Abstract
Foreign direct investment is one of the major factors for the development of national economies with positive implications for the growth of their gross domestic product, technology transfer, as well as increased competitiveness and improved performance of local companies. They generate investment capital, provide new employment, transfer expertise and skills to employees, and increase exports. In the Republic of North Macedonia a number of reform activities have been undertaken relating the protection of property rights, improvement of the efficiency in the functioning of the legislative, judicial and executive branches of government, which result with reduced business risks and motivates companies to make investment decisions. Current paper aimed at outlining the connection between the effectiveness of the judicial system and increasing the number of foreign direct investments in the Republic of North Macedonia.