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==Financial regulatory framework==
==Financial regulatory framework==
===Bank supervision===
===Bank supervision===
The central bank, Banco Central do Brasil (BCB), is in charge of regulating, inspecting and supervising all financial institutions. At the same time, it is responsible for controlling monetary stability. Its main goal is to ensure the stability of the currency's purchasing power and a solid and efficient financial system.
The banking sector in Qatar is supervised, licensed and controlled by the Qatar Central Bank (QCB).  
Regarding the latter, in May 2011 the BCB created a Financial Stability Committee (COMEF) as part of its organisation to evaluate financial stability in the country and to implement strategies to keep systemic risks under control. The Committee is made up of the BCB president and directors and all the deputy governors of the monetary authority. It centralises all the activities related to financial stability within the BCB.
The Qatar Financial Centre (QFC) Regulatory Authority regulates and supervises financial service firms, including banks, which operate in the Qatar Financial Centre.
In addition to BCB's activities, the Securities Commission (CVM) also has regulatory and supervisory authority regarding the activities of investment banks, third party fund managements (such as mutual funds and foreign investment portfolio), intermediaries (such as commodities and future exchange and stock exchanges) and some settlement and custody systems.


===Exchange controls===
===Exchange controls===
Resolution 3.265 dated 4 March 2005 has consolidated the two existing foreign exchange markets, commercial and tourism, into one single floating exchange rate market. This resolution helped to liberalise exchange controls.
Exchange controls are not applied in Qatar.
The BCB has announced several measures to help reduce structural exchange controls, including rulings for the consolida-tion of the Brazilian exchange markets into one single floating exchange rate market. As from 3 February 2014, the Interna-tional Capital and Foreign Market Regulation (RMCCI) has been replaced by four new circulars (Circulars 3691, 3690, 3689 and 3688, of 16 December 2013), in a move aimed at making regulation clearer and simplifying foreign exchange policies. The fol-lowing provisions were, however, maintained:
* Obligation to register with BCB (particularly all foreign exchange transactions).
* Obligation to record foreign exchange transactions via foreign exchange contracts for all transactions higher than USD 3,000.
* Rules applicable to foreign capital investments and loans.
* Requirement to observe operational procedures concerning the recording with BCB of data related to loans, investments and commercial transactions.


===Restriction on foreign investment/ownership===
==Taxation framework==
In general, there are no restrictions for the participation of foreign capital in national activities. Few activities, however, are restricted to foreign investors. This is the case for postal services, health services, sanitation, nuclear energy and airlines with domestic flights. There are also certain restrictions on participation of foreign capital in financial institutions, insurance companies and in the media sector. With respect to financial institutions, however, the restrictions can be lifted with regard to national interest.
There are two separate tax regimes in operation in Qatar and an entity is under the remit of only one regime. By default an entity is under the State of Qatar regime. Alternatively, an entity is under the remit of the QFC regime if the entity is licensed with the QFC.
 
===Corporate taxation===
Tax is levied only on foreign companies’ income derived from activities carried out wholly or partly in Qatar. For joint ventures, only the foreign shareholders’ portion of the profit is taxable. Nationals from the Gulf Cooperation Council (GCC) countries are treated as Qatari nationals and consequently are not currently subject to income tax provided they are resident in Qatar. A company that is wholly Qatari or GCC owned and resident in Qatar will not be required to pay tax. A flat-rate tax of 10% applies; except for oil and gas companies, where a rate of 35% applies.
Under the QFC regime, income is taxable at a flat rate of 10%. Wholly Qatar government-owned QFC entities are exempt (there is no exemption for QFC entities that are wholly owned by Qatari or GCC nationals). Only local-source profits are taxable.
 
===Capital gains===
In general, gains arising from the sale of business assets and business interests are treated as ordinary income. Capital gains arising from the disposal of real estate and securities derived by natural persons are exempt from tax, provided they are not part of the assets of a taxable activity.


===Restriction on non-residents' operations in domestic markets===
===Taxation of dividends===
Investments in financial and capital markets by non-resident investors follow Resolution 2.689 dated 2000. The two main restrictions are:
A final withholding tax is levied on payments made to non-residents with respect to activities not connected with a permanent establishment in Qatar. The rate of withholding tax stated in the law ranges from 5% to 7%.
* Enrolment with the Securities Commission and Internal Revenues Board.
Withholding tax applies to royalties (5%), technical fees (5%), commissions (7%), brokerage fees (7%), director’s fees (7%), attendance fees (7%) and any other payments for services carried out wholly or partly in Qatar (7%). The law states that the rate of withholding tax on interest is 7% with certain exceptions.  
* Appointment of at least one representative in Brazil.
There are no withholding taxes in the QFC.


==Taxation framework==
===Transfer pricing===
Brazil has a complex and inefficient tax system. The tax burden was around 39% of the GDP in 2012. Federal taxes amount to 25% of the GDP and state and municipal taxes to the remainder.
Under local Qatar law there is no specific transfer pricing legislation; however, the anti-avoidance rules give the tax authorities the power to apply an arm’s-length value where an arrangement or transaction has been undertaken with one of the main purposes being to avoid the payment of tax. The anti-avoidance provisions specifically state that the comparable unrelated price (CUP) method should be used, unless approval is given by the tax authorities to apply an alternative OECD-approved transfer pricing method.
 
===Thin capitalisation===
There are no thin capitalisation rules in Qatar, but interest payments made by permanent establishment to its head office and related parties are not deductible for tax purposes.  


===Federal taxes===
===Indirect taxes===
* '''Income taxes''' – Personal income tax (IRPF) is levied at a rate that varies from 7.5% to 27.5% depending on the income level.
There are no consumption taxes in Qatar.  
* Corporate income tax (IRPJ) is levied at a rate of 15%. In addition, a 10% surtax is imposed on taxable income exceeding BRL 240,000 on an annual basis. Income, capital gains and profits are equally subject to corporate income taxes. There is no distinction with respect to the origin of the capital (foreign or domestic).
* Finally, an income withholding tax is levied on certain domestic transactions (such as income derived from banking investments) and on non-residents' income that has a Brazilian source of payment. Rates vary but in general are within the 15% to 25% range.
* '''Social charges''' – Social contribution tax (CSLL) is levied on entities subject to the IRPJ. The CSLL rate is 9% in general and 15% for financial institutions.
* Social contribution for social security funding (COFINS) levied on gross income. Rates vary from 3% to 8%.
* Other social charges include a contribution to the social integration programme (PIS) and a contribution for the intervention in the economic domain (CIDE), which is levied on fuel operations, on remittance to foreign individuals, on royalties and on technologic transfers.
* '''Value-added taxes''' – The tax on industrialised products (IPI) is levied on industrial production, including industrialised imports but excluding exports. The average rate is 20%.
* '''Financial taxes''' – The tax on financial transactions (IOF) is levied on credit operations, insurance premiums, securities trading and exchange transactions. Rates vary largely depending on the transaction. In the most recent years, the government has been using the IOF tax on foreign capital inflows with the goal to try to control exchange rate fluctuations. More recently, the government has been reducing and eliminating IOF taxes on foreign capital introduced in the last few years.
* '''Other taxes''' – Other federal taxes include import and export taxes and a rural property tax (ITR).


===State taxes===
Tax information provided by Deloitte Touche Tohmatsu (www.deloitte.com) and Deloitte Highlight 2014.
* '''Value-added taxes''' – The tax on goods, communications and transportation (ICMS) varies from 7% to 25% depending on the state. It averages 18%. Exports are exempt.
* '''Other taxes''' – Other state taxes include an inheritance and gifts tax and a tax on the ownership of motor vehicles.
* '''Municipal taxes''' – Municipal taxes include a tax on urban properties, a tax on real estate transfers and a tax on services, which applies to a set of specific services.


==Banking system==
==Banking service provision==
Since the launch of the Real Plan in 1994, the Brazilian financial system has experienced a deep process of restructuring, mainly the consolidation of the number of banks, reduction of a public sector presence in the market and an increase in the participation of foreign banks. Since 2008, however, there has been a sharp expansion of state-owned commercial and development banks and credit from public sector banks now represents 52% of the total credit market in Brazil, which compares to 34% in 2007.
The Qatari banking sector supports a high number of banks in comparison to its size and a number of large international banks have a presence in the country.
Brazil has implemented Basel III standards. As the monetary authorities noted, domestic institutions are in a relatively good position to meet the new capital requirements, given their current capital levels and the Brazilian prudential regulation now in force. In line with Basel III provisions, financial authorities have established a schedule of gradual deployment of capital requirements from 2013 to 2019.  
The banking sector currently contains 18 commercial banks, consisting of 11 local banks (including four Islamic banks) and seven branches of foreign banks. Conventional banking services are provided by seven local banks and all seven branches of foreign banks. The 11 locally-owned banks in Qatar account for around 97.5% of the sector’s total assets.
The banking sector is dominated by Qatar National Bank (QNB), which has a market share of over half of all banking assets. QNB is 50% state-owned through the Qatar Investment Authority (QIA) sovereign wealth fund.  
The QIA took a stake in all locally-owned banks in 2008 (with the exception of QNB, in which it already owned 50%) to protect the sector from the effects of the global economic downturn. At the start of 2009, it purchased a further 5% of the capital of all national banks, except QNB. A further 5% of the capital of several domestic banks was purchased by the QIA in December 2009.  


==Clearing and payment systems==
==Clearing and payment systems==
===Clearing===
===Clearing systems===
The launch of the Sistema de Tranferência de Resevas – STR (Reserves Transfer System), in April 2002, marked the beginning of a new phase in the Brazilian payment system. The focus of the system was redirected to risks management from dealing with high inflation. With this system, operated by the Central Bank, Brazil joined the group of countries whose interbank funds transfer can be settled irrevocably and unconditionally on a real-time basis.  
There are three main payment and settlement systems in Qatar: the Qatar Payment System (QPS), QATCH, and the Electronic Cheque Clearing system (ECC). The National ATM and POS Switch (NAPS) processes card payments.
The core features of the payment system are:
All banks and bank branches in Qatar participate in QPS, QATCH and the NAPS.
* Clear definition of the role of the BCB in the payment system and establishment of a well-founded legal basis to allow better risk control.
 
* Setting up of a large-value fund transfer system at the BCB, operating under a real-time gross settlement (RTGS) mode and a real-time monitoring of bank's reserve account balances to avoid the possibility of overdrafts at any time.
* '''''Qatar Central Bank Payment System (QPS)''''' – the real-time gross settlement (RTGS) system processes high-value and urgent interbank fund transfers. The QPS uses the SWIFT network for the transmission of payment messages and to communicate with participants. Payments are settled in real time with immediate finality.
* Enabling clearing houses to assume certainty of settlement through the establishment of proper safeguard mechanisms.  
* '''''National Automated Clearing House Solution (QATCH)''''' – launched in April 2010, QATCH is Qatar’s automated clearing house system for low-value (below QAR 250,000) bulk direct debit and credit payments. QATCH enables the exchange of interbank payment messages between banks in real time. In addition to direct debits, QATCH can also be used for direct deposits such as private and government salary and pension payments, dividends, subsidies and government transactions such as social security payments.
* Clear definition of all the risks involved in every stage of the pre-settlement and settlement process.
* '''''Electronic cheque clearing system''''' – the electronic cheque clearing system has been used to clear cheques in Qatar since 2001. The system uses cheque image exchange, rather than the physical movement of cheques, enabling the same-day clearing of cheques throughout Qatar. The ECC processes cheques above QAR250,000 on a real-time basis while cheques below QAR250,000 are processed on a net basis, at the end of each clearing day. Final settlement takes place across participants’ accounts held at the QCB.  


===Payments===
===Payments===
* '''Cheques''' – In 2012 cheques represented 6% of the total number of transactions. This payment instrument market share
Electronic funds transfer and cheques are the dominant form of cashless payments in Qatar in terms of both value and volume. Card payments are increasing in popularity as a result of an increase in point-of-sale (POS) terminals and ATMs. Direct debits and direct credit are also available.
has been decreasing in the last years as payment cards have been gaining in importance (cheques' share was 62% in 1999).
* '''''Credit transfers''''' – credit transfers are used for high-value transactions and wage payments. Credit transfers can be initiated through e-banking systems for consumer payments.  
* '''Payment cards''' – The use of credit and debit cards has evolved significantly in the last few years. According to the Central Bank, transactions with payment cards represented 34% of total transactions in 2012. In that same year, the BCB implemented Resolution 3.919 to set a new and more modern legal basis for the sound development of the payment card industry in Brazil.
* '''''Payment cards''''' – debit and credit card use is increasing in popularity in Qatar. There are also around 1.2 million ATM cards. All cards issued comply with EMV chip technology or standards. Each bank in Qatar has its own individual clearing and settlement arrangement with the respective card networks, predominantly MasterCard or Visa.
* '''Credit transfers''' – Increasingly, companies are using banks for their electronic payrolls. Since direct payroll credit is now mandatory for most companies, banks have developed special services targeted at employees and are actively pursuing payroll accounts, mainly because the choice of bank where the employee would receive the salary was made by the companies and not by the employee. Since 2006, a regulation implemented by Central Bank, Resolution 3.402, allows the employees of private companies to choose the bank that their salary will be credited to; for public sector companies this regulation started in 2009. In 2012, 38% of all payment operations were made through credit transfers.
The number of ATMs has increased in Qatar along with payment card use. All banks operating in Qatar are members of the National ATM and POS Switch (NAPS) card payments process network. NAPS connects the ATM network to other GCC member states via the GCCNet ATM network.
* '''Direct debit''' – The number of transactions in which the customer allows a company to make charges to his or her bank account automatically increased from practically zero in 2008 to 19% of total payment transactions in 2012.
* '''''Direct debits''''' – direct debits in Qatar have primarily been used for low-value recurring transactions such as utility payments. Payments are processed through QATCH for next-day settlement.  
* '''Electronic payments''' – There has been a strong government push towards electronic tax payment methods by corporations and financial institutions.
* '''''Cheques''''' – cheques are the most popular form of cashless payment in Qatar and their usage has increased dramatically in recent years. Cheques above QAR250,000 are processed on a real-time basis while cheques below QAR250,000 are processed on a net basis at the end of each clearing day.
* '''Collections''' – The basic collection service consists of specialised collection slips (boletos) that customers use when paying by cash or cheque at the teller windows for their commercial or consumer merchandise or services. Such payments can also be electronic. Collection slips are the main method of payment in Brazil. Boletos services are highly sophisticated, evolving to a full paperless process. The bank collects the funds, prepares detailed reports and provides them to their corporate customers either electronically or in paper form. While large banks with an operating services franchise still have in-branch collection windows for their corporate customers, cheaper new alternatives based on centralised electronic funds transfer are frequently used.
 
==Cash and bank account management==
===Interest-bearing accounts===
Interest is available on savings and time deposit accounts. Interest is payable on current account balances, with approval from the QCB.
Most banks in Qatar have now implemented a minimum initial deposit scheme for opening saving or current accounts. Customers are usually required to deposit a minimum initial QAR3,000 for savings accounts and QAR5,000 for current accounts.
 
===Account opening requirements===
Residents are permitted to hold domestic and foreign currency accounts both domestically and abroad. Resident domestic currency accounts are fully convertible into foreign currency.
Non-residents are permitted to hold domestic and foreign currency accounts in Qatar. Non-residents cannot open current accounts. Non-resident domestic currency accounts can be converted into foreign currency with prior approval from the QCB.  
 
===Money laundering===
Qatar has implemented anti-money laundering legislation (including Law No 3 of 2004 on Combating Terrorism and Law No 4 of 2010 on Combating Money Laundering and Terrorism Financing). The Financial Information Unit issued a Guide to Money Laundering and Terrorism Financing Suspicious Transaction Reporting in April 2010. The Qatar Financial Centre Regulatory Authority (QFCRA) has also issued related Regulations and Rules.
Qatar is a member of the Gulf Cooperation Council (GCC), which is a member of the Financial Action Task Force (FATF). It is also a member of the Middle East and North Africa Financial Action Task Force (MENAFATF).
Qatar has established a financial intelligence unit (FIU), The Financial Information Unit, within the Central Bank of Qatar, is a member of the Egmont Group.
 
Supplied by BCL Burton Copeland (www.bcl.com). Data as at March 2014.
 
===Cash concentration===
Cash concentration is permitted in Qatar and is usually offered by international banks.
 
===Cross-border issues===
Cross-border cash concentration is permitted in Qatar and is offered by international banks.
 
===Notional pooling===
Notional pooling is available in Qatar.


===Benchmark rates===
===Electronic and internet banking===
The benchmark interest rate used locally is the SELIC (Sistema Especial de Liquidação e Custodia, or Special System of Clearance and Custody). The SELIC rate is the BCB's overnight lending rate.
Electronic banking is widely available from the larger commercial banks in Qatar.
The BCB has increased the SELIC rate nine times from the record low level observed at the end of 2012 and beginning of 2013 (7.25%) to 11% in April 2014. The current tightening cycle is aimed at containing Brazil's highest inflation in over a decade.
Most banks offer some kind of internet-based balance reporting and transaction initiation services, although these are mainly used by businesses. In 2011, the QCB unveiled the Qatar Electronic Payment Gateway (Q-Pay) to facilitate real-time payments for online transactions. Q-Pay is based on an electronic wallet system and allows card holders (debit and credit cards) to make online payments in real time. Mobile money transfer services are also offered in Qatar by the major telecom network providers.  


==Corporate governance==
==Liquidity management==
In May of 2008 the Bolsa de Valores de Sao Paulo (BOVESPA) and the Bolsa de Mercadorias e Futuros (BM&F) announced their merger. The new stock exchange institution is among the main stock exchanges in the world, the second in the Americas and the leader in Latin America.
===Short-term investments===
Both government authorities and representatives of financial markets have been studying the adoption of measures to transform the city of Sao Paulo into a global financial hub.
Short-term investments include:
* '''''Treasury bills''''' – the Qatari government issues T-bills, generally for maturities of less than one year.
* '''''Repurchase agreements (repos)''''' – repos are available from commercial banks in Qatar, using government securities as collateral.
* '''''Term deposits''''' – time deposits are available in QAR and foreign currency, with interest paid on maturity. Maturities for time deposits are usually between one month and a year.
* '''''Certificates of deposit (CDs)''''' – CDs (certificates of deposit) are available in Qatar, with a range of maturity dates.


===Short-term borrowing===
Borrowing instruments include:
* '''''Overdrafts''''' – overdrafts are available on current accounts from most banks.
* '''''Bank lines of credit and loans''''' – loans and lines of credit are offered by commercial banks in Qatar.
* '''''Commercial paper''''' – there is a commercial paper market in Qatar.


==Websites==
===Websites===
'''Government'''
'''Qatar Central Bank'''
* [http://www.brasil.gov.br http://www.brasil.gov.br]
* [http://www.qcb.gov.qa http://www.qcb.gov.qa]
'''Ministry of Finance'''
'''Qatar National Bank'''
* [http://www.receita.fazenda.gov.br http://www.receita.fazenda.gov.br]
* [http://www.qnb.com.qa http://www.qnb.com.qa]
'''Central Bank – Banco Central do Brasil'''
'''Commercial Bank of Qatar'''
* [http://www.bcb.gov.br http://www.bcb.gov.br]
* [http://www.cbq.com.qa http://www.cbq.com.qa]
'''Securities Commission – CVM'''
'''Doha Bank'''
* [http://www.cvm.gov.br http://www.cvm.gov.br]
* [http://www.dohabank.com.qa http://www.dohabank.com.qa]
'''Macroeconomic analysis of the country by BBVA'''
'''Qatar Financial Centre'''
* [http://www.bbvaresearch.com http://www.bbvaresearch.com]
* [http://www.qfc.com.qa http://www.qfc.com.qa]
'''Qatar Financial Centre Regulatory Authority'''
* [http://www.qfcra.com http://www.qfcra.com]
'''Ministry of Economy and Finance'''
* [http://www.mof.gov.qa http://www.mof.gov.qa]
'''Qatar Chamber of Commerce and Industry'''
* [http://www.qatarchamber.com http://www.qatarchamber.com]
'''General Secretariat for Development Planning'''
* [http://www.gsdp.gov.qa http://www.gsdp.gov.qa]
'''Qatar Exchange'''
* [http://www.qe.com.qa http://www.qe.com.qa]


[[Category:Book_Export]]
[[Category:Book_Export]]

Revision as of 09:34, 2 September 2014

KEY COUNTRY FACTS
Flag of Qatar
System of government: emirate
Population: 2.12 million (2014 estimate)
Currency: Qatari riyal (QAR)
FX regime: conventional peg
GDP: US$213.1 (2013 estimate)
FATF member: yes, via GCC
Treasury association: ACT Middle East

Financial regulatory framework

Bank supervision

The banking sector in Qatar is supervised, licensed and controlled by the Qatar Central Bank (QCB). The Qatar Financial Centre (QFC) Regulatory Authority regulates and supervises financial service firms, including banks, which operate in the Qatar Financial Centre.

Exchange controls

Exchange controls are not applied in Qatar.

Taxation framework

There are two separate tax regimes in operation in Qatar and an entity is under the remit of only one regime. By default an entity is under the State of Qatar regime. Alternatively, an entity is under the remit of the QFC regime if the entity is licensed with the QFC.

Corporate taxation

Tax is levied only on foreign companies’ income derived from activities carried out wholly or partly in Qatar. For joint ventures, only the foreign shareholders’ portion of the profit is taxable. Nationals from the Gulf Cooperation Council (GCC) countries are treated as Qatari nationals and consequently are not currently subject to income tax provided they are resident in Qatar. A company that is wholly Qatari or GCC owned and resident in Qatar will not be required to pay tax. A flat-rate tax of 10% applies; except for oil and gas companies, where a rate of 35% applies. Under the QFC regime, income is taxable at a flat rate of 10%. Wholly Qatar government-owned QFC entities are exempt (there is no exemption for QFC entities that are wholly owned by Qatari or GCC nationals). Only local-source profits are taxable.

Capital gains

In general, gains arising from the sale of business assets and business interests are treated as ordinary income. Capital gains arising from the disposal of real estate and securities derived by natural persons are exempt from tax, provided they are not part of the assets of a taxable activity.

Taxation of dividends

A final withholding tax is levied on payments made to non-residents with respect to activities not connected with a permanent establishment in Qatar. The rate of withholding tax stated in the law ranges from 5% to 7%. Withholding tax applies to royalties (5%), technical fees (5%), commissions (7%), brokerage fees (7%), director’s fees (7%), attendance fees (7%) and any other payments for services carried out wholly or partly in Qatar (7%). The law states that the rate of withholding tax on interest is 7% with certain exceptions. There are no withholding taxes in the QFC.

Transfer pricing

Under local Qatar law there is no specific transfer pricing legislation; however, the anti-avoidance rules give the tax authorities the power to apply an arm’s-length value where an arrangement or transaction has been undertaken with one of the main purposes being to avoid the payment of tax. The anti-avoidance provisions specifically state that the comparable unrelated price (CUP) method should be used, unless approval is given by the tax authorities to apply an alternative OECD-approved transfer pricing method.

Thin capitalisation

There are no thin capitalisation rules in Qatar, but interest payments made by permanent establishment to its head office and related parties are not deductible for tax purposes.

Indirect taxes

There are no consumption taxes in Qatar.

Tax information provided by Deloitte Touche Tohmatsu (www.deloitte.com) and Deloitte Highlight 2014.

Banking service provision

The Qatari banking sector supports a high number of banks in comparison to its size and a number of large international banks have a presence in the country. The banking sector currently contains 18 commercial banks, consisting of 11 local banks (including four Islamic banks) and seven branches of foreign banks. Conventional banking services are provided by seven local banks and all seven branches of foreign banks. The 11 locally-owned banks in Qatar account for around 97.5% of the sector’s total assets. The banking sector is dominated by Qatar National Bank (QNB), which has a market share of over half of all banking assets. QNB is 50% state-owned through the Qatar Investment Authority (QIA) sovereign wealth fund. The QIA took a stake in all locally-owned banks in 2008 (with the exception of QNB, in which it already owned 50%) to protect the sector from the effects of the global economic downturn. At the start of 2009, it purchased a further 5% of the capital of all national banks, except QNB. A further 5% of the capital of several domestic banks was purchased by the QIA in December 2009.

Clearing and payment systems

Clearing systems

There are three main payment and settlement systems in Qatar: the Qatar Payment System (QPS), QATCH, and the Electronic Cheque Clearing system (ECC). The National ATM and POS Switch (NAPS) processes card payments. All banks and bank branches in Qatar participate in QPS, QATCH and the NAPS.

  • Qatar Central Bank Payment System (QPS) – the real-time gross settlement (RTGS) system processes high-value and urgent interbank fund transfers. The QPS uses the SWIFT network for the transmission of payment messages and to communicate with participants. Payments are settled in real time with immediate finality.
  • National Automated Clearing House Solution (QATCH) – launched in April 2010, QATCH is Qatar’s automated clearing house system for low-value (below QAR 250,000) bulk direct debit and credit payments. QATCH enables the exchange of interbank payment messages between banks in real time. In addition to direct debits, QATCH can also be used for direct deposits such as private and government salary and pension payments, dividends, subsidies and government transactions such as social security payments.
  • Electronic cheque clearing system – the electronic cheque clearing system has been used to clear cheques in Qatar since 2001. The system uses cheque image exchange, rather than the physical movement of cheques, enabling the same-day clearing of cheques throughout Qatar. The ECC processes cheques above QAR250,000 on a real-time basis while cheques below QAR250,000 are processed on a net basis, at the end of each clearing day. Final settlement takes place across participants’ accounts held at the QCB.

Payments

Electronic funds transfer and cheques are the dominant form of cashless payments in Qatar in terms of both value and volume. Card payments are increasing in popularity as a result of an increase in point-of-sale (POS) terminals and ATMs. Direct debits and direct credit are also available.

  • Credit transfers – credit transfers are used for high-value transactions and wage payments. Credit transfers can be initiated through e-banking systems for consumer payments.
  • Payment cards – debit and credit card use is increasing in popularity in Qatar. There are also around 1.2 million ATM cards. All cards issued comply with EMV chip technology or standards. Each bank in Qatar has its own individual clearing and settlement arrangement with the respective card networks, predominantly MasterCard or Visa.

The number of ATMs has increased in Qatar along with payment card use. All banks operating in Qatar are members of the National ATM and POS Switch (NAPS) card payments process network. NAPS connects the ATM network to other GCC member states via the GCCNet ATM network.

  • Direct debits – direct debits in Qatar have primarily been used for low-value recurring transactions such as utility payments. Payments are processed through QATCH for next-day settlement.
  • Cheques – cheques are the most popular form of cashless payment in Qatar and their usage has increased dramatically in recent years. Cheques above QAR250,000 are processed on a real-time basis while cheques below QAR250,000 are processed on a net basis at the end of each clearing day.

Cash and bank account management

Interest-bearing accounts

Interest is available on savings and time deposit accounts. Interest is payable on current account balances, with approval from the QCB. Most banks in Qatar have now implemented a minimum initial deposit scheme for opening saving or current accounts. Customers are usually required to deposit a minimum initial QAR3,000 for savings accounts and QAR5,000 for current accounts.

Account opening requirements

Residents are permitted to hold domestic and foreign currency accounts both domestically and abroad. Resident domestic currency accounts are fully convertible into foreign currency. Non-residents are permitted to hold domestic and foreign currency accounts in Qatar. Non-residents cannot open current accounts. Non-resident domestic currency accounts can be converted into foreign currency with prior approval from the QCB.

Money laundering

Qatar has implemented anti-money laundering legislation (including Law No 3 of 2004 on Combating Terrorism and Law No 4 of 2010 on Combating Money Laundering and Terrorism Financing). The Financial Information Unit issued a Guide to Money Laundering and Terrorism Financing Suspicious Transaction Reporting in April 2010. The Qatar Financial Centre Regulatory Authority (QFCRA) has also issued related Regulations and Rules. Qatar is a member of the Gulf Cooperation Council (GCC), which is a member of the Financial Action Task Force (FATF). It is also a member of the Middle East and North Africa Financial Action Task Force (MENAFATF). Qatar has established a financial intelligence unit (FIU), The Financial Information Unit, within the Central Bank of Qatar, is a member of the Egmont Group.

Supplied by BCL Burton Copeland (www.bcl.com). Data as at March 2014.

Cash concentration

Cash concentration is permitted in Qatar and is usually offered by international banks.

Cross-border issues

Cross-border cash concentration is permitted in Qatar and is offered by international banks.

Notional pooling

Notional pooling is available in Qatar.

Electronic and internet banking

Electronic banking is widely available from the larger commercial banks in Qatar. Most banks offer some kind of internet-based balance reporting and transaction initiation services, although these are mainly used by businesses. In 2011, the QCB unveiled the Qatar Electronic Payment Gateway (Q-Pay) to facilitate real-time payments for online transactions. Q-Pay is based on an electronic wallet system and allows card holders (debit and credit cards) to make online payments in real time. Mobile money transfer services are also offered in Qatar by the major telecom network providers.

Liquidity management

Short-term investments

Short-term investments include:

  • Treasury bills – the Qatari government issues T-bills, generally for maturities of less than one year.
  • Repurchase agreements (repos) – repos are available from commercial banks in Qatar, using government securities as collateral.
  • Term deposits – time deposits are available in QAR and foreign currency, with interest paid on maturity. Maturities for time deposits are usually between one month and a year.
  • Certificates of deposit (CDs) – CDs (certificates of deposit) are available in Qatar, with a range of maturity dates.

Short-term borrowing

Borrowing instruments include:

  • Overdrafts – overdrafts are available on current accounts from most banks.
  • Bank lines of credit and loans – loans and lines of credit are offered by commercial banks in Qatar.
  • Commercial paper – there is a commercial paper market in Qatar.

Websites

Qatar Central Bank

Qatar National Bank

Commercial Bank of Qatar

Doha Bank

Qatar Financial Centre

Qatar Financial Centre Regulatory Authority

Ministry of Economy and Finance

Qatar Chamber of Commerce and Industry

General Secretariat for Development Planning

Qatar Exchange

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