Dr. Ghassan Faramand, Director of the Institute of Law, introduced Mr. Basem Khouri, Chairman of the Palestinian Federation of Industries (PFI) and Board Member on the Dar al Shifa' Pharmaceutical Company.

 

Of the recent remarkable achievements it has made recently, the Dar al Shifa' Pharmaceutical Company concluded an agreement with the European Union (EU) to export Palestinian medicines manufactured under German specifications to the EU. Khouri asserted that this achievement is a precedent in the history of Palestinian Industries.

 

In addition, Khouri presented the private sector's perspective on a proper legal environment, which enables economic development and paves the way to enact a new sound Company Law.

 

In his lecture, Khouri focused on two main aspects: the status of the economic situation and private sector in Palestine; and the major principles to be included under a future Company Law.

 

Firstly, the Palestinian economy is deteriorating. For example, the average individual income in Israel is nine times as much as the Palestinian income. This gap is also widening. In 1999, the average of the Israeli individual was 11 times as much as the Palestinian average income. Low income in the Palestinian territories has adversely affected the private sector. As a result, citizens have been seeking jobs in the public sector only.  

 

In this context, economic reform should be institutionalised in order to enhance living standards, ensure effective participation between the public and private sectors, and develop national economy.

 

To meet these pressing needs, the Palestinian Federation of Industries – a private sector institution – has developed an agenda for a comprehensive reform of the Palestinian economy. Accordingly, reform of the legal environment should be a first priority.

 

Secondly, Khouris addressed the Draft Company Law, which is a transcript of comparative laws and does not meet Palestinian economic needs. In light of recent developments in economic and legal domains, the Jordanian Company Law of 1964 is now outdated.

 

Therefore, Khouri emphasised that a new Company Law should be in place. It must be flexible and able to resist economic shocks and variables. Moreover, the new Company Law should differentiate between obligations and duties of both public and private joint stock companies. It should also bring about principles of transparency and accountability as well as adhere to the basic principles of good governance.

 

Furthermore, the new Law has to regulate the relationship between shareholders, employees and the public; identify the social responsibility of companies; conform to other economic laws; keep track with recent economic developments; provide protection to small shareholders; facilitate company registration procedures; make clear the issues and provisions on listing and disclosure; and provide incentives to relevant actors; and set forth effective and efficient basis for legal and financial control.