SOUTH AFRICA Law and Practice Contributed by: Jonathan Ripley-Evans, Fiorella Noriega Del Valle, Veronica Connolly and Kyle Melville, Herbert Smith Freehills Kramer
litigation must be stayed in favour of arbitration, sig - nificantly limiting the court’s own discretion to inter - vene in disputes governed by international arbitration clauses. The decision served both to reinforce the autonomy of arbitration agreements and to streamline their enforcement. Industrial Development Corporation of South Africa Limited and Another v Kalagadi Manganese (Pty) Ltd (661/2024) [2025] ZASCA 70 (30 May 2025) In Kalagadi , the Supreme Court reaffirmed South Afri - ca’s pro-arbitration stance by holding that courts must enforce international arbitration agreements under the IAA, even where parties fail to invoke it. The Supreme Court emphasised that arbitration clauses are bind - ing, that judicial intervention is limited, and that public entities are equally bound by arbitration agreements. The court also drew attention to the critical distinction between the discretionary language of South Africa’s Arbitration Act 42 of 1965 (which governs only domes - tic arbitrations in South Africa) and the mandatory provisions of the IAA, pursuant to which courts must refer disputes to arbitration under Article 8 (1) unless a narrow exception applies. 3.4 Validity Grounded in the doctrine of separability, an arbitra - tion clause is treated as an agreement distinct and independent from the main contract in which it is con - tained. As a result, an arbitration clause may remain valid and enforceable even where the main contract is found to be invalid. The case of Lukoil Marine Lubricants DMCC v Natal Energy Resources and Commodities ( Pty ) Ltd [2023] ZAKZPHC illustrates this principle. In Lukoil , the court held that allegations that the main agreement in ques - tion was invalid did not also call into question the parties’ arbitration agreement (which was contained within the main agreement).
tion in shaping the composition of the arbitral tribunal, reflecting the foundational value of party autonomy in international arbitration. Parties may determine the number of arbitrators, the method of their appoint - ment, and any specific qualifications or expertise required, whether by way of legal background or Where the parties fail to agree on the method of selecting arbitrators, or the agreed method fails, the IAA provides a default appointment mechanism. Article 11 of Schedule 1 of the IAA stipulates the fol - lowing. industry-specific knowledge. 4.2 Default Procedures • In an arbitration with a sole arbitrator, they will be appointed, on the request of a party, by the rel - evant court with jurisdiction. • In an arbitration with three arbitrators: (a) each party must appoint one arbitrator, and the two appointed arbitrators will appoint the third arbitrator; and (b) if a party fails to appoint an arbitrator within 30 days of a request to do so, or if the two arbitrators fail to agree on the third within 30 days of their appointment, the appointment will be made by the relevant court with jurisdic - tion (determined with reference to Article 6 of Schedule 1 to the IAA). 4.3 Court Intervention The South African courts may only intervene in the selection of arbitrators under specific circumstances, as outlined in the IAA. This intervention can occur in the following circumstances: • when there is a failure in the agreed procedure for appointment and the court is requested to inter - vene; or • when a party challenges an arbitrator’s appoint - ment on grounds such as bias or lack of inde - pendence, and if its challenge under the agreed procedure is not successful (although the arbitral proceedings will continue pending the court’s determination).
4. The Arbitral Tribunal 4.1 Limits on Selection
Subject to overriding requirements of independence and impartiality, the IAA affords parties broad discre -
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