Slow Litigation Procedures and their Effects on Investment Business: The Role of the Judiciary in Encouraging Investment

Abrar Majid Al Qattan
Teaching Assistant
Kuwait International Law School


Investment, especially foreign, contributes very much to achieving economic growth and to raising the economy and the domestic product of countries. Although there have been dozens of studies that dealt with the importance of investment and its factors of attraction and other matters, most of them did not address the mechanisms that cause weak investment attraction despite the strong financial position of the state. What is the impact of litigation on investment business, and what is the role of the state’s judiciary in encouraging this type of investment.
Foreign direct investment has emerged as one of the most important pillars of the economy that is relied upon to move the wheel of economic development on the one hand, and the most important aspects of international economic relations on the other hand, and that all countries are racing to attract private foreign investments, and this is because of the countries’ need for external financing, at a time of decreasing saving rates around the world, and other sources of income are decreasing in it, as there are dozens of reasons that drive the investor to be wary of investing in specific countries, regardless of the attractiveness of their investments and the profits they may generate to him, since the protection of these investments and the protection of capital is more important than the investment itself.
Investment disputes after negotiation attempts do not find an alternative to filing a lawsuit before the judiciary to decide how to solve these disputes, and this refers us to an important issue, which is the existence of a relationship – albeit indirect – between the judiciary and the investment business. The judiciary is one of the most important protection mechanisms, as it is the safety valve to protect society as a whole and guarantee the rights of its members, and this means that the investor in examining the investment environment not only checks the state of political stability and the positive return on investment, and that the legislation regulating the investment process is characterized by justice, but also checks the stability of the judiciary system, its integrity, and the guarantee that it is not in favor of the government of the country hosting the investment.
The truth is that the judiciary is characterized by justice is not enough to reassure the investor, as slow justice is more severe than injustice, so slow litigation and its impact on investment business is the subject of our research. In our research, light will be shed on the negative effects of the lack of complete justice on investment, and on reviewing the most prominent mechanisms that have been created to replace the judiciary in its usual form in resolving investment disputes such as the arbitration mechanism and the positive opportunities it provides to end the dispute between the parties with the least amount of damages, and the mechanism of the economic courts, which greatly saves the time factor, and we will also examine the extent to which these mechanisms are implemented, together with the results they have achieved in the states of Kuwait and the United Arab Emirates on investment.
To address this according to the inductive and analytical approach, we have devoted three basic sections, an introductory review of the phenomenon of slow litigation, a section focusing on determining the relationship of the judiciary to investment, and a second section discussing ways to eliminate the phenomenon of slow litigation and protect investment.

Key words: foreign investment, economic growth, economic courts, stability of the judicial system, justice, arbitration, investment disputes, expedited justice.

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