African Insights: dispute resolution - knowing your options

Investing in African private equity funds is not a new phenomenon: development finance institutions (DFIs), such as UK based CDC Group, have been doing it for decades. However, institutional investors are finally recognising the opportunities that the continent affords. As a result, some managers (for example, Helios Investment Partners and The Abraaj Group) are now raising significant African-focused funds in the region of $1bn.

Dispute resolution and governing law clauses provide the essential mechanisms which will enable a party to protect its investment and other contractual rights. For this reason, it is important not to treat these provisions as generic “boilerplate” terms but to tailor them to the specific circumstances of a deal and the parties’ commercial objectives.

In this latest publication of our African Insights series, the first of a two part article, we look at the reasons why arbitration may often be a better choice than litigation in resolving a dispute and at some key international agreements which should be taken into account.

The second part of this article will look in more detail at issues to consider when drafting arbitration agreements.