A)
Legal Framework
In Mozambique, arbitration is primarily recognized by
the Constitution of the Republic[1]. Article
4 establishes that “the State recognizes
the various normative and dispute resolution systems which coexist in the
Mozambican society, as long as they do not contradict the fundamental values
and principles of the Constitution”. Specifically Article 223 states that “administrative, labour, fiscal, customs,
maritime, arbitration and communal tribunals, may exist”[2].
Arbitration in Mozambique is governed by the Law on Arbitration,
Conciliation and Mediation dated 8 July 1999[3]
(“the Arbitration Law”). It was formerly governed by provisions in the Civil
Procedure Code[4]
but it can be said that it is also based on a mixture of laws from other
jurisdictions.
Mozambique is a party to the 1958 Convention on the
Recognition and Enforcement of Foreign Arbitral Awards (New York Convention)
and also a party to the 1960 Convention on the International Centre for
Settlement of Investment Disputes (ICSID).
Mozambique is a civil law jurisdiction, and therefore
does not have an established practice of binding case law. Cases are cited as
persuasive authority in the courts. Cases from the Supreme Court if quoted have
binding power on the lower courts. Mozambique also does not have a formal or
established case reporting system, and as such, it is difficult to obtain case
authorities on matters. The Supreme Court has started populating cases in its
website, but these are few and there are none on arbitration. The
Constitutional Council publishes cases on its website, but these are mostly on
electoral matters. Most cases are presently obtained from a practitioners own
experience, or through obtaining copies of cases from the Supreme Court
Registry.
The UNCITRAL Model Law on Arbitration is considered
the main source of inspiration for the Arbitration Law. However, the Arbitration
Law is a combination of diverse sources of law, and a great example of legal
pluralism established in the Constitution[5]. For example:
a)
The Arbitration
Law bases its definition of an arbitration agreement, establishment of an
autonomous arbitration clause and the format of the arbitration agreement on
the UNCITRAL´s Model Law;
b)
Referral to voluntary
labour arbitration, under special laws, is based on Argentinean and Bolivian laws;
c)
Portuguese law
has also had some influence on the Arbitration Law. This includes the stipulation
of general minimum requirements necessary to be complied with by the
arbitrators; and the inclusion of the criterion “when international trade
interests are put at stake” in the definition of international arbitration;
d)
The
inclusion of an article requiring adherence to arbitration on part of a party
in standard terms and condition contracts (adhesion contracts) which provide
for arbitration has been inspired by Brazilian Law[6].
It should be noted that treaties or multilateral or
bilateral conventions entered into by the Government of Mozambique which relate
to the scope of arbitration, conciliation and mediation will prevail over the Arbitration
Law[7] .
In relation to administrative contracts[8]
and non-contractual civil responsibility of public administration or their
heads, employees or agents for losses due to public management acts, the rules
of arbitration are provided for in the Law of Administrative Litigation
Procedure[9].
This law does not distinguish between domestic and international arbitration.
When analyzed, it seems to be primarily applicable to domestic arbitration. It
also suggests that, within this ambit, if the arbitration is international it
should be subject to the relevant international arbitration provisions in the
Arbitration Law.[10]
The Arbitration Law distinguishes domestic arbitration
(Articles 1 to 51) from international arbitration (Articles 52 to 59). International
arbitrations are arbitrations involving international trade interests and in
particular, where the following circumstances apply:
a)
At the point
of termination of the relevant contract, the parties to the arbitration agreement
are commercially domiciled in different countries;
b)
One of the
following is situated outside the country, where the parties possess their
establishment: i) the seat of arbitration (if this has been established or is
determinable in terms of the arbitration agreement); ii) any place where a substantial
part of the business relationship obligations are executed or iii) the place
that is most closely linked to the subject matter of the litigation; or
c)
The parties
have expressly agreed that more than one country is connected to the litigation
subject matter.
B)
Judicial System
The judicial system in Mozambique consists of the
Judicial Magistracy and the Administrative Judicial Magistracy. The Judicial
Magistracy consists of District Courts, Provincial Courts, the Superior Courts
of Appeal and the Supreme Court. The Administrative Judicial Magistracy
consists of the Provincial Administrative Courts and the Administrative Courts.
There are also courts
that possess specialized competence, such as fiscal and customs courts.
Even though labour courts
are provided for in the Constitution, they have not yet become functional and
judicial courts apply. There is no date provided for labour courts to become
functional, but this is expected to be soon.
The judicial courts do
not have jurisdiction in an arbitration where there is a valid arbitration
agreement, and the dispute is one that is by law authorized to become an
arbitration dispute (an arbitrable dispute). Disputes that are not arbitrable include tax
disputes, family disputes, criminal disputes, and disputes remitting to rights
that cannot be transferred or waived by law (such as rights to the person). Article
10 of the Arbitration Law states that by executing an arbitration agreement,
parties have relinquished their right to initiate judicial proceedings in
respect of the subject matter of the arbitration agreement.
If a judicial authority
receives from a party A an action for a dispute which falls under an
arbitration agreement, the judicial court may remit the dispute to arbitration
upon the request of the opposing party B and provided that party B had not made
its allegations (e.g. defense submissions) in the court case prior to making
the request. The dispute would not be remitted to arbitration if the judicial
court determines that the arbitration agreement is no longer valid or is
unenforceable. The fact that one party has commenced court proceedings does not
suspend the arbitration proceedings, the arbitration can be commenced or
proceed whilst the court proceedings are ongoing and an award may be granted
during this time.
Further, under Article
204 of the Law of Administrative Litigation Procedure, recourse to arbitration
takes priority over recourse to other courts. If the courts are approached,
they should refuse jurisdiction, except in relation to matters of appeal of an
arbitration sentence (arbitration award).
The court competent to
consider and decide upon arbitration-related matters is the court situated
within the area where the arbitration is taking place. Therefore, if the seat
of arbitration is in Maputo, any issue requiring judicial intervention will be
dealt with and decided by the judicial court of the City of Maputo.
The Administrative Court under the Law of
Administrative Litigation Procedure considers disputes which require judicial
intervention in situations where
arbitration has been instituted in order to resolve disputes arising from
administrative agreements or non-contractual civil responsibility of Public
Administration or titleholders of its bodies, employees or agents for losses due to acts of public
management. The Administrative Court’s
rulings are final and non-appealable.
The official language of the
judicial courts is Portuguese. In cases where a party is a non-Portuguese
speaker, an interpreter will be appointed in order to assist the party during
proceedings.
In
general, the courts’ attitude towards arbitration is a positive one. The courts
have adopted a position of not interfering negatively during the course of the
arbitration proceedings and demonstrate a cooperative attitude when it comes to
considering precautionary measures requested by the parties. For example, in arbitration
proceedings acted on by the contributor, between a local football team and a
commercial enterprise, the judicial court of the city of Maputo in case No.
02/2012-G promptly issued a protective order (injunction) requested by one of
the parties.
There
are no records of cases where a court has intervened in arbitration proceedings
in a manner outside the parameters established by Article 9 of the Arbitration
Law, which are: a) decision to refer the parties to arbitration when they start
a court case while existing an arbitration agreement; b) appointment of
arbitrators when parties don’t reach agreement on such appointment; decision on
the rejection or substitution of an arbitrator when parties don’t reach
agreement on such matters; decision on the competence of the tribunal (when
parties do refer such decision to the court) and also decision on any
controversy regarding rights that cannot be waived or transferred; setting
aside proceedings
C) SOVEREIGN
IMMUNITY AND STATE PROCEEDINGS
There is no legal provision
that prohibits the State from being part of arbitration proceedings, neither is
there any provision which allows it to invoke sovereign immunity, provided that
the dispute is appropriate in terms of the Arbitration Law and the Law of
Administrative Litigation Procedure.
Article 6 of the Arbitration
Law states that the State and other public entities with legal personality may
enter into arbitration agreements if these have, as their subject matter,
disputes relating to private law or of a contractual nature and if authorized
by any special law regulating that public entity.
Further, as previously
stated, the Law of Administrative Litigation Procedure allows the State to
enter into arbitration agreements relating to disputes arising from
administrative agreements and non-contractual civil responsibility of Public
Administration or titleholders of its bodies, employees or agents for due losses of acts of public
management.
Immunity from execution
In
the ambit of the enforcement proceedings it is necessary to take into account Article
823 of the Civil Procedure Code, with the title “assets absolutely or
relatively non pledgeble” which sets
out “the assets of the State cannot be
pledged as security, in addition to the assets of the public entity, when these
are affected or employed to the benefit of the public interest, unless the
enforcement is for something certain or for the payment of a debt with real
guarantee.”
Essentially, arbitration awards may be enforced
against State assets, as long as the assets are not found to be affected or
employed to the benefit of the public interest. However, if the enforcement of
the award relates to a specific asset or a debt against which the asset was
offered as security, and the very object of the action was to compel the State
to deliver up this asset or to enforce against this security, then enforcement
will be allowed even against assets which are affected or employed to the
benefit of the public interest. Notwithstanding this, assets which are classified
by the Constitution or a statute to be owned by the State´s public domain will
be excluded from the pledge.
The local laws are applicable only to State-owned
local assets. Any State-owned foreign assets are subject to the laws of the
countries in which they are located.
There are no special requirements for commencing
arbitration against the State and it should be the arbitration clause/agreement
which states the formalities. In addition, Mozambique has not ratified the
Vienna Convention on Diplomatic Relations.
There are no records of domestic arbitrations against
the Government, though it is involved in a few ongoing international
arbitration proceedings[11].
D) ENFORCEMENT
OF ARBITRATION AGREEMENTS
(i)
Formal Requirement
Arbitration agreements must be in writing in order to be valid.
Article 10 of the Arbitration Law states that an arbitration agreement is considered to be
in writing when it consists of a document signed by the parties or of an
exchange of correspondence such as letters, ´telex´, fax or other methods,
which evidences the existence of an agreement.
An agreement which refers to a document that
contains an arbitration clause is equivalent to an arbitration agreement, as
long as the agreement is in written form and refers to such clause as part of
the agreement.
However, arbitration clauses in Adherence
Contracts (standard terms and conditions) are only effective if the adherent
takes the initiative to instruct the arbitration or expressly agrees to its
institution.
(ii)
Autonomy of the Parties
The basis of arbitration
(and other means of alternative dispute resolution), as set out in Article 2 of
the Arbitration Law, is party autonomy in relation to the choice and adoption
of methods of alternative dispute resolution. This ties in with the principle
of private autonomy and contractual freedom, one of the basic principles of
Mozambican contract law. Parties have the ability to freely decide on the
content of their contracts[12].
Accordingly, the parties will have autonomy, within the boundaries imposed by the
law, to decide upon the content of the arbitration agreement.
(iii)
Interpretation of an arbitration clause
An arbitration agreement is, above all else, a
contractual clause which is interpreted by the courts in accordance with the
principles used in the interpretation of legal transactions. The key criterion
for the interpretation of an arbitration clause is the will (expressed or
presumed) of the parties.
In cases of an incomplete or deficient
arbitration clause, the court will not render the clause void if it is
reasonable for the judge to conclude with an acceptable degree of certainty
that the intention of the parties was to submit disputes to arbitration.
However, the court cannot attribute to a clause, a meaning which is
considered completely extraneous
to the wording of the clause
(Articles 236 to 239 Civil Procedure Code).
(iv)
Extent to which the arbitration agreement can
exclude the jurisdiction of the courts
The Arbitration Law does not contain mandatory
provisions relating to the election of law applicable to the arbitration´s
substance and procedure.
If the arbitration’s seat is in Mozambique, the Courts
can exercise control over the proceedings as far as the law allows (Article 54
Arbitration Law).
Therefore the parties may
freely choose what legal rules to apply, and any legal jurisdiction, of any
country chosen by the parties, will be recognized.
(v)
Stay of Proceedings
If a party A seeks to commence court proceedings in
relation to a dispute which is properly governed by a valid arbitration
agreement, the judicial courts, upon application by the opposing party B prior
to or at the time of party B making any allegations (such as defense
submissions), must terminate any judicial proceedings and refrain
from considering the merits of the case.[13]
E) CONDUCT
AND PROCEDURE OF AN ARBITRATION WHEN THE SEAT IS IN MOZAMBIQUE
(i)
Appointment of Arbitrators
Article 16 of the Arbitration Law provides that the arbitral tribunal
may be constituted by a single arbitrator or by several arbitrators, in odd
numbers. If the arbitration agreement is silent on the number of tribunal
members to be appointed to the tribunal, the tribunal will consist of 3
arbitrators.
After being nominated, it is common for the arbitrators to elect a
president from amongst them. If there is a lack of consensus with regards to
who should be elected, the oldest arbitrator then becomes the president. If
necessary, the president will designate a secretary, which may be one of the
arbitrators[14].
If the parties have, in an arbitration clause, elected to use any institutional
rules to govern the arbitration, then the arbitration shall proceed in
accordance with those rules.
If the arbitration agreement is silent on the manner of designation/appointment
of arbitrators, the party seeking to institute the arbitration should send a notice
to the other party setting out:
a. If the arbitration agreement states that one
arbitrator is to be appointed through an agreement between the parties, then
its proposal as to the arbitrator and an invitation to the other party to accept
its proposal; or
b. If the arbitration agreement provides for more than
one arbitrator or is silent on the number of arbitrators to be appointed (and Article
16 of the Arbitration Law applies to fix the number of arbitrators at three),
then its proposal of the arbitrator it seeks to appoint, and an invitation to
the other party to appoint an arbitrator.
If, in accordance with the arbitration agreement, a third party is
required to appoint one or more arbitrators, the party seeking to institute the
arbitration should send a notice to the third party to appoint such
arbitrator(s) and communicate his appointment to the other parties.
If any party fails to nominate any arbitrator(s) as required by the
arbitration agreement, then the arbitrators will be appointed by the President
of the arbitral institution chosen by the parties to do so. If no institution
had been agreed on, then the judicial courts of Mozambique may appoint the
remaining arbitrators on application of either party to the arbitration. This
appointment by the President of the relevant arbitral institution or the
judicial courts should be made within 8 days of a notice from the party
requesting institutional or court appointment.
The decision by the judicial court or arbitral institution on appointment
of arbitrators where a party fails to do so is final and binding on the
parties. No appeal can be made to such a decision.
Under Article 16 of the Arbitration Law, in appointing an arbitrator
where a party fails to do so, the arbitral institution or court should take
into account the required qualifications of the arbitrator as set out in the
arbitration agreement (if any), any other qualifications that would guarantee
the impartiality and independence of the arbitrator. It may also be necessary
to consider the arbitrator’s nationality, and ensure that it is different to
that of the parties.
(ii)
Challenging Arbitrator (s) through the judicial courts
The
appointment of an arbitrator may only be challenged if there are any doubts
regarding his or her impartiality or independence or if he/she does not possess
the qualifications agreed upon by the parties in the arbitration agreement.
If
any party learns of such doubts after appointing an arbitrator, it may revoke
its appointment of the arbitrator. Any such revocation will be governed by the
relevant terms of the arbitration agreement (if any), or in the absence of an
agreement, the arbitral tribunal. If the decision cannot be made under the
agreement or by the tribunal, then it will be made by the judicial courts. Any
decision by the judicial courts in such a matter would be final and binding and
not subject to appeal.[15]
(iii)
Jurisdiction of the Arbitral Tribunal – Kompetenz
– Kompetenz
The principle of kompetenz – kompetenz is provided for in Article 37 of
the Arbitration Law, which states that the arbitral tribunal may decide upon
its own competence, including the existence and/or validity of the arbitration
agreement.
Under Article 37 of the Arbitration Law, the competence of the arbitral tribunal
may only be challenged until the point where the defense is submitted. This allows a party that has already appointed
an arbitrator or participated in his/her appointment to argue this matter. An
action that the arbitral tribunal has exceeded its powers can be raised as soon
as the issue arises, which can be during the proceedings. In both cases, the arbitral tribunal may
accept an expired claim if it finds that the delay is reasonably justified.
The arbitral tribunal may decide on its competence as a preliminary
question or as a part of the substantive award. If the tribunal, in its
determination, finds itself competent to arbitrate the dispute, the parties may
submit the question of its competence to the judicial courts within 30 days of
being notified of the arbitral tribunal’s decision. The judicial courts’
decision in this matter will be final, binding and not subject to appeal. The
judicial court proceedings will not suspend the arbitration proceedings, so the
arbitration may continue and the tribunal may deliver a final award.
If, after the issuance of
the final award by the arbitral tribunal, the judicial courts declare the
arbitral tribunal incompetent to arbitrate the dispute, either party may apply
to the judicial courts to annul the final award. Under Article 12 of the Arbitration Law and Article 496 of the Civil
Procedure Code, the decision of the judicial court regarding such matters will be final and
unappealable.
Similarly, Article 220 of the Law of Administrative Litigation Procedure,
provides that the arbitral tribunal may rule on its own jurisdiction, even if
it will be deemed necessary to recognize the existence, validity or
effectiveness of the arbitration clause or agreement in addition to its
enforceability. Furthermore, the arbitral
tribunal´s incompetence may only be challenged prior to or at the time of
submission of the defense case but not after the defense case has been
submitted.
(iv)
Procedure
The parties have autonomy and so, the procedural rules provided for in
the Arbitration Law are supplementary. They become applicable only when the
parties have not agreed on the procedure or have not chosen the rules of a
particular arbitral institution to govern the arbitration.
Article 27 of the Arbitration Law reiterates the parties’ freedom to
choose the procedural rules which govern the arbitration and the seat of the
arbitration. If the parties have not agreed on the rules of a particular arbitral
institution and the seat of the arbitration, the arbitrators will become
responsible for such decisions and these will be decided in accordance with the
circumstances of the case and convenience of the parties.
(v)
Court
Intervention during arbitration proceedings
The judicial courts may assist the arbitral tribunal with some
pre-arbitral matters such as the tribunal’s constitution, appointing
arbitrators and determining the competence of the arbitral tribunal.
In the course of the arbitration, the judicial courts also play a
supporting role pursuant to Article 12 of the Arbitration Law, with regards to
the award of preventative and precautionary measures such as injunctions, attachments,
suspension of corporate decisions, inventories and other relief (as set out in Article
399 of the Civil Procedure Code).
Pursuant to Article 12 of the Arbitration Law, the judicial courts have
the power to grant interim measures before or during the arbitration, on the
application of either party. The applicant must show a reasonable concern
regarding a possible serious and irreparable injury to one of its interests
which may occur before the arbitration is commenced or while it is ongoing.
Under the Arbitration Law, the arbitral tribunal has powers to order
interim measures. The arbitral tribunal may also require, in relation to interim
measures, that the parties provide an appropriate guarantee (Article 33 Arbitration
Law). Although the law makes no provision for this, in practice, the party that
benefits from these measures, may proceed with a claim in a judicial court, in
cases where the tribunal’s orders on interim measures are not complied with,
even throughout the arbitration proceedings.
Under Article 32 of the Arbitration Law, any kind of evidence acceptable
under the Civil Procedure Code may also be produced in arbitration. Article 16
of the Civil Procedure Code allows for testimony (witness) evidence. Therefore,
witness evidence is allowed in arbitration.
Under the Civil Procedure Code,
(a)
A notified
witness must appear at the hearing to be heard, unless a party has abdicated
the witness;
(b)
If the
witness is not abdicated and he fails to appear at the hearing, he can be
brought to a hearing under compulsion (subpoena);
(c)
It is
possible to call witnesses who are outside the judicial court’s area of
jurisdiction. In this case, a letter with the objects of inquiry is dispatched
to the witness’ residential area.
The above
procedure is also available in arbitration. Under Article 32 of the Arbitration
Law, the arbitral tribunal or an authorised party may request the judicial
court’s assistance in attainment of evidence for the arbitration. The judicial
court would respond to such a request in accordance with its own rules and
limits of competency.
There are no records of the judicial courts of Mozambique’s involvement
in any international arbitration. However, as Maputo gains popularity as a seat
of arbitration, this is expected to change.
F)
COURT INTERVENTION WHERE
THE SEAT OF ARBITRATION IS OUTSIDE MOZAMBIQUE
The
existence of a valid arbitration agreement (independently of the seat of
arbitration indicated by the parties in such an agreement) prevents the
judicial court from proceeding with the judicial process and obligates the
court to remit the parties to arbitration (when one of the parties requests the
court to do so prior to or at the time of making its allegations (such as
defence submissions) in the dispute).
In
a current case (the contributor is currently counsel for one of the parties –
the name of the parties cannot be revealed[16])
a contract was entered into by a Mozambican and a foreign company, which
contains an arbitration clause that remits to the arbitration rules of the
International Chamber of Commerce (ICC) and which sets the arbitration to take
place in Geneva. One of the parties requested a protective order from the
judicial court and also instituted a main action for the performance of the
contract. The opposing party disputed the above by stating than an arbitration
agreement exists. The judicial court awarded the requested protective order (interim
measures) and at the moment the parties await on the judicial court’s decision
regarding the opposing party’s application to terminate judicial proceedings
and remit the matter to the arbitration.
When
an arbitration takes place outside Mozambique, any intervention by the
Mozambican judicial court will become limited to a possible declaration of
precautionary orders regarding material or immaterial interests under its
jurisdiction (for example, the attachment of assets located in Mozambican
territory, in order to prevent the disposal of a party’s assets which may later
be needed in order to satisfy a debt in dispute).
In
cases where an arbitration proceeding takes place outside Mozambique, Article
12 of the Arbitration Law provides that judicial courts may declare provisional
measures, if the interests at issue fall under its jurisdiction. In such a
case, the applicant should demonstrate a reasonable concern regarding a
possible serious and irreparable injury to one of his/her interests, which may
occur before the commencement of an arbitration proceeding or the pendency of
the same. The applicant may choose to apply for special procedures under the
Civil Procedure Code, and in case these are found to be inadequate, request the
court to institute measures which are adequate to the circumstances. These include
the approval to conduct certain acts; barring the opposing party from a certain
conduct, or the attachment of immovable and movable assets which are part of
the action, and which will be delivered to a third party depositary[17].
The courts have been reasonably expeditious when declaring provisional
measures.
G) THE
AWARD
Under
Article 39 of the Arbitration Law, an arbitral award must be in writing and
should contain:
a)
identification of the parties;
b)
a reference to the arbitration
clause/agreement;
c)
the object of the dispute;
d)
identification of the arbitrators;
e)
the seat of arbitration;
f)
the date of the arbitral award; and
g)
the signatures of the arbitrators.
In
an arbitration conducted by more than one arbitrator, it will be deemed
sufficient to include the signatures of the majority of the arbitrators as long,
as a reason for the omission of the others, is provided. The reason should be
well founded unless the parties declare it unnecessary or the arbitral award is
based on the parties’ settlement.
Article
24 of the Arbitration Law establishes that costs such as arbitrators’ fees and
other participants’ fees, in addition to other administrative costs,
should initially be fixed in the
arbitration agreement or on a document subsequently drafted by the parties or
be managed according to the arbitral rules elected by the parties.
In
the absence of specific provisions, costs will include the arbitrators’ fees
and expenses, administrative costs and the expenses incurred in the production
of evidence. In order to calculate the costs, the president of the arbitral
tribunal or the sole arbitrator will determine an arbitration fee considering
the complexity of the matter. .
Each
party shall pay an advance towards the arbitration fee, which will be fixed by
the president of the arbitral tribunal or the sole arbitrator and which cannot
exceed 35% of the total minimum value of the cost of proceedings to be paid by
each party.[18]
In the course of the proceedings, the president of the arbitral tribunal or the
sole arbitrator may order an increase of the initial fees until it complies
with the minimum value of the proceeding costs. Any such additional fees are to
be paid within 5 days from the date the parties were notified of the increase. If
any party fails to make payment within the said deadline, the party shall be
notified and may make payment, free of interest, in the five days following the
second notification.
Under
section [*] of the Commercial Code, the applicable commercial legal interest
rate is 7%. The arbitral tribunal may suspend the arbitration pending such
payment.
H)
ENFORCEMENT OF AN AWARD AND THE ROLE OF THE
COURTS
i)
Where
the seat of arbitration is in Mozambique
In
order for an arbitral award issued in Mozambique to be enforced by the judicial
courts, it must be filed as soon as it is issued in the judicial court nearest
to the seat of the arbitration, which in most cases is a provincial court.[19] There
is no time limit provided for filing an award with the judicial court[20],
but there is a time limit for making any applications for setting aside an
award. Under article 45 (1) of the Arbitration Law, this is 30 days from the
date of notification of the award by the Tribunal or the notification of any
revision of errors by the tribunal.
Once
the award is filed and recognised by the judicial court, it will be enforced as
if it were a judgment of the judicial court. Because the court’s ruling is
condemnatory (obligatory), it will also constitute an enforceable title.
Once
the 30 day time limit set by article 45 (1) of the Arbitration Law for any
appeal or annulment of the arbitral award has passed, the award creditor may
request the judicial court to enforce the award.[21]
Enforcement
of the award takes place in the form of a summary procedure regardless of the amount
of the award.[22]
The party who requests enforcement must provide the Court with legalised copies
of:
i)
the arbitration agreement;
ii)
the arbitral award and any
rectification, interpretation or supplementary decision;
iii)
proof of notification given to the
parties of filing the award; and
iv)
if the award was not issued in
Portuguese, it must be presented together with an official translation.
Similar
to the Civil Procedure Code, the Arbitration Law provides regulations which are
applicable to summary proceedings. According to Article 924 of the Civil
Procedure Code, the creditor may claim pledged assets in summary proceedings[23],
if the enforcement is based on a condemnatory (obligatory) arbitration award
that does not need to be liquidated.
A
party may oppose enforcement of the award on the basis that: i) it has already complied
with the arbitral award; ii) the arbitral award has been annulled; or iii) the
arbitral award is being challenged. In this last case, the Courts will suspend
enforcement of the award until the challenge has been determined. Any such
objection must be filed within eight (8) days from the receipt of the
notification of the first party’s attempt to enforce the award.
Any
objection which is not based on one of the grounds set out above will not be
considered by the courts.
The
courts’ decision on any such objection will be final, binding and not subject
to appeal.
In the writer’s experience, award creditors seeking to enforce
an arbitral award may encounter some practical difficulties and delays,
especially in cases where the judge presiding over the enforcement of the award
is not sufficiently qualified or experienced to deal with the matter.
ii)
Where
the seat of arbitration is outside Mozambique (foreign arbitral awards)
Mozambique
is a signatory to the New York Convention, and made a reciprocity reservation.
This means that the only awards that would be recognised and enforced in
Mozambique are awards which have been issued in countries which are also
parties to the New York Convention and would therefore enforce Mozambique awards.
In
terms of New York Convention enforcement, it is relevant to take into account
the bilateral investment treaty regimes, to which Mozambique is a party to and
which will be applicable if more favourable to the enforcement than the New
York Convention (in terms of Article 7 of the New York Convention). Mozambique
has bilateral investment treaties with Algeria, Belgium – Luxembourg Economic
Union, China, Cuba, Denmark, Egypt, Finland, France, Germany, India, Indonesia,
Italy, Japan, Mauritius, Netherlands, Portugal, South Africa, Spain, Sweden,
Switzerland, United Arab Emirates, United Kingdom, United States of America,
Vietnam, Zimbabwe.
Mozambique
is also a signatory to the International Centre for Settlement of Investment
Disputes (ICSID) Convention on the Settlement of Investment Disputes Between
States and Nationals of other States (18 March 1965) (“the ICSID Convention”). Any
arbitral award issued under the auspices of the ICSID shall be treated as if
they were awarded within Mozambique[24][25].
The court competent to review and enforce foreign
awards is the Supreme Court, which acts as a court of last recourse, and its
decision is final and not subject to appeal.
In relation to the requirements and procedures
needed for the recognition and enforcement of foreign arbitration awards, the following
three situations must be taken into account:
A)
The award
must have been issued in a country that complies with the reciprocity
requirement (reserve adopted by Mozambique).
B)
Where
the award is issued in a country where the reciprocity requirement is not met
under the New York Convention, but was issued under ICSID, it can be enforced
in accordance with the terms of the ICSID Convention.
C)
Where
the reciprocity requirement under the New York Convention is not met, and the
award was not issued under ICSID, then the procedure for recognition of
domestic arbitral awards shall apply with necessary adjustments to foreign
awards. This would fall under the regime of recognition of foreign judicial
decisions under the Civil Procedure code. Article 1097 of the Civil Procedure Code
provides that The provisions set in this code for the court decisions are
applicable mutatis mutandi to the
arbitration awards. The following are the requirements to be met:
i)
There are no doubts regarding the
authenticity or intelligibility of the arbitral award;
ii)
The award is acknowledged or
authenticated by the Mozambican consular authorities in the country in which it
was issued.
iii)
The arbitral award has been declared
final in accordance with the law of the issuing country;
iv)
The arbitral award originates from a
competent court in relation to the Mozambican rules of conflict of jurisdiction
in the Civil Procedure Code;
v)
Lis
pendens
or res judicata cannot be invoked based
on a cause that affects the courts of Mozambique, unless jurisdiction of the
Mozambique judicial courts was determined not to apply by a foreign court;
vi)
The defendant has been given proper
notice (properly served), unless it is
justifiable in terms of Mozambican Law to dismiss such notice or service (e.g.
if the defendant was automatically found liable due to absence of a defence or
appearance by him, when the citation had to be delivered personally);
vii)
The award is not contrary to the public
interests of Mozambique; and,
viii)
If the award is contrary to the public
interests of Mozambique, that it does not offend the provisions of Mozambican
Private Law, when the issue should be settled in accordance with the Mozambican
Rules on Conflicts of Laws (Article 1096 and 1097 Civil Procedure Code)
The
recognition of the awards (in this case where private law needs to be
exclusively applied) occurs by way of exequatur.
Only the formal elements of a revised award may be scrutinised, and not its
merits[26].
The factual basis of awards is not re-visited. The requirements for enforcement
of awards are formal under the Civil Procedure Code.
A
foreign award can be denied if it contains rulings which are contrary to international
public policy. This is limited and corresponds to Mozambican internal public
order. Mozambican internal public order has been historically defined as
economic, social and political values, which society cannot do without, and
which operate in each specific case to prevent any negative effects arising
from foreign law.
The
Supreme Court, which is the court competent to revise and confirm foreign
arbitral awards, can therefore only dismiss requests for recognition of foreign
awards on formality grounds. For example:
(a)
in the Judgment dated 22 September
2010, issued in the process nº 145/06, the Supreme Court decided that “the absence of an initial petition, issued
to cause the process of revision and confirmation of the foreign award as it is
required by Article 1098 of the Civil Procedure Code, just as well as the
legalization of the documents which contain the award in need of revision,
constitute an impediment and the documents will not be accepted in Court”.
(b)
In the judgment dated 19 September
2001, issued under the process number 30/01, the court determined that “in a case where the applicant´s
representative has been notified to, within sixty days, rectify the identified
deficiencies and has not done so within that time period, the court may reject
the application as a whole.”
(c)
Finally, in the Judgment issued
under process number 131/10 dated 24 November 2010, the Court decided that “the documents accompanying the initial
petition, having been issued by the English Supreme Court of Justice, are not
seen as formally in conformity with the disposal in number 1 of Article 540 of
the Civil Procedure Code, as amended by the Law Decree number 1/2005 of 27
December, due to a lacking of acknowledgement or authentication by the
Mozambican consular authorities in the United Kingdom. This procedural issue affects
the progress of other actions”[27].
I)
SETTING ASIDE
An arbitral award
may be challenged by instituting an appeal for annulment. Article 44 of the Arbitration Law sets out
that the arbitral award may only be annulled by a judicial court if:
A)
The party
who requested the annulment, provides proof of the following:
i)
One of
the parties to the arbitration agreement was found to be incapacitated;
ii)
The arbitration
agreement is not valid in terms of the law to which the parties have subjected
it to or in the absence of any indication of such, in terms of the Laws of
Mozambique;
iii)
The
party was not properly notified of the nomination of an arbitrator or of the
arbitration procedure or due to some other reason, it was impossible to assert his
rights;
iv)
The
award concerns a dispute not covered by the arbitration agreement, or contains
rulings which exceed the scope of the arbitration agreement. However, if the
provisions of the award relating to the disputes covered by the arbitration agreement
can be separated from those that are not, then only the part of the award which
relates to issues not covered by the arbitration agreement may be annulled;
v)
The
constitution of the arbitral tribunal or the arbitration proceedings are not in
conformity with the parties´ agreement, unless such agreement goes against a
legal requirement which the parties cannot waive;
OR:
B)
The
court determines that:
i)
the
dispute is not subject to arbitration in terms of the Laws of Mozambique; or
ii)
the
sentence would be contrary to Mozambican public policy
Any such appeal for annulment will suspend any
enforcement proceedings, until the award is made final.
J) APPEAL OF
AN AWARD
Neither
arbitral awards issued in Mozambique nor foreign arbitral awards can be
appealed in the judicial courts. Other than the procedures we have discussed,
the Arbitration Law does not provide any additional grounds for challenging
arbitral awards.
K) LIMITATION
PERIODS IN MOZAMBIQUE
The
limitation periods for challenging civil actions under the Mozambican Civil
Code are as follows:
i)
three (3) years for delictual or
non-contractual civil liability (article 498 of the Civil Code); and
ii)
twenty (20) years for contractual
civil liability irrespective of the status (public or private) of the subject
involved (article 309 of the Civil Code). This civil liability limitation
period would apply to enforcement of a recognised arbitral award in Mozambique.
L) ARBITRABILITY OF A CLAIM AND PUBLIC
POLICY
Pursuant
to Article 5 of the Arbitration Law, disputes of any nature may be subject to
arbitration, except disputes that:
(i)
due to a specific legislation, must
be exclusively submitted to a judicial court or a specific arbitration regime,
such as labour arbitration, tax disputes, family disputes or criminal disputes;
or
(ii)
disputes pertaining to unavailable
or non-marketable rights (rights that cannot be waived such as right to life
and physical integrity).
The
above criterion does not “provide a
clear, unequivocal answer with respect to matters which relate to the
susceptibility of the subjection of numerous matters to arbitration”[28]
such as matters relating to the Law of Companies.
------This Text is available in this BOOK.
[1]The existing Constitution was approved on 16 of November2004
[5] AA.VV, Arbitragem Voluntária e a Mediação de
Conflitos – Commented on areas of Portuguese Legislation, Concordia, Coimbra,
p.204. Legal pluralism is a recognition that the sources of
law include not just state law, but other sources such as customary law and
cultural norms. In the context of arbitration, this includes the concept of ex aequo et bono.
[6] Ibidem
[8] Administrative
contracts are a type of contracts by public bodies where they enter into a
contract in the position of their public powers or authority. These are
distinct to purely commercial contracts by public bodies. Administrative
contracts include contracts by a public body for matters that serve a public
utility purpose, such as contracts with public employees, contracts for the
construction of roads, among others. These contracts would indicate that they
are governed by the Law of Administrative Procedure.
[10] Article 5,
number 3 of the Law of Administrative Litigation Procedure states that “to the
special arbitration regimes it is applied subsidiarily” to the law of
arbitration
[16] Please note that the Mozambican Arbitration Law does
not allow the complete disclosure regarding the content of awards (Article 42,
no. 5 and 6) “the award may only be
released with the consent of the parties. Reference to the award is allowed,
when for investigation and studying purposes, relating to the jurisdictional
interest of the case, as long as the anonymity of the parties and the
confidentiality of the proceedings are maintained”.
[20] But one
must always consider the prescription timeof twenty years for rights recognized
by a court decision.
[25] Mariana
França GOUVEIA, “O reconhecimento das sentenças arbitrais estrangeiras nos
Países Lusófonos”, in AA.VV III Congresso
de Arbitragem da Câmara de Comércio e Indústria Portuguesa, ACL, 2010, page
96
[26] Carlos
Pedro Mondlane, Códido de Processo Civil,
Anotado e Comentado, Escolar Editora, 2014, Maputo (note Article 1096)
[27] Idem
[28] António
Sampaio Caramelo, “A disponibilidade do direito como critério de
arbitrabilidade do litígio”, available at http://www.oa.pt/Conteudos/Artigos/detalhe_artigo.aspx?idc=30777&idsc=54103&ida=54123,
acessed on 02 June 2015 (18:04h)
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