In May 2016, a new bilateral investment treaty
("BIT") was concluded between the
Government of Albania and the Government of Kosovo. This
international treaty was approved by the Albanian Council of
Ministers' Decision no. 375, dated 25 May 2016 and by the
Kosovar President Decree DMN-017-2016, dated 22 June 2016. It
supersedes the earlier BIT, which was concluded in 2004 between
Albania and the United Nations Interim Administration Mission in
Kosovo ("UNMIK") acting on behalf of the
self-governing institutions of Kosovo.
Setting the BIT aside, already the legal framework of Albania
and Kosovo offers considerable legal protection to foreign
investors in each of these countries. Since the fall of communism
and the introduction of market economy in the early 1990s, Albania
introduced a special law aimed at the promotion and protection of
foreign investors/investments. The Albanian Foreign Investment Law
no. 7764, dated 2 November 1993 was drafted in line with the
general international law on international investment. So was a
special law for the promotion and protection of foreign investments
in Kosovo (Law 02/L-33), which was approved in 2006 at a time when
Kosovo was under the UNMIK administration. This was abrogated by a
new Law 04/L-220/2013, passed by the Parliament of the Republic of
Kosovo upon the declaration of its independence in 2008.
On top of these national laws, the recently approved
Albania-Kosovo BIT marks an important legal development with
respect to the reciprocal promotion and protection of foreign
investments and investors of the two countries. Being an
international treaty, it offers to investors from Albania and
Kosovo an additional lawyer of protection and right of action, in
case their investments in the other country are negatively affected
by the government conduct and an investment dispute arises. The BIT
remains available to the respective Albanian and Kosovar foreign
investors despite any abrogations of or detrimental amendments to
the relevant national laws on foreign investment, which are subject
to changes as per the will of each country's parliament.
Content-wise, the BIT is designed in line with the majority of
modern BITs concluded worldwide. It covers the typical three-parts:
(a) definitions ('foreign investor', 'foreign
investment', and 'territory' – which is specific
in the case of Kosovo); (b) substantive investment protection
standards (a provision on admission of investments, a
guarantee of fair, equitable and transparent treatment, a guarantee
of national treatment and most-favored-nation treatment, a
guarantee in case of unlawful expropriation, and a guarantee
concerning the free transfer of payments) and (c) dispute
settlement provisions on state-state and investor-state
arbitration (with regard to this latter, availing the
disputing parties with the option of submitting their investment
dispute to ICSID- and/or UNCITRAL- based arbitration and
specifically referring to the applicability of the New York
Convention on the Recognition and Enforcement of Foreign Arbitral
Awards for purposes of enforcement of non-ICSID awards).
Notably, the BIT offers a combination of the above-mentioned
standards of investment protection with modern provisions on
sustainable development and corporate social responsibility. It
brings into the scope of the BIT – which is primarily an
economic development instrument, issues of foreign investors'
compliance with generally applicable health and safety standards,
employment standards and environmental protection, thereby
reflecting the new trend in the design of international investment
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The government has been working to incorporate the changes required as a result of the OECD's work on BEPS Action 5: Harmful Tax Practices, which requires implementation of a Nexus approach to the Patent Box regime.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).