Lebanon on Monday signalled its readiness to resume US-mediated negotiations with Israel's new government over disputed maritime borders.
President Michel Aoun told US mediator John Desrocher during a meeting at the Baabda presidential palace that Lebanon was keen to pursue the indirect talks to demarcate its borders in line with “international laws”.
The last round of the UN-hosted negotiations was held in early May after a gap of seven months. The negotiations stopped after Lebanon expanded its claims.
Mr Aoun said he urged the US to “push for fair talks without preconditions”, noting that Israel “cannot impose its unilateral view on the course of negotiations.”
“President Aoun expressed hope that the efforts which Ambassador Durocher will undertake with Israeli officials will yield positive results considering the presence of a new government in Israel, which may require additional efforts in order not to delay negotiations,” a statement released by his office said.
Lebanon took a step towards officially expanding its claims over the disputed areas in April, but Mr Aoun refused signing off on the amendment of the country’s exclusive economic zone. Caretaker prime minister Hassan Diab had endorsed a draft decree that claimed an additional 1,340 square kilometres on top of the already disputed 860-square-kilometre area, based on a map that Lebanon sent to the UN in 2011.
The president argued that the amendment, which Israel said would have derailed the talks, must be first approved by the government. Lebanon has been without a fully functioning Cabinet since last August, when Mr Diab's government resigned over the explosion at Beirut port that killed more than 200 people and destroyed thousands of properties.
The blast compounded one of the worst economic and financial crises to grip the country in decades.
The crisis, which unfolded in late 2019, has plunged more than half of the population into poverty, while the national currency lost more than 90 per cent of its value against the dollar.
The dispute over marine boundaries has delayed hydrocarbon exploration in an area that could hold significant gas reserves for Lebanon, which has yet to make any commercial hydrocarbon discoveries. Israel, on the other hand, is already tapping part of its hydrocarbon wealth.
The talks between the two countries – which are technically in a state of war – are taking place at a UN post in the border town Naqoura.
The Lebanese maritime border demarcation of 2011 was also not recognised by Syria, Lebanon’s neighbour to the north.
In March, Damascus awarded a Russian company the rights to offshore oil and gas exploration in areas that overlap with Lebanon’s northern maritime blocks by an estimated area of 750 square kilometres. But Lebanon has yet to engage in negotiations with Damascus.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Petrarch: Everywhere a Wanderer
Christopher Celenza,
Reaktion Books
