MB Legal has authored the Trends and Developments section for Armenia in the Chambers and Partners “Doing Business In… 2026” Global Practice Guide. The chapter, written by Mesrop Manukyan, Anahit Sargsyan, Maria Petrosyan and Ani Avetikyan, examines the legal reforms currently reshaping Armenia’s business environment and what they mean for foreign investors.
Key Takeaways
- Armenia’s new Crypto-Assets Law creates the country’s first comprehensive licensing regime, supervised by the Central Bank of Armenia.
- The Cybersecurity Law, in force in 2026, requires cyber-incident notification within 72 hours, matching EU GDPR and NIS2 practice.
- Technology companies can deduct 200% of qualifying R&D salaries from taxable profit, with support guaranteed to 31 December 2031.
- Convertible notes are now explicitly recognised in Armenian law, easing cross-border venture financing.
- Minority shareholders gained expanded buy-back rights, exercisable at a price set by an independent evaluator.
- The EU accession law of 26 March 2025 makes the direction of future regulatory reform far more predictable.
Planning to enter or expand in Armenia?
Why is Armenia attracting more foreign investment in 2026?
Armenia has positioned itself as a resilient and rapidly evolving destination for international investment in the South Caucasus. Through 2026, the legal landscape is defined by a shift toward transparency, digital integration, and alignment with international regulatory standards. As the chapter notes, these changes are not cosmetic — they represent a fundamental restructuring of how business is conducted, regulated, and protected in the jurisdiction.
What does Armenia’s new Crypto-Assets Law require?
Armenia’s Law on Crypto-Assets brought an entire sector out of legal ambiguity into a regulated framework. Until mid-2025 there was no licensing regime, no regulatory oversight, and no clear legal basis for the commercial relationships crypto businesses needed; banks were often reluctant to serve them, and clients faced real uncertainty about whether agreements were enforceable.
The law establishes a licensing regime for service providers and rigorous disclosure requirements for public offerings. It identifies categories of crypto-assets including asset-referenced tokens and electronic money tokens. Issuers must produce detailed offering documents subject to approval by the Central Bank of Armenia. Providers must hold specific reserve assets and follow internal conduct rules, and the law prohibits insider trading and market manipulation.
What are Armenia’s cybersecurity obligations for businesses?
Armenia’s Cybersecurity Law entered into force in 2026 and applies broadly across the economy, identifying energy, finance and telecommunications as critical information infrastructure sectors. Operators in those sectors must implement robust security measures and protocols.
For international companies, the most familiar element is the 72-hour notification timeline for cyber incidents, which mirrors requirements under the EU’s GDPR and NIS2 Directive. Groups already compliant with European standards will find the Armenian framework conceptually familiar; the practical task is ensuring Armenian subsidiaries maintain their own local incident-response protocols. A designated autonomous body has authority to monitor standards and conduct audits.
What tax incentives does Armenia offer technology companies?
The Law on State Support for the High-Tech Sector, effective 1 January 2025, introduced what the chapter describes as one of the region’s most competitive fiscal regimes for technology businesses, structured around a new High-Tech Registry.
Two incentives stand out. First, the state provides support equal to 60% of calculated income tax for new employees and migrant workers, directly reducing the cost of scaling a local team. Second, Article 123 of the Tax Code allows companies to deduct 200% of salaries paid to staff engaged in R&D and specialised high-tech work — meaning that for every dram spent on qualifying R&D payroll, a company receives twice the deduction against corporate income tax. In effect, the state co-funds innovation.
Registered entities are eligible for these exemptions until 31 December 2031, a seven-year horizon that gives capital-intensive projects unusual predictability. The list of qualifying positions and activities remains subject to government approval, so careful structuring is essential.
Are convertible notes legal in Armenia?
Yes. Amendments adopted in 2025 to the Civil Code and the Law on Joint-Stock Companies explicitly recognise convertible notes as loans convertible into equity upon defined triggers or dates. Previously, this standard early-stage instrument had to be artificially engineered around gaps in Armenian law.
The reforms streamline share issuance on conversion, balance existing shareholders’ rights against incoming investors’ needs, and clarify the board and shareholder approvals required. For cross-border rounds this lowers transaction costs and legal risk, allowing Armenian entities to raise capital using instruments international investors already understand.
Amendments to the Law on Joint-Stock Companies significantly expanded the right of non-controlling shareholders to require the company to buy their shares at a fair price. A “controlling shareholder” is defined as a person or group acting in concert holding 50% or more of voting shares.
A buy-back right now arises where a controlling shareholder’s action or inaction produces obviously disadvantageous consequences or a disproportionate advantage; where the company has failed to convene an annual meeting or approve financial reports and dividend distributions in at least three of the last five years; where a shareholder was not notified of the annual meeting; or where dividends were not distributed in at least five of the last ten years, or were insignificant relative to market yield on net asset value. Notably, the usual 10% net-asset cap on buy-backs does not apply on these protective grounds, and the price must be set by a qualified evaluator meeting government criteria.
What else is changing: labour, migration and gambling
From 1 January 2027, all employment contracts in Armenia — including amendments and terminations — must be executed through a digital system using an electronic signature, with contracts involving foreign nationals following by July 2027. Migration management moves to a fully digital Electronic Unified Platform on 1 November 2026, introducing a “One Status” rule prohibiting multiple simultaneous residency categories and a new non-extendable Work Visa of up to 120 days. The gambling sector, reformed by the 2024 Law on Regulation of Gambling Activities, moves to centralised real-time monitoring with mandatory player identification and age thresholds of 21 for casino and internet games and 18 for lotteries.
What does Armenia’s EU accession law mean for investors?
On 26 March 2025, Armenia’s National Assembly adopted the Law on Launching the Process of Armenia’s Accession to the European Union. Accession is a long-term process, but the practical significance for investors is immediate: the direction of Armenian regulatory reform is now predictable in a way it has not previously been. Businesses familiar with EU-standard frameworks in corporate governance, data protection, competition law and procurement can reasonably expect Armenian law to converge with them over time.
Frequently asked questions
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Read the full Trends and Developments chapter on Chambers and Partners →
