Bahrain: Tightens Timeshare Rules

Gulf Insider, 19 January 2025: Bahrain has introduced a comprehensive new law to regulate timeshare activities, marking a significant advancement in consumer protection and industry transparency.

Ratified by the King, the 36-article legislation targets overselling and misleading advertising, imposing stringent penalties for violations, including fines up to BD 50,000 and potential licence suspensions.

This move positions Bahrain as a leader in setting high standards for the timeshare sector.

Under the new law, all timeshare projects must appoint a licensed manager to oversee daily operations, with the project owner remaining accountable for compliance.

The Bahrain Tourism and Exhibitions Authority, or a designated body, will oversee licensing and ensure compliance to the law.

The authority is empowered to address breaches, with the ability to impose severe penalties based on the violation’s severity and impact.

Violators are notified in writing and given a chance to respond before any action is taken.

Public disclosure of breaches is permitted post-appeal or court ruling, and any criminal evidence found is forwarded to the Public Prosecution.

The licensing process for businesses is clearly defined, with a grievance process available for rejected applications.

Advertising is tightly regulated, allowing only licensed projects to market timeshare products, and banning misleading promotions and investment claims.

These rules extend to foreign projects advertised in Bahrain.

Consumer protection is a cornerstone of the law, offering a ten-day contract cancellation period with a full refund.

Escrow accounts are mandated to safeguard consumer payments, and overselling is prohibited to ensure consumers’ access to their timeshare slots. Beneficiaries can transfer or mortgage their rights, with automatic transfer to heirs upon death.

The Bahrain Tourism and Exhibitions Authority is tasked with enforcing these regulations, with inspectors granted judicial authority to ensure compliance.

Violators face severe penalties, including imprisonment and substantial fines.

Transparency is enhanced by requiring all contracts and transactions to be recorded in a timeshare registry, providing legal clarity and protecting consumers from disputes.

Licensed projects have six months to comply with the new regulations.

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Bahrain: Parliament Approves Draft Law To Ban Conversion Of Visit Visas Into Work Permits

The Daily Tribune, 15 January 2025: In a significant move to reform the labour market, Parliament has approved a draft law that prohibits the conversion of visit visas into work permits.

The proposed amendments target the 1965 Aliens (Immigration and Residence) Act, introducing a new article that explicitly bans the practice.

Additionally, the law includes provisions to annul any conflicting regulations and sets out guidelines for its implementation.

First introduced in May 2023, the draft law aims to prioritise employment opportunities for Bahraini nationals.

It aligns with the government’s long-term labour market strategy, which emphasises placing Bahraini citizens at the forefront of hiring while enhancing their skills through comprehensive training programmes.

The legislation reflects a broader effort to strengthen local employment prospects and reduce dependency on foreign labour in certain sectors.

The draft law will now proceed through the legislative process for final approval and enactment.

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Bahrain: Recommends Extending Environmental Protection Appeals Period

The Daily Tribune, 10 January 2025: The House of Representatives’ Public Utilities and Environment Committee has endorsed a legislative proposal aimed at extending the appeal period for administrative decisions under the environmental protection and wildlife conservation law from 30 to 60 days.

The proposal highlights that the current 30-day timeframe may not be adequate for stakeholders to effectively challenge decisions.

Extending the appeal period would allow for a more comprehensive review before initiating legal action.

The proposal also points out that many Bahraini laws already permit a 60-day appeal period for administrative decisions.

For example, Bahrain Law No. 27/2022 concerning biological and toxin weapons allows for a 60-day appeal period following the rejection of an appeal.

While the Ministry of Oil and Environment and the Supreme Council for the Environment have refrained from expressing a governmental stance, the Supreme Judicial Council has stated that it is not within their jurisdiction to provide an opinion at this stage.

The proposed law is set for discussion and voting in the House of Representatives.

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Bahrain: Proposed Labour Law Changes Could Burden SMEs

The Daily Tribune, 6 January 2025: Changes to Bahrain’s labour laws could pose challenges for small and medium-sized businesses, as a local MP has cautioned, urging the government to enhance support for traders amid increasing economic pressures.

The amendments to Bahrain Decree-Law No. 12/2024, which update Article 40 of Bahrain Law No. 19/2006 regulating the labour market, come at a time when businesses are facing reduced purchasing power and cash flow issues.

The MP has argued that the current economic climate necessitates more flexibility in enforcing penalties on traders, particularly as some delays in meeting financial obligations are due to auditing firms prioritising larger companies.

He has emphasised that limited liability businesses need adequate time to submit their accounts and that it is unjust to penalise them for delays often caused by auditors focusing on major players.

The MP has highlighted the importance of simplifying processes for traders to ensure fair market competition and provide consumers with more affordable options.

He has also welcomed the amendments aimed at reducing legal disputes against small businesses, advocating for these enterprises to have the opportunity to adjust their operations and remain viable.

The proposed changes could support micro-businesses and encourage more Bahrainis to start their own ventures.

He has called for additional measures to bolster these efforts and ensure their success.

Statistics from the Labour Market Regulatory Authority (LMRA) have revealed numerous cases of foreign workers operating without permits and incidents of labour being employed without proper authorisation or breaching permit terms.

These figures highlight the need for tighter oversight while protecting legitimate businesses.

The MP has praised Tamkeen’s efforts in subsidising Bahraini wages in the private sector, describing these programs as crucial for making Bahrainis the preferred choice for employers.

He urged further investment in such schemes to attract more job seekers and called for improved cooperation between government bodies to address labour violations efficiently without overburdening small firms.

The recent amendments, highlight the necessity for a business-friendly environment that balances the rights of all parties.

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Bahrain: Bahrain Bourse Updates the Listing Rules

Bahrain Bourse announced the publication of its updated Listing Rules and Guidelines, which would be effective immediately in alignment with the Central Bank of Bahrain’s (CBB) ESG requirements.

Analysis

The revised Listing Rules and Guidelines incorporate new disclosure requirements related to Environmental, Social, and Governance (ESG) standards, as mandated by the CBB’s ‘Common Volume ESG Module’. These rules apply to all securities listed on the Mainboard Market and future listings on Bahrain Bourse.

The new ESG disclosure requirements aim to standardise reporting among issuers, requiring them to establish their own ESG reporting framework in line with BHB and CBB guidelines. Issuers must submit their ESG reports within six months after the end of their financial year, either as a stand-alone report or as part of the company’s annual report.

The CBB’s ‘Common Volume ESG Module’ is applicable to all listed companies for the reporting period ending December 2024. From the end of 2024, these reporting requirements will be applied comprehensively to listed companies and CBB licensees. The module also addresses ESG-related risks in alignment with Bahrain’s Economic Vision 2030, the UN Sustainable Development Goals (SDGs), and the “Blueprint Bahrain” national action plan announced during the COP28 conference in the UAE.

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Bahrain: Shura Council Approves Doubling Small Claims Limit to BD1,000 in Courts

The Daily Tribune, 18 December 2024: The Shura Council has endorsed a proposal to double the limit for small claims that can be substantiated through witness testimony, increasing it from BD500 to BD1,000.

This initiative aims to streamline and reduce the costs associated with resolving minor financial disputes in Bahrain’s courts.

Prompted by changing economic conditions, the proposal will now be sent to the government for legislative drafting.

If enacted, individuals will be able to use witness testimony for claims up to BD1,000, thereby reducing the reliance on costly legal procedures.

Members of the Shura Council have emphasised that this change would make the legal process more accessible for ordinary Bahrainis dealing with minor financial disagreements.

One council member noted that the previous 500-dinar limit was outdated and no longer aligned with current realities.

Increasing the limit to 1,000 dinars is expected to make legal action less intimidating and help individuals resolve disputes without incurring significant expenses.

The First Deputy Chairman of the Shura Council expressed support for the change but stressed the need for precise legal wording to ensure its effectiveness.

If approved, this adjustment would mark a significant step towards simplifying legal processes for Bahrain’s citizens, facilitating quicker and less burdensome resolutions for small-scale disputes.

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Bahrain: Shura Council Reviewing Amendments to Penal and Evidence Laws

The Shura Council in Bahrain discussed the report of the Foreign Affairs, Defense and National Security Committee regarding a draft law amending some provisions of the Penal Code and the report of the Legislative and Legal Affairs Committee on the proposed law amending some provisions of the Evidence Law in Civil and Commercial Matters.

Analysis
Protection of Modern Communication Means

The Council reviewed a report from the Committee on Foreign Affairs, Defense, and National Security regarding a draft law to amend certain provisions of Bahrain Decree-Law No. 15/1976 on the Penal Law, and associated with Bahrain Decree No. 7/2024. The committee recommended approval of the draft law in principle.

This legislative proposal aims to safeguard modern communication devices such as mobile phones and laptops, which contain personal information, banking data, and other sensitive details. The law seeks to impose stricter penalties for the unlawful exploitation of such data, reflecting the increased reliance on these devices in daily life and the need for protective legislation.

Amendments to the Civil and Commercial Evidence Law

Additionally, the Council discussed a report from the Legislative and Legal Affairs Committee on a proposed amendment to Bahrain Decree-Law No. 14/1996 on the Law of Evidence in Civil and Commercial Matters. The proposal suggests raising the maximum value threshold for legal transactions that can be proven by witness testimony from 500 to 1,000 dinars. This change considers the evolving economic conditions, the purchasing power of the currency, and the nature of current civil transactions. The committee recommended allowing consideration of this proposal, aligning with Bahrain’s legislative policy to update laws in response to economic developments.

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Bahrain: Enhances Fraud Protections with New Timeshare Regulation

The Daily Tribune, 9 December 2024: Holidaymakers and property investors in Bahrain are set to benefit from enhanced fraud protections following the Shura Council’s approval of a new law regulating timeshare agreements.

This legislation, linked to Bahrain Royal Decree No. 33/2023, is now on its way to the Speaker of Parliament for referral to the Crown Prince and Prime Minister, before its final submission to the King.

The law establishes clear legal guidelines for timeshare transactions, safeguarding the rights and responsibilities of all parties involved, while promoting investment in Bahrain’s tourism and property sectors.

The Services Committee’s report highlights six key areas covered by the draft law: oversight authority duties, licensing terms, contract conditions, inspections, legal enforcement, and criminal accountability.

The Tourism Minister described the law as a significant enhancement to Bahrain’s tourism sector, emphasising its role in establishing administrative procedures that protect consumers. She highlighted specific articles that address contractual matters and procedural safeguards, ensuring a comprehensive legal safety net for beneficiaries.

The legislation aligns with the Government Programme (2023-2026), which prioritises tourism as a central component of the country’s economic growth strategy. It supports major tourism projects and strengthens the legal framework governing property and tourism investments, with consumer protection at its core.

The responsible authority will have the power to enforce compliance, issue and renew licenses, and coordinate with other agencies overseeing timeshare schemes.

Strict conditions on licences, technical standards, and contract terms aim to eliminate fraudulent operators and protect buyers.

Despite initial concerns over vague wording in some sections, the Shura Council ultimately endorsed the measure after securing necessary revisions and clarifications.

The law is seen as a valuable framework that provides transparency for investors and safeguards the public interest, reflecting the collaborative efforts of various committees and authorities over the past months.

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