With sovereign debt levels continuing to rise and concerns abounding about the ability of the European states to repay their debts, there is a risk that countries will begin to withdraw from the European Union and that certain member states will abandon the Euro and re-introduce their own local currencies.

Where a business receives payments in Euros it may wish to consider amending its contracts to ensure that it is protected against any potential currency conversion in the less likely event that a dispute arises between the parties as to which currency shall apply instead.

It may also be prudent to consider inserting a similar provision in agreements where payments are made in Euros; for example to a supplier or a service provider, which shall apply where the Euro as a currency ceases to exist. Even if the default currency falls in value (which would benefit a company’s position where it is obliged to make payments to other parties in Euros) there is the potential for uncertainty where there is more than one European jurisdiction that is connected to the contract.

For example, there may be a contract for the sale of products from the manufacturer in Germany to a purchaser in France and therefore, two European currencies that have a connection with the contract.

-          Payments received in Euros

For contracts where payments are to be received in Euros, you could nominate a currency to apply if the Euro no longer exists or if a particular country pulls out of the Euro, or, introduces a second local currency.  Ideally, you would choose a currency that is most likely to increase, or at least maintain its value over the term of the contract as the currency that the Euro is to convert to.

The calculation date for the conversion of the currency may be set at a time that is reasonably prior to the date on which the trigger is to occur (i.e. the date on which the Euro may cease to exist, or the date upon which a member country of the European Monetary Union may begin to recognise a second form of currency as the legal tender for such country). The reason for this suggestion is that the Euro may decrease in value in the period immediately prior to the trigger date. By setting the calculation date reasonably, prior to the trigger date, it may reduce the risk of a potentially adverse effect of the currency conversion.

-          Payments made in Euros

Where payments are to be made in Euros, the provision would ideally be drafted so that it is only to be exercised if the Euro disappears completely, rather than a particular country dropping out of the European Monetary Union or adopts a dual currency system. This would allow your business to benefit from the currency drop that is likely to ensue where countries drop out or adopt a dual currency system.

Similarly, the conversion would ideally occur based on the prices at the time of expiry of the Euro rather than a certain period beforehand in order to allow your business to benefit from the currency drop that is likely to ensue in the period prior to the expiry of the Euro.

However, you need to consider the contract as a whole in order to ensure that your position is adequately protected under the contract.  “For example, the governing law and jurisdiction would need to be reviewed in order to ensure that the contract is subject to a legal system that is likely to enforce such a provision. There may also be a material adverse change provision or a force majeure provision in the agreement. If so, it would also be prudent to ensure that such provision is not drafted so broadly that it is triggered by the break-up of the Euro, a change of currency, or a drastic drop in currency value where payments are to be received in Euros,” she says.

Protection against a drop in the value of the Euro by use of derivatives

Regardless of whether the Euro breaks up or not, it is likely that if the tensions keep mounting in Europe, it will result in a significant fall in the value of the Euro.

Mehdi Al Amine, Director, deNovo Corporate Advisors, suggests that foreign exchange derivatives could be used as a solution to protect businesses against the effect of a potential drop in the value of the Euro.

A foreign exchange derivative instrument such as the Option is a contract and an insurance, which allows a party to force its counterparty, the bank, to buy or sell a currency (in this case, the Euro versus the US Dollar ) for a particular price.

For example, a company is expecting to receive a payment in Euros in one year and, at the time of entering into the agreement, the exchange rate of USD 1.2750 to EUR 1. As Al Amine explains, the company could pay a percentage of the notional amount as a premium in order to buy the protection and, if the Euro falls, will force the bank in one year to buy the Euros for a pre-agreed level.

If the value of the Euro drops to USD 1.10, at the end of that one year period, the company will be protected from the USD 0.15

Melissa Forbes, Associate - Corporate Department, Taylor Wessing

currency conversion loss per Euro that it would have otherwise incurred if it had not entered into the derivative agreement.

The cost of hedging the currency varies, depending on the exercise level of the option and other variable factors, but would usually be between 1-5% of the amount to be hedged.

Al Amine advises that “alternative and cheaper solutions are available where the business seeks only to protect itself against a strong depreciation in the Euro, which would correspond to a deepening of the Eurozone crisis, as opposed to a slight and manageable decrease in its value.”

A business that employs a prudent risk management policy will want to explore these solutions, given the uncertain times that we face in the Eurozone.

You just need to look at the accelerating progress of new applications, social networking forums, state-of-the-art video conferencing, and much more, to understand the unrelenting pressure to stay ahead of the curve.

More and more publications, including newspapers, are going virtual and cancelling their hard copy counterparts for good. Social forums, such as Facebook, Twitter, LinkedIn, Google+ have become the preferred mode of communication amongst us, for personal, business and marketing needs.

To conduct effective and result driven public relations today, you need to be flexible and fast on the uptake, but the key is to know how to utilise different platforms and networks effectively. This may not be a simple exercise, as it involves time, money and a desire to really learn and apply in a targeted and relevant way to client campaigns to ensure they are successful.

There is a skill to offering a client successful social media campaigns, as they are so diverse in application, reach, style, content and tonality. Any small mistake can backfire and yield the communication campaign a failure.

There’s no denying the power you can yield from social media and yet many people continue to undermine it, or sideline it, for many reasons; some don’t understand how it works, some are too scared and some just don’t want to adapt. This is a grave mistake to make as social media is not a passing phenomenon, but rather its one that’s part of the communication fabric and here to stay. You really need to embrace it and understand how it works and how it impacts your target audience, or stakeholders.

If you look at Twitter, adoption is at times slower than Facebook but, nonetheless, it is fast becoming a social media networking force to be reckoned with. Whatever your business communication needs may be, they can be translated and tailored to suit the Twitter style and engage the growing number of businesses networking and connecting with each other on this platform.

There is so much you can do and ways to communicate, as well as chatting to your target audience, you can get widespread publicity for your articles, various developments in real-time, news announcements, achievements, announce and invite people to your seminars, launches, briefings, TV and radio interviews and engage them in competitions – the list is endless.

A really important tactic is to follow and study the thought leaders, experts and even the competition in your industry. There’s nothing wrong in getting a few tips from those who know how to work social media effectively.

Besides just following them, you need to monitor and digest what they are saying and how; understand what makes tick, what interests them and check out the sites they recommend. Learn how to engage them, through common interests, opinions, live dialogue, should they throw a question out to your audiences, and even attend Tweet ups or other gatherings they announce they will be attending on Twitter.

It’s also key to be up to speed with the common references used in various social media platforms, such as RT (retweets), FF (Follow Friday), # (Hashtdags), Tweeps, Post, Tweets and more.

To get an intimate insight into the media, following them on Twitter/Facebook is a valuable activity. Search for the key reporters who are a target for your business and communications. Join and follow their publication accounts and do your homework on what interests them, what they are writing about and get to know them better. By doing so you can then comment on their tweets or posts and refer to their articles, thus building a relationship with them, based on mutual respect.

I believe that most people would agree that Facebook is more straightforward and easier to master. The key here is to spend some time expanding your network. Build relevant relationships; it’s more about quality than quantity and the success of this is based on how many fans really want to engage with your brand in the long-term and are genuinely interested.

Your challenge besides securing those fans is to keep them engaged through interesting and eye grabbing content. You need to differentiate yourself from the competition, through fast-paced and incredibly creative solutions; it’s all about making a noise, but a noise that needs and wants to be heard.

At the end of the day, like any proper marketing plan, you need to manage, coordinate and stay consistent across a number of platforms and not look at each in isolation.

PR’ing your business through social networking doesn’t have to be expensive if you just remember to network and use all the tools available to you in an intelligent way. In fact, it can be a lot of fun, as you become part of the future and the digital social networking crowd and learn to adapt fast to evolving.

If you feel that you don’t have the bandwidth, or the know-how, you can call on the support of social networking experts who spend majority of their time on various platforms. There is no excuse for not getting on-board.

About

Sawsan Ghanem is the Joint Managing Director of Active PR. She has lived in the Middle East region for the greater part of her life. Sawsan lived and studied in the UK for a few years where she gained her BSc in Chemistry & Management from Kings College, London University and MA in International Business, from Webster Graduate School (London Campus).

Sawsan began her career in PR over 14 years ago, when she caught the PR & Communication bug. She founded Active PR in the summer of 2003 along with Louay Al Samarrai. Sawsan has in-depth experience in strategic PR campaigns, media relations, creative thinking, crisis management and more. She is the SMB Advisor Middle East winner [before the magazine was rebranded SME Advisor] in the category of Admirable Woman Entrepreneur (2008) and she won Arab Entrepreneur of the Year at the SME Advisor Stars of Business Awards 2011.

The results from Visa’s Visa Vue Travel Data showed that the total inbound Visa card spend in the UAE between the 5th of January and the 5th of February 2012, came to more than USD 497 million,compared to just over USD 406 million during the DSF 2011 period (20 January to 20 February, 2011) – equal to a year-on-year increase of 22%.

The event got off to a flying start from the very beginning, with spending for the first week hitting a high on the 6th of January, when USD 19 million was spent on overseas Visa cards. The good news for retailers is that spending continued at a positive pace right throughout the DSF period, with sales reaching a peak on the 29th January when they topped USD 20 million, over USD 5 million more than the USD 15.5 million average daily spend during overall the DSF 2012 period.

The statistics also revealed that cardholders from Russia, Saudi Arabia and the United States were the top-spending countries during the DSF 2012 period, contributing more than USD 122 million, USD 106 million and USD 92 million respectively to the UAE economy – with each showing significant increases in spend compared to the DSF 2011 period.

“Other retail” came out on top of the merchant category, with more than USD 171 million spent during the month-long event. “Lodging” (hotels and apartments) came in second place with over USD 112 million spent; while “remaining merchants,”‘other travel and entertainment’”and ‘”department stores” completed the top five spending segments, with over USD 89 million, USD 35 million and USD 17 million spent respectively.

“It’s great to see DSF 2012 having such a strong impact on the local economy, despite the current global financial challenges,” said Karim Beg, Head of Regional Marketing for Visa for Middle East and North Africa (MENA). “Over the years, DSF has really helped put the UAE on the map, attracting visitors from all over the world to take advantage of the great promotions on offer. This year’s success proves yet again the ongoing popularity of the shopping festival, and of the UAE as a leading international shopping destination.”

Visa has sponsored the leading shopping and entertainment event since its inauguration in 1996. As the official payment partner of DSF, Visa has the ideal platform to educate shoppers about the convenience and security of electronic payments while simultaneously rewarding them with value added prizes. As part of this year’s activity, Visa ran a series of promotions giving cardholders the unique opportunity to attend the upcoming London 2012 Olympic Games this coming summer.

“Dubai being a hub, various categories of businesses choose to set up in the Emirate for faster growth and market access. The 120 days licence is part of DED’s efforts to enable businesses to make full use of the advantages of Dubai and improve the Emirate’s ranking in the Doing Business Report of the World Bank,” said Mohammed Shael, Chief Executive Officer of the Business Registration and Licencing (BRL) Division at DED.

The new initiative will allow investors to have their licences issued immediately from DED depending on the risk factors of the intended business activity.  Business activities in Dubai have been categorised as No-risk, Low-risk and High-risk for the sake of evaluating the risk component.

“The categorisation depends on four main risk factors, evaluated on the basis of whether the business activity is harmful to human beings, harmful to animal life, harmful to plants, or harmful to the environment. When a businessman approaches DED for a licence, a 120 days licence is issued immediately, on completion of the necessary procedures, if the specific business activity falls under the No-risk or Low-risk categories,” explained Shael.

The 120 days licence allows the entrepreneur to start his business immediately and complete the rest of the licencing requirements, such as approvals from other government authorities concerned within the next 120 days. Government authorities are entitled to ensure full compliance of the licence holder to the licence criteria on day 121.

More than 90% of businesses in Dubai are No-Risk or Low-Risk and therefore a vast majority of businesses stand to benefit from the 120 days licence. For High-risk business activities constituting the remaining 10%, e.g. restaurants and clinics,  all standards set by the government authorities concerned have to be fully met before DED issues the licence.

The Low-risk category includes chemical plants and similar industrial operations that require pre-approvals from various authorities including Dubai Municipality and Civil Defence. “These facilities have stringent standards often embedded in their design and they go through years of preparation and inspections. Hence, there is no risk in issuing them a licence. It will in fact allow them to complete procedures like testing and hiring before starting actual operations,” Shael said.

Referring to the 120 day hassle free licence as a new philosophy of business registration and licencing, Shael said the initiative along with significant reforms like the Law No.13 of 2011 will dramatically enhance ease of doing business in Dubai.

The Law No. 13 issued by H.H. Sheikh Mohammed Bin Rashid Al Maktoum in 2011 acknowledges the contributions of the Free Zone companies to Dubai’s economy and allows such companies to open branches in Dubai while maintaining their presence in the Free Zone. A Free Zone company can operate a branch in Dubai as long as it is active within the Free Zone but any termination of Free Zone activity will reflect in the Dubai licence as well.

The Law No. 13 also allows Free Zone companies that have no local partners to open branches in Dubai, provided such branch has a Local Service Agent on board. A Local Service Agent is a UAE national or UAE company who will sponsor employees for the Dubai branch of a Free Zone company at the Ministry of Labour. The Local Service agent will have no rights of voting or decision-making in the company.

Shael stated that non-UAE nationals are already allowed to hold 100% ownership in Dubai companies even without a Free Zone licence. Professionals such as doctors, technicians, carpenters, cooks etc can have 100% ownership unless the entity is a Limited Liability Company (LLC). Expatriates can only have 49% ownership in LLCs with UAE nationals holding 51%.

Even with a quick glance over the sections of the new legislation, Law No. 16 of 2011, has SME written all over it; the SCT in essence opens the courtroom doors to the general public so long as the parties “opt in” to the DIFC Courts’ jurisdiction by agreement in writing.

Ghada Qaisi Audi, Head of Disputes Resolution, Fichte & Co Legal explained to SME Advisor: “The DIFC Courts’ SCT recently decided a case between two Dubai-based parties that had no connection to the DIFC to settle a matter concerning the non-payment of an invoice. So long as the parties agree in writing, the SCT can hear any civil and commercial claims up to AED 500,000 (such as contract claims and debt collection matters) and employment claims without a cap on the amount in dispute.”

The Small Claims Court was originally set up in 2007 but was more limited than in its current form. It was ruled under the common law system and was held in English. Before 2009 the cap on the top ceiling monetary amount that could be considered was AED 100,000 and companies had to be registered as operating within the DIFC. In 2009 this monetary cap was raised to AED 500,000.

Under the newly passed legislation employment disputes amounting up to AED 2000,000 can be heard, but there is potential for the court to waive this cap if both parties agree in writing and the judge rules this to be beneficial for both parties involved.

In its current form, the SCT is conducted with the aid of eight judges, two of which are Emirati and the remaining six are chosen from various common law jurisdictions from across the globe. Decisions are binding and hold the same weight of authority and enforcement as domestic court rulings, with the freezing of bank accounts and assets as possible imposition tools at the court’s disposal. The DIFC Courts also work very closely with Dubai Courts and a Joint Committee meets regularly to discuss issues such as joint lectures, Memorandums of Understanding (MoUs) and enforcement.

How it all works

So what is the process from start to finish and within what time scale can SMEs hope to have the dispute settled? “The SCT provides a speedy and efficient forum, in English, that is confidential and binding on the parties. Lawyers are not permitted to participate and the first step is a ‘consultation’ where the parties sit before a Small Claims Tribunal Judge, who assists the parties to come to an agreement.  More than 90% of the cases are settled amicably by a Consent Order in the first consultation with an SCT Judge and within three weeks from the date the claim is lodged with the DIFC Courts,” says Ghada.

Indeed it is perhaps the absence of legal counsel that affords both parties and the judge to participate in a more direct manner to resolve the matter. According to Small Claims Tribunal Judge, Shamlan Al Sawalehi, small claims litigants can expect the SCT judge to take an active role to assist the parties to agree. “It is the process such as asking questions, getting the parties to consider their options and whether it is in their best interest to settle. Sometimes the parties need to let out their emotions, but then they realise the benefit of making a settlement because they actually want to continue working with the other party, for example,” he said.

So what has been the response to the new court’s powers of decision making? Amna Sultan Al Owais, Deputy Registrar and SCT Registrar told SME Advisor that the most common cases are in the instance of employee versus employer and involve an issue of payment. “If the dispute is not resolved in the consultation stage, the case continues to a second step, a ‘hearing’ before another SCT Judge that will take place a week later, and with the judge rendering an Order,” she notes. Amna also pointed out that all judgements and rulings are available as public record and it is only in the most rare of circumstances that that the court is closed to the public.

FACTS AND FIGURES

Small Claims Tribunal

No. of cases

2011 – 83

2010 – 81

2009 – 66

2008 – 54

Court of First Instance

No. of cases

2011 – 31

2010 – 27

2009 – 36

2008 – 9

Court of Appeal

No. of cases

2011 – 2

2010 – 4

2009 – 2

2008 – 1

Indeed, according to Judge Al Sawalehi, many SME’s stand to gain from the new rules because the fees are low, the process is very quick and confidential and the outcome is a binding Court order that can be enforced against the other side if they do not pay immediately. “When it comes to enforcement practices, the general rule is that people take a court Order seriously and pay it within the prescribed timeframe.  In case they do not, the winning party can take it to enforcement to have the losing party’s assets seized in order to pay off the amount,” he says.

However, there are certain points to keep in mind, notes Ghada. “While it is true that parties can file their claims before the DIFC Courts SCT without legal representation, when the disputed amount is towards the high end of the cap, it is still suggested that companies consult with a lawyer before approaching the DIFC Courts to avoid any disappointment,” she says.

According to Ghada, a lawyer will in fact be able to give preliminary advice and assistance on the correct procedures to follow, and in particular advise on:

• Determining whether your claim or counterclaim can be brought in the SCT

• Drafting forum selection clauses in new and existing Agreements

• Lodging the claim and following up with the DIFC Courts

• Preparing for the consultation and hearing

Appealing the decision to the Court of First Instance (see text box for further details)

• Enforcing an SCT Order

Pro Bono Clinic

In addition to the developments of the SCT, Amna told SME Advisor of the recent launch of the Pro Bono Clinic, whereby people seeking legal advice and guidance, but who are unable to pay a fee for a consultation, can avail of the services and expertise from some of Dubai’s finest legal counsel.

“The Pro Bono programme (for the Court of First Instance) was the first of its kind in the Middle East. It had its first session on the 16^th February where attendees were able to book free appointments and sit with a lawyer from one of the international volunteer firms participating, for free and confidential advice,” she said.

Those seeking this service must fill out a criteria form and are then assessed. The DIFC Courts do point out that they are part of the selection process but do remain neutral insofar as the advice afforded to successful applicants by lawyers from the 23 local and international firms participating in the scheme.

The clinic is also exclusive to those companies and employees registered and operating within the DIFC, but precedent case law suggests that if a party has a presence in the DIFC but the dispute originates from outside, then, as long as both parties agree, a judge can grant permission to have the wishes of the parties upheld.

Without doubt, both the SCT and the Pro Bono Clinic programme, are both  very progressive legal developments that best

SMALL CLAIMS TRIBUNAL COSTS

- When filing a claim related to an employment dispute, the fee for filing will be 2% of the value of the claim, with a minimum of AED 200. Any claim relating to an employment dispute that must be referred to the Court of First Instance (CFI) will incur a further 1% of the value of the claim with a minimum of AED 100.

- The filing fee for all other claims (non-employment related) in the SCT is 5% of the claim value or a minimum of AED 500. Any claim related to a non-employment dispute that must be referred to the CFI will incur a further fee of 2.5% of the value of the claim of a minimum of AED 250.

- The SCT Registrar will be able to waive, defer or reduce any fees it deems appropriate.

- The SCT requires that the claimant to provide both the claimant’s and defendant’s full contact information to include name, address, e-mail address, telephone number and fax number. The claimant must also provide a full summary of the dispute, what compensation is expected to receive and the justification for seeking compensation. The monetary value of the claim must also be included. If the dispute is employment related, a photocopy of the employment contract and/or offer letter is required.

- The defendant must respond to the claim within seven days of it being served and must either admit the claim, file a defence to the claim, or complete an application to dispute jurisdiction.

- An intending appellant must file an appellant’s notice on Form 53/02 within 14 days after the date of the decision. The form is available at www.difccourts.ae.

One thing that I have noticed is that enterprising people come in all shapes and sizes and from no one particular place. They can burst suddenly onto the scene from relative obscurity, dominating the media and the stock traders’ tittle-tattle. Or, they amass vast empires by working away diligently, carefully avoiding the limelight, more concerned with substance than style; value rather than their vanity. This raises the question of whether someone becomes an entrepreneur through choice and deliberate action, or are they simply fulfilling a destiny for which they have been fully equipped?

Whatever the answer to that question might be the fact remains that our current global society likes entrepreneurs, wants more of them and is prepared to reward them. From post-communist Russia to reforming China; from Silicon Valley in California USA to Silicon Fen in Cambridge UK; and now in Qatar, entrepreneurs are encouraged and celebrated. The issue is therefore, what should be done to create favourable conditions and by whom, to achieve the right outcome.

There is some logic in the argument that the people who are destined to become successful entrepreneurs need no assistance. The fact that these people have conquered, where others have failed proves their capability. However, this quasi- Darwinian attitude of survival of the fittest might be too harsh for economies which are struggling for growth. Ignoring the talents of all but a few may be a waste of potential.

One aspect of entrepreneurship which has become accepted over the last decade is that entrepreneurs are not restricted to the commercial private sector. In what can be seen as a reaction against global business trends, “localisation” is creating thousands of social enterprises developed and run by individuals with social capital, rather than shareholder profit, as the driving motive. Entrepreneurs are exceptionally valuable in NGOs and employed “intrepreneurs” are recognised as key players working for a knowledge-based organisation.

Is it therefore more pertinent to consider who an entrepreneur is, rather than what they do? In fact, until their occupation (or, more typically, multiple occupations) has been determined, referring to these individuals as enterprising people, gives one the freedom to focus on generic competences which define the person.

It also helps us to avoid stereotypical portrayals or believe that all entrepreneurs are clones or aspirants of famous biographers. It is this examination of the “who” rather than the “what” which is the subject of Qatar Skills Academy’s “Understanding Enterprise”, a development programme running from the Bedaya Centre with the support of Qatar Development Bank and  Silatech.

An enterprising person demonstrates many different qualities, some even conflicting, which go on to determine a career path. One of the most important and guiding capabilities, is to possess a sufficient level of self-awareness to be able to control the use of one’s abilities and develop them according to the situation. This self-awareness is the protection between confidence and determination or arrogance and delusion.

I refer to risk. Attitude to risk is often identified as one of the defining characteristics of an enterprising person. Entrepreneurs are frequently depicted as high-risk individuals. In reality, as Richard Branson said, they often never risk more than they can afford. Therefore, risk-aware is a more accurate definition.

Developing a strong sense of personal identity is critical to an enterprising person’s make-up. Identity can be formed through any combination of factors, such as family influence, national culture, religion, childhood upbringing and experience of education. If any of these inputs are overtly negative to the concept of enterprising behaviour, they are likely to leave a lasting impression. On the other hand, charismatic role models and a value-driven lifestyle is likely to prove central to the inner compass of an individual and define their outlook to life situations.

The ability to use and control one’s talents (and disguise or hide one’s limitations) is a skill acquired through observation and practice. Exposure to real situations where control of one’s self is at issue, either as an observer or an active participant is essential in the learning process of an enterprising person.

Enjoyment and satisfaction in the conscious ability of this control of one’s self-knowledge is the renewable power that fuels the engine driving the enterprising person. It is partly this love of fluid situations and constantly developing scenarios which characterises the enterprising person as a lifelong learner, although they would not usually think of applying this term to themselves as it is such a natural habit.

An enterprising person’s perspective on a situation, either existing or potential, is hard-wired to their self image. Decision making is framed by this central locus of control, which is why progress is swift, non-followers are dropped and clarity of the end result is maintained. Articulation and description of the end result is a particular quality of most enterprising people.

Ian White

The dream which they possess becomes less of a figment of imagination, less of a conceptual idea and more of a reality each time it is verbalised, modelled, prototyped and presented. This ability to form a highly detailed vision of the intended outcome is another of the central qualities of the enterprising person. They will have delved deep into their subconscious to root the vision in a matrix of principles and values, as well as opportunities and rewards. The strength of the vision is what will ultimately determine the quality of the outcome.

In addition to the cerebral activity, enterprising people adore action. Achieving the first stage of action is often through the use of a closely knit group of trusted followers or supporters. The ability to discuss and present ideas is another essential skill of the enterprising person. Communication in all forms, in all situations and in all contexts is usually something which an enterprising person relishes and handles personally. In cases where this task is delegated (because the self-awareness check recognises this is a deficiency) the attention to detail and micro management of the messenger is often so over-powering that the flavour is lost. So even when convention may dictate that a person should not be a public face, the credibility they possess as the custodian of the idea should overrule everything.

We must therefore approach the successful breeding of entrepreneurs as a combination of nature and nurture. After all, if everything was a certainty, life would be very boring.

About

Ian White is a British entrepreneur and specialist in vocational education. His first business after university in the UK was in television production, a venture which earned him the ACE UK Entrepreneur of the Year award. During the mid ‘90s Ian developed businesses in the vocational education and SME development sector whilst also working for the UK Government and the European Commission. He was created a Fellow of the Royal Society of Arts in 2002 for his work on enterprise education. Ian arrived in Doha in 2010 and created Qatar Skills Academy to meet the need for organisations to improve quality and productivity through investment in people.

The Commercial Transactions Law and the Civil Code are two of the key pieces of legislation that govern commercial activities in the UAE.

In addition to the Commercial Transactions Law and the Civil Code, which apply generally to commercial activities, there is a wide range of laws that regulate certain specific commercial activities such as construction, real estate sales, banking, e-commerce, shipping and international trade.  There is also a wide range of specific laws that govern particular issues that are relevant to traders, such as employment, consumer rights and customs duties.

1. Commercial Transactions Law

Who does the Commercial Transactions Law apply to?

The Commercial Transactions Law (or UAE Federal Law No. 18 of 1993, as it is more formally known) applies to traders as well as to any person or entity who conducts commercial activities (even though such a person may not be a trader).

What kind of regulations are set out in the Commercial Transactions Law?

The scope of the regulations covered under the Commercial Transactions Law relate to matters such as unfair competition, commercial obligations, commercial sales, commercial agency, commercial representation, brokerage, transportation, banking, commercial papers, bills of exchange, record-keeping, payment by cheque, and bankruptcy.  

Who is a trader?

A ‘trader’ is defined under Article 11 of the Commercial Transactions Law as:

(a)                 Any person who works in his own name and for his own account in commercial activities and is properly qualified to do so; or

(b)                  Any company which undertakes a commercial activity or has adopted one of the legal forms stipulated by the Commercial Companies Law.

What are commercial activities?

‘Commercial activities’ are defined under Article 4 of the Commercial Transactions Law as being:

(a)                 Activities which are carried out by a trader in relation to his trade affairs, provided that each activity carried out by a trader is considered to be related to his trade unless proved otherwise;

(b)                 Speculative activities carried out by a person, though not a trader, with the intent of realising profit;

(c)                 Activities which are stated by law as being commercial activities; and

(d)                 Activities which are related to or facilitating a commercial activity.

Article 5 of the Commercial Transactions Law clarifies that the following activities are deemed to be ‘commercial activities’ for the purposes of this law:

(a)                 Purchasing commodities and other tangible and intangible movables with the intention of selling the same at a profit, whether sold in their present condition or after their transformation or manufacturing;

(b)                 Purchasing or hiring commodities and other tangible and intangible movables with the intent of hiring them out;

(c)                 Selling or hiring out commodities and movables;

(d)                 Banking, exchange and  stock markets operations as well as those of investment companies, trust funds, financial establishments and all kinds of other financial brokerage operations;

(e)                 All kinds of transactions relative to commercial papers, irrespective of the capacity of the persons concerned therein or of the nature of the transactions for which such operations are carried out;

(f)                  All kinds of sea and air navigation activities, including:

(i)                   The construction, sale, purchase, chartering or freighting, repair or maintenance of vessels and aircrafts, as well as sea and air cargos including sea and air carriage;

(ii)                 The sale and purchase of vessel and aircraft requirements , tools or materials or catering such vessels and aircrafts;

(iii)                Loading and unloading operations;

(iv)               Marine and aviation loans; and

(v)                 Employment contracts concerning captains and pilots of commercial vessels and aircrafts;

(g)                 Incorporation of companies;

(h)                 Operating current accounts;

(i)                   All kinds of insurance other than cooperative insurance;

(j)                  Selling by public auction;

(k)                 Operating hotels, restaurants, movie halls, theatres, play grounds and amusement centre activities;

(l)                   Water, electricity and gas distribution activities;

(m)               Editing newspapers and magazines whenever the publication thereof is made with the intent of making profit through the publishing of advertisements, news and articles;

(n)                 Post, telegraph and telephone operations;

(o)                 Broadcasting and television activities as well as those of recording and photography studios; and

(p)                 The activities of public warehouses and mortgages on property deposited therein.

Article 6 of the Commercial Transactions Law further clarifies that the following activities shall be deemed to be ‘commercial activities’ if practiced as a profession:

(a)                 Brokerage;

(b)                 Commercial agency;

(c)                 Commission agency;

(d)                 Commercial representation;

(e)                 Supply contracts; and

(f)                  Purchase and sale of lands or real estate for the purpose of making profit from selling same in their original status or after transforming or allotting it.

What remedies are available under the Commercial Transactions Law?

Both the trader and the customer have rights under the Commercial Transactions Law. The remedies available under the Commercial Transactions Law vary, depending on the matter to which the claim relates and the damage suffered as a result of the relevant incident. Generally speaking, a claimant may be able to seek compensation, a precautionary order (or injunction), although such orders are granted very rarely and only in exceptional cases, and enforcement orders, among others.

Melissa Forbes

2. Civil Code

Who does the Civil Code apply to?

The Civil Code governs the relationship between private parties (including corporate entities and individuals).

What kind of regulations are contained in the Civil Code?

The scope of the laws covered by the Civil Code relate to matters such as contractual rights, undertakings, guarantees and other forms of security, and rights of ownership.

What remedies are available under the Civil Code?

The remedies available under the Civil Code are similar to the remedies available under the Commercial Transactions Law.  Again, the remedy available for a particular claim will vary, depending on the nature of the claim and the damage suffered.

DISCLAIMER

The information set out above is intended to be used as general guidance only. Please seek legal advice from Taylor Wessing in relation to any particular matter before acting (or refraining to act) in accordance with the information set out above.

 About

Melissa Forbes is an Associate in the corporate department of Taylor Wessing’s Dubai office. She has worked as a legal consultant in Dubai since 2008 and, before that, worked for a number of years in London and Australia.

Melissa has advised on a number of cross-border and domestic corporate transactions, including mergers and acquisitions, corporate reorganisations, private equity investments, joint ventures and divestitures.  She has also advised on a variety of commercial matters relating to issues such as corporate governance, regulatory compliance, management incentive schemes, shareholder disputes, agency and brokerage agreements, licensing, company formations and de-registrations, as well as various commercial and property related disputes.

Melissa is qualified as a solicitor of both the Supreme Court of England and Wales and the Supreme Court of New South Wales in Australia.

Taylor Wessing is an International law firm, based primarily in the UK, Germany, France, the UAE and Belgium, with representative offices in Beijing and Shanghai.It also has well-established alliances with BSJP in Poland and RHT Law in Singapore.

Clients include leading financial institutions, major corporations, public sector bodies and wealthy individuals and families.

The initiative will be a significant value addition for business owners and investors as it allows them to complete business registration fast and at their convenience online. BRL is keen to provide more customer service windows beyond the official working hours of DED.

Mohammed Shael, CEO, Business Registration and Licensing Division at DED, who led the workshop said: “Law firms in Dubai are the strategic partners of DED in attracting and registering companies. DED has been utilising online platforms to offer an advanced, flexible, convenient and diverse suite of services to customers, reinforcing Dubai’s reputation as one of the best and competitive business destinations.”

Shael added: “We are pleased with the positive response from law firms as they raised many vital questions related to the new e-Services initiative, which will be duly considered in the actual launch in April this  year. We have also modified some online procedures to suit the law firms and we call upon all law firms to co-operate with BRL to further enhance the UAE’s top ranking in the Doing Business Report for 2013 and promote the country as a globally competitive business hub.”

The Business Registration and Licensing Division plays a crucial role in promoting Dubai’s business environment through launching various growth initiatives. It is a key partner of the private and public sector in Dubai and seeks to provide the business community with various online services in line with global best practices. BRL is also focused on providing more tech-driven and value-added services to cope with the growth of businesses and to position DED as the best government department leveraging the latest technologies to offer service efficiencies.

“DED believes in continuous growth and is implementing the e-Strategy to enhance and expand its online services according to international best practices and customer feedback. It complements our strategic objective of creating an investor-friendly environment and strengthening Dubai’s standing as an investment destination of choice,” Shael said.

Staples cited the communication approaches of governments to Hurricane Katrina in the US (2005) and more recently to the tsunami and nuclear disaster in Japan (2011) as ineffectual and uncoordinated. On the other hand, Singapore’s response to the Severe Acute Respiratory Syndrome (SARS) outbreak in 2000 demonstrated best practices in crisis communication.

Elaborating on this point, he added: “Within two days of the SARS outbreak, the Singaporean Prime Minister took responsibility for the epidemic and set up a national task force. In addition to actively involving the media, public education campaigns across schools and communities were launched in full force. The Ministry of Health declared the situation as a national crisis and offered continuous updates through holding daily press conferences. A dedicated SARS website and TV station were set up. Periodic polls were conducted on people’s satisfaction that indicated 93 per cent satisfaction to the way the government managed the crisis.”

Panellists in discussion at the Forum

Staples’ comments came during a panel discussion titled ‘Management of Risks and Crises in Governmental Media Communications’ on the first day of Government Communication Forum 2012. Dr. Nabil Al Khatib, Executive News Director at Al Arabiya, jointly headlined the discussion. Attended by leading government officials and top-tier regional and global media thought leaders, GCF 2012 runs until 27^th February at the Sharjah Chamber of Commerce and Industry (SCCI).

In his comments, Dr. Khatib said: “There is a need to redefine the role of public relations agencies (PR) in the Middle East. This is important if we are to avoid any tendency to ‘blackout’ or filter information that is communicated. Instead of talking about the crisis on hand and a possible solution, the audience is kept in the dark. Client in the media is the audience and the different departments of PR need to help them, not mislead.”

“The information ‘blackouts’ in the region are caused when the PR agency does not allow the real extent of the crisis to reach the public, thus keeping them unaware of the reality on ground. Media outlets rely on information from PR agencies. If the agency withholds information from the media and public, it can cause long-term issues for the government entity. It is, therefore, very important for the government to communicate the right kind of information and not just placate the client. ”

Brad Staples serves on APCO Worldwide’s executive committee. Formerly, the CEO for APCO’s Europe region and subsequently for EMEA operations, he led the company’s expansion throughout EMEA and helped develop client service teams across these geographies. Prior to joining APCO, Staples worked at a European affairs consultancy in London and Brussels.

The former Executive Editor at Al Arabiya News Channel, Dr. Al Khatib has extensive experience in news reporting in the region. In addition to his earlier role as Co-Founder and Director of the Birzeit University Media Institute, he has also served as Chairman of the Department of Mass Communications and as Director of the Middle East Broadcasting Centre (MBC) in Jerusalem.

The second day of the Government Communication Forum will host sessions on:

-       Case Study of the Governmental Awareness Campaigns in the US and UK

-       Role of Visual Media in Supporting Government Institutions’ Vision of Social Development

-       Turkey and Malaysia’s Experience in Developing the Government Media Sector, and

-       The Role of Caricatures in Correcting Misconceptions and Raising Levels of Awareness.

A typical statement from employees about their leaders can often go a little something like this: “If they don’t say anything, I must be doing alright.” As much as we have heard this statement, the reality is that a lot of employees know very little about what their manager is really thinking. What management must understand is that in its basic form, workers want to know if they are doing well so they can keep doing it; they want to know when they are not doing so well, so they can change it.

On the other hand, leaders sometimes complain about their employees, “I tell them what to do, but they don’t do it.” While many causes may underlie this statement, one critical component is that employees frequently do not receive enough feedback to deliver on their goals. Hence, they don’t know whether they are doing the right thing or not.

A contemporary definition of feedback is: “A two-way communication that provides information about performance and instils feelings of fulfilment or satisfaction.” An effective leader must utilise feedback and dialogue to:

- Reinforce factors that are helping the employee achieve his or her goal

- Redirect employees when they do not meet objectives, for example support or coach them

- Renegotiate the goal itself or the methods used to achieve it, if the goal seems to be set too high

Leaders should prepare for feedback dialogue and have a general sense of tactics to recommend, but then have the flexibility to change tactics if the dialogue indicates other, more appropriate solutions. The greatest productivity comes from using a consistent approach or process to providing feedback. In addition, not giving feedback is simply not fair to employees.

Consistency is key

Feedback is the main mechanism for leaders to redirect, reinforce or renegotiate employee behaviours and goals. For many leaders, this is the most difficult aspect of their job. Learning and using a consistent feedback process guides dialogue to increase comfort and ensure results are achieved.

Test yourself by answering the following question: “Do you feel you are receiving enough and regular feedback from your employees?” Feedback can be translated into a simple process with a high impact:

Step 1: Reinforce positive intent

Open the conversation by demonstrating positive intent through adopting and conveying a win-win approach:

- Begin with an opening statement that explains the overall goal of the meeting

- Show interest in what the employee wants

- Ask the employee pertinent questions to draw out his or her point of view

- Volunteer information about your own point of view

- Work with the employee to find mutually satisfying solutions

- Demonstrate honesty and integrity

Step 2:  Explore performance with fulfilment

- Ask questions to elicit the employee’s own perception of his or her performance in the situation

- Ask questions to elicit the employee’s perception of his or her level of fulfilment or satisfaction in the situation

- Share your own perception of the employee’s performance and fulfilment and agree on both your viewpoints

For example, if an employee constantly fails to give powerful presentations, but you find out he/she feels awful giving presentations, you first need to work on the motivation, and then tackle performance.

Step 3:  Assess the environment

- Determine factors that are helping the employee achieve the goal

- Determine factors that are getting in the way of goal achievement

Step 4:  Decide on actions

- Given the degree of performance with fulfilment and the current environment, decide what to reinforce, redirect, or renegotiate

- Identify what processes, resources, tasks, and behaviours may need to be continued or changed

Step 5:  Seek an expression of confidence

- Ensure that the employee is confident about his or her ability to commit to the action plan.

- Add your own statements of confidence as appropriate

- If he or she is not confident, discuss concerns and identify what is getting in the way; explore ways to remove the barriers

- End the feedback dialogue on a positive note

Effective feedback is compassionate, timely and accurate

A frequent excuse for avoiding initiating feedback dialogue is fear of hurting a person’s feelings. Yet, without feedback, people are hurt more.

An all-too-common situation is when the whole work unit has difficulty with one person and no one will tell him or her that there is a problem. How would you feel if you were that person? In which way are the employee’s feelings best protected – by ignoring the situation or by providing effective feedback?

It is important to consider feedback from the recipient’s viewpoint prior to providing it. The leader should imagine how it would feel to receive the feedback and the consequences if the feedback is not given. This will help guide a more compassionate approach.

Timely feedback is important because things happen so fast in business today. Providing feedback on something that was done even two weeks earlier loses its power to influence change. The most effective leaders develop a habit of giving feedback frequently, which creates comfort with feedback among employees.

Feedback is not an annual event; it is continuously provided and sought by the leader as goals are being implemented.  Waiting until the goal is completed is too late to develop the employee’s skills and approach to goal execution.

The need for accurate feedback cannot be understated. There are eight errors that leaders frequently make when observing employee behaviour, which result in providing inaccurate feedback to employees:

1) Accuracy of recall

If you rely on memory alone, and keep no records, you may distort the actual event or behaviour

2) Halo effect

One very outstanding characteristic may determine your perception of an employee’s performance. Your feedback on less prominent aspects of the employee’s performance may be distorted in a positive or negative way.

3) Contrast

You compare the employee with someone else, instead of seeing an employee’s own merits.  You may provide feedback that is better or worse than reality.

4) Stereotyping

In stereotyping, the individuality of a person is ignored, and he or she is seen as behaving in a way that is supposed to be characteristic of a particular group.

Stephan Melchior

5) Differences in standards

The standards you use may be unique to you and different from those commonly accepted by other leaders in your organisation, or you may apply standards differently to different employees.  This lack of uniformity will result in employee resistance to feedback and feedback to be unsupportable.

6) Fixed impression

An earlier observation or impression of your employee may remain fixed in your mind and colour all of your later observations. In effect, you will continue to see the employee as he or she was rather than as he or she is now.

7) Projection

You see your own characteristics in others and perceive them accordingly to your feelings about those characteristics. The employee may actually be very different from you.

8) Inference

You draw conclusions about an employee’s behaviours, which are based on limited behavioural observations or hearsay.

Building a balance between following the five-step process and avoiding the eight points above helps creating and maintaining a common and consistent approach to giving feedback.

About

Stephan Melchior has been working in the learning and development field for more than 15 years; designing and delivering training programmes in more than 20 countries. He is well known for the graphic facilitation approach he uses in his courses. Today, Stephan is Managing Partner at the Middle East office of Wilson Learning Worldwide, based in Dubai Knowledge Village. As a global organisation, Wilson Learning is the founder of the Performance and Fulfillment concept, and was rated among the Top 20 Leadership and Sales Training companies in 2010 and 2011 (www.trainingindustry.com). Wilson Learning Middle East was also recently ranked among the TOP100 SMEs in Dubai.

Wilson Learning Middle East can be contacted at info@wilsonlearning-me.com, or at +971 50 7553800.