Legal Briefing – January to February 2015

The SLJ is pleased to provide you with our first Legal Briefing. The following points below are summaries of the latest legal developments taking place in Syria. Our first news item is the recent enactment of the new Consumption Tax Law at the start of this year. In legislative affairs, the People’s Assembly has moved to amend a controversial provision that has been a key feature of the Road Traffic Law. According to the Minister of Labour, a new unified employment law appears to be on the horizon and moreover, both public and private sector employees were granted a salary increase. Members of local councils have been calling for changes in the Local Administration Law to give them a greater say in the decision-making process. The government in the meantime is scrambling to get control over the depreciation of the Syrian Pound while attempting to safeguard local industries not least by seeking to promote small and medium-sized enterprises. The Council of Ministers continues to discuss and approve bills relating to a range of issues while individual ministers- Finance, Telecommunications and Technology, Labour, Economy and Foreign Trade, Justice, and Electricity- have been busy concerning themselves with matters under their exclusive jurisdiction. On the international level, Syria has sought to negotiate and ratify commercial and industrial agreements with Belarus, India and Russia.

• A new law that revises consumption taxes has come into effect. Legislative Decree 11/2015 replaces the previous law provided for in Legislative Decree 61/2004. Accordingly, consumption taxes on a number of goods including those deemed luxurious now range from one percent to 20% but can reach up to 60% with respect to automobile sales. More details about Legislative Decree 11/2015 can be found in the Main Legislation and Recent Legislation sections.
• Dr. Ismail Ismail, the Minister of Finance, has issued an executive regulation detailing the consumer fees payable in touristic establishments.
• The People’s Assembly approved a bill amending Articles 96 and 180 of the Road Traffic Law 31/2004. Accordingly, owners and drivers will not be held liable if their vehicles are involved in accidents resulting in bodily harm while they are not in motion. This change will bring to an end a controversial policy whereby an owner or driver of a parked vehicle for instance was held responsible even if a cyclist or pedestrian struck their automobile and was injured as a result.
• The People’s Assembly approved a bill repealing the provisions of Legislative Decree 5/1962, which had set up the Postal and Telecommunications Institutes. The bill also transfers the private laboratories in the two institutions to the Ministry of Education while the Syrian Telecommunications Establishment (STE) shall retain ownership over the buildings occupied by the institutions. Furthermore, Dr. Muhammad Al-Jalali, the Minister of Telecommunications and Technology, held that the STE will be converted into a joint stock company and will therefore be subject to the provisions of the Companies Law and the Commercial Code.
• The People’s Assembly has referred a bill amending Article 5 of Law 22/2012, which established the Terrorism Court, to its Constitutional and Legislative Affairs Committee for review. This provision touches on the appeals process in the Terrorism Court.
• According to Dr. Khalaf Al-Abdullah, the Minister of Labour, the new unified Employment Law (discussed in the Legislation under Review section) is expected to address salary ceilings and re-examine the procedures for recruiting public sector employees, which are usually done by conducting competitions among candidates. He further explained that the prospect of incorporating provisions for early retirement may not be feasible under the current circumstances. On another note, he mentioned that the General Establishment for Social Security plans to utilize its funds for investment purposes in order to realize more benefits for its subscribers.
• Prime Minister Wael Halqi has stated that the Social Security Law provided for in Legislative Decree 92/1959 should be applied to workers who sustain injuries resulting in death as a result of the ongoing unrest in Syria. In effect, the Social Security Law would be made to apply to incidents that took place from March 15, 2011 up until February 12, 2016.
• At the beginning of this year, Legislative Decree 7/2015 was promulgated with the aim of granting public sector employees whether civilian or military personnel an additional SYP 4,000 in monthly salaries. The Minister of Labour Dr. Khalaf Al-Abdullah has used his authority under this law to issue Regulation 394/2015, which extends the additional SYP 4,000 monthly salary to employees working in the private, foreign, cooperative and joint public-private sector companies. Legislative Decree 7/2015 features in our Recent Legislation section.
• A number of local council officials have called for amendments to the Local Administration Law contained in Legislative Decree 107/2011. They argue that they require more powers to participate in the decision-making process. They are also seeking a clearer delineation of authority between the executive and legislative powers at the local level to ensure that their decisions are properly executed. In addition, a greater emphasis placed on decentralization was also one of the suggestions.
• The Provincial Council of Damascus discussed the implementation of Legislative Decree 66/2012, which aims to carry out an urban redevelopment project in informal parts of southern Damascus that were the scenes of intense fighting during the current unrest. The Council heard that eviction notices will be issued shortly to residents in designated areas who are expected to be compensated accordingly and provided with alternative housing.
• An increase in imports into Syria is regarded as one of the chief reasons for the depreciation in the value of the Syrian Pound. Consequently, Dr. Humam Al-Jazairi, the Minister of Economy and Foreign Trade, has clarified that the government is planning to restrict imports in order to reduce demand for US Dollars. Additionally, MPs in the People’s Assembly have recommended that the public banks be granted the sole authority to conduct the sale of foreign currencies for the purposes of financing imports.
• The Council of Ministers reviewed the prospect of further protecting local industries and encouraging the establishment of small and medium-sized industrial projects. These businesses would be concerned with manufacturing products in order to meet domestic market demands under the present conditions and could even consider exporting surplus goods. The Central Bank and the Ministry of Economy and Foreign Trade are working to develop a legal framework for the provision of loans to these types of enterprises.
• The Council of Ministers has called on pharmaceutical businesses to ensure that the needs of the local market are satisfied first before exporting their products overseas.
• The Council of Ministers have discussed a number of bills including those relating to environmental management and the protection of the Syrian Desert; the acceptance of the validity of digital real estate documents; the extension of the deadline for companies incorporated in Syria to settle their legal status in accordance with the Companies Law provided for in Legislative Decree 29/2011; and the ratification of international documents concerning mail and postal services.
• The Council of Ministers has approved bills that permit the sale of state-owned properties that were part of land reform measures; deal with injuries sustained in the course of employment that result in death; and extend the validity of Legislative Decree 40/2014, which permits public entities to procure their requirements without facing any legal restrictions.
• Dr. Najm Al-Ahmad, the Minister of Justice, has issued a circular declaring that a lawyer cannot be arrested before the respective branch of the Bar Association which he is registered with is informed in advance.
• Dr. Humam Al-Jazairi, the Minister of Economy and Foreign Trade, has informed the Syrian Chambers of Commerce, the Federation of the Syrian Chambers of Industry, the Federation of the Syrian Chambers of Agriculture and the Syrian Exporters Union that the importation of diesel and gasoline by the private sector is restricted to supplying industrial businesses. He also called on them to abide by the pricing list issued by the Ministry of Internal Trade and Consumer Protection in this respect.
• The Minister of Electricity Imad Khamis pointed out that his Ministry has been drafting legislation that encourages investment projects in renewable and alternative energy resources. Nevertheless, their implementation is subject to the present circumstances brought about by the ongoing unrest.
• The governments of Syria and Belarus have signed bilateral agreements focused on the promotion of industrial cooperation between both countries. Bilateral talks have also been held between Syria and India with a view to activating current agreements and signing new ones in the fields of electricity, medicine, transport, agriculture and energy. Syria is also considering a barter exchange agreement with Russia whereby it will export citrus fruits, vegetables, canned foods and cotton products in exchange for wheat and flour imports from Russia.