SOUTH AFRICA Law and Practice Contributed by: Jonathan Ripley-Evans, Fiorella Noriega Del Valle, Kyle Melville and SooBin Park, Herbert Smith Freehills Kramer
1.4 National Courts South Africa does not have courts specifically desig - nated for international or domestic arbitration disputes. However, in the Gauteng Province, the Commercial Court (which is a specialist division of the Gauteng High Courts) can be used to resolve arbitration-related matters expediently. The Commercial Court Directive attempts to streamline arbitration-related cases by assigning them to judges with appropriate expertise and appointing case managers where necessary, which assists in avoiding delays and ensuring that the benefit of “efficiency” is preserved in arbitrations. The statute governing international arbitration in South Africa is the IAA, which came into force in December 2017. The IAA The IAA explicitly incorporates the UNCITRAL Model Law into South African law. As a result, the Model Law serves as the foundational framework for inter- national arbitration in South Africa, ensuring alignment with global standards and offering a predictable legal environment for international commercial disputes. The IAA also provides for the recognition and enforce - ment of foreign arbitral awards, thus replacing South Africa’s prior legislation (the Recognition of Foreign Arbitral Awards Act of 1977). While the IAA closely follows the UNCITRAL Model Law, there are a few notable distinctions, as follows. Public policy and state parties The IAA emphasises public policy considerations, par - ticularly concerning state parties involved in arbitra - tion. It mandates that arbitration proceedings involv - ing public bodies be held publicly, diverging from the UNCITRAL Model Law’s typical confidentiality provi - sions. Investor-state dispute settlement (ISDS) 2. Governing Legislation 2.1 Governing Law The IAA does not provide for automatic recourse to ISDS mechanisms (such as the International Centre
However, the data collected by AFSA from 2013 to 2023 indicates that the arbitrations launched under the auspices of its rules (both international and domes - tic) have predominantly been from the financial sec - tor, which accounts for 33% of its total cases. This is followed by the energy and resources sector at 20%, industrial and manufacturing at 12%, and commodi - ties and trading at 10%. It is likely that the players in these industries – which often experience complex, high-value contractual dis - putes – have, in recent years, opted to include dispute resolution mechanisms requiring arbitration in their contracts. This has likely been done to ensure that the parties are able to appoint arbitrators with special - ist subject matter expertise and resolve their disputes confidentially, and as efficiently and cost-effectively as possible (which is not ensured through the South African court systems). 1.3 Arbitration Institutions AFSA is South Africa’s leading arbitral institution, and has played a significant role in the development of international arbitrations in South Africa. Although it is not a new institution, in 2021 the AFSA International Court was established under the revised AFSA International Arbitration Rules (the “AFSA Inter - national Rules”), and AFSA began to offer services that catered to both domestic and international disputes in diverse sectors, reflecting its capacity to manage complex cases and its importance in the South Afri - can arbitration landscape. The AFSA International Court is the first of its kind in South Africa and is tasked with taking decisions on behalf of AFSA, including the appointment of arbitra - tors and resolution of any challenges to appointments and issues of jurisdiction. The China-Africa Joint Arbitration Centre (CAJAC Johannesburg) is a subsidiary of AFSA and was estab - lished in response to the need for a credible China- Africa dispute resolution mechanism, necessitated by the increasing trade between China and Africa.
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