Source: https://www.legalico.io/overview-of-arbitration-in-afghanistan-a-practical-approach/
Timestamp: 2019-09-18 00:50:11
Document Index: 204489454

Matched Legal Cases: ['Art. 13', 'Art. 16', 'Art. 32', 'Art. 33', 'Art. 17', 'Art. 34', 'Art. 7', 'Art. 36', 'Art. 37', 'Art. 38', 'Art. 39', 'Art. 41', 'Art. 43', 'Art. 46', 'Art. 47', 'Art. 56', 'Art. 8', 'Art. 56', 'Art. 9']

Zahid Safi, Vice President: Afghanistan, RIAA Barker Gillette
Recognised as a leading lawyer by Chambers & Partners 2018, Zahid Safi’s chief areas of expertise include corporate, commercial, banking, dispute resolution, and working with multinational and domestic corporations on their operations and management. Based in the firm’s Kabul office, Mr. Safi advises clients including banks, financial institutions, and multinational companies with respect to their corporate matters including compliance with regulatory requirements. He has also undertaken extensive company searches in cases where a lack of understanding of the law, serious shortcomings in the applicable laws and the lack of expertise of the regulators were substantial hurdles for investors. He is a registered Advocate of the Afghanistan Independent Bar Association and a member of the Afghanistan Centre for Dispute Resolution (ACDR).
Zahid Omarzai, Associate, RIAA Barker Gillette
With extensive experience in commercial dispute resolution and managing financial transactions, Zahid Omarzai also has considerable expertise in international and domestic commercial arbitration. Based in the firm's Kabul office, he is Country Director for South Asian Journal of Law and Policy and a member of the International Chambers of Commerce in Afghanistan. Mr Omarzai is also the author of “Analysis and Challenges of Resolving Commercial Disputes through Commercial Arbitration”
Out of court dispute resolution have an ancient history in Afghanistan. The Afghan communities have used the traditional Jirga (Council of Elders) for the resolution of different categories of disputes in accordance with the overriding customs of a particular region. The history of the Jirga dates back to about 500 BC in which Aryan tribes used to live in the territory of present day Afghanistan[1]. But, Jirgas have not always been successful in serving justice in the best possible way.
As reported by Karin Zarindast, BBC Journalist, on 09 Aug 2012 “an Afghan woman from Parwan province spent six months in her local family court trying to get a divorce from her husband. Her case was handed on to the local Jirga for a decision even though she was not allowed to be present for the discussion. In the provinces and the tribal areas - especially in places where there is no judicial representation - property disputes, domestic issues and criminal cases are often dealt with by these local elders and clerical figures.”[2]
Apart from tribal mechanisms developed by residents of a particular region for dispute resolution, the Afghan Government has developed ulterior forms of dispute resolution mechanisms that have been adopted into hard law a prime example being - Arbitration. The commercial arbitration law of Afghanistan was published in the official gazette number (913) on 30th January 2007 (“Arbitration Law”) which nullified the Commercial Arbitration Law of 1995 that was published in the Official Gazette number 779. The Arbitration Law was enacted to facilitate and encourage the prompt, fair, and neutral resolution of commercial and economic disputes through arbitration, with respect to the agreements signed between Afghanistan and other states on commercial and economic arbitration basis and to regulate their relevant commercial affairs.
1. Any arbitration or other dispute resolution procedure;
2. That the place of such arbitration may be outside of Afghanistan; and
3. That the law of a jurisdiction other than Afghanistan may apply to the resolution of such dispute.
1. When parties enter into a contract which contains an arbitration clause, should any dispute arise it would be resolved by arbitration[3];
2. An arbitration agreement signed after a dispute has arisen, wherein the parties agree that the dispute should be resolved by arbitration[4].
The contracting parties should select an arbitral institution while executing the contract. However, if the parties cannot agree on an arbitral institution in which the arbitration will be conducted, the selection of an arbitral institution shall be determined by a court, and the court’s decision is final[5].
The parties are free to agree on the venue of arbitration. If they fail to do so, the venue of arbitration shall be determined by the arbitral tribunal. The venue selected will depend on the circumstances of the case and the relative convenience of the parties. The arbitral tribunal may, unless otherwise agreed to by the parties, meet at any place it deems appropriate for consultation among its members, for hearing witnesses and, experts, and for allowing the presence of the parties, or for the inspection of goods, other property or documents. For the inspection of goods, other property or documents, the arbitral tribunal shall determine a time for such a hearing of the tribunal and shall inform the parties thereof[6].
Following the agreement of the parties to refer their dispute to arbitration, the parties are free to determine the number of arbitrators. If they do not decide on the number of arbitrators, the law requires at least one arbitrator to hear the matter. However, if one of the parties is a state, three arbitrators should be appointed[7].
The website of the Afghanistan Center for Commercial Dispute Resolution provides a short bio of each arbitrator listed therein. A person can select an arbitrator from among those listed arbitrators who specialize in a particular field and whom a person trusts to be familiar with the problematic issue(s) of the case and, at the same time expect them to remain impartial and independent. The parties may also select a qualified arbitrator from others institutions.
1. Must hold a law or sharia law degree;
2. Must have experience in the relevant field;
3. Must be registered with the Afghanistan Central Business Registry (“ACBR”);
4. Must be an active member of an arbitral association, which can be publicly accessible under the list of arbitrators. Everybody can freely evaluate these files during the working hours.
Following the appointment of arbitrators and submission of an application for arbitration in a particular dispute[8], the parties will submit their claims, documents and evidence to the arbitrators[9].
The claimant(s) shall state the facts supporting his or her claim(s), the points at issue and the relief or remedy sought. Also, the respondent(s) shall state his or her defense regarding the points at issue and shall state the facts supporting any counterclaim(s) he or she may have. The parties may submit to the arbitration tribunal together with their statements all documents that are relevant to the case[10].
The parties may amend or supplement his or her claim or defense during the course of the arbitral proceedings, unless the arbitral tribunal considers it inappropriate on the grounds of the interest of fairness to the parties or are to avoid undue delay, or it violates the terms of the arbitration agreement[11].
The arbitral tribunal may decide to hold oral hearings, provided that there shall be at least a 30-day prior written notice given to the parties of such a hearing. If requested by a party, the arbitral tribunal may hold oral hearings at an appropriate stage of the proceedings, unless the parties have agreed otherwise[12].
All statements, documents or other information, supplied to the arbitral tribunal by one party shall likewise be provided to the other party. Any expert report or evidentiary document on which [the arbitral tribunal] may rely in making its decision shall be communicated to both parties[13].
The arbitral tribunal may appoint one or more experts to report to it on issues to be determined by the arbitral tribunal. The arbitral tribunal may require a party to give the expert any relevant information or to produce, or to provide access to, any relevant documents, goods or other property for his or her inspection. The expert shall, after delivery of his or her written or oral report, participate in the hearing if requested by the parties or required by the tribunal[14].
An arbitral award refers to a decision made by an arbitration tribunal in an arbitration proceeding. The arbitral tribunal shall decide the dispute in accordance with the rules of law chosen by the parties[15]If during arbitral proceedings, the parties settle their dispute, the arbitral tribunal shall terminate the proceedings and, if requested by the parties and not objected to by the arbitral tribunal, record the settlement in the form of an arbitral award on agreed terms[16].
An arbitral award shall be made in writing and be signed by the arbitrators and state the reasons for their decision and shall be delivered to each party and a copy shall be maintained by the office of the Tribunal[17].
(9) The foreign arbitral award is not repugnant to the applicable laws of Afghanistan, public order or standards of decency in Afghanistan[18];
(11)The foreign arbitral award must be translated into the local language (Civil Procedure Code, Article 170 and Article 5 (2) of the Law on Translation and Notarization of Official Documents 2018 and Article 57 of the Arbitration Law. But, one must also ask if in actual practice arbitral awards enforced in the manner are intended by the law and by the international conventions.
1. Official documents that are prepared, registered and issued by government authorities based on provisions of the law and which are free from forgery.
2. A customary document, if the debtor (defendant) agrees to the same or has no objection regarding it.
3. Deeds prepared and issued by the competent court and that have judicial registration records and are free from deception and forgery.
4. Final and binding court orders.
5. Final and binding court orders which have been issued by a foreign court and attested by the Ministry of Foreign Affairs of Afghanistan.
6. Other documents which are considered credible according to provisions of the law.
(1) An application has to be made to the relevant court along with the following documents for the enforcement of an arbitral award[19]:
c. A certified translation copy of the award into of the local languages[20];
(4) The General Directorate of Rights (“GDoR”) will enforce the court order[21];
A Company called “R”, is an internet services provider with its main office located in Afghanistan entered into a contract on 03.09.2012 with a Company called “S” which also provides worldwide internet services with its main office located in Hong Kong SAR. The parties have agreed in the contract that Company S will provide internet services within its specified time to Company R and Company R shall pay the fees for the internet services provided by Company S. The parties used Service Order Forms (“SOFs”) based on which Company R would place its order to Company S for the amount of internet services it needed after which were this was then signed by both parties. The SOF included Terms and Conditions (“T&Cs”) based on which the parties structured their transactions.
The case background further suggests that Company S contacted Company R to reach a solution but could not do so due to the failure of Company R to respond. In such a situation, Company S filed a case in the Primary Commercial Court of Afghanistan whereas the court determined that there was a lack of jurisdiction on 05.05.2015 due to the existence of an arbitration clause in the contract between the parties and the case was referred to arbitration in Hong Kong.
Zahid Safi, Vice President, RIAA Barker Gillette Afghanistan
Email: Zahid.safi@riaabg.com
Phone: +93 (202) 211759
Add: Suite No. B24/25, 2nd Floor, Muslim Business Center, Haji Yaqoob Square, Shar-e-Naw, Kabul, Afghanistan.
www.riaabarkergillette.com
Zahid Omarzai, Associate Attorney, RIAA Barker Gillette Afghanistan
Email: afg.corporate@riaabg.com
www.riaabgarkergillette.com
[1]Legal Pluralism in Afghanistan – A study of alternative dispute resolution mechanisms by Mazhar Bangash.
[2]https://www.bbc.com/news/av/world-asia-19195841/the-role-of-jirgas-in-afghanistan-s-legal-system
[3]Art. 13 and 14 of the Arbitration Law 2007;
[4]Art. 16;
[5]Art. 32;
[6]Art. 33;
[7]Art. 17;
[8]Art. 34;
[9]Art. 7;
[10]Art. 36;
[11]Art. 37;
[12]Art. 38;
[13]Art. 39;
[14]Art. 41;
[15]Art. 43;
[16]Art. 46
[17]Art. 47;
[18]Art. 56;
[19]Art. 8 of the Law on the Manner of Acquisition of Rights 2018;
[20]Art. 56 and 57 of the Arbitration Law;
[21]Art. 9 (11) and 27 of the Law on the Manner of Acquisition of Rights 2018;