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DOING BUSINESS - TOURISM – IN ALBANIA UK-Albania Investments Forum, London, 22 Oct 2010.

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Presentation on theme: "DOING BUSINESS - TOURISM – IN ALBANIA UK-Albania Investments Forum, London, 22 Oct 2010."— Presentation transcript:

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2 DOING BUSINESS - TOURISM – IN ALBANIA UK-Albania Investments Forum, London, 22 Oct 2010

3 KALO & ASSOCIATES is active in the legal market for over 15 years acting as legal counsel to major investors, and IFIs. Some of our clients :

4 YESTERDAY – The check list of investors was quite long: type of legal system, type of vehicle, entry options, cost of starting and continuing a business, form of government support, tax, employment cost and rules, safety, incentives, re-imbursements, exit options, etc. TODAY – Check list is rather short, Albania being a member of NATO, a member-candidate to EU and signatory of many conventions on investment protection and enforcement of claims, so there are less questions on the list UK-Albania Investments Forum, London, 22 Oct 2010

5 QUESTIONS NOW INVESTORS ASK ARE OF A PURE LEGAL NATURE : status of title of land fairness in tender processes/appeals secured transactions system enforcement of contracts and enforcement of claims UK-Albania Investments Forum, London, 22 Oct 2010

6 STATUS OF TITLE OF LAND - Restitution process. - Legalization process - From-scratch registration. - Recent amendment to FDI Law - Amendment of expropriation law enabling GOA to take land for important projects UK-Albania Investments Forum, London, 22 Oct 2010

7 FAIRNESS IN TENDERS/LICENSING Procurement, Concession, Economic Zones laws establish tender procedures (often tender documents are specified by Council of Ministers resolutions) One guarantee is evaluation commission is not part of drafting of tender documents UK-Albania Investments Forum, London, 22 Oct 2010

8 FAIR TREATMENT OF APPEALS We are witnessing introduction of several new special structures, like: Public Procurement Appeal Commission Ombudsman Procurement Ombudsman Taxpayers Ombudsman gover UK-Albania Investments Forum, London, 22 Oct 2010

9 SECUREDTRANSACTIONS SYSTEM A modern secured transactions system which recognizes all forms of security interests that exist in modern societies will developed financial markets. All financing transactions are secured through mortgages, possessory pledge and non possessory pledge and registries deal with such security routinely UK-Albania Investments Forum, London, 22 Oct 2010

10 ENFORCEMENT OF CONTRACTS - Civil Code offers sufficient guarantees -Doing business culture has improved - Government Contracts – no difference, except Governing Law restrictions -Limitation of liability issue UK-Albania Investments Forum, London, 22 Oct 2010

11 ENFORCEMENT OF CLAIMS Local courts will usually handle disputes with public administration, whereas contract disputes can be resolved elsewhere Recognition of foreign judgments/awards An additional force of private bailiffs recently introduced as licensed UK-Albania Investments Forum, London, 22 Oct 2010

12 INVESTMENT OPPORTUNITIES : Energy and Natural Resources Communications/Technology Tourism, Leisure, Hotels Food/Beverages Infrastructure (ports, roads) Agriculture Retail/Commercial Centers Air Transport UK-Albania Investments Forum, London, 22 Oct 2010

13 TOURISM regularly defined as a Strategic Sector

14 UK-Albania Investments Forum, London, 22 Oct 2010 LEGAL FRAMEWORK International Conventions Foreign Investments Small Entrepreneurs/Company Law Tourism Law Policy Statement Regulation on Water Tourism

15 NEW INSTITUTIONS Inter-ministerial Committee Advisory Committee of Private Sector Information Centers in 12 Counties UK-Albania Investments Forum, London, 22 Oct 2010

16 STATE AID State aid in tourism is to be granted in accordance with Albanian Tourism Law and State Aid Law, and also with SAA, CEFTA. It can be provided in the form of: Subsidies, grants, soft loans; guarantees Tax exemptions or deferrals, lowering of tax rates; Lowering of social security contributions; Equity participation Role of National Tourism Agency (NTA): Support investors in tourism sector to secure financing; Managing the national fund for tourism development UK-Albania Investments Forum, London, 22 Oct 2010

17 EFFECTIVE DOUBLE TAX TREATIES : Austria, Belgium, Bosnia Herzegovina, Bulgaria, China, Croatia, Czech Republic, Egypt, France, Republic of Macedonia, Greece, Hungary, Italy, Kosovo, Latvia, Luxembourg, Malaysia, Malta, Moldova, Netherlands, Norway, Poland, Romania, Russia, Serbia, Slovenia, South Korea, Sweden, Switzerland and Turkey. DOUBLE TAX TREATIES EFFECTIVE Estonia, Germany, Ireland and Kuwait. UK-Albania Investments Forum, London, 22 Oct 2010

18 REGULATIONS The sector is regulated: Regulations for hotels, restaurants, travel agents/agencies, tour operators, souvenirs shops, touristic villages, tour guides, designing and building of tourist units

19 SECTORS OPPORTUNITIES - Privatization of assets under Defense Ministry - Investments in the southern coast - Albania good location is fit for business tourism - Industrial parks and complexes - Access to 500 million Euros government has allocated in the 2011 budget for UK-Albania Investments Forum, London, 22 Oct 2010

20 WHAT INVESTORS EXPECT : (i) Finalization of restitution/legalization process (ii) Law enforcement (construction, environment) (iii) Specific industry incentives (bonuses, VAT) (iv) Clear cut powers of local-central government …to be continued… UK-Albania Investments Forum, London, 22 Oct 2010

21 WHAT INVESTORS EXPECT : …continued (v) Mapping and Urban Planning (www.gc-al.com ; (vi) a better coordination with local authorities (vii) improve websites, including GIS/GPS (viii) improve education, continued training UK-Albania Investments Forum, London, 22 Oct 2010

22 CLOSING NOTE TO INVESTORS: Albania is a country with great potential and recently has demonstrated to have a healthy business environment, however it is recommended to: Due diligence on Status of Title/Standing of Target or Terms of Green Field Project Check bankability of project and financing terms Engage in negotiations on Terms of Contract(s). Try to mitigate the risk of payment of purchase price (Escrow is recommended ) Ensure investment benefits the special State protection UK-Albania Investments Forum, London, 22 Oct 2010

23 Hope these slides were useful! However, should you have questions feel free to contact us at: UK-Albania Investments Forum, London, 22 Oct 2010


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