Three new statutes on arbitration and mediation, approved by the Council of Ministers of the Organisation for the Harmonisation of Business Law in Africa (OHADA), entered into force on 15 March 2018, and apply to all proceedings initiated as of this date.
In the 17 nations that make up OHADA (Benin, Burkina Faso, Cameroon, Central African Republic, Côte d’Ivoire, Congo, Comoros, Gabon, Guinea, Guinea Bissau, Equatorial Guinea, Mali, Niger, the Democratic Republic of Congo (DRC), Senegal, Chad and Togo), these new laws include:
- The revised OHADA Uniform Act on Arbitration ("Arbitration Act"), replacing the previous versions dated 1999. This Act applies to all arbitration proceedings (except arbitration conducted by the Joint Court of Justice and Arbitration, CCJA) where the seat of arbitration is located within one of the 17 OHADA member states, regardless of the nationality of the parties;
- The revised Rules on Arbitration of the CCJA, replacing the previous rules enacted in 1996. The CCJA is a supranational supreme court that rules on decisions made by national courts on matters involving OHADA uniform acts, and also conducts commercial arbitration in accordance with the Arbitration Act;
- A new uniform act on mediation that provides general principles governing any mediation process between parties wishing to reach an amicable settlement within any of the 17 member states. Before the adoption of this new act, parties in a dispute could always agree on appointing a third party with the view of reaching an amicable settlement. The new act brings more certainty and efficiency to the mediation process, setting out principles including requirements for the independence and impartiality of mediators, and what to do if there is an incompatibility with the status of an arbitrator or expert on the same dispute. The act also provides rules on the exchange of information between the parties and the mediator, and on the enforcement of the mediator’s recommendation.
The most significant changes that the Arbitration Act brings to arbitration proceedings include:
- Reinforcing the arbitration of investment disputes with a provision recognising the right to start an arbitration proceeding on the basis of an agreement, and also on the provisions of any instrument related to the protection of investments, including bilateral investment treaties and local investment laws. In addition, the Arbitration Act confirms the ability of the states and any public entity to consent to arbitration, both domestic and international;
- Arbitrators now have the power, at the request of a party, to suspend proceedings, and instruct the parties to undertake negotiation, mediation or conciliation prior to commencing arbitration, where these preliminary steps are provided for in the dispute resolution clause;
- State courts must rule on a request for recognition and enforcement of arbitral awards within fifteen days from its referral. If the state court fails to issue its decision within this time limit, the arbitration award will be recognised;
- Loyalty and efficiency among the parties is now provided for in a provision that prohibits the use of dilatory tactics;
- The parties may agree to waive their right to award annulment requests before the competent state courts, as long as the award is not contrary to international public policy. When an annulment request is brought before a competent state court, this court must rule on the request within three months of receiving the application. If the state court does not rule on the annulment request within this time limit, the request may be brought before the CCJA, which must render its decision within six months.
Legal analysts are hailing these reforms as ambitious new rules, but they caution that some of these regulations may be difficult for state courts and the CCJA to implement within the requested time periods.
For more information on these regulations and arbitration reform within the OHAD, please contact Jean Jacques Lecat.