Minister of Justice Mvalo calls upon private sector to champion establishment of Malawi International Arbitration Centre

* He underscored the government’s unwavering commitment to fostering an environment conducive to both international and domestic arbitration

* And highlighted the pivotal role of arbitration in spurring economic growth and magnetising investment

By Duncan Mlanjira

Minister of Justice Mvalo has called upon private sector to champion establishment of Malawi International Arbitration Centre (MIAC), the dispute resolution body which will be at the forefront of resolving commercial and investment disagreements.

Mvalo made the appeal at the first-ever Malawi International Arbitration Symposium emphasising that MIAC — established by the Malawi Law Society (MLS) and Malawi Confederation of Chambers of Commerce and Industry (MCCCI) — is a platform that is set to decongest cases in commercial courts and promote economic growth.

Formation of MIAC comes to decongest dispute cases that was being handled by the Commercial Division Court, which has a backlog of about 3,000 cases being attended to by only six judges.

A statement on Malawi Government Facebook, quotes Justice Minister Titus Mvalo in his keynote address during the Symposium at Bingu International Convention Centre (BICC) in Lilongwe on Thursday as saying the establishment of MIAC resonates with promise and vision.

The Minister eloquently underscored the government’s unwavering commitment to fostering an environment conducive to both international and domestic arbitration and he highlighted the pivotal role of arbitration in spurring economic growth and magnetising investment.

Mvalo illuminated the government’s commendable strides in this noble endeavor, notably the enactment of the International Arbitration Act in 2024, saying the landmark legislation harmonises Malawi’s legal framework with the esteemed United Nations Commission on International Trade Law (UNCITRAL) Model Law.

It thereby positions Malawi “as a distinguished and trustworthy venue for the resolution of commercial and investment disputes through globally recognised model laws”.

Acknowledging the formidable challenges that African arbitral institutions face — such as limited information, unfriendly arbitration laws, perceived corruption, and a modest market size — the Minister’s tone is reported to one of optimism and resolve.

He expressed a steadfast belief that MIAC “can surmount these obstacles by cultivating credibility, establishing a robust arbitration mechanism, and nurturing a culture of arbitration within Malawi”.

He thus called upon the private sector and professional bodies to rally behind this initiative while emphasising the imperative of a collective effort to ensure the triumph of MIAC, while urging the private business sector “to join hands in the quest to create a resilient and independent arbitration centre [which] is a beacon of hope and justice for Malawi and beyond.

In his own statement, MIAC Director, Wisely Phiri — who is MCCCI president — also stressed that the new institution “is a private sector-owned and driven enterprise aimed at providing an alternative dispute resolution mechanism for commercial disputes that is not only efficient but also effective”.

As the private sector leaders, we aim to provide a conducive environment for the business community not only in Malawi but across the world,” he said. “MIAC will be a game changer as regards to commercial dispute resolutions.”

In his address at the Johannesburg Arbitration Week on April 9, 2024, Minister Mvalo told the international and local business community that the Malawi Government fulfilled its core responsibility in establishing MIAC by passing it over to MLS, MCCCI and the general business community to kick start its administration “but will remain supportive if the Centre needs any other Government support”.

Thus the hosting of the first-ever symposium to introduce MIAC to the business community and professional bodies and showcase how it will facilitate effective business dispsute resolution and what role the business community and professional bodies can play to make all this realistic.

On his part, MLS president Patrick Mpaka, who was at the heart of the formation of MIAC alongside Minister Mvalo and the leadership of MCCCI under Lekani Katandula and now Wisely Phiri, is quoted as saying MIAC will instil confidence among investors who are guaranteed of speedy resolution when commercial disputes arise.

The two-day symposium was packed with insightful discussions and presentations from a diverse number of experts from Malawi and the SADC region — setting the foundation for efficient and effective commercial dispute resolution in Malawi.

“This landmark legislation now positions Malawi as a distinguished and a trustworthy venue for the resolution of commercial and investment disputes through globally recognised model laws.”

MIAC is a joint venture private company limited by guarantee incorporated by the MLS and MCCCI on September 7, 2023 — which establishes and seeks to maintain a private sector-led neutral and independent facility for the resolution or settlement of commercial, investment and other disputes by way of arbitration, mediation and like processes as opposed to litigation in the Courts.

The enterprise is to improve the business environment in Malawi by institutionalising arbitration and alternative dispute resolution and enhancing access to justice through efficient non-adjudicatory measures in the service of the local and international business community.

Its unique feature is that it is a legally sanctioned wholly private initiative that actively promotes collaboration and recognition by state parties and multilateral institutions at national, regional and international levels.

In furtherance of this main object, the company undertakes to manage and sustainably operationalise an arbitration centre in the Republic of Malawi to maintain and develop the business of alternative dispute resolution by providing services in Malawi and throughout Africa.

Two of the distinguished speakers were foreign — Samuel Mbiriri Nderitu, who is board director of Nairobi IAC and Kenya ICC national committee as well as chairman of Arbitration Foundation of Southern Africa-SADC, Des Williams.

Others were Dr. Wisely Phiri; former Attorney General, Dr. Chikosa Silungwe; MCCI CEO, Daisy Kambalame; MIAC company secretary, Pempho Likongwe and MIAC director, Emily Makuta.

The Malawi Supreme Court of Appeal already pronounced itself as in favour of international arbitration in the country on March 14, 2024, when Justice of Appeal Frank Kapanda, SC delivered a judgment in a matter in which one of the parties had referred to the International Chamber of Commerce a commercial dispute in respect of a contract which was being performed in Malawi.

The other party sought an anti-arbitration injunction and after the High Court refused to grant the injunction, Supreme Court of Appeal upheld the lower court’s decision.

In his ruling in Projex Group Limited v. Central East African Railways Limited, Justice Kapanda said: “In sum..this Court declines the Applicants request to intervene with an injunction against arbitration…This aligns with the principle of competenz-competenz in commercial arbitration, emphasizing that the arbitrator should decide issues related to the arbitration agreement.

“The competence-competence principle is a fundamental concept in international arbitration. It grants the arbitral tribunal the authority to rule on its own jurisdiction, including challenges to the existence, validity or scope of an arbitration agreement.

“It is our view that this Court lacks jurisdiction to adjudicate a plea that can be decided by an arbitral tribunal. The overarching idea is to provide a one-stop forum for the effective and efficient resolution of commercial disputes through arbitration and judicial intervention should not disrupt the process of arbitration.”