5. Libyan legal system
The Libyan tax laws
The current law for regulating income tax of national and foreign companies in Libya
is the Income Tax Law (ITL) No. 11 of 2004. This Law replaced the ITL No. 64 of 1973,
which replaced the ITL No. 21 of 1968, with very minor changes. However, the new ITL
No, 11/2004 has major changes to the Libyan taxation system and was introduced as
part of the programme to encourage both national and foreign capital to invest in Libya
by reducing the burden of taxation on these businesses (Mukhtar et al., 2008).
The Libyan Commercial Law (LCL)
At the end of 1953 after Libya gained independence, the government enacted the first
commercial law. This law was imposed on all traders operating in the Libyan market.
Article No. 9 of this Law defined a trader as any company or person doing commercial
business as a main activity for them in the country. Article No. 5 in the Law provided
a list including 23 activities which were considered as commercial activities. These
activities are related to services, industrial, constructive, insurance and banking activities.
The Libyan Banking Law
The present law, which regulates the banking sector in Libya is the Banking Law No. 1 of
2005 which replaced the Banking Law No. 1 of 1993. According to Mukhtar et al. (2008)