СТА - ведущая юридическая компания в Дубае с офисами по всему мируhttps://www.stalawfirm.com/ru.htmlSTA Law Firm - Блоги - MiningruCopyright 2024 STA Law Firm All Rights Reserved<![CDATA[Economic and Fraud Provisions in Middle East]]> Economic and Fraud Provisions in the Middle East

"There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud."

- Milton Friedman

Economic fraud is a term that has been repeated over the years, so much so that the consequences it bears do not have any precedence or impact on the ones that hear it. For many companies and capitalist machinery, this term essentially triggers them to explore options to hide their fraudulent tracks and continue operating in the same manner. To have governments help them cover the tracks in certain jurisdictions ultimately defeats the purpose of the assignment.

Despite the incongruent activities of individuals, companies, and governments from the expected norm of justice in many jurisdictions, other countries are tenacious to implement a regulatory framework that will eradicate such fraudulent activities in the market. This article will discuss the economic and fraud provisions established in the Middle East, their effectiveness, and the scope of reach it possesses about financial crime.

What are the Economic and Fraud provisions in the Middle East?

If one area of the economy has seen a steady increase in the past years, it would be the economic fraud prevalent in society. Regardless of the number of provisions that jurisdictions and international organizations establish to combat financial fraud, none of them seems sufficient. The parties involved in economic fraud and other fraudulent practices are constantly evolving to cover their tracks efficiently.

Infamous scandals like Bernie Madoff and the Ponzi scheme leave one in absolute awe as it remains unclear, what is the culprit: the crime or the criminal? Many innocent parties, including employees and clients, were adversely affected by the ill-doings of these financial schemes. After the outburst of many scandals and its impact on many innocent individuals, jurisdictions are trying to fasten their pace to stay a step ahead of wrongdoers and hopefully eliminate the potential threats in the market.

The introduction of new anti-economic fraud regulations has paved the way for potential investors to feel a sense of security over their investments within the market, along with the ability of the regulations to enforce justice. Over time, people have understood that the formation and establishment of an anti-fraud legal framework are not sufficient to ensure peace and harmony in the market, an iron fist must be imposed on fraudulent parties and companies to deter them from doing such activities in the future and serving it as a lesson for other participants in the market who bear similar intentions.

The types of economic fraud can be quite varied and are spread across different industries and the scope of nature. These could include housing benefit fraud, tenancy fraud, council tax fraud, blue badge fraud, social care fraud, business rates fraud, insurance fraud, bribery, and money laundering. These are just a top layer of economic crimes prevalent in an ocean of fraudulent activities in the market. The crimes that are more coherent to the wrongdoings in the market include not declaring the business location, stating that a property is not in use while it is, dishonestly requesting for an exemption to pay for charges that are owed, or any unauthorized movement of money to make ill-gains.

Often, economic crime is caused not by companies but by customers towards companies. The highest reported crime boost in the Middle East is through customer fraud and procurement fraud, which have proved to be the most disruptive fraud within an economic crime. In a survey conducted on a global platform, the number of customer frauds was comparatively more in the Middle Eastern region.

In an ongoing effort to combat fraud together, many companies in the Middle East began investing in more stringent controls and implementation of the rules to avoid economic crime, while many others conducted a thorough examination into reasons after the occurrence of a crime in the company. Another issue that stands alongside customer fraud about its prominence is procurement fraud. This fraud entails the practice of favoring associates with vendor and supplier contracts.

All these efforts are measures taken to mitigate the risks involved and ensure that proper prevention is taken by instilling the right technology and talent to deviate from any fraudulent prone routes.

However, it is not easy to ensure that accountability will be maintained and transparent feedback is provided. Another limitation of this procedure is that advanced technologies to combat financial crime can be costly, which would further deplete if the company possesses insufficient resources to acquire and install the platform and is not equipped with properly trained employees to manage the technology. The lack of proper expertise to handle the in-place technology could attract various cyber threats, which allows a wrongdoer from any part of the world to infiltrate the company's system.

With this in mind, companies must equip themselves from the arsenal of defenses to protect themself and the financial and reputational facets of the company. The extent of damage that infiltration of the company's system can cause to the operations is quite unfathomable. It would be better for companies to leave their vault of secrets wide open than installing an IT platform that is managed poorly. The necessity of combating such insecurities is proliferating and must be countered at the earliest. One would like to believe that the efforts of the legal jurisdictions in the Middle East to battle economic crime are practical and promptly applied. However, many of the jurisdictions still fail to provide a proper implementation of the provisions established against economic crime.

The readiness of companies in the Middle East to confront the indecisive nature of economic crime and report any issues as they arise is still moving at a stagnant rate. The stark increase in cyberattacks and its potential threats is not a mystery to the companies in these regions. Nevertheless, they decide against preparing themselves in defense of such risks and attacks. The firms in the region and the governmental organizations must understand the types of threats that could arise in the economy and the nature of such economic crimes. Although this would seem like an insignificant step, this particular action could help achieve a more profound revelation of the gaps and vulnerabilities of the economy and its protective framework.

Many would argue that the relationship of the Middle East with economic crime and fraud dates back ages. All the glitz and glamour and the boom of economies are incongruent with the fraudulent activities occurring within the firms and regions. A region's legal systems cannot enforce the regulatory frameworks established to fight against economic crime if the country's government does not implement the rulings.

To know more about Economic and Fraud Provisions in the Middle East in Singapore Click here 

 

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Thu, 30 Sep 2021 14:28:00 GMT
<![CDATA[Горная Промышленность Объединенных Арабских Эмиратов]]> Горная Промышленность Объединенных Арабских Эмиратов

Горная промышленность на протяжении веков была движущей силой экономики. Будь то добыча полезных ископаемых, металлов или драгоценных камней, каждый вид горнодобывающей промышленности играет решающую роль в экономической деятельности многих государств во всем мире. Этот принцип ничем не отличается и в Объединенных Арабских Эмиратах, и хотя экономический рост в регионе в основном зависел от расположений нефти, горнодобывающая промышленность в регионе быстро растет и становится прибыльным источником ВВП страны. В Объединенных Арабских Эмиратах список полезных ископаемых, добываемых в этой регионе, является длинным и варьируется от меди и гипсовых месторождений до добычи металлов и драгоценных камней. С технологическим бумом в ОАЭ произошло установление того факта, что страна применяет самые передовые технологии и лучшие научные методы в горнодобывающей промышленности. Эти методы в конечном итоге подтвердили разнообразие и изобилие полезных ископаемых, доступных во многих различных Эмиратах.

Промышленность в стране привлекает множество международных компаний, которые успешно инвестируют в этот сектор экономики. Данная отрасль не только включает в себя процесс добычи полезных ископаемых, но и утверждает, что в ОАЭ неуклонно растет как экспорт продукции горнодобывающей промышленности как сырья, так и готовой продукции. Инфраструктура в ОАЭ с оптимальным функционированием портовых сооружений и наземных транспортных средств является надежной гаванью для горнодобывающей промышленности. Для этой статьи и в соответствии с законодательством ОАЭ использование терминов разработка полезных ископаемых и добыча полезных ископаемых будет взаимозаменяемым.

 

Закон о Добыче Полезных Ископаемых

В каждом их Эмиратов существуют законы, регулирующие добычу полезных ископаемых в Объединенных Арабских Эмиратах; Федеральные законы, регулирующими все горнодобывающие и карьерные работы в регионе в целом. Эти правила включают:

- Федеральный Экологический Закон;

- Федеральное постановление Кабинета министров № 20 от 2008 года (Правила карьеров и дробильных установок);

- Федеральная министерская резолюция № 492 от 2008 года (Руководящие принципы по разработке карьеров и дробильных установок);

- Федеральная министерская резолюция № 110 от 2010 года (Правила карьеров и дробильных установок).

Когда предприятие в ОАЭ хочет осуществлять горнодобывающую деятельность в регионе, оно должно получить экологическую лицензию от соответствующих местных органов власти. В отношении этой лицензии существуют конкретные руководящие принципы, которым должны соответствовать эти организации. В дополнение к инструкциям, правила также предусматривают применение штрафов в случае любого нарушения. Обязательства, предусмотренные руководящими принципами, и определяют конкретные обстоятельства и факты по каждому делу, некоторые из них включают:

- Статья 15 Федерального постановления Кабинета министров № 20 от 2008 года. В этом законе говорится, что если любое лицо или организация, действуя или бездействуя, наносит ущерб окружающей среде в результате нарушения положений настоящей резолюции, оно несет ответственность за оплату всех необходимых затрат на ремонт или устранение ущерба и любых вытекающих убытков;

- Статья 16 Федерального постановления Кабинета министров № 20 от 2008 года. В данном законе дополнительно разъясняется возмещение ущерба окружающей среде в соответствии со статьей 15, включая ущерб, который влияет на окружающую среду и предотвращает или уменьшает ее законное использование на временной или постоянной основе, или ухудшает ее экономическую или эстетическую ценность;

- Федеральная министерская резолюция № 110 от 2010 года. Эта часть законодательства предусматривает восстановление каменоломен и карьеров. Статья 13 этого Закона предусматривает, что операторы карьеров должны добиваться прогрессивного улучшения после разработки своих месторождений. Это положение предполагает, что реконструкция должна выполняться последовательно в течение разумного периода времени после завершения добычи ресурсов карьера или шахты. В нем также говорится о том, как такая реконструкция выгодна:

• Она уменьшает открытые пространства в карьере / шахте;

• Уменьшает потенциальную эрозию почв; а также

• Уменьшает двойную обработку или почву / отходы.

 

Постановление министров № 110 от 2010 года

В статье 3 Постановления министров № 110 от 2010 года содержатся руководящие принципы для разработки карьеров, это положение содержит рекомендации по бурению, разминированию, обработке материалов и транспортировке на месте. Статья 5 Постановления предусматривает общие требования. В этом положении указывается, что все операторы горнодобывающей промышленности должны предоставлять данные о производстве и эксплуатации компетентным местным органам власти и техническому подразделению министерства окружающей среды и воды.

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Mon, 27 Aug 2018 10:07:00 GMT
<![CDATA[Mining in UAE: Overview Q&A]]> Overview

1. What are the recent developments in the exploration and extraction of mineral resources in the United Arab Emirates? 

Response: Mineral resources in the United Arab Emirates (the UAE) are separated into three essential classifications: rocks; sands and soil; and metals. The exploration and exploitation of minerals are only confined to rocks and sands. Whereby, rocks are utilized for construction whereas, limestone, sand, marl, gypsum are utilized to manufacture cement.    The mining sector in UAE has turned out to be a standout amongst the most promising production sectors such as oil fields. It isn't surprising that in coming future minerals of the UAE will pull potential investors around the globe.    UAE has a long list of minerals ranging from copper mines, gypsum to the extraction of metals and valuable stones. The main minerals that are explored and extracted in the country are:   
  • Aluminium; 
  • ammonia; 
  • chromite;
  • gypsum; 
  • hydraulic Cement; 
  • quicklime and hydrated lime;
  • dead-burned dolomite; and
  • Raw steel. 
The Emirate of Fujairah is bestowed with minerals and the mining business or related ventures are major wellsprings of income and are the spine of Fujairah economy. In 2014 the total production of minerals in the emirate was about 102 million Mt. tons. Out of which 80% was used in the country and rest 20% was exported to the neighboring countries such as India, Bahrain, Qatar, and Kuwait.    Organizations around the globe have effectively invested in the mining sector in UAE. Generally, Indian companies mainly invest in the exploration and exploitation of chrome and precious metals. Further, Dubai Gold center a company incorporated in Dubai Multi Commodity Centre (the DMCC) has traded more than US$70 billion of gold in 2013-14, which is almost twice the amount traded in 2011-12.    Dubai Diamond Exchange (the DDE), a subsidiary of DMCC and a leading diamond trader worldwide. In 2016, DDE imported $12.4 billion worth rough diamonds and $13.2 billion was re-exported. In 2006, DDE was made the sole gateway for imports and exports polished diamonds in the UAE.    Aluminium smelting is increasing in UAE with prospects of building up the world's biggest aluminum smelter in Abu Dhabi and Dubai. But the core of the UAE's aluminum ventures remains solely inside its own borders. Emirates Global Aluminium PJSC is the major producers of aluminum in the country. It is an aluminum conglomerate with interests in alumina/bauxite and essential aluminum smelting. The company has produced 2.5 million tonnes of hot metal in 2015. However, the most noteworthy investment is based on a Joint Development Agreement (the JDA) between Mubadala, owned by Abu Dhabi Government and DubaL with a capacity of 1.2 million tonnes a year.    In 2014, Ministry of Energy participated in the Middle East and North Africa (the MENA) mining conference, one of the largest conference in the Middle East and North Africa. The conference aimed at emphasizing the importance of mining sector in economic development and effective ways to provide sufficient investment climate in lieu of supporting the exploitation and exploration of mineral resources in the Middle East and North Africa.    On 12th April 2017, Fujairah Natural Resources Corporation representing UAE participated in the 23rd meeting of Advisory Committee of Mineral resources Sector at Arab Industrial Development and Mining Organization (the AIDMO). During the session, the participants discussed the arrangements for 5th International forum for industrial rocks and mining, organizational activities os Mineral Resources Department as a part of 14th International Arab Mineral Resources Conference held at Saudi Arabia. The participants further discussed the 15th International Arab Mineral Resources Conference to held in 2018.    2. What is the regulatory framework for the exploration and extraction of mineral resources in UAE?   Response:    Regulatory Framework for Mining Industry in UAE   UAE federal mining law is still in the planning phase. His Highness Sheikh Mohammad Al Maktoum has confirmed that the law will regulate the exploitation and exploration of minerals and the investments around the globe in the mineral industry.  However, companies incorporated in free zones are regulated by the laws and regulations promulgated by the free zone authority. For example, DMCC has framed DMCC rules for Risk-Based Due Diligence in the Gold and Precious metals supply chain (DMCC rules for RBD-GPM).    Regulatory authorities   Pursuant to Article 23 of the UAE Federal Constitution, the natural resources and wealth in each emirate are considered as a public property of the Emirate and the society should be responsible for the protection and proper exploitation of such natural resources and wealth. The ministry mainly focuses on sustainable development in petroleum and mineral resources. The Ministry was formed pursuant to Federal Decree Number 3 of 2004 (the Ministry of Energy Decree) by a merger between Ministry of Petroleum and Mineral Resources and Ministry of Electricity and Water (the FEWA)   However, at emirates level, DMCC authority being the control authority regulates the companies incorporated in DMCC and undertaking non-financial activities which include specifically jewelry, precious metals, stones, and traders.    In the Emirate of Fujairah, Fujairah National Corporation Resources (the FNRC) was established in 2009 in the emirate of Fujairah. The corporation is concerned with the policies with regards to natural resources in accordance with the requirements set out in Economic and Social Development Programs. FNRC is also concerned with national and international investments in the mining sector.    3. How are rights to the mineral resources held, and who holds those rights? Are they held by the property holder? Are mineral rights severable from the general ownership of the property? Must they be registered? Also, clarify what proportion of interests is privately owned and state-owned?   Response: The rights of mineral resources are held by the UAE government which can exploit them or assign their exploitation to third parties, subject to prior approval. Consequently, exploitation of such resources requires permits from UAE Ministry of Energy or other relevant ministries prior to exploration.    4. What are the key features of the leases, licenses or concessions that are issued under the regulatory regime? Can these rights be leased by the right-holder?   Response:    Lease/Licence/Concession Term - Is there a time limit on the permissible length of these rights? How long is a typical lease, license or concession period? How can the period be extended?   The concession agreements for exploration of minerals are private arrangements between parties and the UAE government thus, are not shared with or disclosed in the public domain.    Fees   The parties agreeing to commercial terms mentioned in the concession agreement pay a license fee or sharing bonus. Additionally, the host government also seek royalties depending upon the gross revenue generated from net income, both of which are based on the amount of production and price of goods sold.    Liability   Concession holder will be held liable if there is any deviation from what is mentioned in the concession agreement. Companies must strictly adhere to the concession terms and apart from that must adhere to the following: 
  • A company must obtain a license prior to establishing a project and must according to Article 4 of Federal Law Number 24 of 1999, obtain environmental impact assessment (the EIA).  
  • In accordance with Article 71 of Federal Law Number 24 of 1999, any person causing damage, intentionally or by way of negligence will be held liable for all the cost or any compensation thereof. 
Restrictions - Are there any restrictions on obtaining these rights, for example relating to age, bankruptcy or on foreign applicants?   The terms of concession agreements are a private arrangement between parties thus, the restrictions are not out in the public domain. Generally, the most common restrictions are on equity participation, foreign ownership, control on the project company.    5. How are such leases, licenses or concessions awarded?   Concessions are granted by the government with bid participants upon signing a private concession agreement.    6. Environment   (A) What are the main ongoing requirements for environmental protection? Please include the principal laws, requirements, and policies with respect to mining in the UAE. Please also consider third party rights and the general requirements for closure and remediation of a mining project.   Response: The Federal Law Number 24 of 1999 for the Protection and Development of the Environment (the Environment Law) which aims at protecting and conserving the quality and natural balance of the environment. The Federal Environment Agency(the FEA) is the regulatory authority established to facilitate proper functioning of the law.    The law does not specifically mention any provision with respect to mining, however, it gives the power to FEA to overlook all the activities which contribute directly or indirectly in damaging, disturbing the natural resources or soil.    Further, the Federal Natural Resources Corporation of Fujairah (the FNRC) is committed to sustainable development of mining industry which is in line with the UAE government initiative "green growth". FNRC has recently launched 'Labaik' service which includes the country's strategic plan of 2021 and Fujairah master plan of 2040.    7. Health and Safety Factors Relevant to Mining Industry in UAE   (A) What are the main ongoing requirements for compliance with health and safety regulations? Please clarify the principal laws, requirements, and policies with respect to mining in UAE.   Response: The UAE ministry has passed several ministerial resolutions with regards to health and safety in hazardous areas as follows:    The Ministerial Resolution Number 4/1 for 1981 on defining works that are hazardous or in which it is permissible to reduce the legally decided working hours, states that workers will not be made to work for more than seven hours if they work in mines and quarries and other hazardous industries.  The Ministerial Resolution 5/1 for 1981 strictly prohibits minors under the age of seventeen to work in mines and quarries or other excavation works.  The Ministerial Resolution 6/1 for 1981 restricts to employ women to work in mines and quarries and other related industries.  The Ministerial Resolution 37/2 for 1982 regarding the level of medical attention, mandates the employer to provide proper medical facilities to employees working in hazardous industries.  The Ministerial Resolution 32 for 1982 on determining prevention means and measures to protect workers from work-related hazards, mandates the employer to provide suitable means for protection to protect workers from hazardous occupational diseases that can happen during working hours.    8. Foreign Ownership - Are there any restrictions concerning the foreign investment in and ownership of companies engaged in the exploration and extraction of mineral resources?   Response: The foreign owner can only hold 49% percent of shareholding in a mining company incorporated in the mainland, however, a company incorporated in the free zone can be held by foreign owner without any capping to the share percentage.    9. Processing and Sale of Mineral Resources in UAE - Are there any restrictions or limitations on the processing of extracted mineral resources? Please also state whether there are restrictions or limitations on the import of equipment, machinery or services required in connection with mining activities in UAE.   Response: At the national level there is no specific law which restricts the extraction of minerals resources, however, at emirates level, DMCC has issued DMCC rules for Risk-Based Due Diligence in the Gold and Precious Metals Supply Chain (the DMCC rules for RBD-GPM). The rules do not specifically impose any restrictions and limitation with regards to extraction of gold and precious metals, whereas, it forces accredited members to undertake on-site visits and to maintain proper records on mine activities.    10. Are there any restrictions or limitations on the sale, export or import of extracted or processed minerals in UAE?    Response: UAE does not impose any restrictions or limitations on the sale, export or import of extracted minerals, however, there are certain goods banned in the country such as goods from boycotted countries or goods from Israeli origin.    Further companies incorporated in DMCC must take prior permission from the regulatory authority while importing precious metals such as pearls, diamonds, or rough diamonds.   11. Taxation in UAE - What payments, such as taxes or royalties, are payable by interest holders to the government?     Response: Interest holders do not pay any taxes or royalties to the government.    12. Does the government derive any other economic benefits from the exploration and extraction of the mineral resources? Please include details on how tax issues apply to joint-venture arrangements.   Response: There are no other pertinent and/or direct economic advantages to the government from exploration and extraction of mineral resources.    13. What taxes and duties apply on the import and export of mineral resources? Please list the main taxes and duties, and state whether there are any tax advantages or incentives available to private parties engaged in mining activities.   Response: Cross-border transactions are not explicitly controlled. The Customs Bureau in each emirate (city) actualizes control as provided by Federal Customs Authority and applies customs laws mentioned under GCC customs union agreement of 2003 which provides: 
  • 5% customs in GCC for imports on CIF (Cost, Freight, and insurance);
  • free zones are exempted for import duty; 
  • no export duty in UAE;
  • single entry custom duty for items imported in UAE or any other GCC and are exported to other GCC. 
14. Reform - Are there any plans for changes to the legal and regulatory framework?    Response: As mentioned above, the regulatory framework for the mining industry is still at a development stage, the UAE Ministry of Energy is currently drafting the first mining law. It is anticipated that this first and new mining law in UAE will increase investments within the mining sector and further ensure sustainable development in the mining industry.    Details of Regulatory Authorities   Response: Name Ministry of Energy    Address. P.O Box 59, Abu Dhabi – United Arab Emirates  Tel: +971-2-6671999 Fax:  +971 -2 -619001  Email  info@moenr.gov.ae Website  www.moenr.gov.ae   Main responsibilities.   The main responsibilities of the ministry is to establish policies and regulations with prior consultation of stakeholders in order to ensure sustainable development in the energy sector and to meet the international standards and to represent country's interests in mineral resources.    ]]>
Sun, 05 Nov 2017 17:00:00 GMT