Connect with us

Economy

Moldovan foreign investors ask the government to pass the reform on the control bodies

Dear colleagues, representatives of the business community, civil society, state-owned institutions, citizens,

Foreign Investors Association, established in 2003 and which includes some of the largest foreign investment companies in the Republic of Moldova, actively promotes actions aimed at improving the investment climate. The Government and the Parliament have recently adopted a series of reforms of the regulatory framework, in particular in the field of state control over the business activity and permissive acts.

However, these reforms have less covered an important segment of state interference in business activity – the law enforcement bodies. Today, the law enforcement bodies, in particular the Economic Fraud Investigation Division, subordinated to the Ministry of Internal Affairs, and the National Anticorruption Center, enjoy a range of competences such as to seize goods, documents, information systems, to arrest, make proposals to preventively arrest and others, which may lead to a stop in the business activity and laying off of employees. Abusive enactment of such measures may cause major losses to the entrepreneurs and may ultimately determine the decrease in the potential to attract investments to Moldova, as a result of the deteriorated image of the investment climate.

Therefore, the Association welcomes, in principle, the initiative of the Ministry of Justice to promote the draft law amending and supplementing certain legislative acts (Criminal Code, Criminal Procedure Code, Contravention Code and other legislative acts) aimed at improving the investment climate by introducing less repressive criminal norms related to economic crimes and establishing additional procedural safeguards against abuses by the law enforcement and control bodies.

The draft was discussed in several meetings organized by both the Ministry of Justice as well as the Economic Council to the Prime Minister. The last meeting, with the participation of the Prime Minister, was held on 08.12.2017. Given the publicly launched suspicions referring to the recent high profile banking fraud cases, the participants to that meeting wanted to make sure that all the persons involved in these cases would not also benefit from the provisions of this initiative.

We understand and commend the fact that the Ministry of Justice has accepted to make changes, which would guarantee that this does not happen, and proposed to organize an additional technical meeting to discuss further proposals from the stakeholders with the subsequent completion of the draft.

To follow up on the above, we believe it is opportune to expressly provide for in the draft the manner in which the acts of the control bodies can be challenged, which would avoid putting the individual/legal entity in the situation of having to tacitly accept the accusations which are brought up to them and accept the starting of the criminal case.

We also draw your attention to a series of other provisions, which raise concerns among the business community, such as for instance:

  • Applying criminal liability for not obtaining any permissive act required for business operation, including regardless of the damages caused;
  • Applying criminal liability for concluding any anticompetitive agreement which causes extremely large scale damages or which generate extremely high profits (in international practice, such liability applies only in case of cartels, not vertical agreements);
  • If, during a control, a control body identifies that a crime had been committed, it has to mention in its control act the exact amount of damages caused by the crime and the actions which must be undertaken to remedy the violation. The act of control cannot be challenged in the court and serves as evidence for the criminal prosecution. There is the risk that common procedural safeguards, applicable to collecting evidence in the course of a criminal prosecution (including against self-incrimination) be disregarded by the control body;
  • Applying criminal liability for doing business in violation of the intellectual property rights and not indicating the fiscal code in the documents or indicating it with mistakes (it is not clear how these two issues can be combined).

In relation to the above, we express our readiness to continue the consultations with the authorities of the Republic of Moldova for finalizing the respective draft, taking into account the relevant comments, and we kindly call upon the Government, the Parliament and the President of the Republic of Moldova to support the respective legal initiative of the Ministry of Justice, that will substantially improve the business and investment climate in the Republic of Moldova.

The Foreign Investors Association also urges the representatives of other business associations and business community to join this call.

Continue Reading

Economy

A Chinese company wants to expand in the Republic of Moldova

The Chinese company MCC International Incorporation Ltd. plans to launch investment projects in the Republic of Moldova. Priority projects for the Chinese company would be to modernize and develop road infrastructure, digital education, renewable energy, waste management, and drinking water resources.

Entrepreneur Zhang Ye, who is also vice president of the company, said that the project for building national roads and a photovoltaic park could be started by the end of this year or early 2019.

MCC International Incorporation Ltd. is the world’s top 10 contracting company, listed on Hong Kong and Shanghai stock exchanges, with over 75 branches and subsidiaries abroad and over 120,000 employees.

Continue Reading

Economy

For the first time, Moldovan apples will be exported to India

Apples from the Republic of Moldova will be exported to one of the largest markets in the world – India. Moreover, Moldovan apples will soon be exported to Israel. The first batch – a sample of 100 kg will be delivered for the necessary checks. At the same time, from October 1st, prosperous plums from the Republic of Moldova will be exported to Canada, a Government press release announced.

Fresh vegetables and vegetables from the Republic of Moldova are delivered annually in about 80 countries – for example, Moldovan grapes are exported to 20 states of the world, and plums – in 16 states.

Most Moldovan products are currently on the European Union market, with large increases in the markets in Germany, Italy, Portugal, the Baltic countries, the Czech Republic, Bosnia and Herzegovina, and Romania.

Thus, it is being examined whether there could be a possibility of exporting indigenous products to Vietnam, Egypt, Qatar, Bangladesh, and Indonesia.

Continue Reading

Economy

Getting citizenship for investments: is it good or bad?

Granting citizenship to the people having invested into the Moldovan economy is a form of passively capitalizing on Moldova’s status as an internationally recognized country. At the same time, luring investors through international forums and exhibitions, what does have a right to exist, has turned up being not so efficient and may not be viewed as an exclusive tool to interact with and attract foreign investments.

The Moldovan economy goes on feeding on remittances, as the exports – although up 38% (in January-February 2018) – are not capable though to unleash the overgrowth badly needed for the essential improvement of the living standard. Under these circumstances is or is not the program of granting citizenship for investments the panacea, the element able to miraculously boost the economic growth? Certainly, the answer is ‘no.’ The program can yield contingent effects, as raising the amount of direct foreign investment, as a substantial increase of the financial flows to Moldova and implicitly shaping the investment climate so much talked about for so long.

The Economy Ministry assesses an investment flow of about 1.3 bn euros, a difficult thing to assess as the program is launched for the first time and there is no any market response as to the Moldovan passport yet. Still there is a steady demand for such services on the international market: businesspeople having to migrate because of various reasons ask for a second citizenship. For example, according to a study carried out by CS Global Partners in the UK in 2017, about 89% of the British would like having a second citizenship, and about 34% made the effort to find out how such a one may be acquired.

Most countries do have programs of gaining investor visas or citizenship, what’s more these people are sought for in a tough luring competition. If suich countries as the USA, the UK or Switzerland but display the eligibility conditions, in Moldova’s case, this strategy won’t work because of competitive attractiveness of the Moldovan passport compared to the British or American ones, for instance. Hiring a company specialized in providing such services as Henley&Partners is highly increases the chances of attaining the program goals, given Henley&Partners’ experience in providing a wide range of services for potential applicants, but also its massive database of clients and potential applicants.

The risks implied and the critique targeting such programs of gaining citizenship through investments – hinting it’s an illegal scheme of money laundering – are detached from the real context such programs unfold in. First, these services are provided by companies often related to renowned consulting firms, which would incur reputational risks and would be liable to criminal investigation in many countries. Second, gaining one’s citizenship is a public act, your name becomes public what is not proper for “the strategies” used to launder money, which need interposed persons, shell companies and fake identities for short times. Third, as the campaign is going on at the national scale, were it a money laundering scheme, it would have immediately draw the attention of Moldova’s development partners: the USA, the EU, the IMF and other international financial entities.

And last but not least, all the applicants will be checked up by law-enforcing bodies and the Interpol, as the law provides for.

Roman Chircă, director of Market Economy Institute

Continue Reading

Latest News

Important6 hours ago

A military helicopter has collapsed in the Transnistrian region

An MI-8 helicopter of the so-called Transdniestrian Air Force has suffered an accident on the territory of the Tiraspol airfield....

Drafts9 hours ago

A study shows that the online information space in Moldova continues to be strongly affected by Russian propaganda

The actions of the Moldovan authorities to stop the pro-Russian foreign propaganda and its negative effects on the information space...

Economy1 day ago

A Chinese company wants to expand in the Republic of Moldova

The Chinese company MCC International Incorporation Ltd. plans to launch investment projects in the Republic of Moldova. Priority projects for...

Politics2 days ago

A group of Democratic Party deputies demanded temporary suspension of President Igor Dodon

President Igor Dodon is on the brink of his fourth temporary suspension after he repeatedly refused to appoint two candidates...

Drafts3 days ago

PM Filip: Moldova can’t maintain a large army, but it can and must maintain a professional one

Yesterday, Prime Minister Pavel Filip visited the Military Training Base of the National Army in Bulboaca, as well as the...

Politics4 days ago

Dodon refuses to appoint the two ministers. PM Filip will ask the CCM to suspend the president

The political spectacle continues. President Igor Dodon sent a letter to Prime Minister Pavel Philip informing him that he did...

Society4 days ago

Military Attachés to the Republic of Moldova paid a visit to the motorized infantry brigade “Dacia”

During the visit, the 23 military diplomats from the Republic of Belarus, the Czech Republic, Italy, Lithuania, Poland, Romania, Russia,...

Opinions

Trending