Manama: Qatar's Advisory Council has objected to a government proposal to allow non-Qataris to own, in exceptional cases, dealerships selling foreign goods and services.
The Cabinet earlier this year forwarded a memo to the Council on the proposal, but the Council this week unanimously opposed it on the grounds that allowing foreigners to own agencies would cause immense damage to the national economy.
The government wanted an amendment to the law that forbids foreigners to invest in exclusive agencies and sought the authority to confer that privilege to foreigner as an exception.
"Any move to permit non-Qatari capital in exclusive dealerships would gravely endanger Qatari businessmen," the Advisory Council said, quoted by Qatari daily The Peninsula.
Chamber support
The council's opposition to the amendment was hailed by Qatar Chamber of Commerce and Industry (QCCI) amid claims that allowing non-Qatari capital in agencies would not add any value to the Qatari economy.
"An agent would only be distributing and marketing foreign goods and services here," an official from the chamber said. "Moreover, there would always be the risk that a foreigner could wind up his business, repatriate his capital and leave the country for good. The move could also prompt foreign agencies to set up their branches here at the expense of local exclusive dealerships of the same goods or services," the official said, quoted by the daily.
According to the chamber, the privilege to own agencies could be extended to foreigners only if Qatari businessmen were given similar rights overseas.
"There must be reciprocity," Shaikh Khalifa Bin Jasem Al Thani, the Chamber's chairman, said.
Ahmad Al Khalaf, a prominent businessman who backed the Advisory Council's opposition to the Cabinet's proposal, told the daily that exclusive dealerships should only be with citizens.
"Because the Ministry of Business and Trade has the right to intervene if an agency unduly raises the prices of its products or services and can allow traders to directly import these products or services, there is a check and balance against possible monopolistic practices," Al Khalaf said.
However, businessmen who supported the Cabinet's proposal said exclusive dealerships are indeed monopolies and their existence was against the professed goal of Qatar to eventually become a free market.
Criticism
"The world knows that absence of competition in any business does not bode well for consumers since their pricing would always be high," a critic who did not wish to be named said.
"If Qatar has to pursue a free market policy it must get rid of the monopolies," he said.
According to the critic, the facts that the Advisory Council includes many businessmen as members and that its members are nominated, its opinion on matters that concern consumers could be biased.
