Kosovo Welcomes Third-Party Legal Funding
In recent years, Kosovo has taken a number of steps to promote foreign investments. Among these is the ratification of bilateral investment treaties with Switzerland, Luxembourg, Austria, and Belgium, among others. In 2014, a Law on Foreign Investment was adopted, which outlines the use of arbitration for investor-related disputes. Michelman & Robinson LLP, along with Bench Walk Advisors, explains that while Kosovo has not adopted the full measures of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, its Laws on Arbitration accomplishes many of the same things. As the financial climate improves, Kosovo is taking steps to attract more foreign investors, including third-party funding. Specific criteria are utilized when evaluating risks associated with cases:
- Merits. Obviously, cases must be meritorious in order to qualify for funding.
- Legal Team: Funders rely on the plaintiff’s legal team to win a satisfactory result for the client. Legal teams with a strong history of success and expertise in the area of dispute are essential.
- Dispute Forum: Funders will specialize in specific forums for disputes. Some may want to avoid jurisdictions known to be unreliable, notoriously slow, or otherwise lacking in procedural stability or predictability.
- Budget v Damages: Generally funders will have a minimum and maximum budget limitation. This means either a limit on how much funding they will deploy on a single case, or a minimum potential recoupment before considering a case for funding.
- Enforcement and Defendants Financial State: Winning an award doesn’t help investors if the award cannot be collected. Most funders will examine the defendant’s ability to pay, as well as consider other potential enforcement issues such as hidden assets, or cross-jurisdictional issues.