QUESTIONS & ANSWERS
How can I submit a request for conciliation in case of dispute?
In case of dispute, you should apply a request for conciliation to the Secretariat General of the Arbitration at the Beirut Chamber of Commerce and Industry.
Who can benefit from Circular 331?
Only SAL with registered shares (not a financial company or offshore company) may benefit from Circular 331. Banks may benefit from interest-free facilities granted for a maximum period of seven years. The bank should also invest part of the money obtained from the Central Bank in the beneficiary company and the largest part in treasury bills.
Can I register more than one LB domain to the same Lebanese registered company?
Yes, you can register more than one LB domain to the same company if that company owns a Lebanese Trademark Certificate for each of the domain names in Latin script under class 35. The domain name will reflect the exact Trademark Certificate name. i.e. for and XYZ.com.lb you should trademark "XYZ".
If I play music for international artists in my restaurant, should I pay the SACEM any fees?
Yes, the SACEM may collect fees for any artist who is a member of the SACEM, whether locally or internationally.
Is the infringement of a copyright subject to criminal liability?
Yes, it is. Any person who, knowingly and with intent to make a profit, infringes or attempts to infringe copyright or related rights should be liable to imprisonment for a term varying from one month to three years and/or to a fine varying from LBP 5 million to LBP 50 million.
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.
Should a joint stock company have a head office in the Lebanese territory?
Yes, it should.
Why was my domain name application rejected?
Reasons why domain name applications may be rejected, include but are not limited to:
• Incomplete, inaccurate, or incorrect entries in the Application Form
• Not submitting the required legal documents
• The domain name is not correctly hosted in the name servers
• The applicant and/or the application are in a status contradictory with the country's regulations
• Domain names are identical with an already registered domain name
• The domain name does not comply with public ethics
• The domain name is registered with the intent of reselling it
• Primary and/or secondary DNS server(s) do not respond properly
What is public fundraising?
Public fundraising allows startups to tell the general public they're raising money—on Twitter, Facebook, blogs, TV, advertisements, etc. The legal term for public fundraising is ‘general solicitation’.
Which symbol is better to use, the (tm) or the (r) symbol?
In principal, the (tm) symbol can be used when trademark rights are claimed in relation to a mark that has not been registered at the Trademark Office of a particular jurisdiction, meaning that, the use of the (tm) symbol does not mean a legally enforceable trademark. However, the registration symbol (r), does carry legal weight. It should only be used when the mark is registered with the Trademark Office of a particular jurisdiction. Using the symbol (r) illegitimately can be treated as fraudulent marking in most of the countries in our region.
Should the managers of a partnership limited by shares hold any guarantee shares?
No. The law did not impose a limit of shares that should be owned by a manager as a guarantee for her position.
Can a limited liability company be dissolved by the incapacity of one of the partners?
No, it cannot. The partner who lost her capacity will be replaced by a legal representative.
Is the limited liability company required to have a registered office in Lebanon?
Yes, it is.
How regularly should the partners' general assembly be convened?
The partners' general assembly should be convened at least once a year, within six months of closing the year's accounts. The partners may be convened during the year for urgent matters such as dismissing or appointing directors, or appointing auditors.
When does the appointment of auditors for my limited liability company become mandatory?
The appointment of one or several auditors by the limited liability company becomes mandatory if:
• The number of partners exceeds 20
• The company’s capital exceeds LBP 30,000,000
• A request is made by one or more partners representing at least 20% of the capital
What are the main advantages of forming a joint stock company (SAL) instead of a limited liability company (SARL)?
The advantages of forming a SAL over a SARL reside in two main points:
• Transfer of shares: a SAL, unlike a SARL facilitates the transfer of shares among shareholders and third parties and therefore attracts investors; and
• Benefiting from Circular 331 as a tech startup: The Central Bank of Lebanon requires that startup companies be incorporated in the form of a Lebanese joint stock company (SAL).
There are many reasons why it is better to incorporate:
• To be trusted by counter-parties in all prospective transactions whether with suppliers or cli-ents
• To be protected in all the deals, because without a legal framework a person won’t be pro-tected if a supplier does not deliver the right product, or a client does not pay for products sold or services rendered
• To limit your liability because as a shareholder you are legally responsible for the debts of a company only to the extent of the nominal value of your shares
• To have a marketing framework: a brand name and an entity that can be marketed
• To pay less tax and benefit from tax exemptions given for corporations and merchants