Somaliland laws affecting UN organizations include the following:  Somaliland Constitution Somaliland Taxation Laws: Direct tax; Customs duties and tariffs; Registration Tax; Road tax Somaliland private sectors Act of 31/2004

1. Somaliland Constitution  Article 10.2 of the constitution dealing with relations between Somaliland state and United Nations provides that: “ Republic of Somaliland recognizes and shall act inconformity with UN charter and international law…..”  According to the constitution, UN Charter and Conventions on Immunity and Privileges of UN organizations are among the international instruments that should be applied to relations between Somaliland state and UN organizations working within the Somaliland territory.

2. Somaliland taxation laws and UN Organizations 2.1. Direct taxation and UN organizations  Somaliland Direct tax Act provides that UN organizations shall be exempted from income tax inconformity with generally accepted rules of international law and international treaties binding on Somaliland {Article 15(c)} The enforcement of this exemption requires that, in addition to rules of Immunity and privileges, there shall be an international agreement on Somaliland. So one may question whether UN organizations working in Somaliland may relay on existing agreement between Un Organization and the than Republic of Somali as binding agreement on Somaliland?

2.2. Import taxation and UN organizations Somaliland Customs law exempts from import duties on :  All objects and motor vehicles for official use of the United Nations and its specialized agencies  Objects and motor vehicles necessary for the execution with Agreements ratified by law  Issue for discussion: Exemption granted to UN organization for an official use is reflection of the immunity and privileges rules recognized by the Somaliland Constitution. What need to understand is the requirement of exemption of import duties on objects for non official use ( necessary for the execution with agreements ratified by law)

2.3.Registration and Road taxes and Un Organizations  According to SL Road Tax Act, Road tax is exempted for vehicles of UN organizations  SL Registration tax Act ( Act No, 83/96) subjecting payment of tax on documents relating to agreements, contracts, ownership and transfer of title deed and similar documents affects UN organizations. UN organ may pay registration tax if it is interesting party.  Registration tax is exempted on agreements between UN organization and SL government

 If registration tax is not paid, the concerned document shall have no legally enforceable effect in Somaliland territory. And this may affect a UN Organization. 7

3. Somaliland laws and employees of UN Organizations 3.1. Income tax and employees of UN organizations  According to SL Direct Tax Act, pensions and income from employment of any nature what so ever paid under the terms of Contract of employment is subject to tax.  Income tax exemption is given to Expatriate officials and employees of UN and its specialized agencies…… inconformity with international agreement, in respect of their salaries and any other emoluments received in connection with their functions

 Issues for discussion: 1. What the requirement of inconformity with international agreement means? Does it refers to the convention on UN organizations’ immunity and privileges? or does this need the existence of additional binding international agreement on Somaliland? 2. Should local/national employees of UN organizations be considered as UN employees exempted from income tax?

4. As per SL private Act of No. 31/2004 local employee of UN are subject to provisions of labor law, so one may argue that national employees of UN organizations are subject to Somaliland income tax? 4. The SL private sector Act requires that copies of employment contract including those contracts between UN organization and Somaliland nationals shall be kept and filed in Directory of Labor. And one of the reasons for this requirement is to enable the government to trace employment contract and hence to collect tax. Should UN organization comply with this?

3.2. Import tax and Employees of UN organizations  Somaliland Customs law provides that” … objects and motor vehicles belongs to the representatives, officials and experts of United Nations organizations… “ shall be exempted from import duties “… in accordance with international agreements ratified by law”  Issue for discussion: What international agreements ratified by law means ? Does it refer to rules of immunity and privileges of UN organizations recognized in Article 10 of Somaliland constitution? Or does this requires specific international agreement? Can UN organizations relay on agreements with the than Somalia?