KYRGYZSTAN · INVESTMENT PROTECTION AND DISPUTES

Investment Protection and Disputes in Kyrgyzstan

Law No. 198 of 12 August 2025 on Investments gives foreign investors national treatment, free transfer of funds, and protection against expropriation except as the law allows, with proportionate and timely compensation at market value. Since Law No. 46 of 8 April 2026, an investment dispute goes first to negotiation and then to the Kyrgyz courts, or to arbitration only where there is a written agreement with a valid arbitration clause or a treaty that refers the dispute to arbitration. The statute no longer gives a foreign investor a standing right to arbitrate. Kyrgyzstan is a party to the ICSID Convention, in force for it since 21 May 2022, and to the New York Convention, in force since 18 March 1997, without reservations.

This page covers the guarantees in the Law on Investments, how to secure an arbitration route, treaty protection, the Kyrgyz courts, domestic arbitration, and the enforcement of foreign awards and judgments. For stabilisation of tax terms see the Kyrgyzstan Legal Guide.

Legal framework

Guarantees under the Law on Investments

A foreign investor is any individual or legal entity that is not a national investor and that invests or has invested in Kyrgyzstan (Art. 4(5)). Investments include any asset owned or directly or indirectly controlled by the investor, including shares and debt (Art. 4(6)).

Three limits matter in practice. Where a treaty gives more favourable terms than national law, the treaty applies to the extent that this is consistent with Kyrgyzstan's national interests (Art. 3(7)). Laws may prohibit or restrict a foreign investor's activity to protect national security, public order, public health and the rights of others (Art. 3(8)). And the 2025 law applies to investments made before it took effect only where it is more favourable to the investor (Art. 35). Accreditation of foreign investors is voluntary (Art. 33(1)).

Dispute resolution under Article 23

As amended by Law No. 46 of 8 April 2026, Article 23 provides that an investment dispute arising on Kyrgyz territory is resolved by negotiation, and by agreement may be settled by mediation or another agreed pre-trial method (Art. 23(1)). If it is not settled, it is decided by the Kyrgyz courts, or heard in arbitration where there is a written agreement containing a valid arbitration clause, or where a treaty of the Kyrgyz Republic refers the dispute to arbitration (Art. 23(2)).

The same law repealed Article 46 of the Law on Arbitration Courts. In its 2022 wording, that article allowed a foreign investor without an arbitration agreement in its contract with the Kyrgyz Republic to start arbitration itself. With it gone, an investor that wants arbitration needs either a clause in its contract with the State or a treaty that gives access. Claims about expropriation may be considered by the Cabinet of Ministers, the Kyrgyz courts, an arbitration court, international arbitration, or under treaties and investment agreements (Art. 17(5)).

Treaty protection

ICSID. Kyrgyzstan signed the ICSID Convention in 1995, deposited its instrument of ratification on 21 April 2022, and the Convention entered into force for it on 21 May 2022. ICSID arbitration still requires consent, given in a contract or a treaty.

EAEU investors. Annex 16 to the EAEU Treaty protects investors of one member state in another. Investments may not be expropriated, directly or indirectly, except in the public interest, under the host state's procedure, without discrimination and with prompt and adequate compensation at market value (paras. 79–81). If a dispute is not settled by negotiation within six months of written notice, the investor may choose the host state's courts, international commercial arbitration at a chamber of commerce of any state agreed by the parties, ad hoc arbitration under the UNCITRAL Rules unless otherwise agreed, or ICSID (under the Convention or its Additional Facility Rules). An investor that has taken the dispute to the national courts or to chamber of commerce arbitration cannot then move it elsewhere, and an arbitral award is final and binding (paras. 84–87).

Bilateral treaties. The official database lists, as in force, investment treaties or laws ratifying them with a number of states. They include:

Ratification is not the same as entry into force, and each treaty has its own definition of investor, waiting period and choice of forum. Before relying on a treaty, confirm that it is in force for both states, that the holding company qualifies as an investor, and how the dispute clause works. Structuring through a treaty state should be done before a dispute is in view. For Kazakhstan's treaty position see Investment Protection and BITs in Kazakhstan.

Kyrgyz courts

There are no separate commercial courts. Economic cases, meaning disputes from business activity between legal entities or individual entrepreneurs, are heard at first instance by the district courts, including the district courts of Bishkek, under the general civil procedure with the special rules of Chapter 25 of the Civil Procedure Code (Arts. 255, 256(1)). They include contract disputes, damages claims, corporate disputes between founders and the company, bankruptcy, and claims against state bodies for the return of funds they collected (Art. 256(2)).

Kyrgyz courts hear cases with foreign parties where the defendant is based in Kyrgyzstan, and may also hear them where, among other grounds, the foreign defendant has a branch or property in Kyrgyzstan or the contract is to be performed there (Art. 383). Parties to a case with a foreign element may change territorial jurisdiction by written agreement, but not the exclusive jurisdiction of the Kyrgyz courts, which covers claims about rights to immovable property in Kyrgyzstan (Arts. 384, 387). A court must decline or stay a claim covered by an arbitration agreement once the agreement is shown (Law on Arbitration Courts, Art. 5(2)).

Arbitration seated in Kyrgyzstan

The Law on Arbitration Courts applies to investment, civil and commercial disputes referred to arbitration by agreement (Art. 1). Arbitration may be administered by a permanent institution or ad hoc (Art. 3(1)); an arbitration institution is a legal entity operating as a non-profit organisation (Art. 3(2)). The International Court of Arbitration at the Chamber of Commerce and Industry of the Kyrgyz Republic (ICA CCI KR) states on its website that it has operated since 2002. It does not rest on the Law on the Chamber of Commerce and Industry, whose article on an arbitration court at the Chamber was annulled by the Constitutional Court in 1997. Some matters cannot be arbitrated, including bankruptcy, compensation for harm to life or health, and disputes that a law reserves to the courts (Art. 45(2)).

• Setting aside. An award may be challenged within 30 days in the district or city court where the tribunal sits. The court hears the application within 30 days and may set the award aside on limited grounds, including lack of a valid agreement, improper notice, irregular composition or procedure and non-arbitrability (Art. 36-1).
• Enforcement. A writ of execution is issued by the competent court at the debtor's place of residence or location on application within three years of the award, with the award, the arbitration agreement and a notarised translation into the state or official language (Art. 41). The court may refuse only on the listed grounds: incapacity, lack of proper notice, irregular composition or procedure, excess of the arbitration agreement, a well-founded objection to the validity of the agreement, and non-arbitrability (Art. 42).

A separate regime exists for the special financial investment territory "Tamchy" created by Law No. 136 of 10 July 2025. Its International Dispute Resolution Centre sits outside the Kyrgyz court system, has exclusive jurisdiction over civil and commercial disputes falling within it, and its decisions are enforced under that Law and the territory's own acts (Law No. 136, Art. 14; Law on Arbitration Courts, Art. 41(3), as amended by Law No. 119 of 22 July 2026). Whether a project can use it depends on its link to the territory.

Enforcing foreign arbitral awards

Kyrgyzstan acceded to the New York Convention on 18 December 1996 and it entered into force on 18 March 1997, without the reciprocity or commercial reservations. An application to recognise and enforce a foreign award is filed with the district court at the debtor's place of residence or location or, if that is unknown, where its property is (Civil Procedure Code, Arts. 429, 438(1)), with the certified award, the arbitration agreement, a power of attorney, proof that a copy was sent to the debtor and a certified translation (Art. 438(2)). Such applications are heard within 30 days (Art. 214-1(2)). Refusal is limited to the Convention grounds: incapacity or invalid agreement, lack of notice, excess of mandate, irregular tribunal or procedure, an award not yet binding or set aside, non-arbitrability and public policy (Art. 439). The award may be presented for enforcement within three years, and a missed period may be restored by the court (Arts. 434(2), 438(1)).

Enforcing foreign court judgments

A foreign judgment is recognised and enforced if a law or a treaty in force so provides, or on the basis of reciprocity (Civil Procedure Code, Art. 428). The court refuses where, among other grounds, the judgment is not final, the defendant was not properly notified, the case falls within the exclusive jurisdiction of the Kyrgyz courts, there is a conflicting Kyrgyz judgment or earlier Kyrgyz proceedings, the time limit has passed, or enforcement would be contrary to public policy (Art. 432). Before relying on a foreign judgment, check whether a legal assistance treaty, multilateral or bilateral, is in force between Kyrgyzstan and the state where it was given. Without one, reciprocity must be shown, which is why investors often prefer arbitration, where the New York Convention applies. See also Enforcement of Foreign Judgments in Kazakhstan.

Securing protection: step by step

1. Choose the holding company

Check which treaty states can hold the Kyrgyz investment and whether the treaty is in force and gives investor-state arbitration.

2. Write the arbitration clause

Under Article 23 of the Law on Investments, a valid written arbitration clause is the contractual route to arbitration. Name the institution or rules, the seat and the language, and where the State or a state body is a party, consider ICSID consent.

3. Consider a stabilisation or investment agreement

Large investments that meet the Article 3 thresholds may obtain a 10-year stabilisation agreement. Investment agreements with state bodies are defined in Article 4(11) and governed by Articles 24 to 32 and 34.

4. Use the complaint route early

A complaint under Article 22 can be filed before any court or arbitration and may resolve administrative problems without a formal dispute.

Common mistakes foreign investors make

• Relying on the statute for arbitration. Since April 2026 the Law on Investments gives arbitration only through a valid clause or a treaty.
• Assuming a treaty applies because it was ratified. Entry into force and the investor definition must be checked.
• Treating Article 3(7) as unconditional. The Law subjects more favourable treaty terms to Kyrgyzstan's national interests, which a tribunal and a Kyrgyz court may view differently.
• Choosing a foreign court instead of arbitration. Foreign judgments need a treaty or reciprocity; awards benefit from the New York Convention.
• Letting the enforcement period run. Foreign awards and judgments must be presented within three years.

Frequently Asked Questions

Can a foreign investor go to international arbitration against Kyrgyzstan?

Yes, if there is a written agreement with a valid arbitration clause or a treaty that refers the dispute to arbitration (Law on Investments, Art. 23(2)). Without one, the forum is the Kyrgyz courts.

Is Kyrgyzstan a member of ICSID?

Yes. The ICSID Convention entered into force for Kyrgyzstan on 21 May 2022, after it deposited its ratification on 21 April 2022. Consent to ICSID arbitration still has to come from a contract or treaty.

What compensation is due on expropriation?

Proportionate and timely compensation at market value in freely convertible currency, with market interest until payment (Law on Investments, Art. 17). Investors from other EAEU states also have the protection of Annex 16 to the EAEU Treaty.

Can profits be transferred out of Kyrgyzstan?

Yes. Article 13 guarantees free transfer of profits, dividends and capital in freely convertible currency, subject to fair and non-discriminatory application of rules on insolvency, securities, criminal proceedings and fiscal and economic standards.

Will Kyrgyz courts enforce a London or Singapore award?

Kyrgyzstan applies the New York Convention without reservations, and the Civil Procedure Code limits refusal to the Convention grounds (Art. 439). The application is decided within 30 days of filing.

Are there commercial courts in Bishkek?

No separate commercial courts exist. Economic disputes are heard by the district courts under the special rules for economic cases (Civil Procedure Code, Arts. 255, 256).

Bond Stone's Bishkek office advises foreign investors on investment structuring, arbitration clauses, disputes with state bodies and enforcement in Kyrgyzstan.

Related pages

Kyrgyzstan Legal Guide  ·  Company Law and M&A in Kyrgyzstan  ·  Real Estate and Land in Kyrgyzstan  ·  Mining Licences in Kyrgyzstan  ·  Public-Private Partnerships in Kyrgyzstan  ·  International Arbitration in Kazakhstan  ·  Legal Services in Kyrgyzstan

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Primary sources: cbd.minjust.gov.kg — Law No. 198 on Investments (Arts. 3, 4, 10–13, 16–18, 22, 23, 33, 35); Law No. 46 of 8 April 2026; Law No. 90 of 9 August 2022 (Art. 2); Law No. 135 on Arbitration Courts (Arts. 1, 3, 5, 36-1, 41, 42, 45, 46); Law No. 136 of 10 July 2025 (Art. 14); website of the ICA CCI KR (arbitricaccikr.com); Civil Procedure Code No. 14 (Arts. 214-1, 255, 256, 383, 384, 387, 428–439); ratification laws for the treaties listed; ICSID; UNCITRAL status of the New York Convention; Treaty on the Eurasian Economic Union, Annex 16 (paras. 79–87).