QUESTIONS & ANSWERS
Before registering a trademark, can I search for available trademarks to avoid similar trademarks?
Yes, you can. Only word marks are subject to research. The result is available in a few days. One application filed shows all the marks in all classes. The search reveals similar and identical marks.
Can I copy, reproduce or record a specific work for use in judicial or administrative proceeding without the authorization of the author?
Yes, you can.
What if I don't pay the annuity fees charged on my patent?
If you don't pay your patent annuities together with the fine (if due) within the grace period, the patent will lapse.
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 annual payments that should be made by a Lebanese offshore company?
• Offshore companies are considered de facto members of the Beirut Stock Exchange and should pay an annual subscription of one USD 100.
• Furthermore, an offshore company should pay yearly maintenance fees around USD 800.
What constitutes a violation of a trademark?
Unauthorized use of a registered trademark, an imitation of a trademark applied on goods of the same class, sale, storing for the purpose of sale, exhibiting for sale of goods bearing a counterfeit mark, or using a mark duly by another party in order to serve the purpose of unauthorized promotion of goods of the same class are all offenses punishable under the law.
What is the liability of partners in a joint liability company?
In a joint liability company:
• Partners are personally liable for the company’s debts. Their liability is unlimited
• Partners are severally liable for the company’s debts and creditors may attempt to claim the whole debt from any of the partners personally
• Partners who settle the company’s debts may recover payment from the company and may also claim from other partners the amount of debt they are responsible for
Can I protect my trademark internationally?
Yes, you can.
What kind of taxes should I pay for my startup?
For individual enterprises tax rates apply as follows:
• Net income up to LBP 9M: 4% of profits
• Net income between LBP 9 M and LBP 24 M: 7% of profits
• Net income between LBP 24 M and LBP 54 M: 12% of profits
• Net income between LBP 54 M and LBP 104 M: 16% of profits
• Net income exceeding LBP 104M: 21% of profits
For companies tax rates apply as follows:
• 15% on profits
• 10% on distribution of dividends
Note that disposal of shares in SARL are subject to capital gains tax at 10% while sale of shares in SAL companies are exempted
Taxes on salaries and wages are divided as follows:
• Net income up to LBP 6M: 2% of net income
• Net income between LBP 6M and LBP 15M: 4% of net income
• Net income between LBP 15M and LBP 30M: 7% of net income
• Net income between LBP 30M and LBP 60M: 11% of net income
• Net income between LBP 60 and LBP 120M: 15% of net income
• Net income exceeding LBP120M: 20% of net income
Furthermore, you should pay the VAT at the rate of 10% on all goods and services inside Lebanon as long as your turnover over 4 consecutive quarters exceeds LBP 150M.
Do foreign employees of a Lebanese offshore company need a work permit?
Foreign employees in Lebanon are exempted from obtaining a work permit, provided the annual company's budget is not less than LBP 1,000,000,000 (i.e. around USD 6,667,000).
What are the tax requirements imposed on a representative office in Lebanon?
A representative office is not subject to VAT since it does not generate any income on the Lebanese territory. However, it is subject to tax on salaries and wages and to the tax applied on non-residents (if any) mentioned in articles 41 and 42 of the income tax law.
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.
Is it mandatory to register a trademark in the Middle East and North Africa?
If you are seeking protection of your trademark in the Middle East and North Africa, you should register your trademark in each of said countries which actually provide protection on a first-to-file, rather than a first-to-use basis. Having a first-to-file system means trademark registration is absolutely necessary in order to obtain rights on a trademark. Unlike common law countries, the use of the trademark without registration does not necessarily establish protectable rights.
Who is responsible for the management of a limited partnership?
General partners are responsible for the management of the limited partnership.
Limited partners cannot interfere in the management of the partnership, even if by proxy; otherwise, a limited partner becomes jointly liable with the general partners for the debts of the partnership. However, limited partners can have positions in the limited partnership which do not require representation of the firm in front of others.
What is the minimum number of directors in a holding company's board of directors?
The board of directors of a holding company should be composed of a minimum of three members and a maximum of twelve.
Can I renew my trademark indefinitely?
Yes, trademark protection can be renewed indefinitely upon the settlement of renewal fees close to the date of expiry.