(A) Arbitration

Under the provisions of Law on the promotion and management of foreign investment in the Lao PDR, it is stipulated that if there are disputes between foreign parties within a foreign investment, or between foreign investors and Lao parties, the disputing parties should first seek to settle their differences through consultation or mediation. It is also stipulated that if the disputing parties fail to resolve such a matter, they shall then submit their dispute to the Economic Arbitration Authority of the Lao PDR or to any other mechanism for dispute resolution of the Lao PDR, a foreign country or an appropriate international organisation, which the disputing parties can agree upon.

The parties have to specify the provisions of the contract to the arbitration organisation for any dispute arising under the contract.

(B) Court System

Disputes involving foreign investments may be submitted cases to the Domestic Courts. The Lao Court system is known as "General Courts" which consists of both Criminal and Civil Courts.

Recently emerging are Economic Courts, to handle specific disputes involving contractual obligations and other issues related to economics and finance. If the disputing parties do not agree with the decision of the said court, the Economic Court will bring the issue to the Supreme Public Court.

NOTE: 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.

If you would like further advice please contact: David Ellis, Johnson Stokes & Master, 16th Floor, Princes Building, 10 Chater Road, Hong Kong; Tel 2843 4226; Fax no. : 2845 9121. Alternatively do a text search "Johnson Stokes and Master" and "Business Monitor".