Zanzibar to establish arbitration center to boost investments and blue economy

Unguja. The Revolutionary Government of Zanzibar (SMZ) is in the process of drafting laws on arbitration and an arbitration center. These laws are expected to boost investment and the blue economy in Zanzibar.

For the first time, Zanzibar will establish an arbitration center outside of the court system. However, the arbitration law already existed, but it was outdated and is being repealed and replaced with a new one.

Speaking at a stakeholders' meeting to discuss the draft bills of the two laws in Unguja yesterday, Minister of State in the Office of the President, Constitution, Law, Public Service, and Good Governance, Haroun Ali Suleiman said that they had found that when disputes arise between investors and other entities, there are long delays when the cases go to court.

He said that the issue of investment requires more attention to the laws in order to attract more investors.

“Currently, arbitration matters are governed by various laws that were inherited from the colonialists, including the 1928 Chapter 25, another law of 1926 Chapter 26, and another law of 1931 Chapter 27, all of which are close to 100 years old,” said Minister Haroun.

When President Mwinyi took office, he ordered that all laws that are outdated be reviewed and, if possible, be repealed and redrafted.

The enactment of this law and the establishment of the center will not only please investors, but also citizens, as the center will not be used only for disputes between foreign and domestic investors, but also for ordinary arbitration.

Minister Haroun said that the government has decided to establish a specialized arbitration center instead of going to court, because these disputes will be resolved in the center in a more rational and wise way.

The center will have a specialized panel led by a chairman appointed by the President, with members appointed by the responsible minister.

“When you have a dispute, you can resolve it yourselves instead of going to court, where the costs are high and could discourage investors from investing elsewhere,” he said.

For his part, the Attorney General of Zanzibar, Dr. Mwinyi Talib Haji, said that the government is emphasizing investment, which is why they said that there is a need to come up with draft bills of these laws.

“We felt that we had to come up with a solution to a long-standing cry, and through these draft bills, it will be a catalyst for going where we want to go as a nation,” said Dr. Talib.

He said that one of the characteristics of a law is that it must be in line with the times, and the current time is the right time, especially considering the government's intention and that investors, when they go to invest somewhere, the most important thing they want to see in the country is that the laws are in good order and that they believe in the country where they are investing.

“These draft bills will provide very important guidance, and this is aimed at building confidence among investors, first they will appreciate that Zanzibar is a good place to invest and that its laws are friendly to avoid the long delays of involving the courts, first it is expensive, but it also takes a long time, and these things need to be done quickly,” he said.

For his part, independent lawyer and former president of the Zanzibar Bar Association, Slim Said, said that Zanzibar is currently open and attracting more investors and businessmen.

He said that experience shows that investment and business disputes do not go to ordinary courts because the arbitration process is easier and that is where the world is headed.

“We, as lawyers, are very happy to have a law like this, our neighbors have already done this, and we should support these things for the economic and commercial development of our country,” he said.

The bills will be sent to a meeting of permanent secretaries, then the Revolutionary Council, and then the House of Representatives to obtain the approval of the members of the council before being passed into a full law.