SOUTH AFRICA Trends and Developments Contributed by: Jonathan Ripley-Evans, Fiorella Noriega Del Valle, Kyle Melville and SooBin Park, Herbert Smith Freehills Kramer
vices. While historically more formal and litigation-like, this structure has ensured fairness and thoroughness in adjudication, making domestic arbitration a relia - ble option for parties seeking resolution within South Africa’s borders. The International Arbitration Act 17 of 2017 (IAA): a New Dawn? The enactment of the IAA marked a pivotal moment. Based on the UNCITRAL Model Law and incorporat - ing the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”), the IAA aligned South Africa’s international arbitration framework with global stand - ards. This legislative shift was long overdue, having been first proposed by the South African Law Reform Commission in 1998. The reform of South Africa’s international arbitration regime was first envisaged in the South African Law Reform Commission report of July 1998. The core rec - ommendation of the Commission was to adopt the UNCITRAL Model Law for international arbitration. Despite the initial enthusiasm surrounding the Com - mission’s recommendations, it took 19 years before the IAA was passed in 2017. The IAA, in its Schedule 1, incorporates the text of the Model Law along with certain specific adaptions, and incorporates the New York Convention, thereby repealing the Recognition and Enforcement of Foreign Arbitration Awards Act of 1997. With the enactment of the IAA, South Africa became the 11th African country to adopt the Model Law as the framework for its national arbitration legisla - tion. Armed with the power of the Model Law (and the depth of international commentary on interpreta - tion), the country was then well placed to take positive steps towards establishing itself as the premier seat for arbitration in sub-Saharan Africa. As was expected, the courts played their part in embracing the change that the new act brought, con - tributing to the exercise of building confidence in the country as a safe seat.
The Supreme Court of Appeal (SCA) in Tee Que Trad- ing Services (Pty) Ltd v Oracle Corporation South Afri- ca (Pty) Ltd and Another (Case No 065/2021) [2022] ZASCA 68 (17 May 2022) confirmed the South African judiciary’s recognition of the significance of the UNCI - TRAL Model Law and its alignment with international arbitration standards. The SCA held that: “[t]he Model Law reflects the international approach to international commercial arbitration agreements that, unless an arbitration agreement is null and void, inoperable or incapable of being performed, courts are obliged to stay action proceedings pending refer - ral to arbitration.” This statement by the court was significant as it evi - denced a departure from the traditional oversight role that the courts often played in the context of domestic arbitration under the 1965 domestic act. This trajectory was recently further strengthened in the case of Industrial Development Corporation of South Africa Limited and Another v Kalagadi Manganese (Pty) Ltd (661/2024) [2025] ZASCA 70. Here, the SCA reaffirmed that the South African courts are bound to enforce international arbitration agreements under the IAA, even where parties fail to expressly invoke it. The SCA emphasised that arbitration clauses are binding, and that judicial intervention is strictly limited under the IAA. Importantly, it clarified that public entities are not exempt from these obligations. The judgment also drew a critical distinction between the discretionary language of the domestic Arbitration Act and the man - datory provisions of the IAA, holding that courts must refer disputes to arbitration under Article 8 (1) unless one of the narrow statutory exceptions applies. Together, these decisions reflect a judiciary that is not only aligned with international best practice but is also committed to fostering a stable and predictable arbi - tration environment. This judicial consistency is a cor - nerstone of any credible arbitration seat and signals to international users that South Africa is serious about its role in the global arbitration community.
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