This trend has been spurred by a recent report published by the UK Ministry of Justice, indicating proactive measures taken by several African governments to host disputes between African parties within the continent. The surge in infra-African disputes, catalyzed by the African Continental Free Trade Area agreement, has further fueled this momentum.
Mariam Hassaballah, a representative of Pinsent Masons, remarked on the palpable competition among African nations to emerge as the premier “arbitration hub” of the continent. Notably, Nigeria, alongside countries like Sierra Leone and South Africa, has joined this race by enacting new arbitration and mediation laws. Additionally, Egypt’s CRCICA has unveiled draft arbitration rules prioritizing efficiency and flexibility.
The report underscores African governments’ endeavors to relocate arbitrations, traditionally governed by institutions such as the International Chamber of Commerce (ICC) and the London Court of International Arbitration (LCIA), to physical venues within the continent. This strategic move is often justified by concerns regarding costs and perceptions of bias, prompting a leveraging of arbitration’s inherent flexibility in distinguishing between the seat and the physical hearing location.
Hassaballah highlighted the persistent preference of many foreign investors for arbitration seated in familiar jurisdictions like London and Paris, despite advancements in African jurisdictions. Rob Wilkins, another expert from Pinsent Masons, rationalized governments’ push for local arbitration venues, citing the potential economic benefits in terms of revenue generation and currency attraction.
The imperative to bolster arbitration and dispute resolution mechanisms in Africa is propelled by the dual objectives of enhancing access to justice and fostering foreign direct investment. Wilkins emphasized the attractiveness of arbitration to foreign investors due to its neutrality, confidentiality, and flexibility, instilling confidence in the fair and efficient resolution of potential disputes.
While litigation remains prevalent for local disputes, the report highlights a rising tide of alternative dispute resolution (ADR) work in various African jurisdictions. This evolving landscape underscores a broader shift towards embracing arbitration and ADR as preferred methods for resolving disputes in Africa, signaling a promising trajectory for the continent’s legal and economic development.
