Cabinet’s Investment Disputes Commi

Approved last month and issued in the Official Gazette on 16 July 2019, Law 133 of 2019[1] grants two ministerial committees that were formed under the 2017 Investment Law the authority to decide on the manner of enforcement of final court rulings on matters of the divestiture of state assets (privatization). The Law allows the Prime Minister to refer to these committees enforcement requests made with respect to final judgments of rescission or annulment of the partial or full divestiture of state companies, public entities, holding companies, and state banks, as well as settling the financial and legal consequences arising therefrom.

Background

Following the 2011 revolution, a number of privatization transactions were challenged before courts resulting in rulings annulling some of that sale of public assets. Since then there has been a considerable lag in the implementation of the judgments issued in these privatization cases. It is worth noting that Investment Law No. 72 of 2017 provided for the formation of two ministerial committees under the purview of the Cabinet of Ministers: one is the Ministerial Committee for the Resolution of Investment Disputes,^[2] and the other is the Ministerial Committee for the Settlement of Investment Contracts.^[3] The committees are mainly comprised of ministers, and their decisions/opinions are ratified by Cabinet. They settle disputes that arise between investors and the state, and look into conflicts between parties of investment contracts in order to reach settlement and resolve imbalances, including modification of the contract to introduce a rescheduling of payments, or extending time limits. Once ratified by Cabinet, these settlements have an automatically enforceable power and are binding on administrative bodies. Furthermore, failure to comply with the decisions of either investment law ministerial committee is punishable under the Penal Code.

The New Law No. 133 of 2019

In addition to granting the Prime Minister the authority to refer enforcement requests in final court rulings on privatization cases to the investment ministerial committees (without prejudice to the State Council Law), Law No. 133 of 2019 amends the mandate of the committees to include said review of enforcement requests in light of the provisions of the Investment Law. It further grants the investment ministerial committees the right to form subcommittees and hire experts in order to undertake this task. As such, the role of the committees is to set out the process and manner for the implementation of the referred judgments and handle any resultant financial and legal implications.   [1] Law No. 133/2019 allowing the referring of certain enforcement requests to the two ministerial committees that were formed under the Investment Law No. 72/2017, Official Gazette, Issue No. 28 (bis) (a), 16 July 2019. [2] Prime Ministerial Decree No. 2094/2017 forming the Ministerial Committee for the Resolution of Investment Disputes, Official Gazette, Issue No. 38 (bis) (a), 25 September 2017. [3] Prime Ministerial Decree No. 2376/2017 forming the Ministerial Committee for the Settlement of Disputes in Relation to Investment Contracts, Official Gazette, Issue No. 44 (bis) (b), 5 November 2017.