By Dr. Kariuki Muigua, PhD (Leading Environmental Law Scholar, Policy Advisor, Natural Resources Lawyer and Dispute Resolution Expert from Kenya), Winner of Kenya’s ADR Practitioner of the Year 2021, ADR Publication of the Year 2021, CIArb (Kenya) Lifetime Achievement Award 2021 and African Arbitrator of the Year 2022 Shortlisted Nominee. Please follow this link to vote for him by Midnight, Monday, 13th June 2022: https://preview.mailerlite.com/m3m6o7l6c8/1968314795065083207/z0p1/*
In the last few years, the setting up of legal and institutional frameworks specifically meant to promote the growth and practice of international arbitration in Kenya has picked up. The Nairobi Centre for International Arbitration Act28 establishes the Nairobi Centre for International Arbitration (NCIA) whose functions include, inter alia, to promote, facilitate and encourage the conduct of international commercial arbitration in accordance with the Act; to administer domestic and international arbitrations as well as alternative dispute resolution techniques under its auspices; to ensure that arbitration is reserved as the dispute resolution process of choice; and, to develop rules encompassing conciliation and mediation processes.
The NCIA is administered by a Board of Directors as provided for under the Act. There is also an Arbitral Court established under the Act, which court has exclusive original and appellate jurisdiction to hear matters that are referred to it under the Act. Its capacity to handle domestic and international arbitration requires to be constantly improved, and it can only be hoped that this potential will be exploited to its maximum in the years to come so as to prominently place Kenya on the global map of international arbitration. Despite the efforts by stakeholders in Alternative Dispute Resolution (ADR) and especially arbitration to invest in making Kenya a more receptive destination for international arbitration, the country still faces a number of challenges that have slowed down the progress. These include: real or perceived national courts interference; perception of corruption/ government interference; inadequate marketing of the country; inadequate capacity of existing institutions; and endless court proceedings, among others.
Enhanced Capacity
Kenya has qualified and experienced arbitrators who are arbitrating commercial disputes around Africa. Indeed, following the revival of the East African Community and the expansion of regional trade, the possibility of Nairobi becoming a regional centre for arbitration is very high. Therefore, the prospects of international commercial arbitration in Kenya are really promising. However, with the changing trends at the global scene, there is a need for the practitioners and the judges to stay abreast with what is happening. In addition, with the international commercial arbitration taking root in Kenya in recent years and the ever increasing institutional capacity, there is a need to equip students and practitioners with the basic knowledge in their quest for expertise in the area.
Marketing and Arbi-Tourism
The stakeholders in arbitration sector in the country can utilise arbi-tourism to market Kenya as a preferred seat and venue for international arbitration. Arbi-tourism (arbitration tourism) may be defined as the promotion of arbitration alongside tourism. Kenya is known globally for its tourism sector and thus, the stakeholders in the arbitration and dispute resolution sector should make use of this fame. While marketing Kenya as a tourist destination, there is a need for the ADR stakeholders to consider working with the ministry of tourism and all other relevant ministries to market Kenya as a friendly seat and venue for international arbitration. This could be done by providing incentives in terms of subsidized hotel and park rates for those who are in the country for international arbitration. The relevant government and private stakeholders should also take advantage of international conferences and seminar forums to market the country as a friendly and viable seat and venue for international arbitration.
Security
Over the last several years, Kenya has had an unprecedented level of insecurity from both internal and external forces such as the Somali Islamist group, al-Shabaab. 35 This has negatively affected the image of Kenya as a safe destination for tourism and business due to this increased insecurity.36 While the government has done much in improving security over the years, the perception that the larger horn of Africa is insecure still affects Kenya’s rating. If effort towards marketing Kenya as a preferred seat and venue for international arbitration are to bear fruits, then there is a need for the stakeholders in the security department to work closely with other regional leaders to eradicate the insecurity or the perception for the same since security is paramount for both local practitioners and the foreign ones, together with their clients.
Adherence to the Rule of law
The Constitution of Kenya, 2010 provides under Article 259(1) that the Constitution should be interpreted in a manner that: promotes its purposes, values and principles; advances the rule of law, and the human rights and fundamental freedoms in the Bill of Rights; permits the development of the law; and contributes to good governance.
International Cooperation
As already pointed out, international arbitration developed over the years to achieve the status of a transnational legal order. As such, its development and continued acceptance heavily relies on cooperation amongst various states in both developing and developed world to recognise and enforce the outcome of international arbitration in their jurisdictions. There is therefore a need for Kenya work closely with other likeminded states in Africa and beyond in order to build its capacity and have a ready market for its institutions.
Easy Access and Travel to Kenya
One of the factors that make any country to lag behind in attracting international arbitration practitioners and parties’ preference for a country as their preferred seat for their arbitration is difficulty in accessing the same physically, should they require traveling there. As recently as June 2020, it was reported that Government officials are in the process of finalising a free trade agreement (FTA) that, if signed, is set to ease the entry of established US companies into the local market. If concluded, the reciprocal trade deal would grant the US government unfettered entry for its companies into nearly all segments of Kenya’s economy including the heavily guarded ones. While this may come with intended and unintended repercussions for the job market for Kenyans and local companies, the same is also likely to bring some work for the local arbitrators and institutions, if they are ready to grab the opportunity and well prepared for the same.
Effective Supporting Institutions
Kenyan courts have shown a positive attitude towards ADR and arbitration and are willing to minimise court intervention as envisaged under the relevant laws. There is a need for ensuring that this continues and also ensuring that lawyers and judicial officers are not used by parties to frustrate the arbitration process. Only then will the practice of international arbitration in the country grow and attract international clientele. The Nairobi Centre for International Arbitration (NCIA) is commendably rising and making itself known for international arbitration and ADR. There is a need for all stakeholders including the Government of Kenya, arbitration practitioners and learning institutions to support NCIA in its quest to compete competitively with the global international arbitration institutions.
*This article is an extract from the article “Looking into the Future: Making Kenya a Preferred Seat for International Arbitration,” by Dr. Kariuki Muigua, PhD, Kenya’s ADR Practitioner of the Year 2021 (Nairobi Legal Awards), ADR Publisher of the Year 2021 and ADR Lifetime Achievement Award 2021 (CIArb Kenya). Dr. Kariuki Muigua is a foremost Environmental Law and Natural Resources Lawyer and Scholar, Sustainable Development Advocate and Conflict Management Expert in Kenya. Dr. Kariuki Muigua is a Senior Lecturer of Environmental Law and Dispute resolution at the University of Nairobi School of Law and The Center for Advanced Studies in Environmental Law and Policy (CASELAP). He has published numerous books and articles on Environmental Law, Environmental Justice Conflict Management, Alternative Dispute Resolution and Sustainable Development. Dr. Muigua is also a Chartered Arbitrator, an Accredited Mediator, the Africa Trustee of the Chartered Institute of Arbitrators and the Managing Partner of Kariuki Muigua & Co. Advocates. Dr. Muigua is recognized as one of the leading lawyers and dispute resolution experts by the Chambers Global Guide 2022.
References
Muigua, K., “Looking into the Future: Making Kenya a Preferred Seat for International Arbitration,” Available at: http://kmco.co.ke/wp-content/uploads/2020/12/Looking-into-the-Future-Making-Kenya-a-Preferred-Seat-for-International-Arbitration-Kariuki-Muigua-Ph.D.-28TH-DECEMBER-2020.pdf (accessed on 11/06/2022)