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Tue 27 May 2014 12:06 PM

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Qatar's Emir says all listed firms to up foreign ownership limit to 49%

Move is an attempt to attract more liquidity to the buoyant bourse

Qatar's Emir says all listed firms to up foreign ownership limit to 49%
The Emir of Qatar, Sheikh Tamim bin Hamad al-Thani. (AFP/Getty Images)

Qatar's emir has instructed all companies listed on the country's
stock exchange to raise their limit for foreign ownership to 49 percent in a
move that could attract more liquidity to the buoyant bourse.

The order
announced in a bourse filing on Tuesday comes days before index compiler MSCI
upgrades Qatar to emerging market status, but the changes will not be immediate
because they are subject to companies amending their articles of association,
requiring shareholder approval.

All citizens of
the other Gulf Cooperation Council (GCC) countries - Kuwait, Saudi Arabia,
Oman, Bahrain and the United Arab Emirates - will be treated the same as Qatari
nationals, while non-GCC citizens will be allowed to own up to 49 percent of a
company's shares, according to instructions from Sheikh Tamim bin Hamad
A Thani.

Foreign ownership
is usually limited to 25 percent in listed Qatari companies, though some have
raised the ceiling above this level.

Al Khaliji
Commercial Bank said in February that its shareholders had approved an increase
to the limit on the amount of stock foreigners can own to 49 percent, citing
the MSCI upgrade as the reason for the change.

The limits to
foreign ownership will be calculated according to a company's total capital,
not only its free float, the bourse filing stated.

Qatar's main share
index hit a record high on Monday and is up 29 percent this year.

MSCI said this
month that 10 Qatari companies would be included in its emerging market index
from the end of May. These include Industries Qatar, Qatar National Bank and
Islamic lender Masraf Al Rayan.

The upgrade by
MSCI, announced in June last year, had been close for a number of years but had
been held up by technical factors such as the low caps on foreign ownership.