Twitter Logo Youtube Circle Icon LinkedIn Icon

Publishing firms

Legal Developments worldwide

Albania's new courts

December 2013 - Corporate compliance & regulatory enforcement . Legal Developments by Hoxha Memi Hoxha.

More articles by this firm.

This article looks at the new administrative courts in Albania which are part of a strategy to increase foreign investment by offering more security to investors. This was first published in 'The Lawyer' May 2012.

After almost four years of debate, in April the Albanian Parliament approved a law on "the organisation and functioning of the administrative courts and the settlement of administrative disputes". This law represents an important development for the legal system and is a further step towards making Albania a consolidated democracy with a functioning market economy.

A former communist country, Albania has changed its political course since 1991 and is now headed for membership of the EU. Many reforms have taken place to build a political and economic system that relies on three pillars: a democratic, elected government (parliament), an independent judiciary and a market economy. These efforts have seen the transformation of the country from a totalitarian state and a centralised economy to a democracy and a market-oriented economy. As result, Albania is soon to receive EU membership candidate status. Some of the reforms are aimed at making the country more attractive to foreign investment and improving the business climate. The products of change have included a number of new laws and institutions such as the Company Law (law no 9901, 14 April 2008), the National Business Registration Center (law 9723, 3 May 2007), the introduction of the Ô¨āat tax system in 2008 in which corporate, dividend and income taxes were set at a Ô¨āat rate of 10%; the establishment of the National Center for Licensing, a one-stop shop services provider for individuals and companies that require licenses and/or permits to conduct economic activity; and many other developments. 

The establishment of the administrative courts is seen as fundamentally important to efforts to consolidate the country's democratic system as well as making it more attractive to foreign investment.

Why the administrative courts?

The reasons for these courts being established were many, the most important being the excessive workload of judges, while lack of specialisation of judges in dealing with administrative issues was another problem. All this resulted in lengthy and expensive procedures at all levels of the judiciary. The situation was even more burdensome for business, especially in disputes with the public administration.

Another important factor in setting up a specialised judicial system for the settlement of administrative disputes was the country's  totalitarian legacy and its strong inÔ¨āuence on the Albanian legal system. Studies undertaken in recent years show a distinct tendency, in many cases, for Albanian judges to rule in favour of the government in administrative proceedings. It is hoped that establishing the administrative courts and training the judges who will serve in them will address this.

Moreover, to strengthen the position of citizens towards the might of the state the new law shifts the burden of proof towards the administration. According to article 35, the public body has a legal responsibility to prove its action(s) under dispute were in accordance with the law. This is an important break with tradition and a remarkable step forward in a country with a strong totalitarian legacy and a weak democratic tradition.

Court structure and organisation

The administrative courts are part of the Albanian judicial system. Based on the new law there will be at least six administrative courts of Ô¨Ārst instance that will have territorial jurisdiction equal to the current Appeal Courts. There will be at least one court of second instance - the Administrative Court of Appeal in Tirana. Final decisions will rest with the (yet to be established) administrative chamber of the Albanian Supreme Court. This structure reÔ¨āects the current level of judicial review in the country.

Recruiting for the new administrative courts will be done by the High Council of Justice among the existing pool of judges. Only judges with at least Ô¨Āve years' experience will be eligible and they will be chosen through a competitive procedure. Expectations are high for the new system. There is a belief in the business community that it will protect them from the authority of the state in case of abuse, while remedies will come faster and at lower cost. The legislator is happy with the development as it sees the administrative courts as a deterrent to the tendency of government to abuse its powers.

Meanwhile, civil society organisations see the law as a good step towards empowering citizens in relation to the government and, last but not least, the European Commission is satisÔ¨Āed that one of its recommendations with regard to proposing EU candidate member status has been met.

Eris Hoxha, Partner

Hoxha Memi & Hoxha

P.O. BOX no. 48

Rr. Nikolla Tupe no. 5

first floor, Tirana, Albania

Tel: +355 4 2 274558

Fax: +355 4 2 244047