Foreign investment regime in Moldova.

For any state, including the Republic of Moldova, attracting foreign investments has a particular importance. Accordingly, it is necessary to promote and protect investments by creating stable and fair legal, social and economic conditions for investment activity, establishing equal guarantees for domestic and foreign investors, preventing and removing impediments that may affect investors and their investments.

What is an investment in the Republic of Moldova?

In general terms, investments in the Republic of Moldova are regulated by the Constitution, by the Law on investments in entrepreneurial activity, by a series of other normative acts, including international treaties to which Moldova is a party.
Generally, investment is considered the totality of goods (assets) deposited in the business activity on the territory of the Republic of Moldova, including on the basis of the financial leasing contract, as well as within the public-private partnership in order to obtain income.
Foreign investment is considered an investment made by a foreign investor in the entrepreneurial activity carried out in the Republic of Moldova, including the income from his investment and reinvested in the business in the Republic of Moldova.

What forms may have an investment in the Republic of Moldova?

Investment can be made in the following forms:
a) any movable property or real estate and related ownership rights;
b) any right granted on the basis of the law or contract, any license or authorization granted according to the legislation in force, including concessions of research, cultivation, extraction or exploration of natural resources;
c) rights arising from stocks, shares or other forms of participation in commercial companies;
d) cash investments;
e) rights to monetary claims or other forms of obligations towards the investor that have an economic or financial value;
f) intellectual property rights: the rights of industrial property (patents, utility models, trademarks and service marks, trade names, appellations of origin, industrial models and drawings, plant patents, integrated circuits topographies), copyrights and other related rights, trade secrets (know-how), goodwill;
g) other contractual rights, including those resulting from public-private partnership.
The revenue obtained from investments, deposed in order to develop entrepreneurial activity on the territory of the Republic of Moldova, is considered to be an investment.

What are the organizational and legal forms of companies with foreign investments?

In the Republic of Moldova can be established enterprises with foreign investment in the form of joint ventures and enterprises with foreign capital.
A joint venture is a company, established in accordance with legislation of the Republic, whose authorized capital is composed partially of foreign investments.
A foreign capital enterprise is a company established in accordance with the laws of Republic of Moldova, whose capital is composed exclusively of foreign investments.
The enterprise with foreign investments has the right to establish international associations and organizations, to be part of international associations and organizations.
More detailed information on the organizational-legal forms of entrepreneurship in the Republic of Moldova is presented in a separate article.

How to register a company with foreign investments in Moldova?

The procedure for registration of the enterprise with foreign investments, conduct of business and its dissolution is similar to the procedure of registration, conduct of business and dissolution of the local company and is performed in accordance with the law of the Republic of Moldova.
For registration of company with foreign investment are required documents provided by law for state registration of enterprises and organizations.
The company, founded without the participation of foreign investments, and subsequently purchased by a foreign investor, acquires the status of an enterprise with foreign capital.
In the case if a foreign investor buys shares (stocks) of company, originally created without the participation of foreign investment, the enterprise acquires the status of the joint venture.

What are the guarantees of the investor’s rights protection?

The public authorities of the Republic of Moldova are obliged to respect the rights of investors granted by law. According to the law, investments cannot be expropriated or exposed to some measures with similar effect that directly or indirectly deprive the investor from their title of ownership or from their control of investment.
The investment activity cannot be forcibly interrupted except under special conditions, strictly provided by law.
The investor benefits from the right to compensation for damages caused through infringement of their rights, including through acts violating their rights and interests on the part of the public authority or through other illegal actions of the latter.
The compensation is equivalent to the actual extent of the damage at the time of occurrence.
At the same time, public authorities within their competence and in accordance with applicable law or the terms of the public-private partnerships can provide to investors additional guarantees, in particular by mortgage of their property.

Are there fiscal and customs facilities for foreign investments in the Republic of Moldova?

Investors are granted fiscal and customs facilities in accordance with the fiscal and customs legislation of the Republic of Moldova. In addition, the residents of the Free Economic Zones of the Republic of Moldova enjoy a series of significant benefits related to taxes, VAT, other fees.

The above is intended to provide a brief guide only. It is essential that appropriate professional advice is obtained. Our office will be glad to assist you in this respect. Please do not hesitate to contact us.