International Arbitration: Regional Perspectives, Africa

On 10 March 2021, we held the first webinar in our series on regional perspectives in international arbitration.

Our Head of International Arbitration, Dr Johanne Cox was joined by:

• Des Williams, Werksmans Attorneys, South Africa
• Ngozi Efobi, Aelex, Nigeria
• David Asiedu, ENSafrica, Ghana
• Dr Mohammed Hafez, CRCICA, Egypt

South Africa Overview – Des Williams

• The status of arbitration in South Africa has recently been re-affirmed by the South Africa Arbitration Act 2017 which adopts the UNCITRAL model law.
• South Africa is a party to the New York Convention for the recognition and enforcement of foreign arbitral awards.
• The Arbitration Foundation of South Africa (AFSA) is a leading arbitral organisation in South Africa and presides over both domestic and international disputes.
• AFSA has recently set up a SADC Division to develop the arbitration offering across the Southern African region.
• The AFSA partnership with the Chinese Law Society has increased the popularity of arbitration for contracts involving Chinese parties.
• AFSA will shortly be launching updated procedural rules, having delayed the original launch due to the COVID-19 pandemic.
• ICC and LCIA also have a presence within the region.

Nigeria Overview – Ngozi Efobi

• In 1988 Nigeria was the first African country to base its arbitration law on the UNCITRAL model law. It became a signatory to the New York convention in 1970 and has been a pioneer for arbitration in the region.
• Arbitration clauses are common in commercial contracts and are continuing to increase in popularity.
• There are several arbitral institutions in Nigeria with world-class facilities including the Lagos Court of Arbitration and the Regional Centre for International Arbitration – Lagos.
• The Africa Continental Free Trade Area, which became effective as of 1 January 2021, is expected to increase the use arbitration.
• Arbitration is a popular choice for oil, gas, investment and general commercial disputes.
• Arbitration tribunals in Nigeria responded quickly to the COVID-19 pandemic and virtual hearings are now common. The growth of virtual hearings has also helped to reduce the costs of arbitration.
• The courts are supportive of arbitration, and there are only limited grounds on which awards can be set aside.

Ghana Overview – David Asiedu

• In 2010, the Alternative Dispute Resolution Act, based on the UNCITRAL model law, was passed to replace the old Arbitration Act.
• This Act made it mandatory for the courts to respect arbitration clauses, and the higher courts have since been quick to act to prevent jurisdiction being wrongly assumed by lower courts. The Act also incorporated the New York Convention into Ghanaian law.
• Generally, arbitration lags behind litigation, but this is reversed in high-value commercial disputes, where arbitration is more common.
• Arbitration is also the preferred mode for resolving more complex disputes.
• The Ghana Arbitration Centre is the main local arbitral institution, but primarily handles domestic disputes. International arbitrations are usually held under LCIA or ICC rules mostly in London and other European venues.
• The courts are very supportive of arbitration. There are limited grounds to object to enforcement. However, some matters cannot be arbitrated in Ghana (such as the interpretation and enforcement of the constitution, and matters under environmental law); and so awards relating to these matters will not be upheld.

Egypt Overview – Dr Mohammed Hafez

• The Cairo Regional Centre for International Commercial Arbitration (CRCICA) was established in 1979 and its status as an international organization was recognized and endowed with all necessary privileges and immunities ensuring their independent functioning since 1987.
• CRCICA administers a large number of arbitration cases (1465 cases until January 2021) in different fields, particularly oil, gas, and construction disputes. The language of the arbitral proceedings take place in either Arabic or English.
• CRCICA has been issuing regular announcements and updates on its website in response to the COVID-19 Pandemic and is promoting virtual hearings. This was evident through its statistics since the second quarter of 2020.
• The courts are arbitration friendly. There is limited scope for court intervention during arbitrations and courts are able to assist by granting interim remedies.
• The scope for setting aside arbitral awards is limited and the competent courts cannot consider the merits of the underlying disputes.
• Emphasis was made on the Egyptian Court of Cassation ruling in Case No. 14126 of Judicial Year 88, dated 22 October 2019 where the Court of Cassation focused on what is meant by a permanent international arbitral institution within Egypt and the competent court to rule on the setting aside of issued awards from such an institution.
• Egypt is a signatory to the New York Convention and there are limited grounds to set aside foreign arbitral awards. 

Snapshot of discussion

International Arbitration In Africa

International arbitration in Africa has a momentum of its own and is certainly not lagging behind other regions.

Harmonisation of arbitration rules and laws

Our panellists noted that some steps have been taken towards harmonisation, in particular the OHADA arbitration regime has brought together 17 countries in West and Central Africa. They agreed that whilst harmonisation is important, it should not be forgotten that there are significant differences between countries and areas within Africa.

Stability

It is common to see concerns that African countries are unstable. Our panellists discussed this perception and agreed that the reality is often different and much more positive than the perception, and that it is important to highlight the positives. It was hoped that virtual hearings will assist with alleviating concerns about instability when arbitrating in Africa.

OHADA Secretariat in Accra

The panellists discussed whether the siting of the OHADA secretariat in Accra would lead to more arbitrations being seated in Ghana. It was thought that whilst it may do so, there was no direct reason that the location of the administrative centre should lead to more arbitrations in Ghana.