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Arbitration and mediation overhaul for OHADA

Wednesday, 4th January 2018

"OHADA has emphasised its commitment to dispute resolution in West and Central Africa with an overhaul of its arbitration law and the introduction of a mediation law.

New arbitration and mediation laws have been adopted by Organisation pour l'harmonisation en Afrique du droit des affaires (OHADA), reforming and modernising the ADR landscape for its 17 West and Central African member states.

The international organisation which has provided a framework and institutions for corporate law across the region since its establishment in 1993, has adopted the revised Uniform Act on Arbitration, which updates the 1999 Uniform Act on Arbitration, and the new Uniform Act on Mediation, which for the first time establishes a mediation mechanism in the region. The mediation act is the 10th such law passed by OHADA during its 24-year history.

The OHADA council of ministers approved the two laws during its 45th ordinary session, held in Conakry, Guinea, on 23 and 24 November and they will come into force on 15 March 2018.

OHADA has its own arbitral institution, the Common Court of Justice and Arbitration (CCJA), and the council, consisting of the finance and justice ministers from all 17 members, also took the opportunity to adopt revised rules of arbitration.

Following an international tender process, OHADA was assisted in drafting the new laws by a team from United States law firm Jones Day, led by Michael Bühler, head of the firm’s global disputes practice in Paris and including head of the Africa practice in Paris, partner Rémy Fekete, associate Anne-Sophie Gidoin, also based in Paris, and Dubai-based Pierre Heitzmann.

Barthélémy Mercadal of the Institut Français de Droit d'expression et d'Inspiration Françaises(IDEF) and Franco-German mediator Christian Hausmann, a consultant with Squire Patton Boggs in Paris, were also involved.

The process was announced in 2015 and a Jones Day evaluation report was submitted to OHADA permanent secretary, and former Beninese government minister Dorothé Cossi-Sossain October 2016, containing 30 proposals for the revision of the arbitration law and the establishment of the mediation act, following research into international best practice and a survey of 1000 lawyers across the region.

Drafts of the laws were then submitted in early 2017 for review by the member states and the CCJA, and feedback was also provided by UNCITRAL, the Economic and Monetary Community of Central Africa (CEMAC) and the West African Economic and Monetary Union (UEMOA).

Bühler said in a statement that “this initiative will facilitate investment by assuring easier resolution of disputes”.

Javade Chaudhri, partner-in-charge of Jones Day’s Middle East and Africa region, said the firm was “committed to advancing and promoting the rule of law around the world” and embraced “the opportunity to contribute to the modernisation of the dispute resolution system in Central and Western Africa”.

EVOLUTION, NOT REVOLUTION

Thomas Kendra, an international arbitration partner with Hogan Lovells in Paris, says modernising the arbitration act had been discussed since 2009, but that the existing 1999 act “was already a good workable modern law, more favourable to arbitration in some ways than some of the main international texts such as the New York Convention”, and as such he is pleased “that the revisions clarify and build upon the existing texts, rather than aiming to rewrite the system”.

He says that criticisms of the old act “have often been rather aimed at the areas which the act did not cover, and therefore left variation of practice within the member states”.

Those variations include the bringing of annulment proceedings in arbitrations seated in member states, now addressed by the introduction of time limits for annulment decisions, which Kendra describes as “welcome, as it will encourage efficiency in the member states”, by allowing applications to go straight to the CCJA. Interim measures and rules for the appointment of tribunals in multi-party disputes are other blind spots that the new law has tackled.

“There appears to be some element of compromise, however,” says Kendra, who has extensive experience of arbitrating in Africa, “as the act and rules could have gone further, and could be seen to be a missed opportunity in some ways”.”

He picks out the lack of an expedited procedure for small disputes, such as that introduced by the ICC International Court of Arbitration earlier this year, which could have helped with the cost and speed of arbitration, “although this may be seen as less of a problem at the CCJA than in Europe where fees tend to be much higher”.

Despite this, he is positive about the developments: “Overall, it is definitely welcome that OHADA continues to monitor developments and is able to modernise its laws regularly, and this will encourage parties resolving disputes in the region to continue to see the OHADA institution and the CCJA as a relevant set of laws and dispute resolution forum.”

Whether the overhaul helps the CCJA to attract more cases remains to be seen. As an arbitral institution, it has been reasonably well-regarded for the quality of its rules since its inception, yet it has struggled to overcome international parties’ traditional wariness about arbitrating in Africa. Instead, Africa-related disputes have tended to be heard in Paris or London, due to a combination of familiarity, culture and logistics, with transport within the continent still sometimes more complicated than travel to Europe.

Given the difficulties with litigating in many parts of Africa and the increasing levels of international and regional trade on the continent, the CCJA is nonetheless well-placed to capitalise on the need for arbitration, if it can overcome this reluctance."


Web-link: http://www.africanlawbusiness.com/news/7837-arbitration-and-mediation-overhaul-f...
Language: English
Contact: Andrew Mizner


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