New York Convention enters force in the Democratic Republic of the Congo

Today, 3 February 2015, the Democratic Republic of the Congo became a Contracting State to the New Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958. In June 2013, the DRC passed legislation to facilitate its accession to the New York Convention. However, in order to finalize the accession, the DRC needed to deposit its instrument of accession with the Secretary-General of the UN, 90 days after which the New York Convention would enter into force.

Contracting States are able to accede to the New York Convention subject to certain reservations. According to the United Nations Commission on International Trade Law website which charts the status of the New York Convention, the DRC has not made any notifications or reservations in accordance with the New York Convention with respect to its accession. However, in the legislation facilitating its accession the DRC made a number of reservations. These are: reciprocity (the DRC will only enforce awards made in the territory of other Contracting States); commerciality (only awards on matters which are considered commercial under DRC law will be recognised and enforced under the New York Convention); the principle of non-retroactivity (the New Convention will only apply to awards made after 3 February 2015); and finally, that the New York Convention will not apply to disputes related to immovable property or on a right related to immovable property. This is a particularly significant reservation, as it has potential to bite, for example, on disputes arising from mining rights. Unlike the other three reservations, this reservation is not provided by the New York Convention itself (although not prohibited by it).

The New York Convention is a fundamental instrument in international arbitration. In summary, it obliges the courts of Contracting States to stay proceedings and refer disputes to arbitration where there is a valid arbitration agreement, and to recognise and enforce foreign arbitral awards without reviewing them on their merits. Notwithstanding the reservations, the entry into force of the New York Convention in the DRC is a positive step for those investing in the DRC. The effectiveness of the New York Convention as a tool for enforcing foreign awards in the DRC will now depend on the crucial role of DRC court judges in applying the New York Convention appropriately.

For further information on arbitration in Africa, please see this article by Paula Hodges QC, Nicholas Peacock and John Ogilvie which first appeared in the January-March 2015 issue of Corporate Disputes Magazine.