Companies
Value of commercial disputes in arbitration hits Sh25 billion
Friday January 19 2024
Delegates follow proceedings at a past Nairobi Centre for International Arbitration (NCIA) Conference. FILE PHOTO | NMG
The value of cases referred to the Nairobi Centre for International Arbitration (NCIA) hit Sh25.24 billion for the first time last June, underlining growing confidence by firms to refer their disputes to the centre for resolution.
The NCIA said it handled 17 commercial disputes whose value was $210 million (Sh25.24 billion at the exchange rates at the time), underlining an increase of 126.2 percent compared to the previous year and 137.6 percent compared to its third year of the NCIA Arbitration Rules. “94.1 percent of all new cases filed with Nairobi Centre for International Arbitration in the financial year 2021/2022 were domestic while 5.9 percent cases were international.
The NCIA was created via the Nairobi Centre for International Arbitration Act 2013 and has grown in stature over the years as an arbiter as well as a mediator in key commercial disputes.
It also handles negotiations for firms, conciliation of conflicting parties as well as adjudication.
The centre says that 50 percent of the arbitration cases it received during the year were related to supplies and delivery agreements, 28.6 percent were from the construction sector and 14.3 percent and 7.1 percent were related to technology and finance respectively.
Regarding cases that the NCIA received to mediate, 66.7 percent were from the construction sector while 33.3 percent were related to supplies and delivery agreements.
“The year 2021/2022 has seen a majority of arbitrations maintain Nairobi as the seat of arbitration. All disputes administered by the centre during the year have been governed by Kenyan law,” it said.
The NCIA only began handling mediation disputes in 2020 when it received the first case of a value of Sh5.89 billion which remains the single largest claim recorded at the centre.
This comes at a time when mediation is gaining popularity among commercial entities to fasten the process of solving protracted disputes.
Through NCIA, Kenya is aiming to position itself as a world-class arbiter and mediator for big-money commercial cases.
In this regard, Kenya is competing with other African countries such as Burundi, Mauritius, Rwanda, Egypt and Uganda, which also have such arbitration centres.
“The NCIA arbitrations and mediations involve parties from different sectors and nationalities with cases referred from South Africa, Rwanda, and as far apart as agreements applying the laws of Hong Kong and the United Kingdom,” it said.
