Law of the Republic of Tajikistan on Investments

print
LAW OF THE REPUBLIC OF TAJIKISTAN ON INVESTMENTS

 

The present Law regulates relations in connection to carrying out investment activities and identifies legal and economic basis for providing incentives and state support to investments through granting, equitable treatment and legal guarantees for the protection of investors’ rights.

 

CHAPTER 1. GENERAL PROVISIONS

Article 1. Key Definitions

The key definitions used in the present Law:

–         investments – investment of capital by an investor in the form of tangible and intangible assets in the territory of the Republic of Tajikistan for getting a profit;

–         investor – a natural or a legal entity as well as an unincorporated organization that carries out investment activities in the Republic of Tajikistan;

–         investment activity –  an investment process including preparation, execution and management of an investment projects related to investments;

– long-term investment – investment of capital in an investment project with a duration over ten years;

–         foreign investor – foreign government, any foreign legal entity, foreign unincorporated organization, a foreign citizen, , as well as international organizations carrying out investments in the Republic of Tajikistan in accordance with the legislation of its host country;

–         domestic investor – a natural person and alegal entity of the Republic of Tajikistan carrying out investments in various sectors of economy of the Republic of Tajikistan;

–         minority investor – an investor that had made investments in the amount of less than ten percent of voting shares (less than ten percent of votes of the total votes of participants)

–         direct investments – possession, acquisition by an investor of at least 10 percent share/shares (contribution) in the authorized (share) capital of a commercial organization established or newly created in the territory of the Republic of Tajikistan in accordance with the laws of the Republic of Tajikistan, as well as investment in fixed assets of a branch of a foreign entity established in the territory of the Republic of Tajikistan;

–         reinvestment – investment in business ventures in the territory of the Republic of Tajikistan using revenues or profits of investors received from investments in the Republic of Tajikistan;

–         investment dispute – a dispute arising out of contractual obligations between investors and state bodies and/or officials of the Republic of Tajikistan and other participants of investment activities in connection with the investment activities of the investor

–         authorized investment body – a state body that implements the government policy in the field of investment;

–         state in-kind grants – property transferred to the investor for temporary free use for the implementation of the investment project;

–         investment incentives – targeted incentives provided to investors in accordance with the legislation of the Republic of Tajikistan and investment agreements;

–         Single Window for investors – a centralized form of assistance to investors by the authorized body in the field of investment in the provision of public services, ensuring minimization of investors’ participation in the collection and preparation of documents and limiting their direct contact with state authorities;

– expropriation – forced compensated estrangement of property by the state in the public interests;

– indirect (implicit) expropriation – state regulatory measures that are not aimed at direct deprivation of property, but the investments lose their financial value and effectiveness;

– nationalization – transfer of property to the state property with payment of its value and compensation of other losses caused to the owner in connection with the nationalization.

– requisition – impoundment of property from the owner in case of natural disasters, accidents, epidemics, epizootic and other emergencies  in accordance with the mandative decision of the Government of Tajikistan in the manner and on the terms established by law and in the public interest, with compensation of the value of the seized property;

 

Article 2.      Legislation of the Republic of Tajikistan in the area of investments

The legislation of the Republic of Tajikistan in the area of investments is based on the Constitution of the Republic of Tajikistan and comprises this Law and other regulations of the Republic of Tajikistan, as well as international legal instruments recognized by the Republic of Tajikistan.

Article 3.      Types of assets invested in investment activities

An investor can invest in investment activities any property, and rights thereof, owned by the investor by right of ownership and other legal basis, in particular:

– immovable assets;

– financial resources;

– shares, equity stakes in authorized capital, and other forms of participation in legal entity;

– property rights;

– intellectual property and other forms of non-property rights;

– other objects of civil rights the circulation of which is not limited by the legislation of the Republic of Tajikistan.

 

 

Article 4.      Types of foreign investments

Foreign investors have a right to carry out the following types of investments:

– establishment  of enterprises fully owned by foreign investors, as well as branches, affiliated companies, and representative offices belonging to foreign legal entities, or through acquisition of ownership in the existing enterprises;

– establishment  of legal entities of the Republic of Tajikistan with participation of citizens of the Republic of Tajikistan, or acquisition of shares in the existing enterprises;

– acquisition of shares, bonds, and other securities as established by the legislation of the Republic of Tajikistan;

– independent acquisition or acquisition with participation of legal entities of the Republic of Tajikistan as well as citizens of the Republic of Tajikistan concession rights for using of state property and natural resources in the territory of the Republic of Tajikistan;

– acquisition of other property rights;

– other types of investment not prohibited by the legislation of the Republic of Tajikistan.

 

Article 5.      Restrictions on carrying out investments

  1. Investors have a right to invest in any facilities and types of entrepreneurial activity, except for those for which the investment activity is restricted or prohibited, based on the need to ensure national interests.
  2. Investing in property of legal entities occupying a dominant position in the commodity markets of the Republic of Tajikistan in carried out in line with anti-monopoly legislation of the Republic of Tajikistan.

 

Article 6.      Authorized state body in the area of investments and its mandate

The authorized state body in the area of investments is identified by the Government of the Republic of Tajikistan and carries out the following functions:

–   provides assistance to investors in enforcing carrying out of obligations of relevant state bodies and legal entities;

–  considers  applications of investors on issues arising in the course of carrying out investment activities in the Republic of Tajikistan, and serves as a link between the relevant authorities and investors;

–  drafts and disseminates information about investment opportunities, programs, projects, and conditions in the Republic of Tajikistan;

–  develops proposals for improvement of investment climate and on improving the investment legislation of the Republic of Tajikistan in the Republic of Tajikistan;

–  ;

–  provides assistance to investors in addressing emerging issues and disputes, including following pre-trial procedures;

–  signs investment agreements and contracts in line with the agreed procedure;

–  carries out other functions aimed at direct investment promotion, support and protection of investors in the Republic of Tajikistan.

 

CHAPTER 2. LEGAL REGIME OF INVESTMENTS

 

Article 7.      Guarantee of investor rights equality

The state guarantees equality of rights of foreign and domestic investors, not allowing discrimination against rights of investors in connection with their nationality, ethnicity, language, gender, race, and religion.

 

Article 8.      Guarantee of legal protection of investor

 

  1. The present Law and other regulations of the Republic of Tajikistan, and international legal instruments recognized by Tajikistan guarantee protection of rights and legitimate interests and stability of investment legislation.
  2. In line with the civil legislation of the Republic of Tajikistan, investor has a right for compensation of damages caused as a result of issuance by government bodies of regulations contradicting the legal acts of the Republic of Tajikistan, as well as a result of illegal activity (inactivity) of such bodies’ officials.
  3. The Republic of Tajikistan guarantees stability of contracts and agreements concluded between investors and the Government of the Republic of Tajikistan, with the exception when such contracts and agreements are changed and amended by the mutual consent of the parties.
  4. In case of changes and amendments to the legislation of the Republic of Tajikistan or the adoption of new regulations that worsen the conditions of carrying out investment activities, the investors carrying out long-term investments have the right to choose the terms and conditions they deem to be most favourable for them within ten years from the date of effectiveness of such laws.
  5. Changes and amendments to legislation, and adoption of new legislation of the Republic of Tajikistan deem to worsen investment conditions if they envisage:

– increasing of tax burden in comparison to tax burden on the day of beginning of investment project funding;

– introducing of quantitative restrictions on the volumes of investments and other additional requirements to the volume of investments, setting up other prohibitions and restrictions;

– introducing restrictions on the equity participation of foreign investor in statutory fund (statutory capital) of legal entities.

  1. This regime does not apply to changes and amendments to the Constitution of the Republic of Tajikistan and legislation of the Republic of Tajikistan related to the issues of national security, health, and environmental protection, morality and ethics.

 

 

Article 9.      Additional guarantees and measures to protect investors

  1. Along with guarantees and general protection measures for investors, the legislation of the Republic of Tajikistan may also provide for additional guarantees and protection measures.
  2. Additional guarantees and protection measures may be provided for the investments with the total volume equivalent to not less than five million US dollars in the national currency.
  3. Additional guarantees and protection measures set forth in Part 2 of the present Law are provided to investors in the framework of investment agreements and contracts in accordance with the laws of the Republic of Tajikistan “On Investment Agreement”, “On Public-Private Partnership”, “On Concessions”, “On On Product Sharing Agreements”.

 

Article 10.    Guarantee of right of income use
  1. Investors have a right to:

– open bank accounts in the national and (or) foreign currency in banks and other credit organizations located in the territory of the Republic of Tajikistan in accordance with the legislation of the Republic of Tajikistan;

– use, at their own discretion, profit received from their activities after payment of taxes and other obligatory payments.

  1. Investors and foreign employees are guaranteed a right of transferring abroad their income and wages in foreign currency which was legally received in the course of investment and production activity.

 

Article 11.    Currency transactions

  1. In the framework of their investment activities, investors have a right to freely convert the national currency of the Republic of Tajikistan to another freely convertible currency, as well as to purchase foreign currency and carry out other currency transactions. in line with the Law of the Republic of Tajikistan “On currency regulation and currency control”.
  2. Restrictions on remittances in foreign currency to and from the Republic of Tajikistan abroad for investors can be imposed only based on the legislation of the Republic of Tajikistan in order to prevent legalization of income obtained by illegal means.

 

Article 12.    Guarantee for investor participation in privatization of state property

  1. Investor can participate in the privatization of state property through acquisition of ownership of state property or share/shares (contribution) in the authorized (share) capital of the privatized company
  2. The procedure and conditions of privatization of state property are determined by the Law of the Republic of Tajikistan “On Privatization of State Property”.

 

Article 13. Transparency of the activities of state bodies in relation to investors and access to information related to carrying out of investment activities

  1. The State shall guarantee to investors free access to the regulatory database.
  2. Regulations affecting the interests of investors are published in the manner prescribed by the legislation of the Republic of Tajikistan, as well as on the official website of the authorized state body in the area of investment.
  3. Other information relating to carrying out of investment activities, including information on investment guarantees, benefits and incentives, state in-kind grants, Single Window for investors, investment opportunities, programs, projects and conditions, reports on implementation of investment activities, investment agreement, are posted on the official website of the authorized state body in the area of investments and other government agencies involved in investment activities.
  4. Investors, including the minority investors, are provided with free Internet access to information about registration of legal entities, registration of real estate transactions, issued licenses, as well as other information related to the implementation of investment activities, as stipulated by legislation of the Republic of Tajikistan, that does not contain commercial and other secrets protected by law.

 

Article 14.    Guarantee of investor rights in case of expropriation, and requisition

  1. The property of investor is not subject to nationalization.
  2. Expropriation of investments, including indirect Implicit) expropriation, in the territory of the Republic of Tajikistan, or the adoption of measures equivalent to expropriation of investments is prohibited, except for the expropriation in the interests of the state or society on a non-discriminatory basis, in accordance with procedure set forth in the legislation of the Republic of Tajikistan, and prompt payment of an adequate and effective compensation.
  3. 3. Investments and other assets of investors are not subject to requisition with the exception of cases of emergencies, natural disasters, accidents, epidemics, epizootics.
  4. The decision on requisition is made by the Government of the Republic of Tajikistan.
  5. Expropriation, indirect (implicit) expropriation and requisition of investor’s property is carried out upon reimbursement of the value of the property.
  6. 6. The value of property is determined on the date of the decision about expropriation or requisition based on current market prices or using other valuation methods determined by independent appraisers in the currency in which the investments were made, or any other currency acceptable to the investor.
  7. 7. From the accrual of right for compensation, and by the time the compensation is paid, interest is charged on the compensation in the amount of annual average commercial rate on the date of payment of the compensation in the currency in which investments have been made or any other currency acceptable to the investor.
  8. 8. A person whose property is requisitioned, has a right, upon termination of the circumstances of requisition, to require the return of his/her remaining property, and, in case of non-return, apply to court.
  9. 9. Investor may dispute the legality of purpose used for expropriation or requisition, the valuation of requisitioned or expropriated property, procedure that was followed by state bodies in the exercise of expropriation or requisition in the courts of the Republic of Tajikistan as well as in arbitration court, international court, and international arbitration court.

 

Article 15.    Transfer of investor rights to another person

  1. Investor has a right to transfer his/her rights (assign claims) and obligations (transfer duty) to another person in accordance with the civil legislation of the Republic of Tajikistan. Transfer of rights and obligations under the licensed activity is carried out after consultation with the authority which issued the license for that activity
  2. Transferring a share in the property of legal entities with dominating position in the commodities markets of the Republic of Tajikistan is carried out upon the consent of the authorized state antimonopoly body in cases established by the antimonopoly legislation of the Republic of Tajikistan .
  3. The Republic of Tajikistan recognizes the rights of a foreign country, its authorized body or insurance agency under the insurance contract in connection with an investment in the territory of the Republic of Tajikistan only in cases when the investor had actually implemented an investment in the territory of the Republic of Tajikistan and (or) fully complied with contractual obligations.

 

Article 16.    Guarantee of investor right for exporting property and information abroad

An investor who originally imported into the territory of the Republic of Tajikistan property, information in a form of a document or in the form of electronic records as an investment, is eligible for unimpeded (without receiving a license, quotas, and application of other measures of non-tariff regulation of foreign trade) export of the said property and information from the Republic of Tajikistan abroad after the expiry of the investment in accordance with the customs legislation of the Republic of Tajikistan.

 

Article 17. Investor’s rights to use natural resources

  1. Acquisition by the investor of the right to land use and other natural resources is made in accordance with the legislation of the Republic of Tajikistan.
  2. In case of procuring the ownership rights for buildings and structures, the land use right will also be transferred to investor in accordance with the procedures and on conditions stipulated by the legislation of the Republic of Tajikistan.

 

Article 18.  Guarantees for investor implementing reinvestment

  1. Investor may, at his/her own discretion, use profit after payment of taxes for reinvestment on the territory of the Republic of Tajikistan.
  2. In case of reinvestment, the investor enjoys full legal protection, guarantees and incentives established by the present Law

Article 19.    Concession agreements

The rights to the concession objects in granted to investors on the basis of concession agreements concluded in accordance with the Law of the Republic of Tajikistan “On concessions”.

 

Article 20.    Investments to free economic zones

Statutory provisions of the Republic of Tajikistan on free economic zones apply to making investments into free economic zones.

 

CHAPTER 3. STATE SUPPORT TO INVESTOR AND INVESTMENTS

 

Article 21.  Investment incentives

Tax, customs and other incentives are granted to investors in the manner and on the terms established by the legislation of the Republic of Tajikistan, investment agreements and international legal instruments recognized by the Republic of Tajikistan.

 

Article 22.    State in-kind grants

  1. State in-kind grants may be provided to investors by the Government of the Republic of Tajikistan through the authorized state body in the area of investments in investment and other contracts.
  2. The volume of the state in-kind grant, the conditions of its use and transfer of ownership, as well as the return of in-kind grant in case of early termination of the contract are determined by agreement between the investor and the authorized state body in the area of investments.

 

Article 23.    Single Window for providing assistance to investors

  1. The authorized body in the area on investments creates a Single Window for investors with the goal to provide assistance in rendering public services.
  2. The Single Window performs the following functions:

– receiving and counselling of investors on existing public services;

– receipt of applications from investors for getting public services, provision of assistance in the preparation and presentation of the documents necessary to obtain public services and handing out the results of public services;

– following up on investment project in the state bodies when getting public services;

– assisting in addressing investors issues in cooperation with the relevant government authorities;

– monitoring of public service delivery, as well as consideration of requests and appeals of investors to state authorities.

  1. 3. The procedure of establishing and operation of the Single Window for investors is approved by the Government of the Republic of Tajikistan

 

CHAPTER 4. REQUIREMENTS TO INVESTORS

 

Article 24.  Obligations of investors

  1. Investor must comply with the legislation of the Republic of Tajikistan while carrying out his/her investment activity in the territory of the Republic of Tajikistan.
  2. In order to monitor the implementation of commitments under investment agreements and contracts an investor is to submit quarterly reports in the form approved by the authorized state body in the area of investment.
  3. Investor should not take actions that lead to unfair competition, as well as actions (or inaction) aimed at preventing, eliminating or restricting competition, causing harm to the rights, freedoms and legitimate interests of others.
  4. While carrying out investment activities, investor is to take all necessary measures for creating jobs and training of skilled workers from among the citizens of the Republic of Tajikistan.

 

Article 25.  Labor relations between investor and citizens of the Republic of Tajikistan

The labor relations between the investor and employees – citizens of the Republic of Tajikistan is regulated by the labor legislation of the Republic of Tajikistan.

 

Article 26.  Rights and obligations of investor on attracting foreign labor force to the Republic of Tajikistan

  1. Investors have a right to attract foreign labor to the Republic of Tajikistan for carrying out labor activity in the Republic of Tajikistan in accordance with investment agreements and contracts, the legislation of the Republic of Tajikistan and international legal acts recognized by the Republic of Tajikistan.
  2. 2. Wages, remunerations and other types of compensations paid by investor to foreign employee, and other types of income are taken out without any restrictions outside the Republic of Tajikistan in accordance with the legislation of the Republic of Tajikistan.

 

CHAPTER 5. FINAL PROVISIONS

 

Article 27. Control in the area of investment

Control in the field of investment is carried out by the state authorities in line with the procedure set forth in the legislation of the Republic of Tajikistan.

Article 28.    Settlement of investment disputes

  1. Investment disputes between the participants of investment activity shall be settled in accordance with the terms and conditions stipulated in the agreements and contracts signed between the parties. In the event of absence of such agreements and contracts, investment disputes between the participants of investment activities shall be resolved to the extent possible through consultation between the parties.
  2. In case of a failure to settle investment disputes under contracts and agreements, disputes are to be resolved in the courts of the Republic of Tajikistan in accordance with the legislation of the Republic of Tajikistan and international legal acts recognized by Tajikistan, as well as mediation court, international arbitration court, international commercial court determined upon agreement of the parties.

 

Article 29.    Responsibility for the breach of the present Law

Natural persons and legal entities violating the provisions of this Law shall be prosecuted in accordance with the laws of the Republic of Tajikistan.

 

Article 30. Concerning the annulment of the Law of the Republic of Tajikistan “On Investment”

The Law of the Republic of Tajikistan “On investment” dated May 12, 2007, is annulled (Ahbori Majlisi Oli of the Republic of Tajikistan, 2007, №5, p. 365).

 

Article 31. The procedure of the enactment of the present Law

The present Law shall come into force after its official publication.

 

 

The President of the Republic of Tajikistan

 

Dushanbe,

15 March 2016, № 1299

Шарҳи худро гузоред

*

code