The law of Bhutan derives mainly from legislation and treaties. Prior to the enactment of the Constitution, laws were enacted by fiat of the King of Bhutan. The law of Bhutan originates in the semi-theocratic Tsa Yig legal code, and was heavily influenced through the twentieth century by English common law. As Bhutan democratizes, its government has examined many countries' legal systems and modeled its reforms after their laws.
The supreme law of Bhutan is the Constitution of 2008. Under the Constitution, laws are passed through a bicameral process requiring the assent of the National Assembly and National Council of Parliament, as well as the assent of the King. The final authority on law of Bhutan and its interpretation is the Supreme Court. Laws enacted in Bhutan prior to the Constitution of 2008 remain intact insofar as they do not conflict with the Constitution.
Much of Bhutanese law is premised on promoting Gross National Happiness, a fundamental principle of the Constitution.
The law of Bhutan is enforced by the national police, established in 1965. The judicial system of Bhutan, namely the Royal Court of Justice, brings and hears cases and interprets the law of Bhutan. Agencies of Ministries within the Lhengye Zhungtshog (Cabinet) as well as independent Commissions are established by law to implement relevant laws, provide regulations, and establish procedural frameworks.
Sources of law
Bhutanese legislation is the source of Bhutanese domestic law, including civil, criminal, and administrative law. Bhutanese legislation is created by the bicameral Parliament of Bhutan. Either the upper house National Council, the lower house National Assembly, or the Attorney General may author bills to be passed as acts, with the exception of money and financial bills, which are the sole purview of the National Assembly. Acts passed predating the enactment of the Constitution in 2008 were passed under different procedures, some originating as promulgations by the King as indicated in their preamble.
Under Article 20 of the Constitution of Bhutan, foreign relations of Bhutan under the purview of the Druk Gyalpo on the advice of the Executive, namely the Prime Minister and other Ministers of the Lhengye Zhungtshog including the Minister of Foreign Affairs. Treaties of Bhutan predating the Constitution of 2008 remain in force, however any treaties adopted after its enactment must be ratified by Parliament.
Civil law
Contracts Prima facie requirements of Bhutanese contracts, termed "written agreements," are governed by provisions of Evidence Act of 2005. Valid written agreements must be made in the presence of one witness of each party; be signed by all parties or another person duly empowered by a legally binding writing in that behalf; and be executed with a legal stamp. A contract is invalid if it has an erased word; has an alteration that is not counter-signed; has a defective seal or signature; lacks the proper legal stamp; is made while a party is a minor, mentally unsound, or under duress; is objected to by any party in court within 10 days; is executed in breach of law or to conceal an illegal act; or otherwise fails to conform to any other requirement by law.
Property laws Broadly, Bhutanese law divides property into three types: movable (chattels), immovable (real property), and intellectual. Additionally, Bhutan has codified legislation on specific subtypes of property, such as livestock, and on general property-related transactions, such as security interests.
Bhutanese hypothecs, loans, and pledges of movable and immovable property, including mortgages and secured transactions, are governed according to the Moveable and Immovable Property Act of 1999 and Land Act of 2007. These types of security interest are generally the purview of the Royal Court of Justice. Bhutanese law includes normative definitions and procedures for attachment and perfection of security interests as well as types of security interests, such as purchase money security interests. The law also covers default, foreclosure, deficiency, redemption, and allocation of risk of loss in modern terms. Notably, non-citizens are prohibited from taking a security interest in immovable property without prior government approval. Also notably, Bhutanese law provides for tolling of interest for mortgagees while incarcerated, and extends some redemption rights to family members of the debtor.
The Land Act of 2007 establishes the National Land Commission as the government agency overseeing land ownership and transactions. The commission is composed of the Secretaries of the Ministries of Agriculture, Works and Human Settlements, Finance, Trade and Industry, and Home and Cultural Affairs, along with some six other representatives from various public and private interest groups. The Commission oversees land transfers, mortgages, easements, and the national land register ("chhazhag sathram" or "thram"). The commission also issues deeds of land title ("lag thram") and has surveys conducted for registered lands.
Subject to certain limitations, Bhutanese citizens are free to conduct environmentally sound agricultural and commercial activities on the land they own, as well as enter into transactions such as sales and leases. Additionally, the Royal Government is authorized to lease out its reserves for grazing and pasture management ("tsamdro" lands). Land use must generally be licensed by appropriate authorities; for example, commercial agriculture must be licensed by the Ministry of Agriculture. The law imposes a ceiling on land ownership, and provides exemptions for the royal family, government institutions, religious agencies and institutions, and Bhutanese corporations. Because of this ceiling, the law also provides a grace period to dispose of inherited land, or alternatively, intestate succession to the second in line. Under Bhutanese law, all mineral rights are vested in the state, and the Mines and Minerals Management Act and other laws regulate their use and management. Contiguous lots of land under common ownership may be merged only with local government approval. Further limits on land ownership include escheat in the event of intestacy ("tsatong" lands), non-use of land for 3 years, and non-payment of land taxes.
The reigning Druk Gyalpo is empowered to grant kidu, or parcels of land, and may also grant plots for land rehabilitation purposes.
Tenancies and other estates in land less than outright ownership are governed by the Tenancy Act of 2004, and by Land Act of 1979 where incorporated by Tenancy Act. Under these laws, tenancies must be supported by a written lease with definite terms. Tenancies entail several rights and obligations for tenant and landlord, enumerated by statute. These include many rights similar to common law guarantees, such as the tenant's right of "peaceful enjoyment" and duty to refrain from nuisance and dangerous activities. These also include remedies such as lease cancellation and rent abatement for a landlord's breach of warranty of habitability, and eviction for tenant's breach of duty to pay rent over two months. In Bhutan, however, sub-leases are unlawful. Notably, tenancies pass according to a set order upon the death of the leaseholder. Bhutanese law also contains provisions on rents the limit annual increases to 10 percent of the monthly rent. Tenancies are regulated by the Tenancy Authority, an agency of the Ministry of Works and Human Settlement.
Intellectual property Intellectual property law is seen mainly in the Copyright Act and Industrial Property Act of 2001. Under the Copyright Act, Bhutanese copyright protection lasts for the life of the author, plus fifty years after death; in the case of joint authors, it lasts for fifty years after the death of the last author. Collective and anonymous works are protected for fifty years after publication. Applied art is protected for twenty-five years from creation. Bhutanese intellectual property law recognizes both economic and moral rights of the author; the former is freely assignable in whole or in part.
Bhutan protects other types of intellectual property, such as patents, trademarks, trade dress, and industrial design, through the Industrial Property Act.
The Intellectual Property Division of the Ministry of Economic Affairs is responsible for maintaining registration and upholding intellectual property law. The Division cites low levels of awareness and innovation along with poor coordination among stakeholders as hampering the development of intellectual property in Bhutan. It launched its registration system for industrial design in 2009, and had registered two designs as of April 2011.
Corporate law Bhutan has regulated corporations since 1989, most recently under the Companies Act of 2000. Corporations and other legal entities are overseen by the Ministry of Trade and Industry and its various subsidiary agencies. Within the government of Bhutan, the Minister of Trade and Industry represents his ministry in the Lhengye Zhungtshog (Executive Cabinet).
Bhutanese law regulates incorporation, capital, debentures, shares and issuance of stock and securities, corporate management and accounting, directorships, mergers and acquisitions, and dissolution. Notably, licensure to commence business as a Bhutan corporation requires the discretionary approval of the Minister of Trade and Industry; imposes joint and several liability upon directors for ultra vires conduct; and prohibits unsecured debentures. The bulk of Bhutanese corporate law, however, is identical to those of modern nations, including statutory shareholder inspection rights, the dichotomy between "equity shares" (common) and preference shares, and solvency doubly defined as the ability to pay debts as they become due and as the excess of assets against debts. (Cf. general corporate and insolvency laws)
Since 2007, Bhutan has separately regulated civil society organizations ("CSOs"). These include associations, societies, foundations, charitable trusts, nonprofit organizations or other entities outside government that do not distribute any income or profits to their members, founders, donors, directors or trustees. Excluded from CSO status are trade unions, political parties, cooperatives, and religious organizations devoted primarily to religious worship. Rather, the latter group is separately regulated under the Religious Organizations Act of 2007, which aims to protect and preserve the spiritual heritage of Bhutan through providing for the registration and administration of religious organizations. To meet those goals, the Act creates the Chhoedey Lhentshog as the regulatory authority on religious organizations. This body regulates, monitors, and keeps records on all religious organizations in Bhutan, which are in turn required to register and maintain specified corporate formalities.
Public law
Citizenship and immigration law
Bhutanese citizenship and immigration laws are found in the Citizenship Act of 1985 and Immigration Act of 2007, respectively. The Bhutanese citizenship law is generally an ambilineal jus sanguinis law, meaning it is transmitted by parentage as opposed to place of birth, and requires that both parents be Bhutanese. The law also requires continuous registration in local registers. Naturalization requires cultural familiarity and assimilation and allegiance to the Druk Gyalpo. Immigration laws establish a visa schedule and divide aliens into immigrant and non-immigrant categories. They also empower immigration inspectors with broad authority to prosecute offenders, and to detain and search persons and places, both public and private.
Election and government law