Business Law Question

OMAN CHAMBER OF COMMERCEAND INDUSTRY
OMAN
COMMERCIAL
LAW
I
Oman Chamber
of Commerce
publish this unofficial
translation
and
Industry
of the Commercial
the Royal Decree No. 55/90. The provisions
regulate the commercial
The Chamber
has the pleasure
The Oman Chamber
Law issued by
and rules of this law
activities in various sectors.
accepts no liability for the accuracy
The Arabic text published
to
of the trans”lation.
in the official gazelle is the authentic
and Industry
extends its thanks to
Messrs Trowers .& Hamlins, Legal Consultants
preparation of It e translation of this law.
for a,ssisting in the
Oman Chamber
Muscat
of Commerce
text.
of Commerce
and Industry
,i.,
NO. 55/90
ISSUING THE COMMERCIAL LA W
!
We, Qaboos
Bin Sa’ld, the Sultan of Oman,
After perusal
Administrative
of Royal
Apparatus
Decree No. 26/75 issuing the law on selling
of the State and (he amendments therelo: and
The Commercial
Registration
Law No. 3/74 and the amendments
thereto; and
The Commercial
Companies
Law No. 4/74 and the amendments
thereto; and
Royal
Decree
Amendments
No. 4/74
issuing
the Foreign
Business
and
Investment
up of the
Law and the
thereto; and
Royal Decree No. 7/74, issuing the Banking
Law and the Amendments
Royal Decree No. 26/77 issuing the Commercial
Royal Decree No. 35/81 issuing the Maritime
Royal Decree
Estate; and
No. 78/86
issuing
Agencies
theretol and
Law; and
Law; and
the Law on the Organization
of Brokerage
Royal Decree No. 68/87 issuing the Law on Trade Marks and Trade Descriptions:
Royal Decree No. 35/88 issuing the Law of Muscat Securities
In accordance
all concemed
Commercial
as cancelled.
shall
implement
This Decree shall be published in the Official
months after the date of publication.
Issued on:
and
Market; and
with the public interest –
The provisions
of the attached
contradictions
will be considered
Ministers
and
competence.
in Real
18 Dhu al-Hijja
II July,
1990
1410 AH
Law
shall
this
Law,
Gazette
be appllcz.ble
each
within
and shall come
and all other
the scope
of
into force si)(
Qaboos Bin Said
Sultan of Oman
THE COMMERCIAL
LAW
CONTENTS
ARTICLES
GENERAL
1-7
PROVISIONS
BOOK
ONE:
Chapter
One
COMMERCIAL
ACTIVITIES
Commercial
Activities
Chapter Two
The Merchant
Section One
The Merchant
Section Two
Commercial
BOOK
AND THE MERCHANT
in General
16 – 26
27 – 36
Books
TWO:
Chapter
One
The Commercial
Chapter
Two
Components
Concern
of a Commercial
Concern
Section One
Trade Names
39 – 46
Section Two
Unlawful
Competition
47 – 51
Contracts
Disposing
Chapter
Three
of a Commercial
Concern
Section One
Sale
52 – 59
Section Two
Leasing
60-66
Section Three
67 – 73
Mongage
BOOK
THREE:
Chapter
One
Chapter
Two
COMMERCIAL
OBLIGATIONS
AND CONTRACTS
I
“j’
Section One
Commercial
obligations
Designated
Commercial
Commercial
Sale
Sub-Section
One
Basic Principles
Sub-Sepion
One
Effects of Sale
Contracts
of Sale
108 – 118
I – Obi igations of the Vendor
2 – Obligations
Section Two
Cenain
74
75 – 92
119 – 127
of the Purchaser
Types of Commercial
Sale
Sub-Section
One
Sale by Instalment
128 – 132
Sub-Section
Two
Sale by An Agent on His Own Account
133 – 135
Sub-Section
Three
Maritime
Sales
A – Pon of Shipment
Sales
-136 – 145
I – CIF Sale
146 – 154
2 – FOB Sale
B – Pon of Destination
Chapter
Three
Section One
Carriage
Contract
Contract
for Carriage
Sales
155
156 – 157
of Items
158 – 160
one ” ,
Two”,
Sub-Section
Sub-Section
:’
Effect of Contract
on Consignor
Effect of Contract
on the Carrier
161 – 165
and Consignee
166 – 182
Contract
for Carriage
of Persons
183 – 190
Section Three
Carriage
Commission
Agency
191 – 198
Section Four
Special
Provisions
on Air Carriage
199 – 216
Chapler
Pledge. Guarantee
Section Two
Four
Section One
Commercial
Sub-Section
One
Basic Principles
Sub-Section
Two
Pledge
223 – 231
One
Basic Principles
Sub-Section
Two
Effects of Guarantee
232 – 237
of Guarantee
Section Three
Deposit
Chapter
Commercial
Agency
Commercial
Agency
Section One
238 – 251
252 – 275
in Public Warehouses
and Brokerage
Sub-Seclion
One
General
Provisions
Sub-Section
Two
Cenain
Types of Commercial
A – Contract
222
Guarantee
Sub-Section
Five
217-
of Pledge
Effecls of pledge
Commercial
Section Two
and Deposit in Public Warehouses
Agency
292 – 297
Agency
B – Commission
298
Agency
I – Obi igations of the Commission
Towards
Agent
the Principal
2 – Rights of Commission
Agent Towards
the
Principal
3 – Relationshipof
Contracted
C – Commercial
Seclion Two
Brokerage
Chapler
Banking
Six
Commission
Third Panies
Representatives
Agent with
31 I – 313
314 – 322
323 – 338
Seclion One
Cash Deposits
339 – 347
Section Two
Deposit of Securities
348 – 354
Section Three
Rental of Safe Deposit
Section Four
Banking Transfer
Section Five
Opening
Section Six
Documentary
Section Seven
Discount
Leller of Guarantee
Section Eight
Section
Nine
Boxes
(Account
of Credit
Credil
Transfer)
355 – 363
364 – 373
374-)76
377 – 387
388-391
392 – 397
398 – 414
BOOK FOUR:
Chapter
One
Section One
COMMERCIAL
INSTRUMENTS
Bills of Exchange
Creating
and Negotiating
I – Creating
a Bill of Exchange
415-424
a Bill of Exchange
2 – Negotiating
425 – 426
a B ill of Exchange
3 – Multiple
Copies
and Reproductions
Guarantees
of Payment
– Falsification
of Bill of Exchange
442 – 450
I – Consideration
2 – Acceptance
436 – 441
451 – 459
of a Bill of Excha.lge
3 – Precautionary
460 – 463
Guarantee
Lapse of an obligation
Created
by a Bill of Exchange
I – Payment
Maturity
Date
464 – 469
Payment
of the Value of a Bill of Exchange
470 – 482
2 – Failure to Pay
Claiming
and Recourse
for Non-Acceptance
or
483 – 504
Non-Recourse
Intervention
505 -513
3 – Proscription
514 – 517
Chapter
Two
Note to Order
518 – 521
Chapter
Three
Cheque
523 – 532
Section
One
Creation
and Negotiation
of a Cheque
523 – 532
I – Creation
of a Che’lue
2 – Multiple
Copies and Falsification
3 – Cheque
Negotiation
Negotiating
a Cheque
Precautionary
533 – 535
and Precautionary
Guarantee
536 – 542
by Endorsement
543
Guarantee
Lapse of the obligation
Established
by the Cheque
544 – 553
I – Encashment
Crossed
Cheque
and Cheque
Credited
Three
554 – 556
557 – 560
2 – Failure to Pay
Section
to Account
3 – Proscript ion
561 – 564
Penalties
565 – 570
Chapter
Four
Movable
Chapter
Five
Other Instruments
571 – 576
Values
Endorsement
Conveyable
by Way of
BOOK FIVE:
BANKRUPTCY
AND PREVENTIVE
COMPOSIT10N
Chapter
One
Declaration
of Bankruptcy
and Effects
Section
One
Declaration
of Bankruptcy
and Bankruptcy
offences
I – Declaration
of Bankruptcy
579 – 596
2 – Bankruptcy
Offences
597-601
Chapter
Two
Effects of Declaration
Section
One
With Respect
to the Debtor
With Respect
to Creditors
I – Creditors
in General
2 – Holders
of Debts Guaranteed
Lien on a Movable
of Bankruptcy
by a Mortgage
or
by a Mortgage
or
Asset
3 – Holders of Debts Guaranteed
Lieri on Real Property
I – Effect of Bankruptcy
Concluded
I
, ‘
Chapter
Two
Section One
Section Two
on Valid Contracts
Prior to Adjudication
630 – 633
2 – Right of Recovery
‘I” Administration
“, Persons
Administering
Administration
Bankruptcy
of the Assets of the Bankrupt
Verification
of Debts
Verification
of Debts
Closure
634 – 644
of Bankruptcy
and
655 – 665
666 – 675
of Bankruptcy
Due to Insufficiency
of
Funds
Special
676-678
Types of Bankruptcy
Bankruptcy
of Companies
Small Bankrupt~y
679 – 680
681 – 695
Chapter
Three
Termination
of Bankruptcy
Section
One
Termination
By Satisfaction
Section
Two
Judicial
of the Body of Creditors
696 – 697
698 – 721
Composition
722 – 723
Section Three
Composition
Section
Four
Union of Creditors
724 – 740
Section
Five
Rehabilitation
741 – 752
By Surrender
of the Bankrupt
Chapter
Four
Preventive
Composition
Section
One
Judgment
for Opening
Section
Two
Judgment
in Ratification
Section Three
of Assets
Penal Sentence
of Composition
of Composition
Proceedings
753 – 764
765 – 783
784 – 786
The
provisiol1S
engaged
of Ihis Law
shall
apply
to merchants
and all commercial
activities
in by any person even if such person is nota merchant.
In defining
the rules which
apply
shall be taken of legally recognised
10 merchants
and commercial
activities,
due account
conlracts.
The said contracts
shall become effective upon Ihe mere
acceptance unless the Articles of this Code provide otherwise.
congruence
of offer
and
,
Article 3
“f’
,”
The principle in respect of commercial contracts is that they may be proven by all means
of so doing whatever their value unless the Articles of Ihis Law provide otherwise.
Article 4
If no contract exists or if it exists and is silent with respect (0 a provision or if a provision
contained therein is invalid, the legislative provisions comprised
within this and other
laws shall apply 10 all matters which these provisions deal wilh in word or meaning.
If no legislative
provisions
exists, the rules of custom
shall apply with particular
custom taking precedence over general cusrom. In the absence of custom,
of the noble Islamic Sharia shall apply and thereafter the rules of justice.
Article
or local
the p~ovisions
6
The meaning of Court in this Law is the Authority for the Settlement of Commercial
Disputes or any other Court subsequently formed by law 10 examine commercial matters.
Commercial
companies,
trademarks,
trade descriptions,
the Comme~t.,ial Register, the
Oman Chamber of Commerce
& Industry and the Muscat Securities’Market
shall be
regulated
by their own laws.
Without
prejudice
to the provisions
of the Commercial
Agencies
Law, the provisions
Section One of Chapter Five of Book Three of this Law shall apply
agencies, commission agencies and commercial representatives.
ro commercial
of
BOOK ONE
COMM’~RCIAL
ACTIVITIES .. THE MERCHANT
CHAPTER ONE
COMMERCIAL ACTIVITIES
Commercial activities are those undertaken
such person is not a merchant.
The following
activities
in particular
by any person with intent to speculate.
shall be deemed
to be commercial
even if
activities:
I.
The purchase of commodities
and other material and non-material
moveable
property with intent to sell the same at a profit whether sold in their original
condition or after manufacture
or conversion.
2.
The purchase
of commodities
and other material and non-material
moveble
property with intent to hire or lease the same with intent to sub-leasing them.
3.
The sale.
aforestated
4.
The purchase of real estate with intent to profit from the sale thereof in its original
condition or after division and the sale of real estate purchased with such intent.
5.
Supply contracts.
6.
Employment
7.
Public and private
deal ings.
banking
8.
Brokerage
(activities
9.
Commercial
10.
The incorporation
shares or bonds.
of commercial
companies
II.
Public warehouses
and pledges
on property
12.
The e;>;traction of minerals.
rent or sub-leasing
manner.
of the commodities
purchased
or leased
in the
contracts.
activities
transactions.
money-changing
of a middleman)
activities
and commercial
and financial
agencies.
papers such as bills of e;>;change. notes to order and cheques.
and the sale or purchase
deposited
therein.
oils. rocks and other natural resources.
of corporate
Public sites and premises
and auction rooms.
such as public
playgrounds,
cinemas,
hotels,
Public utility concessions
such as the distribution
of water,
postal communications,
telecommunications
and the like.
electricity
restaurants
and gas,
Land, sea anI:! air transport.
.
Business
“1′
ag~:ncies, tourist offices,
import and export.
AClivities related to printing, publishing,
the press, broadcasting
news or picture transmission,
advertisements
and the sale of books.
The establishment
of factories,
undertaking
of construction
Activities
related
demolishing
Article
even if related
to agricullural
and television,
investment,
and the
and manufacture.
to building
and construction
and to altering,
renovating
and
buildings
10
All activities related
activities, particularly:
to maritime
The construction
of ships
and air navigation
or aircraft
shall be deemed
and the sale,
to be commercial
purchase,
charter,
leasing
or
repair of the same.
”
Contracts
pertaining
navigators
of aircraft
Maritime
and air transportation
(0
the wages
and
and all those employed
thereof
in terms
provisions
supply
materials.
Activities
relating
to or facilitating
The principle in respect of a merchant’s
commercial
unless otherwise indicated.
processes
of supplies,
the commercial
Articles shall be deemed to be commercial
by merchants for commercial
needs.
activities
contracts
of a ship’s,’irnaster
thereon.
and all related
sale of the requisites
and aircraft
salaries
such as the purchase
lools,
stores.
transactions
stated
fuel. ropes,
in the previous
as well as all activities
and obligations
or
sails
undertaken
is that they shall be
of the Commercial
Law shall apply to the obligations
unless otherwise indicated.
arising
I.
The production of a work of an by an anist himself
workers and the sale thereof.
2.
The printing
Article
from such contract
on both.
or by his use of the services
of
and sale ()y an author of his work.
15
The sale by a farmer of crops produced from land which he owns or which he cultivates.
even if such land has been transformed by the methods available 10 hill!, for the p;Jrposes
of agricullUral exploitatioll. shall not be deemed a commercial activity. ,I.,
CHAPTER TWO
THE MERCHANT
SECTION ONE· THE MERCHANT
IN GENERAL
Any person who engages in commercial
activities in his name. who has the re4uisite
capacity and who adopts such transactions
as a business
will be comidered
as a
Merchant.
Similarly.
any commercial
even if engaged
company
in non-commercial
aWl ‘!’\;’ Ci;l”,P;’~’Y v~’•.,;_:-: ,