LAWYERS' DIRECTORY
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QUESTIONS & ANSWERS

How can I become a broker with the Beirut Stock Exchange (BSE)?
In order to become a broker with the BSE, you should be licensed by the Central Bank of Leba-non (BDL) in order to trade. Each broker trading at the BSE is required to present a bank guarantee of LBP 200 million renewed yearly.
This amount must be directly replenished within a maximum of three days. Your membership is always subject to approval from the BSE Committee.
Can a joint stock company issue bearer shares?
The commercial code provides for the issuance of bearer shares by a joint stock company and for the transfer of share from nominal to bearer shares and vice versa. However, the Central Bank of Lebanon issued a directive prohibiting issuance of bearer shares by any company.
What is the Banque Du Liban intermediate Circular 331?
The Central Bank of Lebanon implemented Circular 331 with the purpose of incentivizing Lebanese financial institutions (such as banks) to invest in:
• Startups
• Incubators or accelerators, the object of which is limited to supporting the development, success and growth of startups in Lebanon
• Companies whose object is limited to investing venture capital in startups
Can a joint-stock company be managed by foreigners?
Yes, it can. However, the majority of the board of a joint-stock company should be formed by Lebanese.
Do the author and composer of a song have equal rights in the song?
Yes, the author and composer of a song have equal rights in that work, unless agreed otherwise.
Can the limited liability company be managed by foreign managers?
Yes, it can. However, the foreign manager should obtain work and residency permits from the Ministry of Labor and the Directorate General of General Security.
Should I deduct a reserve from the net profit of my joint stock company?
Yes, you should. The board of directors should keep 10% of the company's net profit to form a legal fund reserve until such an amount equals 1/3 of the capital.
What is the procedure to file an international patent?
The procedure to file an international patent includes the following steps:

• Filing: you file an international application with a national or regional patent Office or the World Intellectual Property Organization (WIPO), complying with the PCT formality requirements, in one language, and you pay one set of fees.
• International Search: an “International Searching Authority” (ISA) (one of the world’s major patent Offices) identifies the published patent documents and technical literature (“prior art”) which may have an influence on whether your invention is patentable, and establishes a written opinion on your invention’s potential patentability.
• International Publication: as soon as possible after the expiration of 18 months from the earliest filing date, the content of your international application is disclosed to the world.
• Supplementary International Search (optional): a second ISA identifies, at your request, published documents which may not have been found by the first ISA which carried out the main search because of the diversity of prior art in different languages and different technical fields.
• International Preliminary Examination (optional): one of the ISAs at your request, carries out an additional patentability analysis, usually on an amended version of your application.
• National Phase: after the end of the PCT procedure, usually at 30 months from the earliest filing date of your initial application, from which you claim priority, you start to pursue the grant of your patents directly before the national (or regional) patent Offices of the countries in which you want to obtain them.
What events lead to the dissolution of my joint stock company?

The following events lead to the dissolution of your joint stock company:
• The end of the company’s duration in the article of association
• The execution of the anticipated project for which the company was established or if it be-comes impossible to achieve such project
• A decision of the shareholders at an extraordinary general meeting, whereby at least 1/3 of the capital of the company is represented and the decision is made by the majority of the votes of the shareholders present or represented
• The loss of 3/4 of the company capital (provided that the capital is fully paid) and an extraor-dinary general meeting decision to dissolve the company
Can I be a shareholder in a joint stock company if I was previously declared bankrupt?
No, you can’t. An individual who has been declared bankrupt and has not been reinstated for the past ten years, or who has been indicted in Lebanon or abroad for less than ten years for having committed or tried to commit felony, or fraud, or embezzlement, or for having caused prejudice to the State’s finances, or for writing cheques with insufficient funds, cannot contribute to a joint stock company.
Can a board member of a joint stock company be a member in other similar companies?
No. The members of the board cannot assume management of any similar company unless they get an annual authorization during the annual shareholders’ meeting.
How do venture capital firms (VCs) get paid?
In a nutshell, VCs are paid in two (2) ways:
• Carried interest: commission on gains they produce for the fund (which is usually 20%); and
• Management fees: annual percentage fee to run the business, while they and their investors await a future good payday from investment gains (most commonly a fund charges 2% annual management fees on committed capital for 10 years)
What are the different types of companies in Lebanon?
The different types of companies in Lebanon are:
• Joint liability company
• Limited partnership
• Undeclared partnership
• Limited liability company (SARL)
• Joint stock company (SAL)
• Partnership limited by shares
What is a liquidation preference?
A liquidation preference grants the right to investors to get a certain multiple amount of their initial investment or a pro rata share of distribution whichever is higher before common shareholders are paid anything.
Are there provisions in the Lebanese law to oppose a design registration?
No, there aren't.