A Welcome Review Of The Algerian Investment Law

• Published date: 07 October 2022
• Subject Matter: International Law, International Trade & Investment
• Law Firm: Herbert Smith Freehills
• Author: Mr Thomas Herman

In line with Algeria's recent efforts to become more attractive to foreign investors (see our previous e-bulletin "Algeria: Reopening Algeria to foreign investments"), a new law reforming the investment regime was published on 28 July 2022¹ (the "New Law").

This New Law replaces the previous Investment Promotion Law of 3 August 2016 (the "Old Law").

While this reform will certainly not be sufficient, on its own, to boost foreign investment in Algeria, it is nevertheless a step in the right direction by modernising and making the investment regime more flexible, following reforms in 2016.

The highlights of this reform are:

1. The recasting of the incentive regimes into three incentive regimes: sector, zone and structuring investment regimes;
2. The creation of one-stop shops to monitor investment projects which (i) facilitate access to the benefits of each of the incentive regimes and (ii) issue the authorisations and permits required for the development of projects as required by the various legislation;
3. Simplifying the granting of benefits and the transfer of goods and services;
4. The creation of an electronic platform to ensure a dematerialised follow-up of formalities and procedures related to the investments.

The previous improvements made by the Old Law (eg the possibility to use international arbitration, the guarantee of transfer of capital and income, and protection against expropriation) have been maintained in the New Law.

Eight implementing regulations have been published in the Official Journal No. 60 of 18 September 2022².

1. Three incentive regimes

The New Law repeals the general and derogatory regimes provided for in the Old Law and recasts them by introducing three incentive regimes.

• The Sector Regime which applies to investments in the following areas of activity:
  
  • Mining and quarrying;
  • Agriculture, aquaculture and fisheries;
  • Industry, food industry, pharmaceutical industry and petrochemical industry;
  • Services and tourism;
  • New and renewable energies;
  • Knowledge economy and information and communication technologies.
• The Zone Regime which applies to investments...