SUDAN Trends and Developments Contributed by: Omer Ali Abdelrahman, Omer Ali Law Firm
Historical Background Historically, arbitration in Sudan used to be regulated by a few sections in the Civil Procedures Act 1983 and its predecessors. A piece of legislation exclusively governing arbitration, whether domestic or interna - tional, was introduced for the first time in the form of the Arbitration Act 2005, which has been repealed and replaced by the current Arbitration Act 2016 (the “Arbitration Act”). International Arbitration Under the Arbitration Act, an arbitration is considered “international” if: • the main centres of the businesses of the parties to the arbitration are in two different countries; and • the subject matter of the arbitration is related to more than one country. So far, there have been relatively few international arbitration cases in Sudan. This was due to the fact that until recently Sudan was under severe US and other sanctions, and was thus considerably isolated from international trade activities; as such, interna - tional investors were, to a large extent, blocked from investing in the country, with the exception of limited investments by Chinese, Malaysian and Indian com - panies in the oil industry, and Turkish and Gulf com - panies in construction, agriculture and other sectors. Most international arbitration cases were related to governmental contracts in the few business areas where international companies had such contracts with governmental entities, such as oil, infrastructure, mining and construction. Current Situation Currently, Sudan is undergoing major transformation both economically and politically. In 2019, following a popular uprising, a transitional government succeed - ed the regime of former president Omar Al-Bashir, which was the cause of the sanctions and interna - tional isolation. On 4 August 2019, after the African Union’s intervention, the Sudanese civilian and military factions agreed to share power in a three-year transi - tion period, with elections scheduled for 2023 after the end of the transitional period. The transitional govern - ment that took power had ambitious plans for eco - nomic reform and the restoration of peace after many
years of civil war. As a result of its efforts, US Treasury OFAC sanctions were lifted and Sudan was removed from US State Sponsor of Terrorism status. The transi - tional government’s efforts for securing Sudan’s debt relief through the Heavily Indebted Poor Countries (HIPC) Initiative proved to be successful; the World Bank’s International Development Association (IDA) and the International Monetary Fund (IMF) determined that Sudan had taken the necessary steps to begin receiving debt relief under the enhanced HIPC Initia - tive. Sudan is the 38th country to reach this milestone, known as the HIPC Decision Point. This would have resulted in much of Sudan’s external public debt being dramatically reduced/cancelled, and opened the door for the country to have access to financial resources. These were welcome developments in a country suf - fering from acute economic problems, and under investment and huge external debts. However, a major setback occurred. On 25 October 2021, the Suda - nese military leader General Abdel Fattah al-Burhan took control of the government in a coup, as a result of which the military component of the Sovereignty Council confiscated the powers of the Prime Minister, as stipulated in the constitutional charter. The civilian Prime Minister, Abdalla Hamdok, as well as several top government officials and political activists, were detained for resisting the coup. As a result of civil resistance against the military regime, in November 2021 the military leaders and Abdalla Hamdok announced a deal that included his reinstatement as Prime Minister, and in January 2022 Prime Minister Hamdok announced his resignation after failing to name a government amidst continued anti-military protests in the country, which are ongo - ing. A trilateral mechanism comprising the United Nations, the African Union and a regional body (the Intergovernmental Authority on Development (IGAD)) has been set up with the aim of facilitating intra-Sudan talks; however, so far no agreement has been reached to resolve the political crisis in Sudan. Unfortunately, due to differences between the Sudanese Armed Forces (which are the official army of the Sudanese government) and the Rapid Support Forces (para - military forces set up by the former government), a nasty war erupted between them on 15 April 2023 with devastating consequences in the capital city of
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