Wednesday, July 20, 2016

Airline Carrier Liability for Flight Delays

In recent years, there have been numerous commercial claims brought by airline passengers who seek compensation  for  alleged  damages  arising  from  flight  delays.     This  article  will  discuss  the circumstances under which a passenger may be entitled to compensation for a flight delay, in scenarios involving both domestic and international travel.

It is important to note that Omani domestic law will apply to all domestic journeys.  Conversely, and as discussed below, the provisions of the Convention for the Unification of Certain Rules for International Carriage by Air (the “Montreal Convention”) will apply to all international journeys.

Remedies for flight delays for domestic flights

Passengers who pursue claims for flight delays for domestic flights frequently cite Articles 183 and 204 of the Sultani Decree 55 1990 (the “Law of Commerce”) when attempting to establish an airlines’ purported legal liability:

  1. Article 183 requires airline carriers “to carry the passenger…to the place of arrival at the time agreed, or as stated in the schedules of carriage.”
  2. Article 204 states that airline carriers are liable for any “detriment resulting from delay in the arrival of the passenger.”

However, whilst Articles 183 and 204 establish certain travel obligations upon airline carriers, Article
205 of the Law of Commerce sets out the mitigating factors which will absolve an airline carrier from any legal liability for purported damages arising from a passenger delay.

Article 205 of the Law of Commerce provides that an airline will be “absolved from liability” if it can prove that it had taken “all measures necessary to avert the detriment, or that it was impossible” for it to have prevented the delay.

Furthermore, the amount of compensation to which a passenger may be entitled will depend on whether the airline is considered to be responsible for having caused the delay by virtue of some “unreasonable” act.  Therefore, it is of critical importance to understand what occurrences, or types of causes for delays, may be attributed to the airlines.

Delays arising from and caused by extenuating circumstances, such as inclement weather or air traffic, cannot be reasonably attributed to the carrier.  Therefore, in these scenarios, because it is “impossible” for the airline to have mitigated the causes for the delay, the airline would not ordinarily be held legally responsible in these circumstances.

Remedies for flight delays for international flights, as set out by the Montreal Convention

The Montreal Convention is a multinational treaty, which establishes certain international norms and guidelines regarding international travel.  The Montreal Convention has been incorporated into Omani law by way of Article 3 of the Civil Aviation Law (promulgated by Sultani Decree 93 2004).

As set out in Article 1.1 of the Montreal Convention, the Montreal Convention will apply to “all international carriage of persons.”  Furthermore, as set out in Article 1.2 of the Montreal Convention:

“international carriage means any carriage in which, according to the agreement between the parties, the place of departure and the place of destination, whether or not there be a break in the carriage…are situated within the territories of two States Parties.”

Therefore, the Montreal Convention will apply to every individual flight of a passenger’s voyage whenever the original departure and the final destination are two different States.  For example, if a passenger travels from Salalah to London, with a stopover in Muscat, as part of a continuous voyage, the Montreal Convention will likewise apply to the Salalah-Muscat flight.

Article 19 of the Montreal Convention provides that airline carriers may be liable for “damages” occasioned by a flight delay only if the carrier has failed to take all measures that were “reasonably required  to  avoid  the damage  or  that  it was impossible  for  it,  or  them,  to  take  such  measures.” Therefore, as is the case under Omani domestic law, airline carriers will only be liable for damages occasioned if an “unreasonable” act by the carrier caused the delay.

Further, under international law, it is likewise understood that an airline cannot be considered to have acted unreasonably if the cause of a delay results from an overriding event, such as inclement weather, airport traffic, security threats, or even a mechanical delay.  Therefore, in such cases, the airline cannot be held liable for any resulting excess “damages” incurred.


Wednesday, July 13, 2016

Ramadan Timing and Calculation of Overtime During Ramadan

The Ministry of Manpower has formulated certain regulations to be followed during the holy month of Ramadan.  The Omani Labour Law, promulgated by Sultani Decree 35 2003 and its amendments, specifies in Article 68 that the working hours for Muslims during the Holy Month of Ramadan shall be six hours per day, or a maximum of thirty hours per week.

Article 70 of the Omani Labour Law further provides that an employee may be required to work for more hours than prescribed by Article 68, if the nature of work necessitates working more hours. However, under no circumstances may the total working hours exceed the prescribed working hours. Further, as part of the employee’s entitlement, the employer must grant the employee not less than two consecutive days of rest per week after five continuous working days.

When it comes to overtime work undertaken by workers, the employer is required to pay the worker an extra payment equal to his/her basic salary against the extra work hours plus 25% at least for daytime  working  hours,  and  50%  for  nighttime  working  hours.    Additionally,  if  such  work  is performed during the weekly day of rest or during the official holidays, the employee shall, unless compensated with another day, be entitled to double of his/her gross salary for such a day.  The Ministry  of  Manpower  has,  by  way  of  Ministerial  Decision  1  1976,  provided  that  such overtime payment provisions will not apply to senior private sector employees, such as professionals including “doctors,  engineers  and  those  of  similar  standard”  or  those  persons  who  undertake  dual  roles involving “administrative and supervisory work.”

Notwithstanding the above, the Omani Labour Law also provides that those employers engaged in works carried out at ports and airports or on board ships, vessels, or aircraft may agree to pay employees an allowance in lieu of overtime, subject to the approval of the Ministry of Manpower.  It may be possible for companies in this instance to seek the approval of the Ministry of Manpower to provide an allowance to the employees in lieu of overtime.

During the month of Ramadan, the employer must ensure, with regard to employees’ extra working hours, that any arrangement that the employer and the employee agree upon can be adopted, as long as it does not violate the provisions of the Omani Labour Law.  A Muslim worker must therefore work for a maximum of six hours per day or thirty hours per week, irrespective of whether the work is undertaken during the night or during the day.  Though the maximum working hours for Muslim employees during Ramadan is six hours per day, Article 70 of the Oman Labour Law grants an exemption and permits the employee and employer to agree in advance any additional working hours and the consideration in lieu for the same.  Accordingly, any additional hours that a Muslim employee will be required to work will be construed as overtime work.  The employer will therefore be legally required to compensate the extra hours worked by the Muslim employees during Ramadan in accordance with Article 73 of the Oman Labour Law.

Further, it is also recommended that the employer communicates the Ramadan work timings to the Muslim workers and that the overtime calculation system is explained to them in order to avoid misunderstandings and potential disputes.


Wednesday, July 6, 2016

Oman's New Anti-Money Laundering Law

Sultani Decree 30 2016 (the “New Law”) has recently been promulgated setting out Oman’s new anti- money laundering and terrorism financing regime.   The New Law, which provides a more comprehensive set of rules consistent with internationally approved standards, replaces the previous law issued under Sultani Decree 79 2010 (the “Old Law”).

The New Law has largely come about as a result of a desire for the Sultanate to adhere to recognised international standards with regard to anti-money laundering and terrorism financing.  The New Law was created with the aim of addressing the concerns raised in Oman’s Mutual Joint Evaluation Report of 2010, amended and issued by the International Financial Action Task Force in 2013.   Further, the New Law was issued in compliance with the requirements of various international agreements and treaties ratified by Oman in respect of anti-money laundering and terrorism financing.

National Centre for Financial Information

The New Law establishes the National Centre for Financial Information (“Centre”).  Unlike the existing Financial Intelligence Unit (“FIU”), which is part of the Royal Oman Police, the new Centre will have complete autonomy, with financial and legal independence.  The Inspector General will decide which employees of the FIU will be transferred to the Centre.  The responsibilities of the Centre will include, amongst others, all responsibilities previously held by the FIU.

Areas of focus

The New Law focusses on risk assessment and preventative measures including know-your-client procedures and due diligence on customer identification.   Such measures include increasing the responsibility on financial and non-financial institutions to extensively check their accounts, records and employee details as well as anything else that may intimate money laundering or terrorism financing.

The changes also focus on Politically Exposed Persons who represent risks, correspondent banking relationships, financial operations, sanctions on financial institutions and non-financial businesses, professions and financial institutions, with particular regard to those countries that do not adequately apply proper financial standards.

The New Law also contains provisions concerning international cooperation, customs declarations and strengthening sanctions imposed on violators.


The New Law has provided the public prosecutor with wider powers in relation to investigating potential breaches of the law.  Such powers include the right to ask for any documents in relation to any entity, be it private or public.  The public prosecutor, in conjunction with the Royal Oman Police, may also employ techniques that are used to capture criminals, including wiretapping, staking out, using undercover police, freezing accounts, applying travel bans and several other measures.  The New Law provides for greater cooperation with other countries in relation to finding, capturing and extraditing violators.


Penalties under the New Law for breach are much more severe than under the Old Law.  For example, the minimum prison sentence for breach under the New Law is five years, whereas it was three years under the Old Law.  Financial penalties under the New Law are also much higher than under the Old Law.  For example, under the New Law, violators face a minimum penalty of OMR 50,000, whereas the minimum penalty under the Old Law was OMR 5,000.

The New Law has given the courts the power of reducing or even potentially excluding liability to those  persons  who  come  forward  and  provide  information  regarding  money  laundering  or  the financing of terrorism.


The New Law has addressed the legislative shortcomings of the Old Law and has created a comprehensive  framework  combatting  money  laundering  and  terrorism  financing  in  line  with approved international recommendations.

We expect that the New Law will have a major impact on how the concerned authorities will be able to act in relation to anti-money laundering and terrorism financing types of activities, in light of having been granted broader investigative powers.