AFGHANISTAN LEGAL COUNTRY PROFILE

Transcription

1 AFGHANISTAN LEGAL COUNTRY PROFILE COUNTRY OVERVIEW Afghanistan is located in a landlocked position between the Middle East, Central Asia and South Asia, with important trade routes connecting Southern and Eastern Asia to Europe and the Middle East. Afghanistan is bordered by Pakistan, Iran, Turkmenistan, Uzbekistan and Tajikistan and partially with China. The surrounding States cause various concerns, for instance the length of the Pakistan border means that the distance between border posts makes border control a difficult task. Afghanistan has a highly mountainous terrain- adding further complications with regards military operations and conducting business for example. Afghanistan gained independence from British control in 1919 and was traditionally a neutral country mirroring its foreign policy on that of the Soviet Union during Soviet occupation. 1 Afghanistan is deemed as very high risk both with regards travel and business climate due to the ongoing risk of kidnapping, hostage taking, military combat operations, landmines and insurgent attacks to name a few. 2 The Taliban presence does remain a serious challenge for the Afghan Government almost across the entire country 3 and more recently the emergence of the so-called Daesh creates further complexities not to mention the Haqqani network. Corruption is one of the biggest issues in Afghanistan existing at all levels of government and State entities, and takes many forms from petty bribery to nepotism and misuse of power. 4 Afghanistan is ranked as 116/168 on Transparency International and 172/175 on Insight on Conflict for their corruption ranking. 5 This clearly poses significant problems with regards the rule of law and conducting business, especially for foreign entities. Afghanistan has taken preventative measures to fight corruption through the Law on Supervision and Implementation of an Anti-Corruption Strategy 2008 however whether this in reality is improving the situation is questionable. 6 The current President is Ashraf Ghani Amadzai with his opponent Abdulllah Abdullah as Chief Executive Officer. The President is the head of State and head of government of the Islamic Republic of Afghanistan and exercises authority in the executive, legislative and judiciary, with further legislative power vested in the National Assembly. 7 The executive branch comprises powerful and popularly elected President and Vice Presidents. This current system is a result of the UN-sponsored Bonn Conference in 2001 which sought Constitution, Article 60, Article 64 Page 1 of 11

2 political reconstruction and adopted the new Constitution of Afghanistan, and presidential and National Assembly elections. The UN Assistance Mission in Afghanistan (UNAMA) also was established in 2002 to coordinate international aid and guide the rebuilding process. LEGAL SYSTEM OVERVIEW The legal system in Afghanistan is a mix of civil, customary (such as Pashtunwalli) and Islamic law where the application of these various regimes varies according to local acceptance (or not) of central legislation and is modified by governmental authority. 8 The system is made up of the Constitution (which incorporates Sharia law 9 ), State codes, State laws, decrees and regulations. 10 The supremacy and hierarchy of Afghanistan law is complex given the application of various regimes. The Constitution is supreme and all laws contrary to its provisions are invalid, in addition the Constitution and statutory law is supreme over Sharia law in court proceedings. 11 This therefore suggests that Sharia law is a subsidiary means of interpretation where the Constitution is silent and must operate within the framework of the Constitution and statutory law. 12 The opposing view however is that Sharia law is the highest law and governs the interpretation of statutory law, as statutory law is seen to be a codification of Sharia law because no law can contravene Sharia law. 13 Courts often use Sharia law to fill the gaps and as an interpretative tool, but given that most judges are trained and educated in Sharia law rather than statutory law means that there is a greater application of the former. 14 The debate over the primacy of Sharia law continues due to the different interpretations of the provisions in the Constitution, this leads to unpredictability and uncertainty in the hierarchy of laws in Afghanistan. 15 All legislation enacted prior to the Bonn Agreement is still in force as long as it is not in conflict with the agreement itself, international obligations or the constitution. The creation of new laws is to be approved by both houses of the National Assembly and endorsed by the President. THE CIVIL CODE OF AFGHANISTAN Civil Code of 1977 is the primary source of Afghan contract law and Sharia law is only to be looked to when the Civil Code is silent on the matter in order to secure justice in the best Constitution, Article st-Ed_English.pdf 11 Constitution, Article Constitution, Articles 130 and Constitution, Article 3; Laws_FEB_2014.pdf Page 2 of 11

3 possible way. 16 Many of the provisions of the Civil Code and the following Commercial Code which govern contract law have their origins in common law. 17 A contract is defined under Afghan law as a legal transaction with concurrence of the intention of the two contracting parties, and as a result obligation is incurred to one of the two parties. 18 A contract is therefore formed through mutual consent (similar to the offer and acceptance principles in English contract law 19 ), consideration, capable parties and an enforceable subject matter of the contract. 20 Courts will also find a contract present even when the above requirements are not fulfilled when there has been detrimental reliance on behalf of one of the parties. 21 Articles of the Civil Code and Articles of the Commercial Code provide implied terms which will be incorporated into contracts unless the contract explicitly specifies a different term will be used. 22 The main principle of Afghan contract law is autonomy of the parties to conclude contractual provisions on which they agree. 23 Then in the case of one of the parties failing to fulfil their agreed obligations, the other can repudiate the contract, and where necessary, claim compensation for the losses. 24 With this the parties can also agree on the compensation which is to be paid should the contract be breached, which is known as liquidated damages. 25 The presumed remedy is monetary relief, however specific performance can be ordered when the damage caused cannot be accurately or adequately compensated with money. 26 THE COMMERCIAL CODE OF AFGHANISTAN The Commercial Code of Afghanistan 1995 governs commercial transactions which includes: the purchase of moveable and personal property for sale or lease, employment for the purpose of contracting them to others, working for commission, brokerage, to name a few types of transactions. 27 For commercial contracts to take place only consent of both parties is required, no preparation is necessary. 28 Laws governing companies is currently incorporated in the Commercial Code, however a new law pulls company law out of the Commercial Code and makes two new laws- Partnership Law and Corporations and Limited Liability Companies Law, however these have 16 Civil Code, Article Civil Code, Article Civil Code, Article Civil Code, Article Civil Code, Article Commercial Code, Articles Commercial Code, Article 608 Page 3 of 11

4 yet to be approved by the National Assembly so are currently in force by Presidential decree only. SPECIFIC LEGISLATION Although Civil Code is the primary source of contract law, when the code is silent, Sharia law is applied. 29 Sharia law has been an important source of commercial law throughout Afghan history. 30 Two basic types of contract exist in Sharia law: compensatory and charitable. Compensatory contracts are for personal benefit whereas under charitable contracts the parties look to God for their reward. 31 Islamic contract law allows parties to freely stipulate any conditions they deem necessary, as long as express provisions are preserved. Mutual consent is the cardinal rule of Islamic rule of contract, similarly to the civil law of contracts. Interest charged on money loans, ambiguous contracts, monopolies, and price fixing are all banned under Islamic law. In 2007, The Arbitration Law and the Law on Commercial Mediation were passed, which set out the enforceability of arbitral awards by the courts and the voluntary nature of mediation respectively. The Law on Private Investment in Afghanistan 2005 was enacted to maximise private investment, both domestic and foreign. 32 INTERNATIONAL LAW Afghanistan s approach to incorporating international law in compliance with domestic provisions is still unclear 33 ad in practice our experience is that various ministries will revert to national law before applying international law. Under the Law of International Treaties 1989 the President or the Minister of Foreign Affairs may conclude international treaties, however this power is reserved for the President for treaties on matters of peace and conclusion of war, geographic boundaries, friendship and cooperation, use of force, establishment of international organisations and the legal status of citizens as well as treaties requiring modifications to Afghan domestic laws. 34 The National Assembly has the power to ratify international treaties, 35 and Afghanistan is signatory to a significant number of international treaties, including by not limited to: the Biological Weapons Convention and the Chemical Weapons Convention, the Geneva Conventions and the United Nations Convention against Corruption. 36 Afghanistan is also st-Ed_English.pdf st-Ed_English.pdf 35 Constitution, Article ; Page 4 of 11

5 member to many international organisations, including but not limited to: the International Criminal Court, World Health Organisation, World Trade Organisation. 37 DISPUTE RESOLUTION The Afghan judiciary, like the rest of Afghanistan, is highly susceptible to corruption with heavy manipulation from the executive branch of the State and a lack of checks and balances. 38 The judiciary comprises the Supreme Court, High Courts and Appeal Courts and the President appoints the nine members of the Supreme Court with the approval of the House of People, 39 however, adequately trained jurists are very limited. 40 There are specialised commercial courts, however outside of major cities these are hardly functional. There are claims of people turning to Taliban courts because they are more efficient than the State courts, leading to severe fragmentation of the judicial process. 41 The Judicial Anti-Corruption Centre was established in Afghanistan to enforce the law and prosecute corruption crime, it claims to be independent and free from any political interference. 42 However, critics claim this centre is purely a symbolic step taken ahead of international summits in an attempt to show the world that there are serious anticorruption operations going on in the country. 43 Afghanistan has not submitted an optional clause declaration of acceptance of jurisdiction under Article 36 of the International Court of Justice Statute, however accepts the jurisdiction of the International Criminal Court which is continuing preliminary examinations of allegations of serious international crimes in Afghanistan. Afghanistan is party to the International Centre on the Settlement of Investment Disputes Convention which provides a mechanism for foreign investors to settle disputes. Plus, Afghanistan is party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards which provides for the automatic recognition and enforcement of arbitral awards, however whether in practice this provides adequate protection in Afghanistan is a quite different matter. BUSINESS RISKS Afghanistan s economy has always been heavily reliant on agriculture but was shattered by the wars of the 1908s and 1990s, 44 it is now heavily dependent on foreign aid and is likely to Constitution, Article Page 5 of 11

6 be so for the foreseeable future. 45 Recent economic growth has been in the informal sector (i.e. smuggling, drugs and hawala activities) with suggestions that 80-90% of commerce are undertaken in this sector, this does however lead to weak governance, insecurity, challenges to state authority and lack of rule of law. 46 Afghanistan is surprisingly ranked 22 out of 181 in the World Bank s starting a business ranking, however in the World Bank s ease of doing business-ranking Afghanistan slips dramatically down to 162 out of 181 countries. So, although relatively easy to establish in Afghanistan, effectively continuing business is not so simple. The formal legal requirements for registering a business in Afghanistan are registering with the commercial court, obtaining initial investment and operating licences, and sometimes obtaining sector-specific licences. 47 However, after registering there are additional governmental licences and approvals required and these become costly and time consuming, increasing complexity and creating opportunities for corruption. 48 These also include the need for visas and work permits for all expatriate individuals working in Afghanistan which can be applied for after registration 49 but also present a large opportunity for corruption. Although significant hurdles, there are benefits in doing business in Afghanistan namely that there is a low level of competition creating opportunities for new products; UAE or Pakistan based companies have access to the Afghan market and can offer a low risk option for market entry; there is a young and growing population with 70% below 25 years of age; and the new commitment from the government to tackle corruption- however (un) realistic. 50 In addition, local companies are highly capable of adaptation and entrepreneurship having survived in hard times. There is also significant potential for the exploration of minerals and oil and gas. Problems prevail however with high levels of corruption, mass (ineffective) bureaucracy, weak infrastructure, an underdeveloped legal system unable to deal with complex commercial issues, and a lack of experience in dealing with and managing western companies Page 6 of 11

7 SECURITY INDUSTRY Pre-2001 there was no private security industry within Afghanistan, but currently there an estimated 20,000-30,000 personnel employed by the security industry in Afghanistan, 3,000 of which are British. 52 The security sector continues to have a high demand for products and services therefore there are many opportunities for companies. 53 However, in 2010 the then President Karzai, under Presidential Decree 62 (1389), wanted to phase out private security companies (PSCs) and pass their roles over to an Afghanistan Public Protection Force (APPF) as Karzai considered the private security industry a major source of instability, 54 The US supported this approach. The APPF is a state-owned enterprise which can contract with domestic and international customers but the APPF guards are not members of the Afghan National Army or Police. 55 APPF was designed to take over the work of PSCs by 2011 to allow PSCs to operate and enable APPF to develop, then PSCs could work under the auspices of APPR if licenced to do so. 56 This required that international development organisations and some businesses had to stop using PSCs and instead rely on the APPF, however embassies and entities with diplomatic status were exempt from this transition under the Vienna Convention on Diplomatic Relations and were able to continue using PSCs. 57 By 2012 there were 8,000 APPF guards with the likelihood of this number growing to 18,000 when the PSC personnel are absorbed by APPF. 58 APPF was scheduled to take over most commercial security services in March 2013, however in mid-2016 this transition had still not occurred. State approved PSCs continue to operate in Afghanistan 59 and the APPF concept withering on the vine. The regulation of the private security industry in Afghanistan is piecemeal at best with the Afghan government making weak attempts to enforce any sort of regulatory code that are largely viewed as attempts to extort money from PSC s. PSCs claim that there is systemic corruption within the Ministry of the Interior (the department which regulates the industry) 52 Afghanistan.html tm_medium=twitter&utm_term=coi&utm_content=afghanistan 59 Page 7 of 11

8 including the demanding of bribes in order to award licences to people, weapons or vehicles. 60 A draft code for the regulation of the industry was created by NATO-led International Security and Assistance Force, however when passing through the Afghan government it became so morphed that it was completely contradictory. 61 The ineffective, politicized and unaccountable nature of the Afghan security sector has not been of high importance to the donors. 62 The current situation in the Afghan security sector is not sustainable on a financial basis. 63 The withdrawal of large swaths of international forces has not had a calming effect on the security environment. If anything, the Taliban has resurged with a vengeance suggesting that as long as international donors and possibly commercial activities persist, a market remains for PSC s. ARMED FORCES The President is the commander-in-chief of the armed forces, which comprises the Afghan National Army (ANA) and the Afghan Air Force (AAF). There are approximately 183,000 personnel in the ANA which includes nearly 10,500 special forces. These forces include 6 corps located in different parts of the country, 1 division (consisting of 2 brigades) based in Kabul and 24 additional brigades. There are approximately 6,700 personnel in the AAF with a fleet of 92 fixed-wing and rotary aircraft. 64 The Afghan armed forces are the 11 th largest in the world despite being the 10 th poorest country globally. 65 Afghanistan has depended almost entirely on the US and NATO forces to provide security in and around Kabul and to combat Taliban forces elsewhere based on the US-Afghan Bilateral Security Agreement and the NATO Status of Forces Agreement. In 2003 Afghanistan received an estimated US$191million in foreign military assistance, in 2005 this was US$396million. Other international involvement comes from the Organisation for Security and Co-Operation in Europe which has an ongoing advisory programme on security along the Tajikistan border. 66 In January 2015 both the US and NATO formally ended their combat role in Afghanistan by concluding Operation Enduring Freedom and the International Security Assistance Force mission. 67 NATO continued to support the Afghan national forces through their Resolute Challenges-and-Sustainability.pdf Page 8 of 11

9 Support Mission which focused on training, advice and general assistance. 68 The US also continues to support the NATO residual mission through Operation Freedom s Sentinel in counterterrorism efforts. Officials claim that Afghan s armed forces are not capable of defending against the Taliban and will need international assistance for years. 69 The US alongside other international donors at the Brussels Conference on Afghanistan in October 2016 committed to provide US$15.2billion in civilian assistance to Afghanistan through Afghanistan reciprocally committed to strengthen governance, rule of law, fiscal sustainability and human rights. 71 PARAMILITARY There are about 15,000 paramilitary personnel under various formations in Afghanistan, and post-2001 the bulk of Afghanistan s policing was through their paramilitary forces. 72 Plans called for a border force of 12,000 personnel which overlaps with policing roles. POLICING The Afghan National Police (ANP) comprises approximately 151,000 personnel. The ANP includes: the Afghan Uniform Police (community police, traffic police and fire-fighters), Afghan Border Police, Afghan Anti-Crime Police (counter-narcotics, counter terrorism, and criminal investigations department) and the Afghan Civil Order Police. 73 The police officially are responsible for maintaining civil order, local and regional military commanders continue to exercise control in the hinterland. Police duties often include paramilitary activities that are vital to national defence hence the overlap between the two regimes. The personnel are handicapped by low pay, low recruit quality, pervasive corruption, and an insecure environment, and in 2007 an estimated 925 police were killed, often by insurgents. 74 Generally the ANP is ineffective not just in deterring crime but also in responding to crime scenes in a timely manner. 75 RECENT/ ONGOING CONFLICTS The conflict in Afghanistan sees no end in the immediate or near future, and the complex issues and lack of stable governance arising from it means that rather than the issues be resolved, new conflicts are suspected to continually arise Page 9 of 11

10 After the fall of the Taliban in 2001, Afghanistan establish diplomatic relations with most countries. However, a major issue of concern for many countries is the prosperous drug trade in Afghanistan and the criminal and terrorist activity which is associated with it. 77 Long-term relations between Afghanistan and Pakistan have been strained with the continued presence of Taliban and Al Qaeda forces in Pakistan s border provinces plus Afghanistan seeking closer ties with India. 78 In 2008, a US Afghan-Pakistani border security post was opened in an attempt to secure the fragile border between the two countries. Afghanistan and Iran have fairly friendly relations, but the issue is Iran s long-standing claim to share the water resources of the Helmand River. In addition, the ongoing presence of Afghan refugees in Iran puts a strain on the relationship between the two countries. 79 In the 2000s Afghanistan s official relations with Russia improved after the invasion in 1979 as Russia pledged assistance in building Afghanistan s military and business establishments, however a residual mistrust remains between the two States. 80 Afghan-US relations are strong and substantial, as already mentioned the US conducted military support missions in Afghanistan and continue to support counter-terrorism efforts. The US has also given substantial support to the re-establishment of infrastructure and to strengthen government control. Afghanistan also is granted considerably preferential trade treatment by the US. The extent of the presence of Daesh in Afghanistan is unclear, but unsurprisingly poses a considerable threat to security where several major attacks in Afghanistan over the past few years have been claimed by ISIS. 81 Terrorist attacks are frequent and widespread against Afghan national forces, domestic and international political and civilian targets and humanitarian and reconstruction personnel. 82 The Taliban, in 2015, identified workers of aid organisations as targets making Afghanistan the most dangerous country in the world for humanitarian workers. 83 Nearly half of the country s provinces have been deemed as being high or extreme risk by the United Nations. 84 The insurgency movements in Afghanistan seeks the removal of foreign forces and has a strong anti-western focus therefore posing a significant threat. 85 These insurgents and their use of improvised explosive devices (IEDs) are the leading cause of civilian causalities, and due to their indiscriminate nature are a violation of international humanitarian law. 86 The Page 10 of 11

11 risk of kidnap is also very high and is a constant issue with over 100 Westerners being kidnapped since 2001 in Afghanistan Page 11 of 11