RPHS Law

The Buzz in Kosovo: Interview with Mentor Hajdaraj of RPHS Law

Draft legislation, including a draft law to create a Commercial Court and a draft Civil Code, is at the top of the agenda for lawyers in Kosovo, according to Ramaj, Palushi, Hajdari & Salihu Partner Mentor Hajdaraj, who also points to several ongoing foreign investment disputes of significance to the country’s overall FDI strategy.

The proposed creation of a Commercial Court has been the hottest topic of conversation among lawyers dealing with commercial issues, Hajdaraj says. This special court would handle commercial disputes that are currently heard by the Department for Commercial Matters. “These have captured everyone’s attention in part because of the constant delays in courts,” he explains. “If you initiate a lawsuit in the Basic Court of the Department for Commercial Matters you can expect to wait at least three years for a decision, so it’s normal to want to expedite the process.”

Supporters of the Commercial Court argue that it will help the economy by solving disputes in a faster matter, which is crucial for businesses. “However,” Hajdaraj says, “the draft law on Commercial Court seems to have a lot of critics, including some who think that this law is unconstitutional, which means we can even see the draft ending up in the Constitutional court.”

The other proposed law of significance is a draft Civil Code. “There are, naturally, several laws regulating various procedures in place,” Hajdaraj explains, “but there is no such thing as a Civil Code, per se, that would integrate all the issues and not have overlaps.” 

The draft law creating the Commercial Court and the draft Civil Code were presented as part of the legislative program of the previous government, Hajdaraj reports, and he notes that, at the moment, it is still unclear if the new government will support them. In fact, he says, “the new government, which has been in place since the end of March, so far seems to have other priorities when it comes to the legislative program.” According to him, “the first legislative initiative of new Government is the Draft Law on the Confiscation of Unjustifiable Property – an initiative that is making all the headlines for the time being.”

Turning to another issue of significance, Hajdaraj reports that the Central Bank of Kosovo has recently amended and/or adopted various regulations, including, most importantly, the Regulation on Issuance of Electronic Money, which regulates the Central Bank’s authorization of non-banking financial institutions to issue electronic money. “It is still a very new sector that many people are not very familiar with,” he says. “While traditional banks have not welcomed the update, the CBK seems set to support it and the evolution of the sector will definitely be worth keeping an eye on, with several non-banking financial institutions currently applying for such a license.” 

“In terms of new deals, when it comes to foreign investments, there is not much going on,” says Hajdaraj, adding that many players “are on hold because we are waiting for the new government to present a new plan and to see how it will choose to deal with ongoing issues.”

In the meantime, he says, a particularly interesting focus of attention are the three open foreign investment disputes currently in international arbitration. “The state is currently in the process of appointing an international law firm to represent Kosovo in these procedures, and these cases have given rise to two main debates: First, to what extent were the past governments right in terminating the relevant agreements – or whatever legal instruments were used; Second, whether the current law designed to attract FDI into Kosovo is too generous.” According to him, “the fallout from these cases is definitely something to follow.”