrian citizens, Arabs or foreigners through Syrian Bank or in a way approved by the Foreign Currency Bureau.
b- machines, vehicles, equipment, means of transport, buses, mini-buses, and materials necessary for setting up or expanding, renewing or developing these projects, as well as materials imported from abroad, necessary for operating these projects.
c- profits, revenues and reserves realized from the investment of the external funds in investment projects, if they were added to the capitals of these projects or were invested in other projects approved according to the rules of this law.
d- moral rights utilized in projects, as well as patent rights and trade marks registered in a member state of the International Federation for Industrial Property, or according to the international rules of registration included in international agreements concluded in this regard.
Article 24
(a) Investors of Syrian expatriates, or of Arab or foreign nationals, are allowed, after the elapse of five years from the investment of the project, to re-transfer abroad the net value of their share in the project in foreign currencies on the basis of the actual value of the project, provided that re-transfer of funds should not exceed the capital brought in by them in foreign currencies, and according to executive instructions issued by the council in this regard.
(b) External funds may be re-transferred abroad after six months from their entry and in the same way as they were brought in, should any difficulties or any circumstances beyond the control of the investor, and at the council discretion, stand hindrance against the investment of these funds. The council, in special cases, may approve the re-transfer abroad of external funds without consideration of the aforementioned period of time.
(c) Profits and revenues realized annually by the investment of the external funds may be transferred abroad according to the rules of this law.
Article 25
According to the rules of Article (23) of this law, the Central Bank of Syria shall allow the transfer abroad of the external funds invested in the project, together with the profits and revenues, in the same currencies brought in or in any other transferable currency.
Article 26
Investors of Arab or foreign nationals may insure their funds invested in the approved projects at the Inter-Arab Investment Guarantee Corporation or any other establishment with the approval of the concerned authority.
Chapter VI General Rules Article 27
(a) Investor shall apply to the concerned Ministry for approval of his project and that it is covered by the rules of this law. Application form shall be accompanied by papers and documents that indicate the prerequisites, elements, and aims of the project and its economic feasibility and the legal form it will take.
(b) The concerned Ministry shall study the project, give its opinion about it and refer it to the council within a period of 30 days from the date of application.
(c) The council may cancel the decision of approval, if the project propose fails to take serious procedures to initiate his project within one-year period from the date of issuance of decision of licensing, unless there are justified reasons accepted by the council to extend the given duration of implementation.
Article 28
The propose of the project approved shall:
1 - keep books as per the commercial law.
2- present an annual balance sheet and a statement of profits and losses ratified by an authorized auditor, within a four-month period from the end of the fiscal year of the project.
3- keep a special register in which all details relating to the project funds, which, as per the rules of this law, enjoy franchise, privileges or facilities, are taken down, together with the, movement of these funds and overhead expenditures.
4- at the request of the council and the concerned authority, the investor shall present all data and statements about the project.
Article 29
By a decision taken by itself, the council may suspend the validity of franchise, privileges and facilities given to the project, wholly or partially, in case the project proposed violates the rules of Article (28)of this law, and until these rules are implemented.
Article 30
(a) Customs fees and fines, according to customs rules and regulations in force, shall be incurred on the project in case the materials mentioned in Article (11) of this law are used to serve purposes other than the project itself or were abandoned to a third party without the council's consent.
(b) In case the offence quoted in the previous paragraph is repeated, the council may cease the project's enjoyment of the franchise, facilities and privileges specified in this law.
Article 31
By a decision by the council, franchise, privileges and facilities quoted in this law may be given, except the exemption from taxes and fees, to any of the standing projects.
All obligations quoted in it remain in force
Article 32
In case the ownership of Projects approved is transferred, wholly or partially, to a new owner, then the new proprietor replaces the old one in rights, obligations and duties he had to fulfill as per the roles of this law and the regulations and instructions issued in this regard. Capital profits ensued by the sale of the stable assets are subjected to profits income tax according to roles and regulations in force.
Article 33
Rules of the Legislative Decree No. 10 of 1986 regarding joint-stock agricultural companies shall continue to be in force.
Article 34
Tourist projects are governed by the rules and regulations in force and relating to them.
Article 35
Rules of the Legislative Law No. 348 of 1969 shall remain in force as regards the projects effected by it before this law is put in effect.
Article 36
Projects approved shall be subject to the roles of the Commercial Law No. 149 of 1949 and its amendments, provided that these rules are not in contradiction with the rules of this law.
Article 37
Experts and technicians of Arab and foreign nationals working in any of the approved projects are allowed to transfer abroad in foreign currencies 50% of their net wages, salaries, remunerations and 100% of their compensations at the end of their services.
Article 38
The Prime Minister, the chairman of the Higher Council of investment, shall issue the instructions necessary for the implementation of the rules of this law.
Article 39
This law shall be published in the official gazette.
Damascus, 4.5.1991 President of the Republic Hafez Al-Assad
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