When doing business in a foreign market, legal clarity in dispute resolution is essential. In Albania, both local and foreign companies have access to a structured system that allows for dispute settlement through courts or arbitration.
Understanding how these mechanisms work is critical for protecting your investment.
Court System or Arbitration?
Most commercial disputes in Albania are handled by the civil courts, which have jurisdiction over contract claims, tax disputes, labor issues, and other business-related cases.
However, court proceedings in Albania can be slow and unpredictable. For this reason, many companies prefer to resolve disputes through arbitration, especially in cross-border or high-value contracts.
If your contract includes an arbitration clause, you can settle disputes outside the courts, using a private legal process with rules agreed upon in advance.
Domestic Arbitration in Albania
Arbitration is legally recognized in Albania under the Law No. 10385/2011. This law outlines the procedures for both domestic and international arbitration.
Businesses may choose:
Ad hoc arbitration, where the process is defined entirely by the contract
Institutional arbitration, offered through centers like the Albanian Chamber of Commerce
The arbitration process is confidential, faster than litigation, and allows both parties to select neutral decision-makers.
International Arbitration Rights
Foreign investors in Albania also benefit from access to international arbitration, especially in disputes with public authorities or the state.
Albania is a member of:
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The ICSID Convention, allowing claims against the Albanian government
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The New York Convention, which ensures that foreign arbitration awards can be enforced in Albania and vice versa
These treaties provide a legal framework that adds security and neutrality for investors operating in sensitive or complex sectors.
Enforcing Arbitration Awards
Arbitral decisions are enforceable in Albania through the civil enforcement system, provided they meet procedural requirements. A properly executed arbitration clause and a final award that complies with the law are essential for enforcement to proceed without challenges.
The courts do not re-evaluate the case but verify the formal validity of the arbitration process.
When to Use Arbitration
Arbitration is ideal when:
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You are entering into international contracts
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You want faster and more confidential resolution
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You prefer neutral decision-makers
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You are dealing with high-value or politically sensitive transactions
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You want the option to enforce awards globally
To benefit from arbitration, your commercial agreements must contain a clear, valid arbitration clause before a dispute arises.
Albania provides both court and arbitration paths for resolving business disputes. For investors, arbitration offers privacy, speed, and global enforceability. When structured properly, it is one of the most effective tools to protect your interests in Albania.