Muscat – The Ministry of Commerce, Industry and Investment Promotion (MoCIIP) has issued Ministerial Decision No 412/2023 aimed at curbing hidden trade in the sultanate. The new rules impose stringent penalties, with fines reaching up to RO15,000 for individuals engaged in hidden trade.

The decision aims to mitigate hidden trade and its economic and social impacts on business owners and the wider Omani society. The move is in response to appeals from citizens in recent years calling for an end to this phenomenon.

The decision provides definitions for clarity. ‘Hidden trade’ refers to any activity undertaken by an individual, independently or collaboratively, that is not permitted by current laws and Royal Decrees within the sultanate.

‘Activity’ encompasses commercial, industrial, professional, crafts, tourism or any other economic engagement. A ‘hidden person’ refers to an individual engaged in hidden trade.

The new regulation states that no person may engage, directly or indirectly, in any activity that is not permitted under the prevailing laws. Hidden trade, carried out under the name of the hidden person, using their commercial registration or licence, or by any other means, is strictly prohibited.

The decision empowers MoCIIP to take any measure it deems necessary to enforce these regulations. Furthermore, any individual who becomes aware of any hidden trade activity must promptly report this to the ministry.

MoCIIP can task its specialised staff to monitor businesses, permitting them to enter at any time to ensure compliance with these new rules and deal with any violations accordingly.

Upon violation of these new rules, the ministry may impose several penalties: Removal of the activity from the commercial register, and impose an administrative fine of RO5,000, or even higher RO10,000 for a second violation, along with a three-month activity suspension. A third violation will result in a fine of RO15,000, removal from the commercial register, and a one-year suspension before re-registration is possible.

The decision holds legal entities accountable for penalties if an employee commits a violation in its name or for its benefit.

The incidence of commercial fraud has escalated in recent times, posing significant challenges to the labour market. These introduce unfair competition, especially detrimental to small and medium enterprises.