Investment Protection in Albania
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Albania has a well-structured/systemized and functional legal framework concerning foreign and strategic investments.
- Law No. 7764, dated November 2, 1993, "On Foreign Investments," as amended, anticipates the fundamental principles, rights, and mechanisms for resolving disputes related to foreign investments within the territory of the Republic of Albania. This law clearly guarantees the admission, as well as the equally and impartial treatment of foreign investments in comparison to domestic ones, including, among other aspects, matters related to employment right and the transfer of profits and contributions.
- Law No. 55/2015, "On Strategic Investments in the Republic of Albania," aims to promote and attract domestic and foreign strategic investments in the economic sectors identified as being of strategic interest. The purpose of this law is to simplify administrative procedures and provide facilities or institutional support to investors who meet the legally defined criteria. The status of "Strategic Investor" is granted by the Strategic Investments Committee (KIS) based on the value of the investment, the number of new jobs created, and the economic sector in which the investment will be made.
CEFTA
CEFTA (the Central European Free Trade Agreement) is an international agreement aimed at establishing a free trade area among the countries of Central and Southeastern Europe. Albania has been a member of CEFTA since 2006. The primary objectives of this agreement are to facilitate the trade of goods and services, reduce customs duties and non-tariff barriers, harmonize the legal trade framework with European and international standards, and encourage cross-border investments within the region.
EFTA
Albania signed the Free Trade Agreement with EFTA (the European Free Trade Association) on December 17, 2009, which entered into force on November 1, 2010. The member states of EFTA are Switzerland, Norway, Iceland, and Liechtenstein. The main focus of this agreement is the liberalization of trade in goods, including the elimination of customs duties on industrial products and marine products as of the date of entry into force.
Bilateral Investment Treaties (BITs)
Albania has signed Bilateral Investment Treaties (BITs) with various countries as part of its policy to attract foreign direct investment (FDI) and to ensure a secure and predictable legal framework for investors. To date, Albania has concluded 45 treaties, of which 41 have been ratified and are currently in force.
The ICSID Convention
The International Centre for Settlement of Investment Disputes (ICSID) is an international institution that provides mechanisms for mediation and arbitration in disputes related to investments. As yet, the ICSID Convention has been ratified by 156 countries, including Albania, which is a member state.
The New York Convention
The New York Convention on the “Recognition and Enforcement of Foreign Arbitral Awards” (1958) is one of the most significant international instruments in the field of commercial arbitration. Its purpose is to ensure the recognition and binding enforcement of international arbitral awards in all member states, thereby minimizing legal risks and strengthening the enforceability of contracts and decisions in cross-border relations. Albania is a contracting party to this Convention.
The Law on Arbitration in the Republic of Albania
This law sets forth the rules governing the organization and conduct of national and international arbitration proceedings when the seat of arbitration is located within the territory of the Republic of Albania. The law aligns with the UNCITRAL Model Law and is harmonized with the New York Convention, thereby ensuring the international enforceability of arbitral awards rendered in Albania.
