ALBANIA

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1. ARBITRATION

Arbitration in the Republic of Albania is governed by Part II, Title IV, Articles 400 – 439 of the Albanian Code of Civil Procedure. The chapter contains provisions for the regulation of domestic arbitration proceedings, i.e., when all parties are resident in or have the legal seats of their companies within the territory of the Republic of Albania, and when the seat of arbitration is within this territory. The chapter does not apply to international arbitration proceedings. A draft arbitration law containing provisions for international arbitration proceedings, which is based on the UNCITRAL Model Law and sponsored by the World Bank is still being discussed. Albania currently does not have any domestic arbitral institution.

Generally, an arbitration agreement may be concluded for any monetary claim or dispute arising from a commercial transaction. Public law disputes, such as criminal law cases and family matters, including divorce, alimony or paternity disputes, are not arbitrable. An arbitration clause is deemed valid if it is made in writing and is included in the main agreement as part of this agreement, or in a separate agreement referring back to the main agreement. Although the Code of Civil Procedure does not contain explicit content requirements, the clause should specify that any disputes between the parties will be settled by means of arbitration. In addition, the arbitration clause should indicate the parties to the agreement, the scope of the agreement, the arbitral institution or the basis for forming the arbitral tribunal (in case of ad hoc arbitration).

The parties are free to decide on most aspects of the arbitration proceedings, including the seat of arbitration, the language of arbitration, the substantive law and the procedural rules. The parties are also free to decide on the number of arbitrators, although there may only be an uneven number, and the method of their appointment. Arbitrators are appointed by the court if the parties fail to do so.

The arbitral tribunal may, at the request of one of the parties and unless agreed otherwise, order any measure to preserve the interests of the parties in the arbitration. If the parties have not agreed on any rules on this matter, the arbitral tribunal must apply the rules on interim measure that exist in the context of a lawsuit in the court system (Article 418 CPC). Interim measures granted by arbitral tribunals must always be enforced by state courts. The following rules apply:

-at the request of the claimant the arbitral tribunal may grant interim measures to secure the execution of the final award in the arbitration proceedings, if there are reasons to believe that the proper execution of an award in favour of the claimant may become impossible or difficult (Article 202 CPC); and

-a claimant may also request the court to stay the execution of an administrative act (i.e., a decision by ministers or other acts issued by the state administration as provided by the CPC in the section on administrative disputes) (Article 329 CPC). The arbitral tribunal may grant such stay if there is a risk of grave and irreparable harm to the claimant. The arbitral tribunal must provide reasoning for its decision.

Such interim measures are allowed for all kinds of claims and at any stage of the arbitration proceedings, until the decision becomes final and irrevocable. Interim measures preserving rights are also allowed in proceedings before the Court of Appeal, if the award is under its consideration (Article 203 CPC).

The claimant may also request interim measures to preserve its rights in the arbitration even before bringing the claim before an arbitral tribunal. In such a case, the court determines a time period of not more than 15 (fifteen) days within which a request for arbitration must be submitted (Article 204 CPC). If the claimant does not submit a request for arbitration for a claim regarding which a security measure has previously been granted by a court within the relevant time period, the security measure is considered revoked.

If the arbitral tribunal rejects the claim or if the arbitration proceedings are stayed, the arbitral tribunal must also decide on the lifting of the interim measure, which will in any case take effect when the decision to reject the claim or to stay the proceedings becomes final and irrevocable (Article 211 CPC).

Arbitral awards are enforceable in the same way as court decisions. The courts may set aside arbitral awards only under a few conditions, in particular in case of:

-the invalid constitution of the arbitral tribunal;

-an incorrect declaration of the arbitral tribunal of its jurisdiction or lack of jurisdiction;

-the arbitral tribunal has exceeded the scope of the arbitration agreement or has not decided on one or more claims submitted to it;

-the equality of the parties and their right to be heard has not been respected;

-the lack of impartiality and independence of one or more arbitrators; or

-an infringement of Albanian public order.

2. ENFORCEMENT OF FOREIGN ARBITRAL AWARDS

Regarding the enforcement of foreign awards, Albania is a party to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, with the reservation that the Convention will only be applied to the recognition and enforcement of awards made in the territory of another contracting state.

Albania is also a party to the European Convention of 1961 on International Commercial Arbitration.

PROCEDURE AND ASSUMPTIONS

PRACTICE TIPS

TYPE OF PROCEEDINGS

Approximate Duration

Document Production

Arbitration Proceedings

Limited.

The procedural costs depend on whether a sole arbitrator or an arbitral tribunal of three members is appointed, the complexity of the case, and the administrative charges.

Hourly fees or a fixed fee and success fee may be agreed upon between the attorney and the client.

-The costs of arbitration depend on the arbitration agreement and the amount in dispute, the amount of documents, number of witnesses, and whether expert opinions are required. The costs of arbitration also include the fees of arbitrators and administrative charges.

-The arbitrators have large discretion regarding the award of costs. The award of legal fees is usually not determined by reference to a statutory tariff.

-Currently there are no arbitration courts in Albania.

Approximate Costs

PROCEDURAL COSTS

ATTORNEYS’ FEES (NET)

Simple and Complex cases

2-3 years.

Enforcement of Foreign Arbitral Awards

-For enforcement of awards under the New York Convention, the creditor must provide the court with the authenticated original award or a duly certified copy thereof, and the original of the arbitration agreement or a duly certified copy thereof.

Court fees range from EUR 25 up to 1% of the contractual amount in dispute.

Hourly fees or a fixed fee and success fee may be agreed upon between the attorney and the client.

Approximate Costs

COURT FEES

ATTORNEYS’ FEES (NET)

Simple and Complex cases

Approximate Duration

The enforcement of arbitral awards varies depending on a series of factors including the identification of the debtors’ assets, financial means, the response of the debtor, and the perseverance of the enforcement authorities in the fulfilment of their duties.

The information in this chapter was correct as of 1 January 2018. If you have any questions about the content of this chapter,

or would like further information about arbitration in Albania, please contact