When operating a business in Africa or in connection with an African State, there are a wide range of laws and practices that likely apply which can impact business activity. Businesses entering into contracts with States or other companies in Africa must typically consider the law applicable to the contractual relationship and the law applicable to the arbitration proceedings foreseen in the contract in question before a dispute arises.
Pre-Dispute Considerations
Determine the law applicable to the contractual relationship
When drafting a contract, parties must agree upon a law that will govern their contractual relations. Parties typically consider the effectiveness of the law, its technical appropriateness and strategic aspects, including their familiarity with the law in question when determining the law applicable to the relationship.
Determine the law applicable to arbitration before a dispute arises
The parties must determine the “seat” of the arbitration in the arbitration clause (i.e. the law that would govern the arbitration proceedings) in anticipation of any arbitration proceedings. When determining the seat of the arbitration, parties typically consider the effect of the national arbitration law and the state’s track record in enforcing agreements to arbitrate and arbitral awards in that jurisdiction, along with its neutrality and impartiality.
>>More about the arbitration clause
>>More about the law for resolving disputes in Africa
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