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Commercial Law

Commercial law is one of the main deficit areas in transition economies and in countries seeking to move up the economic value chain. Globalization has vastly expanded the need for competence in this field. A sound knowledge and practice of commercial law facilitates economic integration. It enables poorer nations to secure better terms in international or bilateral trade agreements, and empowers resource-rich ones to handle large foreign investment flows. Where investment is scarce, commercial law capacity encourages it by improving the overall business climate.

Building the capacity of the justice sector in Tajikistan

The economy and banking sectors of Tajikistan face a number of factors affecting the country’s business environment, including high interest rates and weak enforcement. At the core of the banking crisis is the fact that banks do not use the judiciary to support the enforcement of contracts. This in turn affects the construction sector, which, despite the challenging banking environment, is experiencing considerable growth. The justice system in its current condition is not able to address the construction sector disputes that inevitably surface as the sector expands.

Judicial Training on Intellectual Property in Tunisia

A strong regime of intellectual property (IP) law is crucial for fostering increased investment and innovation in key sectors of the economy. In recent years Tunisia has focused on building and implementing a policy for attracting foreign investment. Following the adoption of the new constitution, many laws regulating the economy were revised and a new investment code was adopted. The Tunisian government has also strengthened the legal framework for protecting IP, by acceding to the majority of treaties relating to IP and passing several laws on these matters.

Bailiff Service Capacity Building in Kyrgyzstan

The Court Department under the Supreme Court of the Kyrgyz Republic currently lacks a managerial and institutional strategy necessary to address increasing commercial litigation turnover and legal preparedness among bailiffs, which undermines the credibility and functionality of the judicial system. Despite the progress achieved by the judicial system in improving its commercial law capacity, enforcement of judicial decisions remains a hindrance to an effective commercial dispute resolution framework.

Jordan: Women entrepreneurs’ access to justice

While women entrepreneurs in Jordan contribute greatly to the economic development of their countries, they face a range of legal, social and economic challenges as compared to men in setting up and running their businesses and resolving disputes. Lack of awareness among women entrepreneurs about their legal rights can prevent them from accessing legal avenues to help settle their claims, and lack of gender sensitivity among justice actors in the implementation of business and economic laws might lead to unintended biased decisions that adversely affect women-owned businesses.

Commercial Mediation in Tajikistan

The judiciary in Tajikistan, despite ongoing structural reform, continues to suffer from limited financing and capacity. Mediation could dramatically ease the burden of judges and the formal courts, but there is currently no law on mediation in the country. The concept is strongly linked to peace building and community conflict resolution rather than an alternative dispute resolution mechanism as mediation was introduced to resolve post-conflict situations after Tajikistan’s civil war.

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Key Initiatives

  • In recent years, following a growth spur which made it the fastest growing economy in the world, Mongolia has experienced rapid economic and social downturn. Although the years of growth yielded wealth and investment, the country was unable to prepare for a recession due to corruption, inflation, distortion of the local economy and environmental degradation. One of the key obstacles to sustainable growth and development is the weak and poorly prepared judiciary.
  • Tajikistan’s enforcement framework and practice is considered to be the poorest in the region according to an assessment by the European Bank for Reconstruction and Development (EBRD).  Non-enforcement and lengthy delays of court decisions, particularly with regards to commercial matters, is a significant problem which affects investor confidence and, as a result, economic indicators.
  • The judiciary in Tajikistan, despite ongoing structural reform, continues to suffer from limited financing and capacity. Mediation could dramatically ease the burden of judges and the formal courts, but there is currently no law on mediation in the country. The concept is strongly linked to peace building and community conflict resolution rather than an alternative dispute resolution mechanism as mediation was introduced to resolve post-conflict situations after Tajikistan’s civil war.
  • While women entrepreneurs in Jordan contribute greatly to the economic development of their countries, they face a range of legal, social and economic challenges as compared to men in setting up and running their businesses and resolving disputes. Lack of awareness among women entrepreneurs about their legal rights can prevent them from accessing legal avenues to help settle their claims, and lack of gender sensitivity among justice actors in the implementation of business and economic laws might lead to unintended biased decisions that adversely affect women-owned businesses.
  • The Court Department under the Supreme Court of the Kyrgyz Republic currently lacks a managerial and institutional strategy necessary to address increasing commercial litigation turnover and legal preparedness among bailiffs, which undermines the credibility and functionality of the judicial system. Despite the progress achieved by the judicial system in improving its commercial law capacity, enforcement of judicial decisions remains a hindrance to an effective commercial dispute resolution framework.
  • A strong regime of intellectual property (IP) law is crucial for fostering increased investment and innovation in key sectors of the economy. In recent years Tunisia has focused on building and implementing a policy for attracting foreign investment. Following the adoption of the new constitution, many laws regulating the economy were revised and a new investment code was adopted. The Tunisian government has also strengthened the legal framework for protecting IP, by acceding to the majority of treaties relating to IP and passing several laws on these matters.
  • Croatia has eight first instance commercial courts and one High Commercial Court, and is committed to raising the capacity of its commercial court judges to resolve cases related to insolvency matters. The Judicial Training Academy has incorporated insolvency training into its annual program almost every year since 2010. However, there is still more progress to be made, especially regarding impediments to the resolution of non-performing loans which highlights the importance of the legal framework on insolvency law.
  • Under this new Programme, IDLO will provide support to LDC governments and businesses by enlisting experts to assist beneficiaries in preparing for and conducting negotiations and participating in arbitral proceedings or alternative dispute resolution methods. The Programme will also arrange complementary training and capacity building activities on demand.
  • The economy and banking sectors of Tajikistan face a number of factors affecting the country’s business environment, including high interest rates and weak enforcement. At the core of the banking crisis is the fact that banks do not use the judiciary to support the enforcement of contracts. This in turn affects the construction sector, which, despite the challenging banking environment, is experiencing considerable growth. The justice system in its current condition is not able to address the construction sector disputes that inevitably surface as the sector expands.
  • Alternative dispute resolution (ADR), and in particular mediation, is well established in developed economies and becoming increasingly popular in transition countries. For any court system, mediation can substantially reduce caseload burdens, improve clearance rates, and raise efficiency in the administration of justice.
  • After Romania joined the European Union in 2007, wide-reaching reforms were implemented to the country’s civil, criminal and commercial legal codes. While acknowledging positive development in the judicial sector, concerns remain over the lack of predictability of judicial decisions, including contradictory judgements and inconsistency in the administration of justice.
  • After Bulgaria’s accession to the European Union the national tax system underwent significant transformations. Wide-reaching reforms to Bulgarian legal codes - civil, criminal and commercial - were implemented, previously existing legislation was overhauled, and many new areas of legislation were introduced, requiring extensive re-training of the judiciary. To deal effectively with cases relating to tax, judges require a sound understanding of tax matters through ongoing and specialized training.
  • Legal reform and institutional capacity building have been priorities for the Government of Mongolia since 2005, when a specific Government Agency for Fair Competition and Consumer Protection was established. However, the Government Agency for Fair Competition and Consumer Protection still has institutional weaknesses and has not always been able to effectively implement changes of the legal framework. ​
  • In recent years Jordan has taken significant steps toward promoting economic development, including through strengthening rule of law. Judicial specialization in relevant areas, while promoting an enabling environment for capacity development within the relevant judicial institutions is crucial to maximize the impact of those efforts and ensure sustainability. At the same time, attention has been given to encouraging entrepreneurship, in particular women entrepreneurs, as a means to achieve economic growth.
  • Justice within the context of commercial law is premised on the fact that an effective commercial justice system meets and facilitates the specialized needs of the business community and the private sector at large. However, there are persistent challenges related to the dispensation of commercial justice in Kenya.
  • Even the best functioning courts, without effective mechanisms for ensuring compliance with their   decisions, are in effect perceived as weak institutions, leading to an erosion of public confidence in the rule of law as a whole.
  • In April 2018, the Republic of Armenia adopted a new version of the Civil Procedure Code with the aim to expedite cases and increase the efficiency of civil courts. As in most transition countries, implementation of the law by courts and officials is weak and uneven. The judiciary needs to become familiarized with the new Civil Procedure Code and its application within a limited timeframe. Hence, it is critical that judges have a firm grasp of the newly adopted rules, especially related to commercial disputes.
  • Serbia has recently implemented several judicial reforms to modernize and improve the regulatory framework for mediation, such as the new Law on Mediation in 2014. By implementing the new legal framework on mediation, the number of registered mediators and of mediation cases in Serbia have both increased. However, the Supreme Court of Cassation still registers an excessive amount of backlogged cases.
  • Alternative dispute resolution, and in particular mediation, is finally gaining momentum in Tajikistan. Previous attempt to introduce law on mediation in Tajikistan have not been successful and consequently there is currently no formal legal framework for mediation. In the first phase of the project, the International Development Law Organization worked to promote commercial mediation and build momentum for its expansion. However, there is still the need to provide assistance to the Chamber of Commerce and Industry Mediation Center and improve its effectiveness.
  • Tunisia has achieved considerable economic progress in recent years despite regional challenges affecting foreign direct investment (FDI) inflows. Because FDI is so critical to the economic growth necessary to underpin economic growth and stability, Tunisia recognizes the need to attract and retain more FDI, building on the investments already made in the country. With the guidance and support of the Ministry of Development, Investment and International Cooperation (MDICI), Tunisia has engaged with IDLO to strengthen Tunisia's institutional capacity in relation to intern
  • The Gambia’s transition to democracy has led to an increase in foreign investors wishing to undertake commercial and infrastructure projects in the country. While an opportunity to strengthen the country’s markets, The Gambia recognizes that foreign investment may easily turn into a potential liability if not properly managed and regulated. To address this concern, IDLO has been requested to provide State Counsels and relevant government actors with specialized knowledge in commercial and investment law to be able to provide effective legal advice on transactional matters.
  • The private sector is of central importance for The Gambia, a Least Developed Country where the availability of private capital from foreign and domestic investors is critical to promote sustainable economic growth, increase employment and ensure better living conditions.
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