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10 May 2007
The process of litigation in Kenya is generally lengthy and expensive. There is an extensive backlog of cases awaiting determination. The Kenyan judiciary is also in the process of rebuilding its image after the 2004 corruption purge which resulted in the resignation of several High Court and Court of Appeal judges and magistrates. The general lack of efficiency in the courts has resulted in litigants turning to alternative dispute resolution methods as a means of settling arising commercial disputes, with arbitration being the most popular method.
Arbitration in Kenya is governed by the Arbitration Act 1995. The act is substantially based on the United Nations Commission on International Trade Law Model Law on International Commercial Arbitration, which was adopted in 1985 with a view to encouraging arbitration and processes that would have global recognition. The act provides very broad party autonomy in fashioning the arbitration process. Once a dispute has arisen, parties have autonomy with regard to:
The act also allows parties to an existing dispute to refer the dispute to arbitration.
Kenya is also a party to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Arbitral awards under the convention were previously recognized under the Arbitration Act (formerly Chapter 49, Laws of Kenya). This statute was repealed by the act, which provides for universal recognition of foreign awards subject to the arbitral award complying with its provisions. A Kenyan court may decline to recognize foreign arbitral awards if, for example (i) recognition or enforcement of the arbitral award would be contrary to the public policy of Kenya; or (ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication of that law, under the law of the state where the arbitral award was made.
The Chartered Institute of Arbitrators of the United Kingdom is represented in Kenya by a local branch which has, over the past 10 years, promoted and facilitated the determination of disputes through arbitration. The institute also maintains and provides upon request names and profiles of suitably qualified persons to act as arbitrators or as mediators.
Parties also have the choice of arbitral institutions such as the London Court of International Arbitration, the International Court of Arbitration (of the International Chamber of Commerce) and American Arbitration Association.
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