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Transnational Law, Unification and Harmonization of International Commercial Law in Africa

Published online by Cambridge University Press:  28 July 2009

Extract

The problem of diversity of laws remains a major, if indirect, obstacle to African economic development which has not been the subject of any concerted consideration or attention by African states. It is now generally recognized that diversity of laws is an impediment to international commercial activity. Diversity of laws also negatively affects commercial transactions between African merchants and foreign (non-African) contractors. Furthermore, diversity of international commercial laws among African countries is likely to impede the achievement of the objectives of the economic integration schemes.

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Articles
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Copyright © School of Oriental and African Studies 1994

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References

1 See Report of the UM Secretary General on International Trade Law, I UNCITRAL Yearbook (19681970) 18 et seq.Google Scholar; Walsh, D. A. and Ryan, K. W., “Harmonisation and standardisation of legal aspects of international trade” (1977) 51 Aust. L.J. 608Google Scholar; Hayes, L. H., “A modern lex mercatoria: political rhetoric or substantive progress?” (1977) 3 Brooklyn J.Int.L. 210Google Scholar; Cremades, B. M. and Plehn, S. L., “The new lex mercatoria and the harmonization of the laws of international commercial transactions” (1984) Vol. 2, No. 3Boston U.Int.L.J. 317.Google Scholar

2 R., David and Brierley, J. C., Major Legal Systems in the World Today, 3rd ed., London, 1985, 18.Google Scholar

3 For a very instructive summary of the different criteria propounded by scholars, see Zweigert, K. and Kotz, H., Introduction To Comparative Law Vol. I, Oxford, 1987, 63 et seq.Google Scholar

4 For further and very instructive elucidation of this issue and traditional African law generally, see Keba, M’Baye, “The African conception of law” Vol. II Chap. 1 (1975) International Encyclopedia of Comparative Law 225.Google Scholar

5 The description “continental European civil law family” is a convenient amalgamation of the French (or Romanistic), Germanic and Scandinavian families identified by both Zweigert and Kotz, and Arminjon, Nolde and Wolff.Google Scholar

6 A somewhat similar classification of African legal systems has been adopted in the past. See Mabula, T. K., Unification of Commercial Law in the PTA region: The need for Unification of the Law of International Trade as an Integral Part of the Economic Integration Process, Ph.D. Thesis, University of London, 1991, 212 et seq.Google Scholar The author also identified the socialist legal family as one into which the legal systems of Ethiopia and Somalia—prior to the political upheaval—may be classified. But even she acknowledges that although socialism was an avowed political doctrine of these countries at one stage, the commercial laws do not reflect socialist principles. It is believed that these countries are better identified as part of those with mixed legal family jurisdictions.

7 U.N. General Assembly Resolution 1707 (XVI) of 19 December, 1961.Google Scholar

8 Ndulo, M., “Harmonisation of trade laws in the African economic community” (1993) 42 I.C.L.Q. 101 at 108.CrossRefGoogle Scholar

9 Improved intra-regional trade can greatly enhance the economic prosperities of African countries and contribute towards a reduction in foreign indebtedness particularly if the nations could come up with a regional payments clearing system within the framework of the economic co-operation schemes.

10 Unavoidable obstacles include language differences and difficulties. In this respect, see further Ajulo, S. B., “Law, language and international organisation in Africa: the case of ECOWAS” (1985) 29 J.A.L. 1.CrossRefGoogle Scholar

11 African countries must demonstrate actual commitment to promoting intra-regional trade by taking positive steps and active measures in furtherance of their stated intentions in this regard. It is not sufficient merely to declare, for example as in art. 2 of the Treaty of ECOWAS, an intention to ensure “the abolition of quantitative and administrative restrictions on trade among member states”. Actual steps must be taken to carry out this intention. It can only be hoped that the political history of Africa will produce leaders who are truly committed to both national and regional economic development.

12 See e.g. Fabunmi, J. O., Commercial Law in the Context of Economic Development: The Nigerian Experience, Inaugural Lecture Series 85, Obafemi Awolowo University, 1989, 5.Google Scholar In fact the international trade laws of many African countries are well developed having been derived from European legal systems.

13 Since this article is mainly concerned with the harmonization of international commercial law, the focus is upon resolving diversity among African states inter se on the one hand and between African states and their non-African trading counterparts on the other hand. The resolution of internal diversity/conflict within individual countries is not fully discussed. For exhaustive consideration of the problems of, and solutions to, internal conflict of laws in Africa see e.g. the works cited in n. 37 below.

14 Further examples are listed in Ndulo, above, at 104.

15 Art. 2 of the ECOWAS Treaty of 1975.

16 Hence the current global proliferation of regional economic integration schemes including the European Economic Community (“European Union”), North American Free Trade Agreement (NAFTA) etc.

17 Thompson, Bankole, “Legal problems of economic integration in the West African sub-region” (1990) 2 African J. Int. & Camp. L. 85 at 100.Google Scholar

18 Ndulo, above, at 102.

19 Ibid, at 107.

20 One notable example lies in the work of the Industrial Property Organisation for English-Speaking Africa (ARIPO) established in 1976 which has published two model laws: the Model Law of English-Speaking Africa on Patents and the Model Law of English-Speaking Africa on Trade Marks. See Zikonda, A. R., “Survey of industrial property laws of English-speaking Africa: the need for harmonisation” (1988) Vol. 4, No. 1Lesotho Law Journal 1.Google Scholar

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22 Ndulo, above, at 108.

23 In the case of Tanzania and Zambia, the English legislation which serves as the foundation of companies legislation is the U.K. Companies Act 1929 although Tanzania subsequently passed another law based on the 1948 U.K. legislation. See Katende, J. W., “Company law in East Africa: present and future” (1969) 2 East Af. L. Rev. 135Google Scholar; Hussain, A., A Textbook of Company Law in Kenya, Nairobi, 1980.Google Scholar

24 See generally Salacuse, J. W., An Introduction to Law in French-Speaking Africa, Vol. 1 of the Legal Systems of Africa series, Charlottesville, 1969Google Scholar

25 Kebir, Yamina, “The commercial laws of Algeria” in Digest of Commercial Laws of the World, New York, 1988.Google Scholar

26 See Xavier-Bender, Phillipe, “The commercial laws of France” in Digest of Commercial Laws of the World, New York, 1993.Google Scholar

27 Ibid., esp. at 46; see also the entry for Cameroon by Ngongi, M. I., in Campbell, D. (ed.), Legal Aspects of Doing Business in Africa, 1991.Google Scholar

28 See generally, Xavier-Bender, above; Gower’s Principles of Modem Company Law, 5th ed., London, 1992.Google Scholar

29 I am indebted for this information to George Elombi, Cameroonian national and doctoral research scholar at the Centre for Commercial Laws, Queen Mary and Westfield College, University of London.Google Scholar

30 In respect of the harmonization of E.C. company law generally, See Woolridge, F., Company Law m the U.K. and the E.E.C.; Its Harmonization and Unification, London, 1991Google Scholar; Schmitthoff, G. M. (ed.). The Harmonisation of European Company Law, London, 1973.Google Scholar

31 Most francophone African countries, however, share the CFA as a common currency.

32 Omorogbe, Y., “The legal framework for economic integration in the ECOWAS region: an analysis of the trade liberalisation scheme” (1993) 5 Af. J. Int. ’ Camp. L. 355 at 360.Google Scholar

33 Ibid, at 361.

34 One reason for this is that European countries have more goods and services to offer their partners—thus a vested interest in successful economic integration—than African states have to offer their own regional partners.

35 Convention on the Law Applicable to Contractual Obligations (Rome, 1980).

36 Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (Brussels, 1968).

37 See e.g. Agbede, I. O., “Conflict of laws in a federation: the Nigerian experience” (1973) 7 Nig. L.J. 48Google Scholar; also, Towards unification of municipal laws in Africa: the Nigerian experience” (1975) 8 Verfassung Und Reckt in Ubersee 423CrossRefGoogle Scholar; Mbai, Fafa E., Internal Conflict of Laws Problems in African Legal Systems, The GambiaGoogle Scholar; Allott, A. N., “The unification of laws in Africa” (1968) 16 Am. J. Camp. L. 51CrossRefGoogle Scholar; Woodman, G. R., “Unification or continuing pluralism in family law in anglophone Africa: past experience, present realities and future possibilities” (1988) Vol. 4, No. 2Lesotho Law Journal 33Google Scholar; Sanders, A. J., “The internal conflict of laws in Botswana” (1984) 5 Yearbook Of African Law 137.Google Scholar

38 Allott, A. N., “Towards the unification of laws in Africa” (1965) 14 I.C.L.Q, 366 at 378.CrossRefGoogle Scholar

39 It is understood that a “Commission of African Jurists” was constituted under the auspices of the Organisation of African Unity in the mid-1960s (ibid.), but I am unaware of any notable achievement of the Commission.

40 Ndulo, above, at 116. Speaking from a premise of national harmonization, Professor S. A. de Smith made a somewhat similar suggestion many years ago when he observed that “It would be very delightful if any African country or group of countries could have at its disposal a large body of expert volunteers who would give sweat and toil over the years to the production of model codes—like the National Conference of Commissioners on Uniform State Laws in the USA or the Conference of Commissioners on Uniformity of Legislation in Canada—for enactment by territorial legislatures; or of advisory restatements of entire branches of private law, like the massive Restatement produced by the American Law Institute.” Smith, De, Integration of legal systems” in Leys, and Robson, (eds.), Federation in East Africa: Opportunities and Problems, Oxford, 1965, 158 at 169.Google Scholar

41 See Ndulo, above, at 112.

42 See e.g. Boggiano, A., International Standard Contracts: The Price of Fairness, Dordrecht, 1991, 2Google Scholar: “[t] he standard forms of contracts which are ‘the result of the concentration of a particular kind of business in relatively few hands’ would not give rise to the presumption of fairness”.

43 Elias, T. O., Africa and The Development of International Law 21 (Second Revised Edition, 1988; ed. Akinjide, R.).Google Scholar

44 The first non-European members were Japan, Canada and Australia. The United States of America only became a member in 1964.

45 See Mabula, above.

46 “Progressive development of the law of international trade”, Report of the Secretary General (UN Doc. A/6396, para. 210), reprinted in I UNCITRAL Yearbook 41 (1968–70); see also UN G.A. Res. 2205 (xxi) establishing the UNCITRAL which alludes to “the limited membership … and the small degree of participation in this field, of developing countries”.

47 A. Allott, “The unification of laws in Africa”, above; he argues that these problems actually made it more urgent to do something about the laws in Africa.

48 Sempasa, S. L., “Obstacles to international commercial arbitration in African countries” (1992) 41 I.C.L.Q. 387 at 390.CrossRefGoogle Scholar

49 See Gen, U.N.Ass. Res. 2205 (XXI) 1966.Google Scholar

50 See e.g. Date-Bah, S. K., “The international trade law of Ghana: present position and prospect for its harmonisation with the law of other African countries” in Institute Italo-Africano, Harmonisatum of African Law, Milano, 1972, 163 at 171Google Scholar; also The United Nations Convention on Contracts for The International Sale of Goods, 1980: overview and selective commentary” (1979) 11 Review of Ghana Law 50.Google Scholar

51 As of 1991, 16 African states had ratified or acceded to the UN Convention on the Carriage of Goods by Sea, 1978 (Hamburg) while 19 had ratified or acceded to the UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958. XXII UNCITRAL Yearbook 437–441 (1991). (The 1958 Convention was UN sponsored but its promotion was subsequently taken over by the UNCITRAL.)

52 See e.g. The UN Charter of Economic Rights and Duties of States UN Gen. Ass. Res. 3281 (XXIX)Google Scholar; see also Bulajic, M., “Legal aspects of a new international economic order” in Hossain, (ed.), Legal Aspects of the New International Economic Order, 1980, 45.Google Scholar

53 Horn, N., “Uniformity and diversity in the law of international commercial contracts” in Horn, and Schmitthoff, (eds.), The Transnational Law of Commercial Transactions (Studies in Transnational Economic Law Vol. 2, 1982), 3 at 17.Google Scholar

54 See e.g. Honnold, J., “The draft convention on contracts for the international sale of goods: an overview” (1979) 27 Am. J. Comp. L. 223, 225.CrossRefGoogle Scholar

55 Bradgate, R. and White, F., “In to the 21st century” in Gazette—Weekly Journal of the Law Society (11 November 1992) 19 at 23Google Scholar. Incidentally the Hague-Visby Rules are an improvement on the original Hague Rules. For instance, the rules on the limitation of the liability of the carrier by reference to 666.67 SDRs (“units of account”) are far more generous than the original Hague Rules. In The Morviken (also called The Hollandia) [1983] 1 A.C. 565Google Scholar, the cargo owners would only have been entitled to compensation of about £250, for damage to the shipped goods, in accordance with the Hague Rules whereas under the Hague-Visby Rules, deemed to be applicable, they were held to be entitled to compensation of about £11,000.

56 Similar suggestions in this regard were made by Date-Bah many years ago when he remarked that “The movement which is now afoot towards the unification and harmonisation of the various different national rules on international trade will eventually come to demand an expertise in the field of international trade law as such which may make persons concentrating on their internal commercial laws not fully competent to handle disputes and problems of a transnational character. It is believed that international trade law is of such importance that it is a national duty for an increasing number of lawyers to make effort of acquiring mastery over its rules in the interest of their national business community.” See Date-Bah, above, n. 21, 164–165.

57 The most cited definition of transnational law is that of Jessup who denned transnational law as including “all law which regulates actions that transcend national frontiers”—including both public and private international law and “other rules which do not fit into such standard categories”. See Jessup, P., Transnational Law, New Haven, 1956.Google Scholar The expression is, however, used in this article to denote the body of internationally developed rules of law that are universally accepted and applied, by the tribunals of different states and international tribunals, to transactions of a private nature involving a foreign element.

58 See e.g. Lando’s, Ole reference to “… the rules of law which are common to all or most of the states engaged in international trade …”, “The lex mercatoria in international commercial arbitration” (1985) 34 I.C.L.Q. 747Google Scholar; see also Goldman, B., “The applicable law: general principles of law—die lex mercatoria” in Lew, J. (ed.), Contemporary Problems in International Arbitration, London, 1986, 113Google Scholar

59 Sempasa, above, at 409–411.

60 Ibid. at 410.

61 Goldman, above, at 116.