There are around 89 arbitration centers in Africa. But many still rely on the more well-known international hubs outside of the continent. Credit: Shutterstock

As Africa's nations continue to develop, there has been a tendency for lawyers and judiciaries to cleave to tradition when resolving disputes. But, still a relatively new concept, the continent is gradually embracing the practice of arbitration.

"The overarching, exciting thing about Africa is the growing attention to and efforts being made to increase expertise in international arbitration and counseling," said Naana Frimpong, counsel at King & Spalding in Atlanta, Georgia. "There is also a surge in arbitration centers emerging across the continent."

As of March 20 this year, there were a total of 89 arbitration centers in Africa, with multiple centers in a number of countries, according to the latest list compiled by university lecturers Dr Emilia Onyema and Sopuruchi Christian.

Yet international arbitration, even with an African element, has traditionally been administered under the aegis of western institutions such as the London Court of International Arbitration.

"A free market cannot exist without an African relevant continental dispute resolution and arbitration process and justice system."

Of the 54 members of the African Union (AU), at least 30 now have modern legislation for international arbitration, says Des Williams, director and head of arbitration at Werksmans Attorneys in Johannesburg.

The long overdue reform of South Africa's 1965 arbitration legislation finally arrived in December 2017 in the form of the International Arbitration Act.

"The act incorporates the United Nations Commission of International Trade Law (UNCITRAL) Model Law," said Williams.

He said it took South Africa so long to reach this point, largely due to negative perceptions of arbitration in some quarters, although this attitude has changed over the past 10 years.

There has been strong support from the courts for arbitration "and our courts recognize the principle of party autonomy and the importance of restricting court interference in arbitration," said Williams.

A Unified Approach

The problem is that Africa's various arbitration centers operate in isolation, with their own regulations and jurisprudence, said Michael Kuper, South African advocate and chairman of the China-Africa Joint Arbitration Centre (CAJAC).

CAJAC is a subsidiary of the Arbitration Foundation of Southern Africa (AFSA).

"It is my belief that a unified approach is needed to bring all the centers together under one set of standardized practices and legislation."

Kuper maintains that the essential requirements of unification of China-Africa arbitration include a shared constitution, shared rules, standard jurisprudence, and eventually the same panel of approved arbitrators.

"The idea is to have a panel of high-standard, neutral, non-African, non-Chinese arbitrators who are available to all the centers," he said.

Mauritius has one of the most sophisticated jurisdictions for arbitatration in Africa, said Dev Erriah, barrister at law at Gray's Inn, Port Louis.

"Our arbitration center was set up in 2008 and is based on U.K. law, which is favoured by investors."

"The exciting thing about Africa is the growing attention to and efforts being made to increase expertise in international arbitration."

He suggests that arbitration has only started to catch on in the past 10 years in Africa and there is still a tendency to rely on the courts to resolve disputes.

"But with globalisation it is important to adopt international norms."

Kenya's 2010 constitution led to court assisted mediation, as an almost obligatory initial stage in complex dispute resolution, said Fred Ojiambo, senior partner at Kaplan & Stratton, based in the capital Niarobi.

"In addition, it allowed the courts to strongly advise, (read 'compel') parties to seek arbitration, instead of insisting on resolving their dispute through the courts."

The courts are aware that their processes are often slow and cumbersome, and can end up in a 'winner takes all' scenario that a system of mediation would frown upon, he said.

Alloys Mutabingwa, founder and chairperson of law firm Aims Capital in Kingali, Rwanda,  said arbitration can be less costly than taking a dispute to court.

"Even if the ruling is favourable, the court may award less than has been claimed."

Free Trade

Mutabingwa said one of the issues in Africa is that vital aspects of the dispute resolution and arbitration component of the African Continental Free Trade Zone Agreement (AfCFTA) which the African Union is promoting so hard are missing from the protocol.

"They have copied and pasted the arbitration component of the World Trade Organisation (WTO) into the AfCFTA framework, but it cannot be applied in Africa."

Something needs to be done about this, because an African-relevant arbitration instrument is essential to cross-border trade and investment, said Mutabingwa.

"A free market cannot exist without an African relevant continental dispute resolution and arbitration process and justice system."

Mutabingwa is producing a paper outlining what needs to be done about this, which he intends to submit for consideration.

"With globalisation it is important to adopt international norms."

Uganda established its Centre for Arbitration and Dispute Resolution (CADER) in 1998. But two decades later in 2018 the outcome of an arbitration it handled was questioned.

It then came to light that the center did not have a governing council, as required by the act by which it was set up, said Jacqueline Lule, partner at Bowmans Uganda.

"This put in doubt all past and current arbitrations handled by the centre."

In the same year, the International Centre of Arbitration & Mediation of Kampala (ICAMEK) was set up as a private NGO in collaboration between the Law Society, the Uganda Bankers Association and others.

"The minister subsequently appointed ICAMEK as the country's official arbitration centre in June 2019," said Lule.

All in all, the positive signs of progress with arbitration across Africa bode well for the future of the continent in bringing it closer to global norms, and reflect a strong will to move in this direction.

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