Accession of the DRC to the New York Convention on arbitration
After its adoption by the National Assembly and the Senate of the Democratic Republic of the Congo (“DRC”), the President of the Republic promulgated on June 26, 2013 the Law No. 13/023 authorizing the accession of the DRC to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards signed in New York, on June 10, 1958 (the “Convention”).
This Law is based on Articles 213 al. 1 and 214 al. 1 of the Constitution authorizing the President of the Republic to sign and ratify the Convention. However, the Law authorizes the accession of the DRC to the Convention with four reservations.
The first reservation, based on the principle of reciprocity, provides that arbitral awards made in the territory of States that have not ratified or acceded to the Convention are not eligible for the enforcement of arbitral awards on DRC territory. This first reservation should not be an obstacle to the recognition and enforcement of most arbitral awards since at present 148 states are already signatories to the Convention and arbitral awards made in the territory of a State not party to the Convention are becoming increasingly rare. However, to avoid any adverse effects related to this reservation in any particular case, the parties to a compromise or an arbitration clause should ensure to fix the seat of the arbitral tribunal in a non-signatory country to the Convention.
The second reservation provides that only awards on matters considered “commercial” under national law shall be recognized and enforced in the DRC. This second reservation should only moderately affect the effectiveness of the accession of the DRC to the Convention insofar as disputes subjected to the Convention are generally commercial disputes and that commercial activities are broadly defined by the revised OHADA Uniform Act on general commercial law adopted on December 15, 2010. The OHADA Uniform Act on commercial companies and economic interest groups of April 17, 1997 establishes the theory of commerciality on the form in that disputes relating to commercial companies are considered commercial. In addition, pursuant to Act No. 08/007 of July 7, 2008 laying down general provisions on the transformation of public enterprises, Law No. 08/008 of July 7, 2008 laying down general provisions on the divestiture of the State from portfolio companies as well as Law No. 08/010 of July 7, 2008 laying down rules on the organization and management of the portfolio of the State, acts taken indirectly by the DRC in its capacity as the sole shareholder of public enterprises transformed into commercial companies are also within the scope of commercial matters.
The third reservation solely comes in as a precision to note that only arbitral awards made after the accession of the DRC to the Convention may be enforced under the Convention. This reservation confirms the principle of non-retroactivity.
Finally, the Law contains an important final reservation which provides that the Convention does not apply to disputes related to real property located in the considered State or on a right related to such property. In making such reservation, the DRC namely excludes from the scope of the Convention, all disputes which would, directly or indirectly, arise from real estate and property of the State and public entities such as mining rights, which are realty holdings in accordance with article 3 of the Mining Code. The DRC also excludes real property of the State and some public entities such as the Central Bank and public establishments within the meaning of the Law No. 08/009 of July 7, 2008 laying down general provisions applicable to public institutions. This last reservation made by the DRC is not provided by the Convention, which solely provides the possibility for a State to issue, at the time of signing, ratifying or acceding to the Convention, the reservation on reciprocity and/or that relating to the commercial nature of a dispute in accordance with its national law. Under the Vienna Convention on the Law of Treaties of May 23, 1969, a state at the time of signing, ratifying, accepting, approving or acceding to the treaty, may formulate a reservation unless the reservation is prohibited by the treaty; the treaty provides that only specified reservations, which do not include the reservation in question, may be made; or, in other cases, the reservation is incompatible with the object and purpose of the treaty. In this case, the Convention does not prohibit the latter reservation, and although it does not provide other reservations, it does not specify that only these two reservations on reciprocity and commerciality can be made by a state. In addition, although this reservation diminishes the effectiveness of the Convention in the DRC since the Convention would not apply to disputes over property or rights related to property located in the DRC, it should be noted that this reservation is not in itself incompatible with the object and purpose of the Convention. It must also be noted that Norway has issued a similar reservation when acceding to the Convention on March 14, 1961. Thus, with such a reservation, the DRC does not intend to limit the enforcement of foreign arbitral awards in the DRC to moveable property, but rather, to exclude disputes over immoveable property or interests in immoveable property located in the DRC from the Convention.
Despite the four reservations contained in the Law, the accession of the DRC to the Convention presents new perspectives for investment security in the DRC. Indeed, in acceding to the Convention, the DRC mainly takes the initiative to recognize and enforce arbitration agreements subject to its courts and tribunals, and to recognize and enforce arbitral awards rendered abroad without prejudice to the reservations made by the DRC upon its accession to the Convention.
Nevertheless, it should also be noted that the enforcement of foreign arbitral awards in the DRC will be done in conformity with the national rules of collection and enforcement, which are now governed exclusively by the June 1, 1998 OHADA Uniform Act organizing simplified recovery procedures and measures of execution. It should be noted that Article 30 of this Uniform Act as well as the related jurisprudence of the Common Court of Justice and Arbitration excludes public corporations’ properties, including that of state-owned companies, from general pledge of their creditors by acknowledging their sovereign immunity from execution. Therefore, if the state or public enterprises have not expressly waived their sovereign immunity from execution, any creditor of the State or of a public company will not be able to use the Convention to enforce a foreign arbitral award on the State’s property or of its state-owned companies.
The Law which was promulgated by the President of the Republic on June 26, 2013 shall be soon published in the Official Journal. In order to finalize its accession to the Convention, the DRC needs now to depose its instrument of accession to the Secretary-General of the United Nations. Pursuant to Article 12, paragraph 2 of the Convention, the Convention will enter into force in the DRC on the 90th day following the date of deposit by the DRC of its instrument of ratification or accession.
 Article 19 of the Vienna Convention on the Law of Treaties of May 23rd, 1969 to which the DRC joined on July 25, 1977 and entered in force on January 27, 1980 in the DRC.
United Nations, Treaty Collection http://treaties.un.org/pages/ViewDetails.aspx?src=TREATY&mtdsg_no=XXII-1&chapter=22&lang=en#EndDec)
Emery Mukendi Wafwana and Upio Kakura Wapol, Protection of State-owned companies subsequent to the accession of the Democratic Republic of Congo to OHADA, (http://www.cabemery.org/fr/2013/03/16/la-protection-des-entreprises-du-portefeuille-de-letat-en-consequence-de-ladhesion-de-la-rdc-a-lohada/#_ftn3)