The Lao government already has in place a legal framework covering environmental and social requirements and is continuing to develop these laws.

It is working to encourage investment in the hydropower sector and is continuously improving its legal framework to meet international financing requirements.

It has developed a range of legislation pertaining to and favouring foreign investment in the country. The foreign investment laws include:

• Private majority permitted
• Collateral securitisation on project assets including leasehold on lands
• No restriction on project borrowing
• Neutral arbitration accepted
• Ratification of international treaties such as New York Convention 1958, ICC 500 Paris etc., and agreements on avoidance of double taxation signed with several countries
• Mitigation measures already accepted by banking communities
• Despite still being under development, existing Lao laws and regulations pertaining to environmental and social mitigation measures have already been accepted by banking communities.

For more information on the country's legal framework see Legislation.

Financial incentives
The government will also offer financial incentives to investors, contractors and banks

• Reasonable tax holiday
• Several taxes and other Government imposts waived
• Withholding tax on net profit repatriated to home/third countries waived
• Special rates of import duty for materials, equipment and supplies
• Foreign contractors/labour accepted
• Concession period of 25-30 years
• Offshore bank account permitted