The Lagos State Government Administration of Governor Babatunde Raji Fashola, as part of its commitment to position Lagos as a regional hub for international commercial arbitration in the West African sub-region and beyond, enacted the Lagos State Arbitration Law (Law No. 10 of 2009) and the Lagos Court of Arbitration Law (Law No. 8 of 2009 (LCAL)). The functions of the Lagos Court of Arbitration (LCA), as stated in Section 9 of the LCAL are to promote the resolution of disputes in the territory of Lagos by arbitration and other Alternative Disputes Resolution (ADR) mechanisms. Being composed of a board of directors, a secretariat and the LCA itself, its organisational structure is similar to that of the London Court of International Arbitration.
The LCA's location in Lagos, the commercial and economic nerve centre of Africa's largest market, creates the potential for the improvement of Nigeria's investment climate and the promotion of economic development in Nigeria. In order to achieve this however, much will depend on its ability to establish a regime of dispute resolution which will reliably, efficiently and effectively protect and enforce the rights of foreign investors and their investments, thus inspiring them to take advantage of the immense business opportunities in Nigeria and the wider West African Sub-region. The strategy to be adopted in realising this goal should be one which blends local practices with international best practice to achieve the most efficient solutions.
The incorporation of local practices is important because culture affects every facet of the daily life of a people from the food they eat to their system of education, religious practices and social interactions. It reasonably follows from this that culture also influences the way people in a specific region engage in business relationships and by extension, the way associated disputes are generally resolved. The application of internationally accepted best practices is relevant because it serves as a reference point for foreign investors who are not familiar with the practices of the host country. It also aids in conferring legitimacy on international dispute resolution outcomes. Legitimacy, being a normative status conferred upon a system by those subject to it, requires that the particular regime in question act in accordance with generally accepted standards which ensures its acceptance and continued usage. A truly effective dispute resolution process therefore must be able to understand and engage all factors related to the dispute and, in so doing, must be able to withstand strict scrutiny on a global level.
The above suggests that the credibility of ADR in individual countries depends substantially on the availability of certain Arbitration and ADR infrastructure. This paper examines the role that unique Arbitration and ADR infrastructure plays in contributing to "foreign investment attractiveness" especially for emerging economies which are becoming increasingly competitive about attracting foreign investment, and looks at structures in Dubai and China as examples in this regard. In so doing, Part I addresses the need for invention, Part II deals with Dubai's dispute resolution history and the IICRA, Part III deals with China's dispute resolution history and the CIETAC and Part IV looks at the impact these institutions have had in their regions and the challenges they face. The paper concludes with a look at the potential of these economies to attain the prominence of arbitration hubs as New York, London and Paris.
Arbitration and ADR Infrastructure and the Need for Invention
Arbitration and ADR infrastructure is a general term used to describe all the physical and non- physical arrangements necessary for arbitration to exist and succeed, from initiation of arbitral proceedings through to the enforcement of the award. It includes well equipped arbitration venues, modern telecommunication and transportation facilities, accommodation, modern and robust arbitration laws, experienced arbitrators and ADR experts and an independent, efficient and reliable judiciary to support the arbitral tribunal in the discharge of its duties and to enforce valid arbitral awards.
Even though arbitration and ADR has been practised in different forms since ancient times1, the prevailing form of arbitration today is that which evolved in the hegemonic western economies necessarily because they dominate the global business and economic landscape. The United Nations Commission on International Trade (UNCITRAL), in recognising the capacity of a unified dispute resolution framework to enhance global trade and investment, produced a Model Law on International Commercial Arbitration in 1985 with amendments in 2006 (the UNCITRAL Model Law)2 based on international best practice. The Model law has been adopted by many countries with amendments as necessary. Its adoption signifies progressiveness and its familiarity boosts investor confidence.
Despite the clear benefits of global uniformity, cultural diversity must necessarily influence the approaches of individual countries to the practise of this general framework that has been adopted. This is important for the accommodation of culture-specific, idiosyncratic commercial forms and arrangements which investors will encounter in various states. The very evolution of what is regarded as "modern arbitration" is based on the adaptation of non-court, neutral third party dispute resolution methods, to the various circumstances and peculiarities of Anglo-American commerce and which evolved over time into the formal arrangements we have today. Countries outside this evolution process have their own peculiar commercial arrangements, the nuances of which may not necessarily be adequately addressed by the Anglo-American model. This is where invention is important.
To invent means to, "... originate something that has never been in existence before".3 Invention recognises that all countries are different, discourages the "one size fits all" approach and promotes self-realisation. There is therefore a need to create a balance between the adoption of general global ideals and the affirmation of individual local particularities.4
There is a wave of emerging economies which are gradually positioning themselves as possible arbitration hubs for the near future by re-defining arbitration and ADR options within their borders and proving that global ideas and local practices are not necessarily mutually-exclusive but can be blended quite harmoniously towards inventing something new, unique and yet effective. Notable examples can be found in Singapore, China, Malaysia and Dubai but this essay will focus on the efforts of Dubai and China.
1. M. Sornarajah, "The Settlement of Foreign Investment Disputes", 2000, Kluwer Law International, at p. 151.
3. Oxford Dictionary of English, Second Edition, Oxford Press.
4. S.F. Ali refers to the global practice of international commercial arbitration with a local approach in different regions as "convergence and informed divergence". See S.F. Ali, "Approaching the Global Arbitration Table: Comparing the Advantages of Arbitration as Seen by Practitioners in East-Asia and the West" 2009, The Review of Litigation, Volume 28, Issue 4, pp. 791-844, ABI/INFORM Global 2009 at p. 794.
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