The Role of African Regional Courts in Commercial Disputes

The existing African and regional courts include:

1.  African Court on Human and People’s Rights based in Arusha, Tanzania, with jurisdiction to protect the human and peoples’ rights in Africa. With Morocco joining AU in 2017, all African countries are now members of the AU and are subject to the African Court on Human and People’s Rights jurisdiction.
2.  The Economic Community of West African States (ECOWAS) Community Court of Justice has jurisdiction to adjudicate disputes on questions of economic cooperation between member states. This court is also vested with the mandate to arbitrate over commercial disputes.
3. The Treaty for the Establishment of the East African Community (EAC) established the East African Court of Justice (EACJ) with jurisdiction to determine disputes flowing from the treaty including trade disputes and human rights violations. EACJ is further clothed with jurisdiction to resolve commercial disputes through arbitration.
4. Southern African Development Community Tribunal (SADC Tribunal) was charged with ensuring Member States’ compliance with the SADC Treaty. The Tribunal was unfortunately suspended in 2012 due to a lack of political will from some states that seemed to object to the Tribunal’s extended jurisdiction to adjudicate on matters of human rights violations.
5. The Common Market for Eastern and Southern Africa (COMESA) Court of Justice is established under the Common Market for Eastern and Southern Africa and offers a medium for resolving commercial disputes. Further to the court’s primary jurisdiction of resolving disputes emanating from the treaty, the Court has jurisdiction to resolve disputes arising from an Arbitration Clause contained in a contract to which the Common Market or any of its Institutions is a party.

We look at the role of the EACJ in facilitating a cost-effective medium of arbitration of commercial disputes.

The EACJ as a Seat of Arbitration for Commercial Disputes
The East Africa Community (EAC) is a rapidly growing regional bloc. EAC has evolved since its inception in 1999 from a three-member regional bloc to its current seven members after the recent admission of the Democratic Republic of Congo (DRC) to the community. The common market within EAC brings about the free movement of goods, persons, labour, services, capital, information, and technology. Regional integration within EAC is taking shape, and with the common market, cross-border transactions will undoubtedly spike. There is an estimated population of over 280 million citizens within EAC. More interaction between individuals and businesses is expected to increase drastically, ultimately resulting in potential disputes.

The Treaty for the Establishment of the East African Community (the Treaty) anticipated these disputes and provided an elaborate dispute resolution mechanism. Article 23 of the Treaty establishes the EACJ as a judicial body responsible for adjudicating disputes where jurisdiction is bestowed on the court by the Treaty. One of the special jurisdictions given out by the Treaty on EACJ is to hear and determine disputes through arbitration pursuant to Article 32 of the Treaty.

Arguably, arbitration has been the most suitable, reliable, and time-saving mode of alternative dispute resolution over the years. This position is supported by the increased number of disputes referred to arbitration either through arbitration clauses incorporated into contracts or by mutual agreement of the parties. Commercial disputes are mainly submitted to arbitration due to their complexity and high value, thus necessitating an arbitral tribunal with the necessary set of experience, skills, and competence in a specific area of dispute.

The increasing cost of arbitration is a concern that will likely reduce the gains made in arbitration. Parties are now shying away from arbitration due to the high cost of arbitration attributable to the colossal arbitrator’s fees. Arbitration at the EACJ is at no cost with no fees payable to arbitrators, save for minimal one-off filing fees payable to the court when filing the claim.

This article discusses EACJ as a seat of arbitration, its significance, its arbitral jurisdiction to entertain commercial disputes, and the benefits of submitting commercial disputes for arbitration to this court as juxtaposed to local and other international arbitral tribunals.

Advantages of Arbitration at EACJ

a. Cost Effective
Arbitration at the EACJ is free, with no fees payable to arbitrators except for one-off minimal filing fees when filing the claim. The arbitrators are selected from judges of the court. Thus, no fees are payable to them.

This is a massive benefit that arbitration at EACJ offers. The cost implication of arbitration has chased parties from the seat of justice over the years. The cost of arbitration is rising to unmanageable levels due to the exorbitant arbitrators’ fees. Arbitrators charge their fees based on time spent on an hourly basis. Due to the complexity of matters, the number of documents to be perused, and the notion of witnesses, many hours are utilised in the long run. The net effect of the accumulated hours is high fees payable to arbitrators.

Cost-free arbitration at EACJ offers a reprieve to parties and allows them to present their case comprehensively and satisfactorily without constant fear of accumulation of costs.

b. Competence
The arbitrators at EACJ who constitute an arbitral tribunal are court judges. These are ordinarily high-ranking and experienced judicial officers or legal practitioners in the courts of EAC partner states. The current Appellate and First Instance Divisions of the court comprise some notable, highly professional judges who sit in superior courts of their respective countries and can competently adjudicate over any complex matter submitted before the court for arbitration.

In addition to the vast experience of these judges, the court has frequently undertaken the education of these judges to increase competition and skills in arbitration. This is an opportunity that parties in commercial contracts need to consider and tap. All Judges, who are not professional arbitrators, are trained and examined by CIArb UK up to the level of Fellows. They, therefore, possess the necessary skills to undertake arbitration.

c. Party Autonomy
Arbitration at EACJ embraces party autonomy. The Rules give parties the latitude to decide and agree on various issues. This ranges from selecting an arbitrator from the judges of the court , choosing the applicable law, deciding on the place of arbitration, and even modifying the court rules to fit their preferred model. This solidifies the traditional norm of party autonomy in arbitration, which gives parties the liberty to decide how the process should be conducted.

d. Bias
There is a high, increasing concern or perception about arbitrator bias globally. The deteriorating impartiality and the ethical deficiencies of arbitrators are mainly attributable to home country bias. EACJ offers an opportunity for parties to disassociate themselves from home bias and have such disputes arbitrated by judges from different countries as the parties in the disputes.

It is a cardinal principle in arbitration that the proceedings should be conducted by a neutral and impartial tribunal free from bias. The model provided by EACJ in selecting arbitrators will undoubtedly eradicate the perceived bias that ordinarily entangles local arbitration.

Conclusion
The common objective of  regional courts is to ensure access to justice by all in the resolution of disputes. Most regional courts in Africa can constitute themselves as arbitral tribunals and competently arbitrate over any commercial dispute.

In pursuit of justice in these regional courts, costs must not rise to levels that hinder access to justice. Excessive costs to access these courts can certainly hinder ordinary citizens from utilising these courts.