SMEs In Qatar And Listing On The QE Venture

The development and support of Small and Medium Enterprises ("SME") is necessary to bolster economic diversification in the State of Qatar ("Qatar"). In recent years this sector has been considered weak, however, legislative initiatives have been put in place to drive it forward. SMEs are material to Qatar's National Vision 2030 which has set up a number of strategic goals, including building a well-diversified economy. The new approach focuses on stimulating services for SMEs, supporting diversification and creating employment opportunities for the national work force.

Qatar Authority for the Development of SMEs

The Emiri Decision No. (17) of 2011 ("Emiri Decision") establishes a Qatar Authority for the Development of SMEs (the "Authority") which is run by a board (the "Board"), holding all powers necessary for achieving the Authority's objectives.

The Emiri Decision defines SMEs as such small and medium scale enterprises as may be determined by a Board's resolution.

Article (4) of the Emiri Decision describes the Authority's responsibility as encouraging the development of the SME sector in Qatar. It is mandated to put a strategy in place to encourage growth for these enterprises by providing them with technical assistance and coordinating with banks and governmental institutions for the purpose of financing and marketing projects.

QE Venture Market

Listing on Qatar Exchange ("QE"), or going public, is the process of offering shares of a previously privately owned company to the general public. In Qatar the initial public offering ("IPO") process is governed by Qatar's Commercial Companies Law No. (5) of 2002 as amended and is regulated by the Qatar Financial Markets Authority ("QFMA").

QE is creating a junior bourse for SMEs to give a lift to this sector, the QE Venture Market. QE Venture Market will be dedicated to SMEs who will by definition have a minimal track record and a higher risk profile but companies nonetheless who are growing and need the access to capital that being listed entails. The establishment of a secondary market would give SME owners an opportunity to be listed in the bourse in accordance with lighter and flexible regulations, while giving further finance sources in order for them to grow and expand their businesses.

On the 17th January 2012 QE announced the readiness of technical and regulatory infrastructure dedicated to the market. The market is able to receive listing applications to be submitted by business...