Modernising Mesopotamia: The Case for Arbitration Reform in Iraq
Published 16 July 2014
Introduction
Not much time has elapsed, relatively speaking, since the US troops' withdrawal from Iraq. However, no sooner than the proverbial dust began to settle have international forces returned to the scene, to combat the most recent terrorist activity. Notwithstanding the ongoing conflict on the ground, for many businesses, operations must not grind to a halt. The continuing violence, and the serious corruption that subsists within the country's decision-making organs, should not detract from the urgent need to assess the adequacy of Iraq's legal regime, particularly from the perspective of international trade.
It remains true that significant economic progress has been made in Iraq, and is predicted to continue . However, a rise in business means an increase in claims. A major concern for foreign business is whether disputes may be settled in an efficient, fair and final manner in Iraq. At present, this does not appear to be the case . Although arbitration is now perceived to be the best and most efficient method to resolve international trade disputes, Iraq is yet to embrace the concept fully. The issue is not perhaps a fundamental misunderstanding of international arbitration in Iraq, but a mistrust of the mechanism. Another, more practical, impediment to reform is that change takes an excessively long time in Iraq, especially at the central government level.
This article commences with: (A) a brief overview of the history of arbitration in the Middle East, and subsequently describes (B) the origins of arbitration in Iraq. The position in relation to investment arbitration is then set out. This is followed by an analysis of the general commercial arbitration regime and, at (C), an identification of the main flaws of the arbitration laws in force. Focusing on commercial arbitration, Iraq's concerns about ratifying the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (the New York Convention or Convention) are set out, at (D), followed by an attempt to address those concerns, at (E). Finally, the article explains the reasons for which imminent reform is needed and concludes with (F) an overview of the developments currently in process, along with suggestions for further reform.
This paper will be part of the TDM special "Arbitration in the Middle East - Expectations and Challenges for the Future" - www.transnational-dispute-management.com/news.asp?key=527