Academic journal article Proceedings of the Annual Meeting-American Society of International Law

Investment Law, Dispute Resolution, and the Development Promise: Back to the Future

Academic journal article Proceedings of the Annual Meeting-American Society of International Law

Investment Law, Dispute Resolution, and the Development Promise: Back to the Future

Article excerpt

The panel was convened at 10:45 a.m., Saturday, March 31, by its moderator, Doak Bishop of King & Spalding, who introduced the panelists: Adesegun Akin-Olugbade of the African Development Bank; Jack Coe of Pepperdine University School of Law; Susan D. Franck of the University of Nebraska College of Law; W. Michael Reisman of Yale Law School; and Javier Robalino of Perez Bustamante & Perez.

THE AFRICAN DEVELOPMENT BANK'S CONTRIBUTION TO THE HARMONIZATION OF INVESTMENT LAWS IN AFRICA AND PROSPECTS FOR FUTURE HARMONIZATION OF SUCH LAWS

By Adesegun A. Akin-Olugbade *

THE CASE FOR THE HARMONIZATION OF LAWS

There are fifty-three countries in continental Africa, and yet Africa accounts for only 2% of global trade. Four countries--Algeria, Egypt, Nigeria, and South Africa--contribute approximately 60% of this GDP while the other forty-nine countries account for only 40%. Several African countries are lagging behind in meeting the Millennium Development Goals and need substantial resources in addition to Official Development Assistance (ODA) to alleviate extreme poverty on the continent. These additional resources can only come from increased trade and investment through Foreign Direct Investment (FDI) and local investment. However, despite having signed over 500 Bilateral Investment Treaties (BITs) and 360 Double Taxation Treaties (DTTs), African countries still fail to attract substantial FDI.

Regional and sub-regional organizations or initiatives such as the Regional Economic Communities (RECs) and the New Partnership for Africa's Development (NEPAD) are mandated to promote investment, but this needs to be complemented by predictable and enforceable investment laws in order to deliver results. Harmonization of laws is particularly necessary in order to promote cross-border transactions, trade (including South-South and intra-African trade), regional integration, and private-sector development. Harmonization of investment laws will also complement positive trends in FDI flows to Africa (estimates range between two or three times ODA) and support the scaling-up of the African Development Bank's private-sector operations.

CONSTRAINTS TO THE HARMONIZATION OF LAWS

Several factors may be considered as challenges to the harmonization of laws in Africa:

1. The diversity of legal cultures and traditions: in addition to customary legal systems, (Roman) civil law, Roman Dutch law, Islamic Sharia law, and common-law systems co-exist on the continent.

2. The diversity of languages.

3. The absence of well-developed and efficient institutional arrangements to coordinate and facilitate the harmonization of business laws on the continent.

4. The difficulty of enforcing laws across legal boundaries in the absence of continent-wide supra-national enforcement or interpretation mechanisms.

NASCENT INSTITUTIONAL ARRANGEMENTS TO FACILITATE THE HARMONIZATION OF BUSINESS LAWS

The Organization for the Harmonization of Business Law in Africa (OHADA)

The OHADA was established by treaty in 1993 and currently has sixteen member countries, mostly francophone Roman civil-law countries. Non-francophone countries are Cameroon, Equatorial Guinea, and Guinea Bissau.

Mission: Its principal aim is to establish a modern and accessible system of unified business law in Africa--directly applicable in all the member states and superseding the national legislation on the subject concerned. While influenced predominantly by French civil law, its ambition is to create a truly African system.

Uniform Acts: To date, the OHADA has adopted eight Uniform Acts concerning general commercial law, corporate law, bankruptcy, securities, accounting, recovery and enforcement procedures, arbitration, and contracts for the transport of merchandise by road.

Common Court of Justice & Arbitration: The OHADA has established a supranational Common Court of Justice & Arbitration (CCJA) to ensure that the judicial interpretation of OHADA laws will sustain and not compromise their uniformity. …

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