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Hamster255

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Tanzania’s withdrawal from international arbitrations could scare investors - experts

A decision by the Government of Tanzania to amend public-private partnership (PPP) laws, and withdraw from international arbitrations will scare away investors, experts said on Thursday.
The experts said the move will also make it difficult for Tanzania to do business with international financial institutions. Honest Ngowi, an economics lecturer at Mzumbe University, said withdrawing from international arbitrations will scare away investors because most foreign investors prefer international arbitrations in resolving disputes.
“No one will be willing to invest in a place where disputes are resolved by local courts,” Ngowi said. “This is not good news as far as investments are concerned, though I am yet to look at the new amendments thoroughly,” he added.
Kigoma Urban Member of Parliament, Zitto Kabwe, said the move was a setback to efforts aimed at attracting more investors, who could have contributed to the government’s drive toward an industrialised economy.
Kabwe said the amendment of the law is self-pleasing, because the problem is not arbitration but the government’s actions not to respect contracts.
“It’s simple. Nobody will invest in Tanzania,” he said. Tanzania is a member of the World Bank where the International Center for Settlement of Investment Disputes (ICSID) is affiliated, Kabwe said, adding that pulling out of the ICSID amounts to pulling out of the World Bank.
However, his sentiments differed from that of Semboja Hadji, an economics professor from the University of Dar es Salaam, who said the amendment of the law is of great importance, taking into consideration the stages in development that Tanzania has taken.
“To a serious investor who intends to come and make money, the change in the law was nothing; but to an investor who is coming with some other hidden agenda then this law is not suitable for him,” Hadji said.
He said the accommodation of international arbitration sections in the country’s laws were formulation during a time that the country had no expertise in any of the key sectors. “This time we have trained our people and we have experienced judges and lawyers who can handle such issues,” Hadji said.
Tanzanian Parliament on Wednesday made amendments to some articles in the PPP Act, giving supreme powers to the country’s judicial system, instead of international arbitration bodies, to resolve disputes.
Attorney General Adelardus Kilangi told Parliament in the capital Dodoma that local courts are better placed to resolve investment disputes than international arbitration bodies. “It is for this reason the government tabled the amendments of the PPP laws so that all disputes arising from government contracts with private entities are heard and determined within the country,” Kilangi told lawmakers.
The government’s chief legal adviser said most of the arbitrators in the international bodies are biased, forcing the government to use its own courts. Under the amendments of the PPP Act, which was approved by parliament on Wednesday, all PPP agreements, negotiations and legal disputes shall be processed locally.

Tanzania’s withdrawal from international arbitrations could scare investors - experts
 
Tanzania loses status as preferred mining destination
Tanzania has overnight lost its status as miners’ preferred destination in Africa after sudden changes in legislation
Though new laws being enacted in Tanzania to increase the state’s share of mining profits are not draconian enough to cause an exodus of mining companies, they raise the risk of further arbitrary changes and will cap future capital flows into the country.
The higher the risk, the higher the return needed to attract capital, which means some lower-returning projects will no longer go ahead.
The new laws allow the state to renegotiate mining companies’ agreements and take a nondilutable 16% free carried interest in mining companies. Royalties on exports have also been increased.
"While resource nationalism is not a new theme in the country, the nature, scale and manner of the recent changes have spooked the mining community and pose questions around the attractiveness of Tanzania’s business environment," says Ronak Gopaldas, RMB’s head of country risk.
SP Angel analyst John Meyer says government’s motive might be to address corruption among authorities or it could be a populist measure to force mining companies to share more economic benefits with locals.
"We fear the latest developments are likely to lead to completely opposite results involving a revision in estimates for risk premiums of operating in Tanzania, hurting a major forex-earner industry and costing the nation jobs, tax revenues and future investments," Meyer says.

Tanzania loses status as preferred mining destination
 
Nashindwa nimfuate Semboja au huyo anaekataa

Ngoja nikapekuwe na mimi mazuri na mabaya yake
I will be back
 
In international trade and commerce, arbitration has become exceptionally strong and widely accepted as a means of resolving disputes. Exactly how widely accepted is probably impossible to know, but some commentators have suggested that a figure as high as 90% of all international contracts are governed by an arbitration clause.
Rapid globalisation has meant a corresponding growth in the volume of international contracts with clauses providing for international arbitration. In turn, the availability and effectiveness of international arbitration has been seen by many as a spur to crossborder commerce and investment.
As the focus of the world economy has tilted towards the higher growth economies in emerging markets, the disputes brought to international arbitration are increasingly drawn from trade with and between emerging economies. Although the traditional centres of international arbitration in Western Europe and North America are busier than ever, they are facing strengthening competition from elsewhere.
In particular, an increasing number of countries have modernised their arbitration laws and supporting judicial practices, and an everwidening choice of arbitral institutions worldwide now offer their services to potential customers. Meanwhile in some jurisdictions the courts themselves are fighting back and making attempts to attract international disputes away from arbitration.
This exciting but increasingly complicated legal landscape presents an array of choice to international parties as to how they manage and resolve their disputes. Business needs will always vary depending on the context, but some general guidance can be drawn from an analysis of those aspects of international arbitration which have typically been seen as most advantageous for international parties while minimising perceived disadvantages of international arbitration.

A further strength of commercial arbitration is that of confidentiality and privacy. In many countries, court proceedings are in public to some extent and they can, particularly in high profile cases, result in a distracting "trial by media", with parties contacting the press, or unwelcome attention being attracted to the case by pressure groups or even competitors.
By contrast, whether or not arbitral rules provide for confidentiality in the arbitral process, it is normally open to the parties to reach agreement that the process is private and confidential. A significant issue for many parties is the commercial confidentiality of their business dealing and this confidentiality is more likely to be preserved in arbitral proceedings.

A notable advantage of international arbitration is the ability to enforce international arbitration awards through the New York Convention. Most countries in the world are now signatories to this Convention and the number of countries which have joined continues to grow.
Although it is often possible to enforce the court judgments of one jurisdiction in another jurisdiction, the ability to do this is by no means guaranteed and the procedures for doing so are often complex and slow. As yet, enforcement of court judgments in other jurisdictions has no equivalent to the New York Convention. There are exceptions to this overall picture, however; most notably the EU, where issues of enforcement of court judgments and arbitral awards have recently been affected and clarified by the introduction of the new Brussels Regulation, but where nonetheless, the enforcement of the judgments of the courts of one Member State in the courts of another Member State is probably as a general rule no more difficult than enforcement in a Member State of awards of a tribunal seated in another Member State. Accordingly the advantage accruing to international arbitration in enforcement largely occurs in relation to matters not wholly within the EU.
Nonetheless, enforcement through the New York Convention is not without its problems and these should not be underestimated, particularly in emerging market jurisdictions. The increasing trend of countries to have adopted the UNCITRAL Model Law, or a variant of it, has helped to standardise the approach to international arbitration worldwide and has in turn made enforcement easier under the New York Convention, but there remain very clear difficulties in enforcing in some jurisdictions – as is the case in a number of countries in the Middle East, for example.
It is necessary to go to the domestic court in the country where the party is seeking to enforce and that court has a reviewing role, which may nonetheless be interpreted in different ways in different countries. However, the experience drawn from this is that, particularly in relation to emerging jurisdictions, the process of enforcing under the New York Convention will invariably be less difficult than enforcing a court judgment.

The rapid and continual state of change in international trade means that the choice for businesspeople whether to arbitrate international disputes in preference to litigation in the courts, and exactly the manner of arbitration, will often be complex decisions requiring careful consideration and wise counsel. There are many instances in which the right decisions can lead to an international arbitral process which is optimal in meeting the needs of the parties, offering as it does a system of dispute resolution tailored to the parties' needs and recognising the need for a business-like resolution, so as to allow trade to continue.

Advantages Of International Commercial Arbitration - International Law - Worldwide
 
Although used as a method of dispute resolution as far back as Plato's time, arbitration has grown into a 21st-century institution. Especially on the international scene, where claimants range from individuals to nation states to global commercial entities, arbitration offers a flexible, expedient, and cost-effective alternative to formal courtroom litigation. This is reflected in several of the largest arbitration institutes reporting their highest-ever numbers of cases filed in 2015, averaging between 10 to 22 percent increases over 2014 case numbers.
Arbitration can be generally described as the private determination of a dispute by an independent third party through a judicial or quasi-judicial process agreed upon, at the outset, by the parties. The neutrality of the third-party decision maker ideally positions arbitration for resolving international disputes. As a result, parties with nation-spanning disputes increasingly opt for arbitration in order to benefit from the advantages it offers over regular litigation.
Unlike court rulings from a particular country and jurisdiction, judgments resulting from international arbitration are enforceable in a wider range of countries. For example, the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958—commonly called the "New York Convention"—ensures that international arbitration judgments are fully enforceable within its 156 signatory countries, including the United States, Canada, the United Kingdom, Germany, India, Australia, China, Japan, and Singapore.
Another advantage of arbitration is expediency. In addition to easier scheduling and streamlined processes, international arbitration can effectively fast track resolution of disputes in jurisdictions suffering from a large backlog of court cases. Even in courts without significant case backlogs, formalized courtroom procedures covering discovery, hearings, motions, trials, and every other step of the litigative process can drag out into months or even years.
A large part of arbitration's enduring appeal lies in its flexibility. Unlike formal litigation, where attempting to "shop" for a favorable judge is frowned upon, parties to arbitration by and large have the ability to choose the arbitrator or tribunal of arbitrators who will decide the case. This allows highly technical or specialized cases to benefit from a decision maker who is well versed not only in dispute resolution but also the controversy's underlying subject matter. In addition, free as it is from the bounds of the courtroom and its procedures, the arbitration can be scheduled in times and places conducive to parties and witnesses, and the process itself can be streamlined, simplified, or truncated as the parties' needs may warrant. International arbitration in particular allows parties to sidestep potential jurisdictional issues and comes with ethical standards independent of both country-specific and domestic arbitration guidelines. Especially when claims span borders, the benefit of a unified set of rules and a judgment that binds across jurisdictions cannot be overstated.
Last year, the five most frequently chosen venues were London, Paris, Hong Kong, Singapore, and Geneva. These five cities' popularity as locales for arbitrating disputes directly track with the presence of highly regarded international arbitral institutions: the London Court of International Arbitration ("LCIA"), the International Chamber of Commerce's International Court of Arbitration ("ICC," headquartered in Paris), the Hong Kong International Arbitration Centre (“HKIAC”), the Singapore International Arbitration Centre (“SIAC”), and the Arbitration Institute of the Stockholm Chamber of Commerce ("SCC"). By far the most important factor considered by parties is the locality's reputed neutrality and impartiality, track record, and perceived level of "internationalism." Other venues catering to specific subject matters include the International Center for Settlement of Investment Disputes ("ICSID"), headquartered in Washington, D.C., and, for the adjudication of intellectual property disputes, the World Intellectual Property Organization (“WIPO”) in Geneva.
One of the most prominent international arbitration cases of the last decade is Abaclat v. Argentina, in which an ICSID tribunal found that a state's refusal to honor its sovereign debt can breach the terms of bilateral investment treaties and allow aggrieved investors to pursue their claims. More notably, the Abaclat v. Argentina case marks the first time that an ICSID tribunal found jurisdiction over "mass claims" brought by more than 60,000 Italian bond holders, potentially opening the door for other class-action-type claims to be heard before other international arbitrators.
While international arbitration options are often less costly and time-consuming than formal courtroom litigation, not all claimants are equally resourced. Litigation finance can offer claimants the capital to fund an international arbitration case where their own war chest would fall short, or even bolster operating funds to keep a business running during the months a dispute remains pending before an arbitrator or tribunal. LexShares' innovative platform makes it easy for claimants to connect with funders and obtain the resources they need, with returns that are only payable if their claims prevail

The Benefits of International Arbitration – and How Litigation Finance Can Help
 
If this was the main cause of signing out from the ADR and Internationa Arbitration, to avoid litigation with Barick And Acacia. I'm afraid its too late,

"The Barrick Gold (US:ABX) subsidiary lost US$707 million in 2017 thanks to the US$644 million write-down from the uncertainty in Tanzania, and EBITDA was down 38% year-on-year to US$257 million."

We will have to dance with the music.
 
Hamster255 said:
Just shows how much of a brainwashed Tanzanian you are😉
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Just shows how biased you're, ill motivated na wivu umekujaa, towards Tz, dua la kuku halimpatagi mwewe. Naona umeruka wahadhiri waliocomment positive remarks about these changes and you prefered to consider those predicting doom, i understand you're just another hater, but as the article said, it will not bother the honest investors, wenye hidden agendas ndio waanze kupack, shamba la bibi no more here. So proud of this.
 
What do you know about international arbitation?
 
Detective J said:
What do you know about international arbitation?
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Arbitration, not arbitation. I know about them, hiyo article imewaelezea vizuri. Sio malaika kama vile unataka anza kuwatetea hapa, it has people who can be bribed kufavour those investors, article inasema they're sometimes biased, na kama investor ana nia njema, kwann aogope kuinvest Tz, if she/ he doesnt believe in our judicial system to protect his and our interest, fvck off.
Na tutaona hiyo fdi kama itashuka, Tz is becoming better, hamjionei wanavunja sheria tulokubaliana alafu wakibanwa wanakimbiloa huko na kujaribu kuteka ndege zetu, mwisho wake umefika.
 

Yani, umeiweka kama vile inatakiwa kuwa, its high time we create our own way of doing things. Kama ilivyokuwa vita vya ukombozi, vita ya kulinda rasilimali itaanzia hapa hapa Tanzania na watakuja kujifunza.
 
Reply of the thread...Kudos
 
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