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Published: 29 Oct 2008 09:10:10 PST

Jordan

Business Environment

Business practices

Closed hours and days: Banks: from 9 am to 12.00 pm and from 4 pm to 6 pm Saturday to Thursday.
Public administration: from 8 am to 2 pm Saturday to Thursday.
Shops: from 9 am to 8 pm Saturday to Thursday.
During the month of Ramadan, economic activity is considerable reduced and working hours change.

Public holidays

New Year's Day	1 January
Labor Day	1 May
Independence Day	25 May
Army Day	10 June
Christmas Day	25 December
Hegirian calendar New Year's Day	end December/ beginning January (variable)
Good Friday	March (variable)
Easter Monday	March (variable)
Birth of the Prophet	March (variable)
Eid El Fitr	3 day festival at the end of Ramadan (variable)
Eid El Adha	3 day festival, 70 days after the end of Ramadan (variable)
Ascension of the Prophet	June (variable)

Compensation day: Days are compensated for.

Periods when companies usually close

Eid El Fitr	It usually lasts three days at the end of Ramadan. In some regions it can last up to 10 days.
Eid El Adha	3 days, 70 days after the end of Ramadan. It can last 10 days in some regions.
The month of August	It is not an official holiday period but during this time activity really slows down.

Standards

National standards organizations: Jordan Institution for Standards and Metrology Committee
Integration in the international standards network: The organisation in charge of the standardisation of products in Jordan is the Jordan Institution for Standard and Metrology Committee (JISM)
Any product, whether locally manufactured or imported, has to follow the Jordanian national standards which, for the greater part, meet international standards. If there are no national standards for a specific product, this has to match the corresponding international standards.
Classification of standards: JS then a number then the year.
Online consultation of standards: Jordanian standards are available on the JISM website. You have to pay to consult them.
Certification organizations: The JISM is also responsible for certification.

Legal framework

Independence of justice: The Judiciary is not independent in Jordan and is subject to executive influence through the Ministry of Justice and the Higher Judiciary Council whose members are appointed by the King.
Equal treatment of nationals and foreigners: Foreign nationals cannot be guaranteed an impartial trial from the country's judicial system.
The language of justice: The judicial language is Arabic.
Having recourse to an interpreter: An interpreter can be easily arranged.
Sources of the law and legal similarities: Jordan is a constitutional monarchy where King has absolute powers. Jordan (official name: Hashemite Kingdom of Jordan) has played a pivotal role in the Middle East peace process because of its strategic geographical location.
The chief of state is the King. The monarchy is hereditary. King enjoys the executive powers. King signs and executes all laws. He appoints and may dismiss all judges by decree, approves amendments to the constitution, declares war, and commands the armed forces. Cabinet decisions, court judgments, and the national currency are issued in his name. King appoints the Prime Minister as head of the government, having no fixed term of service.The cabinet, led by a Prime Minister, is appointed by the King.
The legislature is bicameral in Jordan. Its parliament called National Assembly consists of: House of Notables (the upper house) having 55 members which are appointed by the King to serve four-year terms; and the House of Representatives (the lower house) having 110 members elected by popular vote on the basis of proportional representation to serve four-year terms. King’s veto power may be overridden by a two-thirds vote of both houses of the National Assembly (parliament).The people of Jordan have limited political rights. The first parliamentary elections in 22 years were held in November 1989.
Judiciary is not independent in Jordan and is subject to executive influence through the Justice Ministry and the Higher Judiciary Council whose members are appointed by the King. The main source of the law is the constitution of 1952 (amended numerous times). The country’s legal system is based on Islamic law and French codes; as well as judicial review of various legislative acts in a specially provided High Tribunal. The country has not accepted compulsory ICJ jurisdiction. The judicial language is Arabic; an interpreter can be easily arranged.
Jordan is ruled by law. However, foreign nationals cannot be guaranteed an impartial trial from the county judicial system. The corruption in the country is under control; several high profile cases of embezzlement and abuse of authority by government employees were prosecuted in 2004.
Consulting national laws online: Website where the Jordanian laws are available.

Intellectual Property

National organizations: The organisation in charge of protecting intellectual property is the Department of Trade and Industry.
Jordan is considered to be the country in the Middle East, North Africa region which protects intellectual property the most effectively. It is part of the Paris Convention for the Protection of Industrial Property, and the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks. Jordan's joining the Berne Convention for the Protection of Literary and Artistic Works is being studied.
Regional organizations: Jordan does not belong to any regional organization for the protection of industrial property.

National regulation and international agreements

Type of property	Law	Validity	International agreements signed
Patent	Patent Law 1953	16 years
Trademark	Trademarks Law 1952	7 years renewable indefinitely	Trademark law treaty Nice agreement concerning the International classification of goods and Services for the Purposes of the registration of Marks Protocol relating to the Madrid Agreement concerning the International Registration of Marks
Design	Industrial Design Law	5 years renewable for a period of 10 years
Copyright	Law n°22 of 1992	30 years after the death of the author.	WIPO copyright treaty
Industrial Models	Law n° 14 of 2000	15 years after the registration of the model.

Tax rates

Consumption taxes

Nature of the tax: VAT is called General Sales Tax - GST. It concerns national products as well as imported ones.
Tax rate: The rate of this tax is 16%.
Reduced tax rate: There are reduced rates for some products. Thus, 91 products (live animals, meats, dairy products, etc...) are subject to VAT at 4%. 6 products and services are subject to VAT at 0%. 18 products (basic foodstuffs, water, gold, etc.) and 31 services (education, health, charity, etc.) are said to be exempt. Income from exports is exempt from taxes.
Other consumption taxes: 9 products (cement, iron bars for building, mineral oils, beer with or without alcohol, ethyl alcohol, wines and spirits, tobacco, cars and subscription services to mobile phones and radios) are subject to a specific tax over and above VAT.

Corporate taxes

Tax rate

Tax on company income

- 15% for mining activities, hotels, hospitals, transport, construction contracts.

- 35% for financial companies and banks

- 25% for other companies (insurance, exchange and intermediation, communications, services, trading companies and all other sorts of company)

Capital gains taxation

Dividends distributed to shareholders are taxable at 25%. On the other hand, dividends paid by subsidiaries to their parent company are not subject to levy at source.

Main allowable deductions and tax credit

Companies set up in the special economic areas benefit from exemptions from tax, social security contributions and Customs duties. However, these exemptions vary according to the economic area.

Other corporate taxes

There is a property tax on rentals but it is deducted from income tax. It is 10% of 80% of the annual rent.

Individual taxes

Tax rate

Individual Income tax	:	Rate
From 2000 JD per annum:	:	5%
From 4000 JD per annum:	:	10%
From 8000 JD per annum:	:	20%
Over 14 000 JD per annum:	:	25%

Allowable deductions and tax credit

There are no particular deductions.

Special expatriate tax regime

The income of a non national working for a foreign company is not taxable.

Double taxation treaties

Countries with whom a double taxation treaty have been signed: Jordanian Ministry of Finance website
Whithholding taxes
Bilateral agreement

Sources of fiscal information

Tax Authorities: Jordanian Customs; Tax department of the Jordanian Ministry of Finance
Other domestic resources: Website of the Federation of International Trade Associations

Accounting rules

Tax year

The fiscal year begins on January 1 and ends on December 31 of the same year.

Accounting standards

There are no particular accounting standards. The standards must conform to recognized international principles of accounting and audit .

Accounting regulation bodies

Jordanian Securities Committee

Accounting reports

Every company must keep a book of accounts, a stock inventory and a register of commercial correspondence. These documents must be kept in Jordan and be written in Arabic or in English.

Publication

The banking sector is obliged to publish its accounts.

Professional accountancy bodies

Arab Society of Certified Accountants

Certification and auditing

The certification and the control of accounts in Jordan refers to the recommendations from the "Jordanian Association of Certified Public Accountants" which adopted, on January 1 1980, the standards of the International Financial Accounting Standard. Only the auditors who have received this certification are authorized to validate annual reports.

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