Qatar Financial Centre Courts formally established

Whilst there have been various formal announcements regarding the identity of the judiciary that will sit in these Courts, the formal, enabling legislation to actually establish them has taken some time to be introduced. It is reassuring for businesses operating within the QFC that the necessary legislation to give effect to them is now in place.

The provisions establishing these Courts are found in Law No. (2) of 2009 Amending certain provisions of Qatar Financial Centre Law No. (7) of 2005 (the "QFC Amending Law").

The QFC Amending Law replaces a number of Articles in the original 2005 QFC Law. Two of the most significant amendments are the introduction of provisions formally establishing the QFC Regulatory Tribunal and the QFC Civil and Commercial Court.

A number of other consequential amendments to the original QFC Law are made, the most notable of which are amendments to Article 18 which deal with the interaction of QFC Laws with other laws of the State of Qatar.

QFC Regulatory Tribunal:

Article 8(2) establishes the QFC Regulatory Tribunal (the "Regulatory Tribunal"). The Regulatory Tribunal will hear cases lodged by individuals and bodies against decisions of the QFC Authority, the QFC Regulatory Authority and other QFC bodies.

The Chairman of the Regulatory Tribunal will be Sir William Blair. The Council of Ministers' of the State of Qatar ("the Council of Ministers") made this appointment in 2007.

QFC Civil and Commercial Court:

Article 8(3) establishes the QFC Civil and Commercial Court (the "Commercial Court"). Interestingly, the Commercial Court is structured so that it effectively has two "circuits" - a first instance circuit and an appeal circuit. Each circuit shall comprise three judges. Decisions of the appeal circuit of the Commercial Court will be final.

The appeal circuit of the Commercial Court will also operate as the appellate Court for challenges to judgments of the Regulatory Tribunal.

The Commercial Court will hear cases relating to a range of civil and commercial disputes that involve parties within the QFC but also, in certain circumstances, parties operating outside the QFC. The Court's jurisdiction will cover the following civil and commercial disputes:

- disputes resulting from "deals, contracts, arrangements or events carried on, in or through the QFC" by entities established within the QFC;

- disputes between the QFC authorities/institutions and the entities established within the QFC;

- disputes resulting from "deals, contracts or arrangements" between entities established in the QFC and persons or bodies existing/operating outside the QFC jurisdiction (unless the parties have agreed otherwise); and

- disputes between entities established in the QFC and their contractors and employees (unless the parties have agreed otherwise).

These new provisions relating to the Commercial Court effectively give it presumptive jurisdiction over any civil or commercial disputes involving a QFC licensed body, regardless of whether or not the other party to the dispute is located in the QFC.

This is a significant step, and it may come as a surprise to persons and bodies located outside the QFC that they may be caught by the QFC's jurisdiction and laws in any dispute arising from their dealings with a QFC licensed body.

The parties can agree a different jurisdictional arrangement, or that different laws apply, but if this has not been agreed upon by the parties, then the default position appears to be that the Commercial Court will have jurisdiction and QFC laws will apply to any dispute resulting from the parties' dealings.

The President of the Commercial Court will be the internationally renowned jurist Lord Woolf of Barnes, the former Lord Chief Justice of England and Wales. The Council of Ministers appointed Lord Woolf to this position in 2007.

Lord Woolf and Sir William Blair will be supported in their respective roles by a distinguished group of international jurists and lawyers who have also been appointed to the benches of the Regulatory Tribunal and the Commercial Court.

These appointments are for a term of five years and the circumstances in which appointees can be removed are very limited (e.g. bankruptcy). This provision is one of several safeguards written into the QFC Amending Law which are designed to ensure the independence of the two Courts from both the State and the QFC institutions.

What next?

Now that the requisite enabling legislation is in place to establish the Regulatory Tribunal and the Commercial Court, the next stage will be the promulgation of civil procedure rules and regulations to be followed by litigants. These will be subject to the approval of the Council of Ministers.

In view of Lord Woolf's appointment, it is reasonable to expect that the new civil procedure rules will, to a large extent, mirror the Civil Procedure Rules ("CPR") in force in England and Wales. The CPR were the end product of a reform process led by Lord Woolf in 1996, which concluded that the English civil justice system was too slow, too costly and too complex. The CPR were introduced in 1999 to remedy these problems and consequently they focused on dealing with cases expeditiously, ensuring proportionality, ensuring parties were on an equal footing and that costs were limited as far as possible. If the new civil procedure rules for the QFC Courts do have a similar focus to the CPR, they are also likely to include an emphasis on litigants resolving their disputes through alternative methods such as mediation.

Pending the implementation of the new civil procedure rules, it appears that civil procedure matters before QFC Courts will be governed by state law No. (13) of 1990 the Civil and Commercial Procedure Code.