Listening to Massimo Mazzone's interview on the ZEDEs, he mentioned the possibility that a new government legislature could overturn and extinguish the ZEDEs if the political scenario changed in a future election. How likely is this to occur in the short term and also how strong are the protections against this kind of political hostility?

The OP is talking about this interview with the founder of another ZEDE.

I'll take a stab at this.

It's too early to tell how the next election (in November) will turn out. Wikipedia shows the current governing party's Presidential candidate leading in one poll, but with 51% undecided.

The standard answer about protections, from that recent Journal article:

Given the reputation of Honduras for corruption and impunity, the authors of the ZEDE regime knew they would need to insulate the legal stability of the ZEDE system from the day-to-day affairs of the legislature as much as possible. As such, the ZEDE organic law has three strong elements of legal stability, despite the provision of the Honduran constitution stating that ZEDEs are "subject" to national legislation "in all topics related to sovereignty, application of justice, national defense, foreign relations, electoral matters, and issuance of identification documents and passports" (Constitute, 2020, p.74). First, a two-thirds vote of Congress is required under the ZEDE amendments for any future legislation that would invoke this constitutional provision to amend or otherwise repeal the ZEDE organic law to expand the national laws that currently apply within ZEDEs (Constitute, 2020). Second, Honduras’ treaty obligations to investors in Kuwait, (La Gaceta, 2014),11 the United States (United Nations, 1995), and CAFTA member nations (USTR, 2004) guarantee that Honduras will not abrogate the ZEDE program as an obligation of the treaties. Third, CAMP, the Committee for the Adoption of Best Practices, has expressly and by non-objection agreed to comply with such treaty obligations and to resolve disputes concerning Próspera’s legal authority by private arbitration, which agreement is enforceable by the promoter and organizer of any given approved ZEDE under CAFTA-DR (Próspera 2019d).

Put differently, substantially amending the ZEDE Organic Law and constitutional amendments in such a way that materially changes the legal autonomy of the jurisdiction requires a 2/3rds majority vote of Congress in a highly partisan legislature, which would then put Honduras in violation of treaties with Kuwait, the United States, and CAFTA member nations, while simultaneously opening the Honduran government up to international litigation on the world stage for rescinding investor protections. The reputational and pecuniary damages this could cause to the Honduran government serve as powerful bulwarks protecting the legal stability of the ZEDE program.

11 This treaty was duly signed by public officials from both countries on January 15, 2014, as well as ratified by the Honduran National Congress; the Honduran Committee for Adoption of Best Practices has represented that the treaty is in effect and we are awaiting confirmation of effectiveness from the Foreign Ministry of Kuwait.

And to add the obvious: Honduras doesn't have a good record of adhering to its constitution.

[–]GregFoley 7 points8 points9 points 1 month ago (8 children)

• permalink
• embed
• save
• parent
• report
• give award
• reply