Montenegro’s Constitutional Court has launched a review of the law ratifying the country’s tourism and real-estate cooperation agreement with the United Arab Emirates (UAE), raising uncertainty over the legal framework for future investments.
Constitutional Review of Ratification
The court voted 4–3 to examine whether parliament followed constitutional requirements when approving the agreement, including whether a two-thirds majority was necessary because of its potential impact on foreign investors’ property rights. Judges also questioned whether the agreement ensures reciprocity between Montenegro and the UAE.
The decision does not mean the agreement has been declared unconstitutional. The court noted that it has not yet entered into force and is not producing international legal effects.
Implications for Investment Projects
The agreement provides a framework for potential UAE-backed investment in tourism, real estate and infrastructure. Although no specific investment has been cancelled because of the review, projects relying directly on the agreement could face additional legal and financing risks.
For developers and lenders, uncertainty over land rights, development obligations and investment protections can affect project valuations, financing conditions and banks’ willingness to commit capital. The case also raises broader questions about bilateral investment arrangements, particularly regarding constitutional safeguards, public procurement, state property and equal treatment of investors. The court’s eventual ruling could influence how Montenegro structures future investment agreements beyond those involving UAE capital.
EU Accession and Legal Certainty
The proceedings come as Montenegro aligns its property, competition, procurement and investment rules with EU standards while seeking foreign capital for large tourism and infrastructure developments. The next key step is the court’s substantive assessment of whether the ratification law complies with the constitution. Until then, the agreement remains under review, with legal certainty a central consideration for prospective investors.
