Step 1: Submission of applications for permits
Applications are made simultaneously for permits from the MIC and the Directorate of In- vestment and Company Administration (DICA). While the applications are submitted simul- taneously, in practice the DICA will not start to consider its application until the MIC has issued its conditional permit as described below.
Step 2:Processing of application by the MIC
While the application to the MIC is being processed by the MIC, the foreign investor will have two key obligations:
- to respond to any requests from the MIC for additional information or clarification of any aspect of the application;and
- to attend the first ‘technical’ meeting of the MIC usually held within two weeks from the date of submission of the application to the MIC (see step 4 below).
Step 3: Engaging with relevant Ministries
The MIC will send copies of the application to the relevant Ministry/Ministries with respon- sibility for the sector in which the proposed investment will be made.
Step 4: First technical meeting
The first technical meeting referred to in step 2 above will be attended by the foreign inves- tor, representatives of the technical departments of certain Ministries referred to in step 3 above and other relevant public administrations (such as the Ministries of construction, industry, labour and commerce, electric power, finance etc) at which the representatives will ask technical questions about the foreign investor’s proposal.
Step 5: Scrutiny of application
Following the first technical meeting, all Ministries involved will have seven days under the Foreign Investment Law in which to provide to the MIC their comments and recommenda- tions (or objections) to the proposed investment. This feedback is gathered together withthe internal recommendations of the MIC members and officers and a ‘scrutiny’ takes place in ac- cordance with the requirements of the Foreign Investment Law. The MIC may require changes and additions to the MIC application in response to issues raised by the MIC during the scruti- nyprocess. It is at this stage that if the MIC determines that the foreign investor’s proposed in- vestment does not meet the required criteria set out in the Foreign Investment Law, it willwrite to the foreign investor and inform it that the foreign investor’s proposed investment does not qualify for a permit, and it will state the reasons for reaching such conclusion.
Step 6: Approval meeting
If no communication is received notifying the foreign investor that its application has been rejected following the scrutiny process and there have been ‘no objection’ responses received from all concerned Ministries/relevant public administrations, the foreign investor will be notified within six to eight weeks of the first technical meeting of the proposed date of the second ‘approval’ meeting of the MIC, at which meeting the MIC members (nine individuals in all) will usually attend with case officers and other MIC staff.
Step 7: The MIC’s draft permit
Within a few days of the second ‘approval’ meeting, the MIC will issue to the foreign investor a copy of the permit it intends to issue at the end of the process. This permit contains all of the conditions imposed by the MIC in respect of the investment.
Step 8: The “conditions sheet”
Following the issue of the draft copy of the MIC permit, the DICA will issue to the foreign investor a letter attaching a “conditions sheet” (the Conditions Sheet Letter) whichmust be signed and returned by the investor and which will include a number of conditions.
Step 9: Permit to Trade and Certificate of Incorporation
If the foreign investor pays the DICA registration fee on receipt of the Conditions Sheet Let- ter, the DICA will issue a temporary Permit to Trade and Certificate of Incorporation within a day or two which will allow the foreign investor to begin preliminary operations including opening a foreign exchange bank account with a local bank authorizedto conduct foreign exchange activities. The temporary Permit to Trade and Certificate of Incorporation are each valid for six months but in our experience the DICA will issue the final Permit to Trade and Certificate of Incorporation within a shorter timeframe than this.
Availability of exemptions from foreign ownership restrictions
There are currently no general exemptions from the above foreign ownership restrictions. Any exemptions are considered by the relevant Government body on a case-bycase basis.
Expected changes to foreign ownership restrictions
It is widely expected insurance sector will partially open for foreign investment soon after giving permission for some foreign banks.
