Explained: Store Regulations and Commercial Registers in Syria’s Trade Law

Trade Law No. 33, issued in 2007, provides rules for stores and commercial establishments and their records. The law defines a store as a group of tangible and intangible elements aimed at practicing a commercial profession, i.e. as the primary means through which a merchant carries out their commercial activities. 

Through Decision No. 2210 of 2022 (published in Issue No. 32 of the Official Gazette on August 31, 2022) the Ministry of Domestic Trade and Consumer Protection issued executive instructions for Law No. 33 concerning stores and commercial registers.

It is necessary to distinguish between the different types of records granted by the Commercial Register Secretariat, affiliated with the Ministry of Domestic Trade and Consumer Protection: store records and commercial registers. A commercial register is a tool for publicising a company so that the public can access information about the trade establishment. Meanwhile, each store has a mandatory record dedicated for others to access; its data is used to prove store ownership. From this measure, it is clear that Law No. 33 treats stores as real estate properties by assigning them dedicated records and requiring the registration of their rights and other reservations.

These store records must include basic information such as the store owner’s name or the extent of their share if there are multiple owners, the name of the store investor, and the date of registering their investment. It must also feature the store’s address, property number, the store’s real estate area, a description of the store and its components, and the registered rights and reservations.

According to the trade law and its executive instructions, the tangible components of a store include equipment and industrial tools used by the merchant in their work, commercial furniture such as desks and furnishings, and goods meant for sale. The intangible or goodwill components, on the other hand, include the right to deal with customers, the trade name or address used by the merchant in conducting their commercial activities, the logo placed on the storefront, licences issued by authorities to the merchant, patents and the right to rent if the merchant leases the retail space. A store derives its legal status from combining these components rather than their individual attributes. Therefore, according to Trade Law No. 33, the store is deemed intangible, meaning it has no tangible physical existence but requires a physical property to conduct commercial activities.

Any contracts and transactions related to the store must be written in the store record. Law No. 33 executive instructions mention some of these contracts and commerce, including sales, transfers, donations, investments, renting, lending, mortgages, insurance, lawsuit indication, seizure, and prohibition of transactions, among other things. 

It is important to distinguish between renting a store and investing in it. Suppose the main purpose of the contract, as proven by its clauses and circumstances, focuses on exploiting the store’s trade name, customers, location, popularity and administrative licence. In that case, it is considered an investment contract. However, if the primary purpose of the contract is merely to benefit from the rented property, it is a rental agreement, according to the General Assembly of the Court of Cassation’s Decision No. 154 of 1994. Due to this differentiation, if the contract is meant for investing in the store and its components, it cannot be vacated. 

However, if it is a rental contract, it is subject to rental provisions and can be vacated under the Court of Cassation’s Decision No. 107/211 of 1978.

The rights accrued on the store are not valid for other parties unless registered in the store record, according to Article 57 of the Trade Law. This other party could be a creditor of the store owner, for example. The creditor must place a reservation indication on the store record, which grants them the possibility of collecting that right. Such rights must be listed in the store record at the Commercial Register Secretariat alongside the number and date specifying the time of the registration process. This process requires the store owner and the other party with the right to sign the contract to be present in front of the Commercial Register Secretary after paying any taxes due for the store. The contract registered for the store record is cancelled by mutual agreement or at the owner’s request after the contract period has ended, and an inspection has been conducted to verify the occupant.

Implementing a precautionary seizure on the store would require the court and the creditor to go to the store’s location to impose the actual seizure of the goods, furniture and movable assets inside.

Should the store owner cease their commercial activities, they must cancel the store record. A store closure indication is placed in the store record after conducting an inspection and presenting documents proving the cessation of commercial activities. If the store is reopened, the closure indication placed in its record must be cancelled.