ARMENIA Law and Practice Contributed by: Hayk Hovhannisyan and Tachat Voskanyan, HAP
licensed company’s decisions, the license hold - er must first get approval from the PSRC. Similar rules apply to transactions with telecommunica - tions operators under the Law “On Electronic Communications” . 2.3 Restrictions on Foreign Investments RA maintains a favourable legal regime for for - eign investments, ensuring they are not treated less favourably than investments made by Arme - nian citizens, enterprises, institutions, or organi - sations. Furthermore, additional incentives may be provided under Armenian legislation to pro - mote foreign investments in key social and eco - nomic development sectors. According to the Law “On Foreign Investments” , in the event of legislative changes affecting for - eign investments, investors have the right to apply the legal framework in force at the time of their investment for up to five years. A key safeguard is that foreign investments in Armenia cannot be nationalised. State authori - ties are also prohibited from expropriating for - eign investments. Expropriation is permitted only in exceptional cases under law, specifically in a state of emergency, and must be ordered by a court with full compensation provided. The customs privilege is significant because it allows enterprises to import goods listed by the Government of the RA without incurring customs duties, provided that these goods are intended to replenish the enterprise’s authorised capi - tal with foreign investments. Foreign-invested companies can export their products and import necessary goods without a license, except in cases set by Armenian law or international trea - ties. This shows Armenia’s commitment to a business-friendly investment environment.
The above shows that RA has a more favour - able regime for foreign investments. Article 4 of the Law “On Foreign Investments” defines how foreign investments can be made, with any restrictions set only by Armenian law. For example, Article 60 (Part 6) of the Constitution bans foreign citizens and stateless persons from owning land unless the law allows exceptions. Under the RA Land Code, foreign citizens and stateless persons can only use land, not own it, except those with special residency status. The Law “On Audiovisual Media” restricts foreign capital from owning 50% or more of shares in broadcasting and private multiplex companies unless allowed by an international agreement. 2.4 Antitrust Regulations According to Article 13 of the Law “On the Pro- tection of Economic Competition” , the following shall be deemed to be a concentration of eco - nomic entities: • absorption between economic entities regis - tered in RA; • consolidation of economic entities registered in the RA; • when a company acquires the assets of another company registered in RA, the transaction must be declared if the acquired assets alone or combined with other assets bought from the same company in the last three years – make up 20% or more of the seller’s total assets at the time of filing; • if a company acquires 20% or more of another company’s share capital in RA or if the new share combined with previously owned shares makes up 20% or more of the transaction, it must be declared; • acquisition of the right to use the object of intellectual property, including means of identification, because of which the economic
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