Dastid Pallaska, Attorney at Law

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1 Dastid Pallaska, Attorney at Law

2 Law on Foreign Investments Improvements in Business Registration Procedures Reforms in the Judiciary Other Relevant Considerations

3 Key Definitions Key Protections Resolution of Investment Disputes Status of the Law

4 Key Definitions Foreign Investor: A foreign physical person or legal entity that has made an investment in Kosovo Foreign Investment: Any asset that has been contributed or leased to a Kosovo business organization for business purposes Asset: Any item of value, whether tangible or intangible, and includes, immovable and movable property, intellectual property, cash, securities, receivables, licenses etc

5 Key Protections Prohibition of Discrimination Equal Treatment Stability of the Investment Regime No retroactive application of detrimental laws Compensation for detrimental change(s) of law The change(s) of law occurred within five years from the date the investment was made The foreign investor suffered damages from the change(s) of law Government of Kosovo is liable by law to compensate the damage and expenses The rights of the foreign investor are irrevocably acquired at the moment the investment is made

6 Key Protections (continued) Rights and Privileges Compensation for damages suffered for actions of public authorities that are in violation of domestic or international law Compensation for destruction of or damage of an asset Compensation for failure of Kosovo to offer protection and security in accordance with the requirements of the law Facilitation of entry and assistance in obtaining visas and residence permits for expatriate personnel

7 Resolution of Investment Disputes International Arbitration Freedom to choose the procedural rules for the resolution of investment disputes: ICSID Convention ICSID Additional Facility Rules UNCITRAL Rules ICC Rules Consent of Kosovo for the submission of an investment dispute is given by law

8 Resolution of Investment Disputes (continued) Applicable Law: Freedom to agree on applicable law In absence of agreement Kosovo law and relevant public international law applies Place of Arbitration: Freedom to agree on the place of arbitration In absence of agreement arbitration shall be held in any EU country that is also member of the New York Convention

9 Resolution of Investment Disputes (continued) Status of the Arbitral Award: Arbitral award has final and binding effect Arbitral award is enforceable within Kosovo to the same extent and degree as if it was the final decision of the highest court of competent jurisdiction Enforcement in accordance with the New York Convention No legal immunity can be claimed and served to prevent the enforcement of the arbitral award

10 Status of the Law Repeals any previous laws or other normative acts that are in contradiction with it Supersedes any other laws or normative acts that are not in accordance with it, unless: Such a normative act is a law; and The law contains a clearly expressed intention to avoid the application of this law.

Recent Amendments in the Laws Governing the Registration of Business Organizations No requirement to have charter capital to register a limited liability company The charter

11 Recent Amendments in the Laws Governing the Registration of Business Organizations No requirement to have charter capital to register a limited liability company The charter capital of a joint stock company reduced from EUR 25,000 to EUR 10,000 Deadlines for the procedures before the Business Registry shortened in half Revocation of the Municipal Work Permit

12 Reappointment of Judges and Prosecutors Internationally funded and implemented project Comprehensive competence evaluation Vetting of candidates, including background checks and full financial disclosure A refreshed justice system with 60.48% new judges and prosecutors

13 Legislative Reforms New law on Courts, streamlining the structure of the court system and providing for specialized departments within courts New laws on the Judicial Council and the Prosecutorial Council, strengthening the structural and functional independence of the justice system Considerable increase of the salaries of judges and prosecutors Major infrastructural investments in the justice system

14 Domestic arbitration offered by: American Chamber of Commerce in Kosovo; and Kosovo Chamber of Commerce. The first arbitration cases have been decided and enforced without any problems

15 Laws and Instruments Enabling Foreign Investments Privatization of Socially Owned Companies Privatization of Publically Owned Companies Public Private Partnerships Long-Term Use of Municipal Land New Law on Merger Control Intellectual Property Rights Considerable number of patents, trademarks and industrial designs registered with the Industrial Property Office Commercial Court issued its first decisions sanctioning the infringement intellectual property rights A new law providing for efficient Customs procedures to prevent counterfeited goods from entering Kosovo enacted

16 Dastid Pallaska, Partner Pallaska&Associates L.L.C. Tel: Fax: Web:

17 Republika e Kosovës Republika Kosova Republic of Kosovo Ministria e Financave Ministarstvo Finansija Ministry of Finance PARTNERITETET KOSOVA PARTNERSTVA KOSOVO PARTNERSHIPS KOSOVO Investing in Kosovo Sept 24, 2012 Washington D.C

18 Presentation Overview Legislative & Institutional Framework Scope of PPP Law Current Projects Project Pipeline Overview

19 Why Invest in Infrastructure and Services? Public-Private Partnerships Opportunities The Government of Kosova is committed to create an attractive investment friendly environment: New PPP framework legislation The PPP law is investor-friendly, in accordance with international best practices (UNCITRAL, EBRD, EC guidelines, etc.) Extensive PPP project-pipeline in all sectors Law On Publicly Owned Enterprises Providing a transparent and predictable process of Private Sector Participation in POEs Clearly articulated Government Policy on assuring Private Sector Participation in Publicly Owned Enterprises

Vast Infrastructure Development Opportunities and Needs Urgent

billion (next 3-5 years) Great opportunity for private

private sector to assure Economic Efficiency Expanded service

20 Vast Infrastructure Development Opportunities and Needs Urgent Infrastructure Development Needs Infrastructure gap of over 5 billion (next 3-5 years) Great opportunity for private participation Need for additional resources and expertise of the private sector to assure Economic Efficiency Expanded service coverage across all sectors Energy, Telecommunication, Transportation, Public Utilities

21 Legislative PPP Framework Government declared PPP as a national priority Via policy directive in July 2008 The new Public Private Partnership Law 2011 No. 04L-045, promulgated in the Official Gazette on Replacing the PPP and Concession Law No. 03/L-090,promulgated in August 2009 PPP Committee has approved many directives and standardized forms for PPP project implementation, found at

22 Legislative PPP Framework The provisions in this law shall govern Public-Private-Partnerships for the provision of Public Services and/or Public Infrastructure in all economic and social sectors, including, but not limited, to: Transport, including railway system, transport in rails, airports, roads, tunnels, bridges, parking, public transport; Energy infrastructure, excluding the construction of new energy generation capacities; Oil pipeline, gas pipeline, refinement and distribution; Production, distribution, treatment, collection and administration of water, sewage, drainage, irrigation, channels; Collection, disposal, recycling and management of waste;

23 CURRENT PROJECTS

AIRPORT INFRASTRUCTURE Prishtina International Airport - PPP

3 mill pax annually Positive Pax growth every year Large

commercial activities Public Private Partnership Model:

24 AIRPORT INFRASTRUCTURE Prishtina International Airport - PPP Project Data: The only Airport in Kosova Over 1. 3 mill pax annually Positive Pax growth every year Large potential of Expending Costumer base, non-aeronautical commercial activities Public Private Partnership Model: Design, Build, Finance, Operate, Transfer, 20 Year contract Transaction Value: Euro 100 Million

25 AIRPORT INFRASTRUCTURE Prishtina International Airport PPP Under Construction

ROAD INFRASTRUCTURE Route 6: Macedonia - Kosovo Prishtina Hani i Elezit Project Data: Connected to Pan-European Road Corridor VIII 80 KM motorway (4 lane) Kosovo's outlet to Pan

26 ROAD INFRASTRUCTURE Route 6: Macedonia - Kosovo Prishtina Hani i Elezit Project Data: Connected to Pan-European Road Corridor VIII 80 KM motorway (4 lane) Kosovo's outlet to Pan European Corridor connecting to the strategic port of Thessaloniki Traffic Data: Over 25,000 vehicles per day Contractual Model: Public Contract Transaction Value: Approx 600 million

27 ROAD INFRASTRUCTURE Route 7 Albania - Kosovo Prishtina - Morine Project Data: Installation of Tolling Plaza (s) Maintenance of 107 km highway Concession of all rights on highway including: Petrol stations, advertising, and caballing. Ability to charge tolling based on predefined criteria Public Private Partnerships Model: Operation Concession Contract (Tolls) (PPP)

ROAD INFRASTRUCTURE Route 7 Albania - Kosovo Service

Service Areas Exclusivity over the whole stretch of

restaurants, parking, and hotels Public Private

28 ROAD INFRASTRUCTURE Route 7 Albania - Kosovo Service Stations Project Data: Building and Operation of Six Service Areas Exclusivity over the whole stretch of highway Wide range of services: Gas Stations, restaurants, parking, and hotels Public Private Partnerships Model: Build Operate Transfer (BOT) Investment Value: 36 Million Euro

CENTRAL SOLID WASTE LAND FILL Kosovo Land Fill Management Company Project Data: Investment Project to Increase and Modernize Land Fill Locations throughout Kosovo.

29 CENTRAL SOLID WASTE LAND FILL Kosovo Land Fill Management Company Project Data: Investment Project to Increase and Modernize Land Fill Locations throughout Kosovo. Five Land Fills with total Capacity of over 180,000 tones of solid waste with great potential for expansion. Natural Monopoly Currently faced with significant financial constraints Donor interest for financial support Public Private Partnership Model: Rehabilitate Operate Transfer (ROT) Transaction Value: Euro 4-5 Million

TOURISM AND RECREATION Brezovica Ski & Real Estate

lanes Installing new superstructure Building of at least

Exclusivity on the site Public Private Partnership Model:

30 TOURISM AND RECREATION Brezovica Ski & Real Estate Project Project Data: Building of Green Field new skiing lanes Installing new superstructure Building of at least two hotels Opportunity to establish touristic village Exclusivity on the site Public Private Partnership Model: Finance, Build, Operate, PPP Transaction Value: Euro: 60 Million Euro

31 MUNICIPAL PPP PROJECTS No Municipalit. y Project 1 Prishtina Underground Parking - Municipality Building (BOT) 2 Prishtina Underground Parking - Grand Hotel (BOT) 3 Prishtina Underground Parking - Prishtina University (BOT) 4 Peja URBAN TRANSPORT 5 Suhareke Solid Waste Collection 6 Prishtina URBAN TRANSPORT 7 Fushe Kosova WASTE COLLECTION AND SORTING 8 Shterpce WASTE COLLECTION 9 Mitrovica WASTE COLLECTION AND SORTING Municipalit No. y Project 10 Prizren PARKING & COMMERCIAL & CINEMA (Multi-level,under&above ground) 11 Prizren PARKING ( Above ground) 12 Gjilan COMMERCIAL/RECREATIONAL COMPLEX 13 Gjilan WASTE COLLECTION AND MANAGMENET 14 Ferizaj Construction of Recreational, Cultural and Sports Center 15 Ferizaj TRADE CENTER AT THE MARKETPLACE WITH UNDERGROUND PARKING 16 Ferizaj WASTE WATER TREATMENT 17 Prizren RECONSTRUCTION of MARKETPLACE

32 CONCLUSION Kosova has a modern and welcoming investment framework Policy Posture is decidedly pro-private sector Major pipeline of PPP and Privatizations in all sectors Kosova is committed to long-term sustainable growth by working together with the private sector

33 Republic of Kosovo Ministry of Finance

1 st US - Kosovo Trade Forum New York, New York

Republic of Kosova Ministry of Economy and Finance 1 st US - Kosovo Trade Forum New York, New York Presentation By Lorik Fejzullahu Head of Public Private Partnership Unit October 27 2010 Presentation