Donnerstag, 26. September 2013

New Tajik Law on investment contracts

On 28 February 2013, the Parliament of the Republic of Tajikistan enacted the Law “On the Investment Agreement”. The Law was signed by the President on 14 March 2013. The Law provides for rules on investment contracts between the Government of Tajikistan and investors for investment projects of a “strategic” character. Such contracts are to be signed by the Government of the Republic of Tajikistan and ratified by the Parliament (Art. 12 and 13 respectively). The contract may establish rules, which are not provided for under the legislation of Tajikistan, as well as a strong grandfathering clause (Art. 6 sec. 3 of the Law). The ratification of such contracts by the Parliament elevates the special contractual regime to the level of formal legislation with a character of lex specialis. The Law foresees the possibility to agree on a very broad arbitration clause covering all disputes out of the investment contract, also in public matters (Art. 21 Sec. 2 of the Law). Tajikistan can give its consent to waive its state immunity including immunity against enforcement of arbitral awards.
The above-mentioned provisions are just examples from a long list of concessions made by Tajikistan to investors. Legislation providing for the internationalization of contracts, restrictions on sovereign rights and state immunity waivers was typical for the investment legislation of developing countries in the 1960-70s (e.g. Indonesia) and also for some post-Soviet countries in the early 1990s (e.g. Azerbaijan, Kazakhstan). The experience of these countries shows that extensive restrictions of sovereign rights very often sooner or later lead to disputes with investors. The State needs at least the right to react to changes of external circumstances and to adapt its legal framework. Investors are often not interested in such amendments and make use of the rights given to them by the State (e.g. under the grandfather clause).
The above-mentioned Law was drafted with the support of the International Finance Corporation. Probably many other international experts and organizations (e.g. UNCTAD) would advise Tajikistan to drop or at least to amend some of the provisions of this Law.

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