New Taxes Inform New Appointment at DLA Piper

Dubai and Saudi Arabia are adding a VAT.

The UAE and Saudi Arabia will both be implementing a value added tax as of January 1, 2018, In anticipation of that event DLA Piper, a global law firm, appointed a new Middle East head of tax in the company’s branch in Dubai.

Ton Van Doremalen began in his new position on December 3. He has more than 16 years of experience in international tax structuring in a number of countries, including the Netherlands, Luxembourg, UK, the UAE, the GCC and Egypt.

Roderik Bouwman, global co-chair at DLA Piper, said, “We are delighted to have Ton on board as the founder of DLA Piper’s Middle Eastern Tax practice, at a time of highly anticipated tax changes and regulation in the Middle East. Ton is widely respected within the industry and brings energy, business acumen and an entrepreneurial spirit to the role.”

DLA Piper is an award-winning law firm, having been recognized as the “International Law Firm of the Year” at last year’s Middle East Legal Awards.

Regional managing partner Peter Somekh said that, “last year has seen us further consolidate our already strong presence in the Middle East. We see the creation of a dedicated Tax practice as invaluable as the region continues to develop as a major international business hub, with Ton’s arrival further reinforcing our ongoing commitment to delivering clients a full-service local offering.”

UAE Wins First Place in ME Best Place for Business

Dubai, UAE

The World Bank recognized the United Arab Emirates as the best place in the Middle East to do business. Among the cities of the world it was ranked 21st.

The ranking is based on a study conducted by the World Bank. According to the study the rise to first place of the UAE was due to its economic policy reforms enacted over the past year which reduced bureaucratic hurdles for business. Four significant reforms were undertaken, including improved construction quality control and shortening the time to get building permits.

The World Bank added that during the course of the 15 years in which it has ranked cities for their business friendliness, the UAE has made the largest number of changes to its business structures in the region, with a total of 33.

Other countries in the Gulf ranked as follows:
• Bahrain-66th
• Oman-71st
• Qatar-83rd
• Saudi Arabia-92nd
• Kuwait-96th

Oman Halts Bids for A Third Mobile Phone Operator

After taking bids from several possible mobile phone companies since earlier this year, the Sultanate of Oman has decided to instead give administration of Oman’s third mobile phone carrier to a group which its backed by Oman’s wealth funds.

The state-run Oman News Agency reported that the new mobile phone company will be owned by the funds and run together with a “strategic global partner.” The decision was made to strengthen the role of wealth funds in the country and have them contribute more to economic growth.

When bidding for a third company was initiated earlier this year several companies participated, including, Saudi Telecom Co, Emirates Telecommunications Group, Sudatel Telecom Group and Mobile Telecommunications Co. The decision was supposed to have been made by September 4, but it was postponed by a month.
The Sultanate is studying the best ways to improve the way it manages its investments. It is considering a possible merger of its two main sovereign wealth funds during the prolonged downturn of oil prices.

If the State General Reserve Fund merged with the smaller peer Oman Investment Fund, the new fund would be worth about $25 billion in assets.

The two companies that now serve Oman for mobile services are Oman Telecommunications Co. and Ooredoo Oman, a unit of Qatar-based Ooredoo.

Vis Raghavan Appointed CEO of EMEA Business at JP Morgan

Viswas Raghavan, who has been with JP Morgan Chase since 2000 in different positions, was appointed to be the new chief executive of the investment bank’s Europe, Middle East and Africa business. Prior to his new appointment Raghavan held the post of deputy CEO of JP Morgan’s EMEA division. In his new role he will oversee the bank’s EMEA business in asset management and private banking. He will also oversee the corporate and investment bank.

His other main role will be to run the JP Morgan Securities, plc as CEO. This appointment is in the wake of Daniel Pinto’s promotion to joint global head of technology and operations across the JPMorgan Chase group after his involvement as corporate and investment bank head. H e took over when Matt Zames, the chief operation officer, departed.

Raghavan will report to Pinto, as well as to Mary Erdoes, the CEO of the asset management division.

 

Cathay Pacific Air Dubbing Dubai Hub

Cathay Pacific Airlines. Photo courtesy Aero Icarus.

The Hong Kong-based airline, Cathay Pacific, has designated Dubai as its official hub for all passenger and cargo air traffic throughout the Middle East. The airline said that the decision was part of its overall “renewed focus” strategy.

Beginning on September 1 Jonathan Ng will be the country manager for Cathay Pacific in the Middle East. Previously Ng was the company’s country manager for Bahrain and Saudi Arabia. Regional sales head and marketing manager for the Middle East will be filled by Nikhil Kilpady, transferring from the UAE and Oman.

The airlines routes include two flights per day from Dubai to Hong Kong, and once a day service from Bahrain to Hong Kong. There is also a daily flight from Dubai and Bahrain and back. Cathay Pacific no longer services Riyadh since last March. The airline also used to have service to Doha, Jeddah and Abu Dhabi.

The airline announced it had its first annual revenue loss since the global economic crisis of 2008. It said increased competition from mainland Chinese carriers is hurting their bottom line. The company has about 33,700 employees across the world, as of March. The company recently had to remove 600 jobs from its roster in response to the difficult economic times.

Cigna Health Acquires Zurich Insurance Middle East

The giant health services company Cigna announced that it has successfully acquired the general insurer Zurich Insurance Middle East. For the time being the new division will maintain its current name. Plans to re-brand as a Cigna company are on hold until the takeover is completely finalized.

Now Cigna offers group health solutions and services for multinational and small businesses in the Middle East. The addition of Zurich to their constellation of companies will allow Cigna to provide health services also to individuals, employers, and governments in the UAE, Lebanon, Kuwait, and Oman.

“Cigna has enjoyed a strong presence in the Middle East for more than 15 years through our local partners. Today, we mark a significant new phase of our journey and commitment to the region,” said Jason Sadler, president of Cigna International Markets.

The former CEO of Cigna in Taiwan, Arthur Cozad, was appointed to be the new CEO of the Middle East market. Earlier in 2017 the company opened a new branch in Dubai, at the International Financial center, designated to be the company’s regional headquarters.
Cigna has a 95 million customer base served by over 40,000 employees.

Royal Jordanian Airlines in the Clear with US Homeland Security

The national carrier of Jordan, Royal Jordanian Airlines, announced that passengers

Royal Jordanian Airlines Airbus A319. Photo by Aero Icarus

traveling from Amman to the United States will be allowed to bring their laptops and other electronic devices into the plane’s cabin.

Royal Jordanian is now the fifth Middle Eastern-based airline to be taken off the US’s exclusion list, which demands that passengers hand over their laptops, iPads and other electronics to airline officials to be stored out of reach of the passengers to the flight to the US. The ban made traveling to the US inconvenient, especially for businessmen who use their laptops for work while in flight.

The other four airlines who now meet the security standards of the US Department of Homeland Security are Emirates, Etihad Airways, Qatar Airways and Turkish Airline.
Beginning in March this year the US banned laptops and other larger electronics from the cabins of direct flights originating in 10 airports in eight countries: Egypt, Morocco, Jordan, the United Arab Emirates, Saudi Arabia, Kuwait, Qatar and Turkey, in fear that those devices could be used to hide explosives or other means of disrupting flights.

The ban was lifted from Royal Jordanian flights for the same reasons it was lifted from the other airlines, due to improved security processes by those airlines for their US-bound routes.

On June 29, the US announced more strict security measures for in-bound flights which will entail longer time for passenger screening and the examination of electronic devices for explosives. The measures are due to take effect within three weeks of the announcement. It is estimated that the upgraded screenings will affect 325,000 passengers each day, traveling on 180 airlines, from 280 airports all over the world.

Russian Hackers Responsible for Sowing Discord Middle East

Emir of Qatar Tamim bin Hamad Al-Thani. Picture by Presidencia de la República Mexicana

CNN reported on Tuesday that Russian hackers were able to insert a made-up news story into Qatar’s state news agency in order to influence diplomacy in the Middle East in a negative way.

According to US authorities, Russia was most likely trying to create a breach in relations between the United States and its allies in the Gulf region.

US intelligence agencies hinted that Russian hackers were connected to the first cyberattack that took place two weeks ago. Since that event FBI agents went to Doha, the capital of Qatar, to help them investigate who was responsible for the original attack.

Although it is clear that some entities based in Russia are the source of the hacking, it is not yet known if they are criminal organizations or Russian military groups, like perhaps the GRU. The actual source might not be that significant since, as one unnamed official said, based on previous intelligence on Russia’s cyber-hacking behavior,

“nothing much happens in that country without the blessing of the government.”

The Qatar News Agency published a story on May 23 that they stated was falsely attributed to Sheikh Tamim bin Hamad Al-Thani, the country’s emir. The story quoted the emir as wondering what the future has in store for President Trump and the hostility the US harbors towards Iran. Iran is an ally of Qatar, but an enemy of the other Gulf states, including US ally Saudi Arabia.

The story said that Al-Thani said, “There is no wisdom in harboring hostility towards Iran.” Qatar said that the report itself as well as the quote were not true, calling the report a “shameful cybercrime.”

Relations between Qatar and the other Gulf Cooperation states hit a new low this week when it was announced that Bahrain, Egypt, Saudi Arabia, and the United Arab Emirates were going to withdraw their ambassadors and support staff out of Qatar, and cease flights in the region.

“Whatever has been thrown as an accusation is all based on misinformation and we think that the entire crisis being based on misinformation,” Qatari Foreign Minister Sheikh Mohammed Bin Abdulrahman al-Thani said. “Because it was started based on fabricated news, being wedged and being inserted in our national news agency which was hacked and proved by the FBI.”

Oman Air Flying Direct to Nairobi from Muscat

Targeting the market in the Middle East, Oman Air added several direct flights per week to Kenyan’s capital, Nairobi from the Omani capital of Muscat.

From now until May 31 Oman Air will offer customers a promotional return fare of $450. The airline, which is the national carrier of the Sultanate of Oman, will offer travelers four flights per week from Muscat to Nairobi.

Samer Abu Ltaif to Head Microsoft in Gulf

Microsoft sign at the entrance of Microsoft Dubai office.

The multinational hi-tech company Microsoft announced its appointment of Samer Abu Ltaif to be the new president for Middle East and Africa.

Abu Ltaif joined Microsoft in 2004 and served as the regional general manager of Microsoft Gulf. He had a crucial role in expanding the company’s Gulf presence and developing the 1,400 partners in the region.

He will be taking over from Ali Faramawy, who was the head of the MEA region for the past 13 years. After his stint as corporate vice president Faramawy will take over as the global head of the Emerging Markets Digital Transformation Organization.

“MEA has tremendous potential. The rich diversity across the region, combined with the fast-growing youth population and innovative spirit, opens up enormous opportunity,” Abu Ltaif said.

He will remain based in Dubai, which is one of the key hubs for Microsoft in the region.
The Dubai office of Microsoft was launched 15 years ago at the beginning of Dubai’s Internet City.