fDi reports on the latest regulatory and trade changes that will affect foreign direct investors.

Israel’s Ministry of Finance has proposed that foreign companies that invest more than $500m should receive full tax exemption on profits and the withdrawal of dividends; Investment Promotion Center approval will not be required. The ministry has also proposed that companies located in outlying areas that export more than 50% of their production should receive tax breaks, under which they will pay only 10% on profits and dividend withdrawals. IPC approval will not be required for this either.

www.globes.co.il

The Bulgarian Ministry of Economy has proposed several draft amendments to the Law on Foreign Investments, aimed at attracting more foreign capital. Equal treatment of Bulgarian and foreign investors is the principal pillar of the draft. According to the amendments, investors will be grouped into three classes, depending on the amount of capital invested: large-scale projects of more than Lv100m ($59.5m); investments of Lv50m-100m; and investments of Lv10m-50m. Investors will be able to count on full or partial administrative support, depending on the class into which they fall. Only projects of more than Lv100m will receive state help, in the form of free state-owned or municipal land and infrastructure in close proximity to the plant in which the investment is to be made. The Foreign Investment Agency, which will be renamed the Bulgarian Investment Agency, will provide information support and advice. The agency will be transformed into an executive agency reporting to the Ministry of Economy and it will be in charge of assigning foreign investors into classes.

www.sofiaecho.com

The Malaysian government has proposed several new measures to attract more investment in the service sector, particularly in the multimedia super-corridor. The measures include more liberal equity conditions, and tax incentives to attract service-oriented companies, including operational headquarters, regional distribution centres and back-office outsourcing operations. The incentives proposed include income tax exemptions for operational headquarters. There is also a proposal to transform the Multimedia Development Corporation into a one-stop agency for investment similar to the Malaysia Industrial Development Authority.

http://biz.thestar.com.my

Oman has issued three royal decrees amending legislation on corporate taxation relevant for foreign investment. Royal Decree No. 54/2003 amends some provisions of the Corporate Income Tax Law promulgated by Royal Decree No. 47/81. Royal Decree No.55/2003 amends some provisions of the law of profit tax on establishments promulgated by Royal Decree No. 77/89. Royal Decree No. 56/2003 amends some provisions of the Foreign Capital Investment Law promulgated by Royal Decree No. 102/94.

www.menafn.com

The Governing Council of Iraq is expected to pass legislation allowing 100% foreign ownership in all sectors except natural resources, as part of a broader package of economic reforms. The reforms will also permit full profit, dividend and interest repatriation, a tax holiday for the rest of this year and a maximum individual and corporate tax rate of 15% beginning next year, as well as a tariff rate of 5% on non-humanitarian imports. Foreigners will not be allowed to own land but will be able to lease it for up to 40 years.

www.news-leader.com

Afghanistan has approved a law allowing foreign banks to operate in the country. Standard Chartered intends to be the first major international bank to open commercial banking activities there. It expects initially to offer a range of general banking services that will include deposit taking in US dollars and Afghani dollars; facilitating international money transfers; and trade services on selected secured transactions.

www.iht.com

Vietnam plans to simplify and streamline its commercial law in an attempt to attract more foreign investment. The reforms, which are due to take effect at the beginning of next year, are the latest step towards the liberalisation and modernisation of Vietnam’s economy, which is one of the fastest-growing in Asia. Under the present system, investors need petty approvals from many official agencies and issues of any complexity may even be referred to the prime minister’s office. Under the new rules, every agency will have to act as a one-stop shop, able to process approvals instantly without referral elsewhere. State agencies will have to start publishing schedules of government fees.

http://news.bbc.co.uk

Further information on all stories can be found at www.ipanet.com