The US Embassy in Albania has pointed at the need for government reforms to attract foreign investment.
In a Facebook post, the embassy illustrated challenges foreign investors face in Albania by making the case of an apparent conflict on who has the right to operate the Duty Free space at Tirana International Airport (TIA).
“As it stands today, the circumstances in regard to the Duty Free space at Tirana International Airport show the challenges foreign investors face in Albania. It is disappointing that the current business climate hinders increased foreign investment. Albania must apply a set of fair, transparent rules equally to all businesses. We hope the Government of Albania will take a serious look at the challenges in the current environment and implement tangible change to attract much needed foreign investment.”
The American Chamber of Commerce has also repeatedly called for “urgent reform”, while pointing out that the “huge gap” between Albania and neighbors is primarily due to corruption in the country.
The conflict for the Duty Free space at TIA
Monitor, a magazine specialized in business matters, reported that American company International Cruise Duty Free (ICDF) has been unable to operate the space despite having won a tender.
The space is claimed by Albanian Duty Free Distribution (ADFD), an Albanian company that has operated the duty free area in the only civil airport in the country for many years before ICDF won the latest tender.
Whilst the Ministry of Finance first renewed and later revoked ADFD’s business license, the Administrative Court overruled ministry’s order arguing that the company’s license is valid.
In November 2018, ICDF won the tender launched by TIA and acquired the right to operate its Duty Free space for the next 5 years.
The winner was announced in June 2019 and the contract was signed in late July. Implementation of the contract was due to begin at the end of July, when the existing contract with the ADFD would expire.
However, ADFD had already started efforts to regain the right to manage the tax-free zone inside the airport. The company is owned by Elona Çaushi, wife of Judge Gjin Gjoni.
Monitor reports that in May 2019, ADFD sent a new financial offer to TIA. It also was able to renew its business license for the same area with the Ministry of Finance in record time, even though it had already lost the tender. When going through the process of license renewal, ADFD hid the fact that it had lost the tender and that its rent contract for the area were expiring on August 27. Rent contract or proof of ownership of the business area is a requirement for license renewal.
Within 24 hours after the General Directorate of Customs asked the ministry for license renewal, Deputy Minister of Finance Elton Haxhi approved it on August 16 on behalf of Minister Anila Denaj.
Following an internal audit on, the ministry revoked the ADFD license based on the fact that it lost the tender and hid crucial information in its application.
ADFD filed a lawsuit with the Administrative Court, asking the recently approved license back. The court overruled the ministry’s decision to revoke ADFD’s license, arguing that the Ministry of Finance knew the company’s situation and it had a choice not to renew its license.
