Weekly Spotlight: Five Oman Sultani Decrees Approved

This week the spotlight is on legal and regulatory developments in Oman, where the Sultan has approved five Sultani Decrees, including a Decree amending the country’s Law on the Protection of Competition and Prevention of Monopoly.

Oman Sultani Decree No. 22/2018 amends Article 1 of Oman Sultani Decree No. 67/2014 replaces the word ‘Authority’ wherever it occurs in the Law with ‘Centre’ and replaces the definition of the ‘Authority’ wherever it occurs in the law with ‘The Centre: Centre of Protection of Competition and Prevention of Monopoly’. Anything which contradicts or contravenes the Decree is cancelled. It will be published in the Official Gazette and come into force the day after it is published.

The Sultan also approved a Sultani Decree amending Oman Sultani Decree No. 35/2012 which promulgates the System of the Public Authority for Investment Promotion and Exports Development. Under Oman Sultani Decree No. 23/2018, anything which contradicts or contravenes the Decree is cancelled. It will be published in the Official Gazette and come into force the day after it is published.

In addition, the Sultan approved Oman Sultani Decree No. 26/2018 establishing the Oman Commercial Arbitration Centre. It will be affiliated to the Oman Chamber of Commerce and Industry but will have its own legal identity and financial and administrative autonomy. The Chairman of the Board of Directors of the Oman Chamber of Commerce and Industry will issue the operational systems and functions of the Commercial Arbitration Centre. Anything which contradicts it is cancelled. It will be published in the Official Gazette and come into force on the day it is published.

Weekly Spotlight: Regulatory Amendments Issued by Oman’s Central Bank to Enhance the Sultanate’s Financial Industry

This week the spotlight is on regulatory developments in Oman, where the Sultanate’s Central Bank has issued a number of regulatory amendments to enhance the Sultanate’s financial industry. The amendments came into force on 1 April 2018.

The Bank has reduced the capital adequacy ratio requirements for banks from 12 to 11%. This will increase banks’ lending capacity. It is expected to make an additional 2.6 billion Riyals of credit available with 7.8 billion Rials instead of 5.2 billion Rials being released. The Bank has also decided to remove the regulatory restrictions imposed on the risk weights to claims on sovereign and central banks. It comes as the Bank looks to implement the Basel Committee guidelines.

The Bank has decided to increase the prudential limit for all currencies from 15 to 20% for three-to-six months, 25% per cent for six-to-nine months and 25% for nine-to-12 months. The aim is to give banks more flexibility to utilise available credit lines available from foreign and local correspondents at a reasonable rate. Finally the Bank has increased the prudential limit ratio of credit exposure to non-residents and placement of banks funds abroad to banks’ local net worth from 50 to 75%. It is hoped this change will provide banks with greater flexibility to manage their liquidity surpluses, diversify their revenues and increase their external borrowing capacity to finance local projects.