UGANDA Law and Practice Contributed by: Moses J. Adriko SC, Ernest Sembatya Kaggwa, Derrick Kizito Kunyiga and Philip E. Nsaja, MMAKS Advocates
Aya Investments ( U ) Limited v Industrial Development Corporation of South Africa Ltd , Court of Appeal Civil Reference No 20 of 2023; Great Lakes Energy Compa- ny NV v MSS Xsabo Power Ltd , Consolidated Arbitra - tion Causes No 2 and 5 of 2023). Where setting-aside proceedings are still pending at the seat, the court may adjourn its decision on enforcement and, on the award creditor’s application, order the resisting party to provide suitable security. Sovereign Immunity Sovereign immunity is not, in practice, a bar to recog - nition: by agreeing to arbitrate, a state or state entity is taken to have waived immunity from the arbitral tribunal’s jurisdiction and from recognition proceed - ings. Execution is the real constraint. Uganda has no comprehensive state immunity statute, and the courts apply the common law, under which the restrictive theory of immunity now prevails: a foreign state is immune in respect of its sovereign acts but not in respect of its commercial transactions. An agreement to arbitrate does not of itself waive immunity from execution; in the absence of an express waiver in the contract, execution will only be available against property of the state in Uganda that is in use, or intended for use, for commercial rather than sover - eign purposes. A sovereign state’s property in Uganda is immune from execution irrespective of the merits of the award. The premises of the diplomatic mission of the sovereign state in Uganda, their furnishings and other property thereon, and the mission’s means of transport are immune from attachment and execu - tion under Article 22 (3) of the Vienna Convention on Diplomatic Relations, which has the force of law in Uganda under the Diplomatic Privileges Act. The mission’s ordinary bank accounts are presumptively immune on the same footing, unless it can be proved that an account is earmarked solely for commercial transactions. Property of the Central Bank of the sov - ereign state, if any is held in Uganda, would attract similar protection under customary international law. 12.3 Approach of the Courts The courts are strongly pro-enforcement and construe the defences to recognition narrowly. The High Court’s decision in Kampala International University v Housing Finance Company Ltd (Arbitration Causes No 38 and
46 of 2024, consolidated) stated that the public poli - cy defence is reserved for cases where enforcement would violate Uganda’s most fundamental principles of justice and morality, its constitutional principles or national interests; the court cannot review the mer - its; and the award creditor was permitted to enforce in Uganda notwithstanding prior recognition of the award as a judgment in Kenya, so long as the debt remained unpaid (parallel enforcement). The standard applied is formally the domestic pub - lic policy of Uganda, encompassing conflict with the Constitution or laws of Uganda, injury to the national interest, and repugnance to justice and morality. How - ever, it is applied with a restraint akin to international public policy, and confined to fundamental illegality, fraud and corruption rather than mere error. The older authority of National Social Security Fund v Alcon International Ltd , Supreme Court Civil Appeal No 15 of 2009, remains the reference point for refusing effect to awards tainted by illegality. 13. Miscellaneous 13.1 Class Action or Group Arbitration Ugandan law makes no provision for class or group arbitration, and no local institutional rules provide for it. Arbitration remains strictly consent-based: multi - ple claimants may proceed together only where all of them are parties to the same arbitration agreement (or to compatible agreements and all parties consent), and an award cannot bind absent members of a class. Representative and public interest litigation exists in the courts under the Constitution and the Civil Proce - dure Rules, but those mechanisms do not transfer to arbitration. 13.2 Ethical Codes Counsel Ugandan advocates are governed by the Advocates Act and the Advocates (Professional Conduct) Regu - lations, enforced by the Law Council, whether they act in court or in arbitration. Foreign counsel appearing in Uganda-seated arbitrations remain subject to the professional rules of their home Bars.
1076 CHAMBERS.COM
Powered by FlippingBook