Virtually all of the countries where communist regimes have fallen since the late 1980s have undergone two closely connected transformations. Dictatorial, one-party rule has collapsed, and the centrally planned economy has been replaced by a more or less market-oriented system. Western observers have watched with amazement and excitement as this process has unfolded in the former Soviet Union and Eastern Europe. In Asia the countries ruled by communist regimes are still far from political democracies but they are (with the exception of North Korea) undergoing similar economic transformation. Much attention has been paid to China,less to Vietnam, and least of all to Laos. Both Vietnam and Laos are currently struggling to create the foundations of capitalism - a free market, private ownership, and most important, legal institutions. This article deals briefly with what can be discerned at this stage about creation of a legal foundation for the newly emerging society in Laos.