Monday, April 10 2023 19:17

ArmInfo.The Ministry of Economy of Armenia is considering the possibility of creating a regulatory framework for option agreements. This became known  following the meeting of the SME sub-council chaired by Minister  of Economy Vahan Kerobyan.

In particular, it was noted that the meeting participants discussed  issues related to the introduction of the "option agreement" term ,  the establishment of the main conditions for its application.  The  meeting agenda also included issues related to the possibility of  revising the liability established by the Code "On Administrative  Offenses" in the event of non-payment or non-calculation of wages by  the employer in accordance with the procedure established by law,  payment by the employer of the difference between the amount paid by  the state and wages in the event of training fees and other issues in  the field of SMEs.

An option agreement is where a prospective buyer enters into an  agreement with a landowner for the right to buy their land/property,  often paying the landowner a sum of money as an option fee.  The  prospective buyer then has the option (within a period defined within  the agreement) to buy the land/property.

Unlike conventional agreements, payment or prepayment is made  immediately before the service is performed. According to the option  agreement, the right to declare a demand for the service is bought,  that is, a 100% guarantee for the performance of the service.