Tuesday, 19 February 2013

Kigali’s arbitration centre, where dispensing justice meets business


Lawyers at the Justice Ministry headquarters. Arbitration in Kigali is now a fully-fledged entity of the justice system for feuding parties.
Jurists are encouraging litigants to settle disputes, especially those on breach of contract, out of court to save expenses and time.

The alternative justice system that is increasingly being used, especially by business operators, is arbitration through the Kigali International Arbitration Centre (KIAC) a brainchild of the Private Sector Federation.

The centre, which was formally launched in February 2011, only handles disputes that are of commercial nature such as contracts.

According to officials, filing a complaint at the centre, which operates as a business entity, costs the complainant $250 (about. Rwf160,000).

The request for arbitration is filed alongside a brief statement describing the nature and circumstances of the dispute and monetary value involved in the case.

The respondent, in the chosen language of arbitration, is served a copy of this request from the centre’s secretariat within five days for him to have a confirmation or denial of all or part of the claims.

It takes 20 days for the case to begin and within this time, the two parties work out the necessary paperwork with the centre’s secretariat and also go through the selection of the arbitrators to hear the case.

Specialist arbitrators

The arbitrators should be in the domain of the subject matter, meaning, for instance if the dispute is of medical nature, the arbitrators – who have to be agreed upon by both parties have to have a medical background.

Eudes Kayumba, the managing director of Landmark Company, an architectural firm, said he is the only one in his career working with KIAC as an arbitrator. 

Kayumba entered into this system after a three-month training in the UK, which was followed by a week-long training in arbitration. He said he has so far heard 10 cases since KIAC was established.

“In our domain, you can understand better the importance of arbitration. We deal with bigger construction projects, whose cases can last up to five years, if one chose to go through conventional courts,” he said.

He says many things can happen within these years including disasters, inflation and administration changes among others that can affect the contract. 

“That’s where arbitration comes in handy,” he advises.

According to Kayumba, “when you decide to take the case in court, it affects the project because it halts completely while in case of arbitration, parties seek justice but carry on activities; it limits damages.”

According to the law, the proceedings which are facilitated by the arbitration centre and attended by the two parties or their authorised representatives, take place from a discreet place agreed upon by both parties.

“The confidential character of arbitration makes parties feel comfortable and seem like they are not in dispute, different to the litigation where the hearing is public,” disclosed Bernadette Uwicyeza, the secretary-general of KIAC, in an interview with The New Times recently.

This confidentiality also made it difficult for this newspaper to trace any client whose case was adjudicated through arbitration. 

The ruling of the arbitrators is legally binding, just as any court ruling, only that in the former, it is confidential and it is believed to be final and can only be challenged under very limited circumstances.

“In business you have to be careful because opening a commercial case to the public to hear can bring other negative repercussion in the parties’ business,” argues Thierry Ngoga, the registrar of KIAC.

Ignorance of dealings

Officials in KIAC say they have 184 arbitrators in different professions. 

They include 34 international arbitrators, who deal with cases of international nature, 30 local arbitrators plus 120 more that are yet to complete the required training.

“The general constraint today is that people do not know yet how to include the arbitration clauses in their contracts. We are carrying out a campaign to facilitate this,” Ngoga said.

The remuneration for the arbitrator ranges from between $ 1000 (Rwf637, 000) upwards, depending on the sum in dispute.

“People have been accusing us of charging a lot, but one spends a lot in litigation than in arbitration,” says Uwicyeza.

According to Jean Marie Vianney Uwamungu, a Kigali-based practicing lawyer, the availability of arbitration services can be seen as another tool to attract investors. He said arbitration services expedites dispute resolution, which is critical in business. 

He said, “It was very important to have arbitration despite the existence of commercial courts, because the country has a policy of improving trade; thus, it’s in the country benefit to have a system whereby they can assure entrepreneurs that they have an option rather than courts which delay procedures.”


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