Qualifying Income : Any income derived by a Qualifying Free Zone Person that is subject to Corporate Tax

at the rate specified in paragraph (a) of Clause 2 of Article 3 of this Decree-Law.

Free Zone : A designated and defined geographic area within the State that is specified in a decision
issued by the Cabinet at the suggestion of the Minister. Free Zone Person : A juridical person
incorporated, established or otherwise registered in a Free Zone, including a branch of a NonResident
Person registered in a Free Zone.

Qualifying Free Zone Person : A Free Zone Person that meets the conditions of Article 18 of this Decree-
Law and is subject to Corporate Tax under Clause 2 of Article 3 of this Decree-Law

Qualifying Free Zone Person : A Free Zone Person that meets the conditions of Article 18 of this Decree-
Law and is subject to Corporate Tax under Clause 2 of Article 3 of this Decree-Law

Qualifying Free Zone Person : A Free Zone Person that meets the conditions of Article 18 of this Decree-
Law and is subject to Corporate Tax under Clause 2 of Article 3 of this Decree-Law

Article 3 – Corporate Tax Rate 1. Corporate Tax shall be imposed on the Taxable Income at the following
rates: a) 0% (zero percent) on the portion of the Taxable Income not exceeding the amount specified in a
decision issued by the Cabinet at the suggestion of the Minister. b) 9% (nine percent) on Taxable Income
that exceeds the amount specified in a decision issued by the Cabinet at the suggestion of the Minister.
2. Corporate Tax shall be imposed on a Qualifying Free Zone Person at the following rates: a) 0% (zero
percent) on Qualifying Income. b) 9% (nine percent) on Taxable Income that is not Qualifying Income
under Article 18 of this Decree-Law and any decision issued by the Cabinet at the suggestion of the
Minister in respect thereof.

3. A Resident Person is any of the following Persons: a) A juridical person that is incorporated or
otherwise established or recognised under the applicable legislation of the State, including a Free Zone
Person. b) A juridical person that is incorporated or otherwise established or recognised under the
applicable legislation of a foreign jurisdiction that is effectively managed and controlled in the State.

Chapter Five – Free Zone Person Article 18 – Qualifying Free Zone Person 1. A Qualifying Free Zone
Person is a Free Zone Person that meets all of the following conditions: a) Maintains adequate substance
in the State. b) Derives Qualifying Income as specified in a decision issued by the Cabinet at the
suggestion of the Minister. c) Has not elected to be subject to Corporate Tax under Article 19 of this
Decree-Law. d) Complies with Articles 34 and 55 of this Decree-Law. e) Meets any other conditions as
may be prescribed by the Ministe

Free Zone Person shall apply for the remainder of the tax incentive period stipulated in the applicable
legislation of the Free Zone in which the Qualifying Free Zone Person is registered, which period may be
extended in accordance with any conditions as may be determined in a decision issued by the Cabinet at
the suggestion of the Minister, but any one period shall not exceed (50) fifty years.

Article 19 – Election to be Subject to Corporate Tax 1. A Qualifying Free Zone Person can make an
election to be subject to Corporate Tax at the rates specified under Clause 1 of Article 3 of this Decree-
Law. 2. The election under Clause 1 of this Article shall be effective from either of: a) The
commencement of the Tax Period in which the election is made. b) The commencement of the Tax
Period following the Tax Period in which the election was made.

4. A Participation in a Qualifying Free Zone Person or an Exempt Person shall be treated as having met
the condition under paragraph (b) of Clause 2 of this Article, subject to any conditions that may be
prescribed by the Minister.

Article 26 – Transfers Within a Qualifying Group 1. No gain or loss needs to be taken into account in
determining the Taxable Income in relation to the transfer of one or more assets or liabilities between
two Taxable Persons that are members of the same Qualifying Group. 2. Two Taxable Persons shall be
treated as members of the same Qualifying Group where all of the following conditions are met: a) The
Taxable Persons are juridical persons that are Resident Persons, or NonResident Persons that have a
Permanent Establishment in the State. b) Either Taxable Person has a direct or indirect ownership
interest of at least 75% (seventy-five percent) in the other Taxable Person, or a third Person has a direct
or indirect ownership interest of at least 75% (seventy-five percent) in each of the Taxable Persons. c)
None of the Persons are an Exempt Person. d) None of the Persons are a Qualifying Free Zone Person. e)
The Financial Year of each of the Taxable Persons ends on the same date. f) Both Taxable Persons
prepare their financial statements using the same accounting standards.

Article 27 – Business Restructuring Relief 1. No gain or loss needs to be taken into account in
determining Taxable Income in any of the following circumstances: a) A Taxable Person transfers its
entire Business or an independent part of its Business to another Person who is a Taxable Person or will
become a Taxable Person as a result of the transfer in exchange for shares or other ownership interests
of the Taxable Person that is the transferee. b) One or more Taxable Persons transfer their entire
Business to another Person who is a Taxable Person or will become a Taxable Person as a result of the
transfer in exchange for shares or other ownership interests of the Taxable Person that is the transferee,
and the Taxable Person or Taxable Persons that are the transferor cease to exist as a result of the
transfer. 2. Clause 1 of this Article applies where all of the following conditions are met: a) The transfer is
undertaken in accordance with, and meets all the conditions imposed by, the applicable legislation of the
State. b) The Taxable Persons are Resident Persons, or Non-Resident Persons that have a Permanent
Establishment in the State. c) None of the Persons are an Exempt Person. d) None of the Persons are a
Qualifying Free Zone Person. e) The Financial Year of each of the Taxable Persons ends on the same date.
f) The Taxable Persons prepare their financial statements using the same accounting standards. g) The
transfer under Clause 1 of this Article is undertaken for valid commercial or other non-fiscal reasons
which reflect economic reality. Article 38 – Transfer of Tax Loss 1. A Tax Loss or a portion thereof may be
offset against the Taxable Income of another Taxable Person where all of the following conditions are
met: a) Both Taxable Persons are juridical persons. b) Both Taxable Persons are Resident Persons. c)
Either Taxable Person has a direct or indirect ownership interest of at least 75% (seventy-five percent) in
the other, or a third Person has a direct or indirect ownership interest of at least 75% (seventy-five
percent) in each of the Taxable Persons. d) The common ownership under paragraph (c) of Clause 1 of
this Article must exist from the start of the Tax Period in which the Tax Loss is incurred to the end of the
Tax Period in which the other Taxable Person offsets the Tax Loss transferred against its Taxable Income.
e) None of the Persons are an Exempt Person. f) None of the Persons are a Qualifying Free Zone Person.
g) The Financial Year of each of the Taxable Persons ends on the same date. h) Both Taxable Persons
prepare their financial statements using the same accounting standards.