By Abah Adah, Abuja

The immediate past Director General (DG) of the Nigerian Institute of Advanced Legal Studies (NIALS), Professor Muhammed Tawfiq Ladan, has charged member states of the Economic Community of West Africa (ECOWAS) to own up their treaty obligations towards tackling fundamental challenges for seamless subregional integration and implementation of the African Continental Free Trade Agreement (AfCFTA).

The Nigerian legal icon gave the charge in a presentation he made titled, “State Sovereignty and Some Implications of State Versus State Dispute Settlement in AfCFTA Law” at the 2-day capacity building on dispute resolution mechanisms under the AfCFTA and ECOWAS laws for judicial, registry, and legal officers of the Community Court of Justice, organised by the Trade Directorate, ECOWAS Commission at its headquarters in Abuja from 3rd to 4th October, 2024.

In the presentation, the professor dwelt extensively on the encumbrances on the way of AfCFTA laws implementation, exploring the rationale behind, and the implications, relating to the AfCFTA law protecting the sovereignty of state parties through exclusive right to sue each other on behalf of their nationals and the exclusive mandate vested in the Assembly and the Council of Ministers to adopt authoritative interpretations of AfCFTA Law.

According to Ladan, the AfCFTA law provides for a robust Dispute Resolution Mechanism (DSM) for resolving trade disputes among member states (state to state dispute) modelled after the World Trade Organisation (WTO) mechanism, with the first option to explore amicable solution through Alternative Dispute Resolution (ADR) processes before referral to a Panel, then an Appellate Body and Final / Binding Ruling by the Dispute Settlement Body (DSB) on the parties in dispute.

“It is a central element in providing security and predictability to the continental Free Trade Area (FTA), and shall preserve the rights and obligations of state parties under the agreement and clarify its existing provisions in accordance with Customary rules of interpretation of public international law,” he stated.

The power is exercised based on the recommendation of the Council of Ministers responsible for Trade. And because AfCFTA is Member State-driven, the unequivocal provision of the DSM Protocol is that it does not give standing to any natural or legal person to bring a case against an AfCFTA State Party that breaches its obligations in a manner that causes injury to that natural or legal person.

Hence non-state actors/ the private sector operators are practically excluded from having access to the DSM, knowing that, most transactions involve private entities like cross-border traders, service providers, importers, exporters, producers and investors, etc; and that African governments are known to be reluctant in suing each other as they prefer to resolve such disputes by an alternative option, such as diplomatic means.

He therefore tasked member states to show greater commitment to their treaty obligations by addressing the fundamental operational and financial challenges facing the community institutions and the capacity deficits to implement community laws, programmes and decisions at national levels, while stressing the urgent need to engage and involve all relevant stakeholders for successful implementation of the recommendations made.

“Engaging all relevant stakeholders, including State Parties, businesses, legal experts, and civil society organisations, is crucial in considering and implementing the above recommendations.

“By taking these steps, the AfCFTA can strengthen its Protocol on Dispute Resolution, foster confidence in the system, and promote a fair and efficient resolution of disputes among its State Parties,” he said.

He expressed concern that since the AfCFTA dispute settlement mechanism does not allow for any other mechanism, there is the likelihood of conflict or overlapping between regional and continental mechanisms.

According to him, there is therefore the need to fine tune the relationship between the AfCFTA Agreement dispute settlement mechanism and that of RECs (Regional Economic Communities, set up to serve as the building blocks for the Continental common market) in respect of economic disputes.

Prof. Ladan commended ECOWAS for providing a hybrid system specified a role for the ECOWAS Court of Justice.

“Although there is emphasis at the continental and ECOWAS regional levels on Rules based mechanism for resolution of economic disputes, it is commendable that ECOWAS has provided a hybrid system that provides a role for the ECOWAS Court of Justice.

“Unlike the AfCFTA Dispute Protocol that only settles disputes between State Parties, the ECOWAS DSM grants access to State parties, Investors, corporate bodies and individuals. It is also interesting that the ECCJ has also been able to use its human rights mechanism to settle economic disputes.

“Although, the regional and continental DSMs appear workable on paper, implementation is always a challenge in Africa,” he said.

Prof. Ladan made a case for supranational status for regional bodies, such that ECOWAS, for instance, can be empowered to take decisions that are binding on itself and on all.

Full Text of Prof Ladan’s Paper:

Introduction:

The Dispute Settlement Mechanism (DSM) of the AfCFTA is a central element in providing security and predictability to the continental Free Trade Area (FTA). The dispute settlement mechanism shall preserve the rights and obligations of State Parties under the Agreement and clarify the existing provisions of the Agreement in accordance with Customary rules of interpretation of public international law.

The AfCFTA law consists of the founding AfCFTA Agreement, its eight Protocols on Trade in Goods, Services, DSM, Investment, Competition policy, Intellectual Property Rights (IPRs), Digital Trade and Women and Youth in Trade, as well as their Annexes and Appendices, shall form the integral part of the Agreement upon adoption by State Parties.

The obvious effect of Article 10(2) of the AfCFTA Agreement and Article 4(1) of the Protocol on DSM is to protect the Sovereignty of AfCFTA State Parties regarding the interpretation of AfCFTA Law. The power to adopt authoritative interpretations of AfCFTA law is vested in the African Union Assembly of Heads of State and Government. However, this power is exercised based on the recommendation of the Council of Ministers responsible for Trade.

The Agreement and the Protocol on Rules and Procedures on the Settlement of Dispute established a DSM to be administered in accordance with the protocol. Put together, the AfCFTA law provides for a robust DSM for resolving trade disputes among Member States (State to State Dispute) modelled along the World Trade Organisation(WTO) mechanism, with the first option to explore amicable solution through Alternative Dispute Resolution(ADR) processes before referral to a Panel, then an Appellate Body and Final / Binding Ruling by the Dispute Settlement Body (DSB) on the parties in dispute. Because AfCFTA is Member State-driven, the unequivocal provision of the DSM Protocol is that it does not give standing to any natural or legal person to bring a case against an AfCFTA State Party that breaches its obligations in a manner that causes injury to that natural or legal person. Hence Non-State actors/ the Private Sector operators are practically excluded from having access to the DSM, knowingly that , most transactions involve private entities like cross-border traders, service providers, importers, exporters, producers and investors, etc; and that African Governments are known to be reluctant in Suing each other as they prefer to resolve such disputes by an alternative option, such as diplomatic means.

It is against this background that this paper seeks to explore the rationale behind, and the implications, relating to the AfCFTA law protecting the Sovereignty of State Parties through exclusive right to sue each other on behalf of their nationals and the exclusive mandate vested in the Assembly and the Council of Ministers to adopt authoritative interpretations of AfCFTA Law.

 

1.0 AfCFTA LAW:- NO SUPRANATIONALITY, MEMBER STATE-DRIVEN, A SINGLE UNDERTAKING AND RECS AS THE BUILDING BLOCS.

The concept of SUPRANATIONALISM1 refers to a decision making process in a regional integration framework that encourages sovereign member states, that voluntarily established a regional organization for their common benefit, to agree to transfer/cede to or share or jointly exercise part of their sovereignty with, the regional integration body (like ECOWAS) and its established institutions, such that they can take decisions and enact laws that are directly applicable in member states and of binding effect directly on both the Regional Community Institutions, the Member States and their citizens or non-state actors2. These twin principles of direct applicability and of binding effect ensure that laws passed at the regional level in those areas where the regional organization is granted competence or power3, prevails over national legislations and national interest for the collective interest of the regional community4.

The key issues with supranational arrangements are in ensuring that:

Shared power for decision making processes between the SUPRANATIONAL ENTITY and the Member States are for shared responsibility in achieving the regional integration agenda/economic community objectives5;

Democratic participation of stakeholders in regional integration processes, increases the participation of community citizens civil society organizations and the private sector (as Non-State Actors)6;

Upholding the Rule of Law in exercising power, transparency in decision making and accountability of Supranational entities to both Members States and their citizens, shall remain of paramount importance7.

The AfCFTA law consists of the founding Agreement and its eight Protocols on Trade in Goods and Services, Dispute Settlement, IPR, Investment, Competition policy, Digital trade, and Women and Youth in Trade, as well as all their Annexes and Appendices are deemed to be part of the Agreement upon adoption. The AfCFTA is based on founding principles. Article 5 of the Agreement explicitly states that this arrangement will amongst other things, be MEMBER-DRIVEN and the ACQUIS (the body of laws, rights and obligations that bind a group of member States in an integration body) of the Regional Economic Communities (RECs) must be preserved. These important aspects are confirmed in the provisions of Article 19(2) of the AfCFTA Agreement and Article 8(2) of the Protocol on Trade in Goods. It means, firstly, that the eight recognised RECs by the African Union (namely ECOWAS, SADC, EAC, AMU, COMESA, IGAD, CENSAD and ECCAS) are essentially the building blocs of AfCFTA.8 Secondly, it means that AfCFTA State Parties retain the right to conclude trade agreements with third parties under Article 4 (2) of the Protocol on Trade in Goods.

The institutional architecture of the AfCFTA is another important matter. The AfCFTA Agreement does not establish a Customs Union and there are NO Supranational institutions in its implementation framework. The AU Assembly of Heads of State and Government is the highest decision-making body. The Council of Ministers Responsible for Trade provides strategic trade policy oversight and ensures effective implementation and enforcement of the AfCFTA Agreement. Decisions are adopted by consensus. The only permanent institution is the Secretariat based in Accra-Ghana, headed by a Secretary General. The AfCFTA Secretariat receives its instructions from the Council of Ministers. The Committee of Senior Trade Officials implements the Councils decisions, as a body responsible for the development of programmes and actions plans for the implementation of the AfCFTA Agreement.9

The intention of the AfCFTA Agreement is to have a ‘SINGLE UNDERTAKING’ , whereby all State Parties must be bound by the Agreement as a whole, including the Protocols, their Annexes and Appendices, as defined in Article 1 of the Agreement. Article 8(2) of the Agreement provides as follows….. that the Protocols on Trade in Goods, Trade in Services, Investment, Intellectual Property Rights, Competition Policy, Rules and Procedures on Dispute Settlement and their associated Annexes and Appendices shall form part of the single undertaking upon adoption.10

 

2.0 THE STATE PARTIES’ EXCLUSIVE STANDING TO BRING A CASE: – A PRESERVATION OF STATE SOVEREIGNTY AND IMPLICATIONS UNDER AFCFTA LAW

Perhaps, the most ostensible feature of the AfCFTA dispute settlement mechanism is the establishment of a state v state dispute settlement system. Article 3(1) of the AfCFTA Dispute Settlement Protocol states that “This Protocol shall apply to disputes arising between State Parties concerning their rights and obligations under the provisions of the Agreement”. This is an unequivocal provision that does not give standing to any natural of legal person to bring a case against an AfCFTA member that breaches its obligations in a manner that causes injury to that natural or legal person. For example, if a company in Ghana were to suffer a breach of the non-discrimination in the Protocol on Trade in Goods11 while exporting goods to Nigeria, that company will not have standing in the domestic courts of Nigeria nor under the AfCFTA dispute settlement mechanism to pursue a redress of the breach suffered. The said company would have to rely on the Ghanaian government to bring a case against Nigeria for the breach of the non-discrimination obligations. In effect, the AfCFTA dispute settlement mechanism does not incorporate the principle of direct effect as pertains in EU law, but rather tows the state v state system followed under WTO law.

In the EU system, as per established jurisprudence in landmark cases like Costa v ENEL12, Van Gend en Loos13, and Francovich v Italy14, persons whose rights under EU law are breached by a member state are empowered to bring cases against the member in breach of its obligations in the domestic court. If there is no precedent in an already decided case that the domestic court could follow, it refers the matter to the Court of Justice of the European Union (CJEU) for a preliminary ruling. The CJEU then refers its’ ruling back to the domestic court for enforcement. This process obviates the need for the home state of the injured person to bring a case on behalf of its citizen under the traditional international law principle of diplomatic protection. Importantly, the principle of direct effect means that, EU law is directly applicable in the domestic legal systems of member states and can thus be enforced like any domestic law that grants enforceable rights to citizens.15

It can be surmised from the provision in Article 3(1) of the AfCFTA Dispute Settlement Protocol that, the overriding rationale for adopting a system that only allows the member states to have standing to bring a case is the preservation of state sovereignty. It is however doubtful whether such a jealous protection of state sovereignty can deliver the high aspirations vested in the AfCFTA project. Precedent from a subregional free trade system like the Economic Community of West African States (ECOWAS) shows that member states are very reluctant to bring cases against each other for breach of ECOWAS law. For example, Nigeria has on many occasions closed its land borders in breach of the free movement of goods provision in ECOWAS law16 but this has not resulted in any of the affected ECOWAS member states bringing a case against it. Also, the ‘on-off’ harassment of ECOWAS traders in Ghana by their Ghanaian competitors in breach of the national treatment provisions in ECOWAS law17 has not resulted in any of the home states of the affected traders bringing a case against Ghana. It may be argued that the Ghanaian traders who have often harassed other traders from ECOWAS countries did not act on the directions of the state and thus there is no state responsibility for their individual actions. However, the inaction of the state to resolve the sporadic harassment of ECOWAS traders in Ghana hampers the certainty and full realisation of the freedom of establishment provisions in ECOWAS law.18 Of particular note is the fact that Section 27 of the Ghana Investment Promotion Centre Act 2013 blatantly discriminates against ECOWAS citizens by denying them national treatment regarding admission and establishment in Ghana.19 Again, no ECOWAS member state has brought a case against Ghana for breach of ECOWAS law. Compared, for example, to the Factortame20 cases in EU which also centred on discriminatory treatment against some EU citizens in the UK21, the application of the principle of direct effect ensured and protected the rights of the injured persons resulting in their access to effective and expeditious remedies. There was no need for a calculation of the political ramifications of bringing a case against the UK government as this was not a state v state dispute settlement hence obviating the involvement of the home state22 of the affected EU citizens.

The reluctance of ECOWAS member states to initiate dispute settlement proceedings in the ECOWAS Court of Justice against other members who breach their obligations thus seems to indicate a tacit agreement among themselves not to sue each other for breach of the treaties they signed up to. In effect, ‘I don’t sue you if you breach your obligations and you don’t sue me if I breach mine’. The overreliance on diplomatic resolution of disputes at the state level without resort to formal dispute settlement proceedings at the ECOWAS Court of Justice has not helped in the development of the Courts jurisprudence on key provisions in ECOWAS law. This has also not contributed to legal certainty and the persons who suffer the brunt of ECOWAS countries’ reticent inertia regarding enforcement of the law are, ironically, the ones that are supposed to be the beneficiaries of its trade liberalisation provisions. If such behaviour becomes the norm among AfCFTA members, the effectiveness and enforcement of the trade liberalisation rules will be sacrificed on the altar of protection and preservation of state sovereignty. A self-imposed restriction on sovereignty arising from treaty obligations does not result in its diminution. It is rather a legitimate expression of state sovereignty. A corollary in domestic law would be the fundamental principle of freedom to contract. While signing a contract may impose some limits on the freedom of the individual, the freedom to enter into such self-imposed restrictions is, itself, an expression of the individual’s freedom and not a diminution of it.

It is hoped that AfCFTA members will not tow the example that has pertained in ECOWAS. While resort to the principle of direct effect would have been more advantageous due to the limitations of state v state dispute settlement, a more proactive resort to the dispute settlement system in the AfCFTA can also lead to the clarification of the law which will in turn result in more certainty, especially, for the business community. Resort to diplomatic resolution of disputes, as has been practiced in the ECOWAS system, has the evident benefit of preserving good international relations. However, it also has the major disadvantage of reliance on political goodwill, especially from the state in breach of its obligations. There is also the possibility of watering down the treaty obligations that must be adhered to, especially, if the state in breach of its obligations is more powerful and can thus exert greater influence in resolving the dispute on its terms. In the absence of direct effect of AfCFTA law, resort to the rules-based system established under the AfCFTA Dispute Settlement Protocol where Panels and the Appellate Body will act as impartial arbiters should be the more preferred route. It will take away the power dynamics of the dispute settlement process and ensure that an impartial rules-based forum decides cases on principles of law instead of the uncertainties of diplomacy.

 

3.0 PROTECTING THE SOVEREIGNTY OF STATE PARTIES REGARDING INTERPRETATION OF AfCFTA LAW.

The dispute settlement mechanism of the African Continental Free Trade Area (AfCFTA) follows the system that pertains in the World Trade Organisation (WTO) by vesting in the dispute settlement process the power of ‘clarification’ instead of interpretation of AfCFTA law. As normally pertains in national and international legal systems, the political organs exercise legislative powers while the judicial organs exercise the powers of interpreting the law. The AfCFTA dispute settlement system is technically distinct in this regard as interpretation is a function exclusively vested in the political organs.23 Article 4(1) of the AfCFTA Dispute Settlement Protocol states that:

The dispute settlement mechanism of the AfCFTA is a central element in providing security and predictability to the regional trading system. The dispute settlement mechanism shall preserve the rights and obligations of State Parties under the Agreement and clarify the existing provisions of the Agreement in accordance with customary rules of interpretation of public international law.

The power to adopt authoritative interpretations of AfCFTA law is vested exclusively in the Assembly.24 However, this power is exercised based on the recommendation of the Council of Ministers.25 Article 10(2) of the AfCFTA Agreement states that:

The Assembly shall have the exclusive authority to adopt interpretations of this Agreement on the recommendation of the Council of Ministers. The decision to adopt an interpretation shall be taken by consensus.

Article 11(3)(o) further elaborates on the Council of Ministers’ role in the adoption of authoritative interpretations by providing that “The Council of Ministers shall within its mandate make recommendations to the Assembly for the adoption of authoritative interpretation of this Agreement”. It is important to point out that the phrase – ‘this Agreement’ – used in Articles 10(2) and 11(3)(o) refers to the AfCFTA Agreement and all the protocols annexed to it. The phrase ‘this Agreement’ in effect means AfCFTA law. This position is supported by the provision in Article 8(1) of the AfCFTA Agreement which states that:

The Protocols of Trade in Goods, Trade in Services, Investment, Intellectual Property Rights, Competition Policy, Rules and Procedures on the Settlement of Disputes and their associated Annexes and Appendices shall, upon adoption, form an integral part of this Agreement26.

Consequently, the power given to the Assembly to adopt authoritative interpretations of ‘this Agreement’ is, simply put, the power to adopt authoritative interpretations of AfCFTA law. With the power to adopt authoritative interpretations so specifically and exclusively vested in the Assembly, it does not leave any residual powers of ‘interpretation’ for panels and the Appellate Body of the AfCFTA dispute settlement mechanism. Consequently, Article 4(1) of the Dispute Settlement Protocol vests in the AfCFTA dispute settlement mechanism the power to “clarify the existing provisions of the Agreement” and not the power to ‘interpret’. Article 4(1) also provides that the power to clarify AfCFTA law “shall preserve the rights and obligations” of member states. This implies that the findings of dispute settlement panels and the Appellate Body cannot add to or diminish the rights and obligations of members states, or make law for that matter.27

Some guidance can be gleaned from the WTO dispute settlement system as the AfCFTA political and judicial decision-making systems are largely modelled on what pertains in the WTO. In the Japan – Alcoholic Beverages II28 case, the issue of the legal effect of decisions of panels and the Appellate Body arose – i.e. whether prior decisions of panels and the Appellate Body adopted by the Dispute Settlement Body (DSB) amounted to subsequent practice within the meaning of Article 31 of the Vienna Convention on the Law of Treaties. The panel in the Japan – Alcoholic Beverages II29 case had held that decisions of panels and the Appellate Body adopted by the DSB constituted subsequent practice. Regarding interpretation of treaties, Article 31(3)(b) of the Vienna Convention on the Law of Treaties provides that: “There shall be taken into account, together with the context: any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation”. If the Appellate Body had concurred with the reasoning of the panel, it would have meant that their prior decisions adopted by the DSB established subsequent practice that could be used in addition to the WTO treaties in the interpretation of WTO law. Panels and the Appellate Body could, effectively, be making law through the adoption of their decisions by the DSB. The Appellate Body however disagreed with the reasoning of the panel. It held that:

We do not believe that the CONTRACTING PARTIES, in deciding to adopt a panel report, intended that their decision would constitute a definitive interpretation of the relevant provisions of GATT 1947. Nor do we believe that this is contemplated under GATT 1994. There is specific cause for this conclusion in the WTO Agreement. Article IX(2) of the WTO Agreement provides: ‘The Ministerial Conference and the General Council shall have the exclusive authority to adopt interpretations of this Agreement and of the Multilateral Trade Agreements’. Article IX(2) provides further that such decisions ‘shall be taken by a three-fourths majority of the Members’. The fact that such an ‘exclusive authority’ in interpreting the treaty has been established so specifically in the WTO Agreement is reason enough to conclude that such authority does not exist by implication or by inadvertence elsewhere.30

The above position is further buttressed by the Appellate Body’s reasoning in the US – Wool Blouses31 case. The Appellate Body held in this case that:

Article 3.2 of the DSU states that the Members of the WTO ‘recognize’ that the dispute settlement system ‘serves to preserve the rights and obligations of Members under the covered agreements, and to clarify the existing provisions of those agreements in accordance with customary rules of interpretation of public international law’. Given the explicit aim of dispute settlement that permeates the DSU, we do not consider that Article 3.2 of the DSU is meant to encourage either panels or the Appellate Body to ‘make law’ by clarifying existing provisions of the WTO Agreement outside the context of resolving a particular dispute. A panel need only address those claims which must be addressed in order to resolve the matter in issue in the dispute.32

It is worthy of note that the Article 10(2) of the AfCFTA Agreement which vests in the Assembly the exclusive power to adopt authoritative interpretations mirrors a similar provision in Article IX(2) of the WTO Agreement. Also, the provision in Article 4(1) of the AfCFTA Dispute Settlement Protocol is a direct replication of Article 3(2) of the WTO Dispute Settlement Understanding (DSU) as quoted above in the US – Wool Blouses case. Thus, the jurisprudence of the WTO Appellate Body on Article IX(2) of the WTO Agreement and Article 3(2) of the DSU can be transposed into the interpretation of Article 10(2) of the AfCFTA Agreement and Article 4(1) of the AfCFTA Dispute Settlement Protocol.

The obvious effect of Article 10(2) of the AfCFTA Agreement and Article 4(1) of the AfCFTA Dispute Settlement Protocol is to protect the sovereignty of the AfCFTA member states regarding interpretation of AfCFTA law. In effect, AfCFTA members have carved out for themselves the exclusive authority to determine the meaning of the treaty provisions they negotiated and acceded to. A cogent argument can be made in support of the protection of state sovereignty provided for in AfCFTA law. The member states that negotiated and adopted to an agreement should have the exclusive right to interpret the meaning of the provisions in that agreement. A supranational organ vested with such powers of interpretation could develop interpretation that is at variance with the original intensions of the treaty framers. Robert Jackson thus argues that fundamental issues regarding sovereignty arise:

… in connection with many treaty details, such as (for example) when a treaty-based international institution sees its practice and “jurisdiction” evolve over time and purports to obligate the nation members even when they opposed such evolution.33

For AfCFTA members, it is obvious that the mechanism they have adopted to prevent an evolution of AfCFTA law in a manner that may contradict their intentions is to carve out for themselves the exclusive authority of interpretation.

4.0 CORE PRINCIPLES OF AfCFTA DISPUTE RESOLUTION MECHANISM

Under Article 20 of the AfCFTA, a Protocol on Rules and Procedures for the Settlement of Disputes was also created to ensure transparency, accountability, fairness, and predictability in AfCFTA dispute settlement processes.

Core Principles Reflected in the Protocol

Article 334 of the Protocol applies to disputes between State Parties to the AfCFTA regarding the interpretation and application of their rights and obligations under the AfCFTA. The core principles of the Protocol for addressing disputes arising from the interpretation and application of rights and obligations under the AfCFTA are as follows:

Party Autonomy. The Protocol empowers the parties involved in a dispute to have control over the dispute resolution process and outcome. Within the AfCFTA framework, the parties can decide how to resolve their dispute. The Protocol provides them with various options, including consultations, mediation, adjudication through a Dispute Settlement Panel (“DSP“), or independent arbitration. This flexibility allows the parties to choose the most suitable method.

When exercising this autonomy, the party initiating the dispute must notify the other party and indicate a dispute settlement mechanism of its preference. The parties can opt for alternative methods, such as mediation or arbitration, as long as they have attempted to settle the dispute amicably through consultation and – for arbitration – provided that both parties have consented to arbitration and the arbitration rules35.

The principle of party autonomy empowers the parties to participate in the dispute resolution process actively and provides a cooperative and consensual approach for the parties in resolving disputes. Allowing the parties to tailor the process to their needs, preferences, and priorities fosters a sense of ownership and fairness in the dispute resolution process, enhancing the parties’ confidence in the outcome and thereby, contributing to the effectiveness and efficiency of the overall dispute resolution system within the AfCFTA framework.

The Neutrality of the Forum. The AfCFTA’s dispute settlement forum (“the forum“) is designed to ensure neutrality, impartiality, and fairness in dispute resolution. One of the fundamental aspects of this forum is its commitment to providing a self-contained and independent dispute resolution system.

The proceedings under the Protocol are delocalised from domestic procedures to maintain neutrality. National courts do not have jurisdiction to intervene in disputes subject to the AfCFTA. By removing national courts’ influence, the forum can operate independently and make decisions based on the provisions and principles outlined in the AfCFTA.

Overall, the neutrality of the forum is crucial in fostering a robust and reliable trade environment among State Parties. It ensures that disputes are resolved in a fair, unbiased, and independent manner, contributing to the effective implementation and enforcement of the AfCFTA.

Efficiency and Finality of the Process: Unlike in domestic courts, where a dispute may be decided by a judge who may not have expertise in the subject matter, here, the State Parties nominate only qualified individuals with expertise and experience in international law, international trade, and dispute resolution to join the list of active neutrals maintained by the AfCFTA Secretariat. The Dispute Settlement Body (“DSB“) selects individuals from this list to constitute the DSP to adjudicate disputes under the AfCFTA36. The DSP has a continuous obligation to remain impartial and independent. Members of the DSP are also barred from participating in another dispute resolution proceeding that would create a direct or indirect conflict of interests, which is crucial for ensuring quality awards.

If a party feels aggrieved by the DSP’s decision, the party may (as of right) appeal it to the Appellate Body (“AB“)37. The Protocol imposes limitations related to the scope of the appeal, i.e., the issues covered in the panel report and legal interpretation. Only the disputing parties have the right to appeal (a third party with substantial interest may also be joined if the disputing parties agree that the claim of significant interest is well founded). The AB’s decision is final, binding, and subject to no appeal.

Confidentiality. The secrecy of the dispute resolution process is also a vital component of the Protocol, binding on the parties, DSB, DSP, and AB38. They must keep confidential all information, documents, submissions, and discussions related to the dispute. Confidentiality fosters an environment conducive to open and frank discussions between the parties involved. It allows and encourages them to freely exchange information, including sensitive information, present their arguments, and explore potential solutions without concerns about public disclosure which helps ensure a more effective and efficient process.

By maintaining the confidentiality of the proceedings, parties can avoid potential harm to their reputation or commercial interests or keep any other sensitive information from being disclosed to the public. As such, it enhances the parties’ confidence in the system and encourages them to participate actively.

By upholding confidentiality, the forum maintains its credibility and preserves its role as a trusted mechanism for resolving disputes under the AfCFTA. Additionally, it safeguards the integrity and effectiveness of the forum and prevents any unauthorised disclosure of information that could undermine the impartiality and fairness of the process.

Shortcomings

The Protocol encompasses vital principles for free and fair resolution of disputes. Still, it leaves out crucial elements that, if unaddressed, could hinder the achievement of its desired purposes of promoting intra-African trade, enhancing economic growth and development, facilitating industrialisation and structural transformation, promoting regional integration, enhancing Africa’s global competitiveness, and promoting sustainable development and inclusive growth. Some of these shortcomings are as follows:

Limited Participation of Non-State Actors. The Protocol only applies to disputes between State Parties, restricting the participation of non-State actors such as private enterprises, civil society organisations, or individuals. The exclusion of these actors limits their ability to address trade-related grievances or concerns. Greater inclusion of non-State actors could contribute to a more comprehensive and balanced dispute resolution framework.

Ambiguity and Unpredictability. The Protocol empowers the DSB and AB to make their own rules. In doing so, they are not obligated to consult or comply with other standards. These bodies lack democratic legitimacy, and granting them such vast power may lead to a lack of accountability, limited transparency, risk of bias, and inconsistency. All of which undermines trust and confidence in the dispute settlement process.

Lack of Transparency. The Protocol does not sufficiently address transparency concerns within the dispute resolution process. While confidentiality provisions are in place to protect sensitive information, there is a need for greater transparency in providing access to information related to ongoing disputes, the selection and appointment of adjudicating panel, and the overall functioning of the dispute settlement mechanism. Enhanced transparency would promote trust, accountability, and understanding among stakeholders.

Capacity Building Challenges. The successful implementation of the Protocol relies on the availability of skilled personnel and effective institutions to handle dispute-resolution processes. However, many African countries face capacity-building challenges, including limited expertise in trade law and dispute settlement procedures. Insufficient resources and training programs for judges, lawyers, and other stakeholders involved in the dispute-resolution process can hamper the efficiency and effectiveness of the system.

Insufficient Clarity on Mediation Procedures. While the Protocol includes provisions for mediation as an alternative dispute resolution mechanism39, it lacks clear guidelines and procedures for conducting mediation. This ambiguity may make it challenging for parties to effectively engage in mediation or understand how to initiate the process. Clear guidelines would enhance the utilisation of mediation and provide parties with an additional option for resolving disputes.

Limited Access to Justice for Small and Medium-Sized Enterprises (SMEs). The Protocol may pose challenges for SMEs in accessing the dispute resolution mechanism. SMEs, which play a significant role in many African economies, may face difficulties navigating the complex procedures and costs associated with the dispute settlement process. It could create an imbalance in access to justice, working more favourably to larger and more resourceful entities.

The following can be done to address the shortcomings mentioned above: (1) extend the scope of the Protocol to allow non-State actors, e.g., private investors to lodge their complaints directly under the AfCFTA; (2) provide more explicit guidance on the scope and limitations of confidentiality obligations within the Protocol which could include outlining the types of information that should be kept confidential, specifying exceptions to confidentiality, and ensuring a proper balance between transparency and protecting sensitive information; (3) developing mechanisms within the Protocol to address SMEs’ specific needs and challenges in accessing the dispute resolution mechanism which could involve providing simplified procedures, reduced costs, and technical assistance to facilitate their participation; and (4) amending the Protocol to provide clearer guidelines and procedures for mediation within the Protocol, including details on initiating mediation, the role of mediators, and the time frame for completion.

5.0 AfCFTA AND SPECIAL DISPUTE RESOLUTION FRAMEWORK

AfCFTA dispute settlement is defined by two main frameworks: the traditional framework involving the preliminary processes in dispute settlement (conciliation and use of good offices), panel state and appellate stage, arbitration, and enforcement; and non-judicial (or quasi-judicial) procedure for the resolution of issues.40 While efforts are been devoted to the analysis of the traditional frameworks of dispute resolution, the quasi-judicial procedure for the resolution of non-tariff measures and/or NTBs and its interrelationship with sustainable development have been largely under-explored.

Indeed, Article 3(2) of PRPSD, following treaty practice, states that the PRPSD ‘shall apply subject to such special and additional rules and procedures on dispute settlement contained in the Agreement’. In the event of a difference between the PRPSD and the special or additional rules and procedures, the latter shall prevail.41 Such a ‘difference’ or conflict between the PRPSD and the special or additional rules and procedures would exist only where both provisions cannot be read as being complementary to each other because they are mutually inconsistent such that adherence to one provision would lead to a violation of the other provision.42

Clearly, the pre-eminence of ‘the special or additional rules and procedures’ in the covered agreements (and the right of the state parties to ‘invoke another forum for dispute settlement’)43 over the dispute settlement framework established under PRPSD indicate that the operation of PRPSD is not overarching. Although the PRPSD does not provide any clue as to the contents of the ‘special or additional rules and procedures in the Agreement’ as is the case with Appendix 2 of the dispute settlement understanding (DSU), they are understood to cover dispute resolutions concerning non-tariff measures (such as SPS and TBT), trade remedies (such as anti-dumping and countervailing measures), and other special rules as may be provided by the covered agreements.44 These specific rules and procedures are designed to deal with the particularities of disputes under a specific covered agreement. For instance, Annex 5 of the AfCFTA Agreement on NTB provides a number of non-judicial mechanisms, including an independent expert or person agreed upon by the parties in addition to the AfCFTA NTB Coordination Unit, which will be responsible for the resolution and elimination of NTBs.

Article 3(4) of PRPSD, reinforcing the provision of Article 3(2) of PRPSD, provides that ‘[a] State Party which has invoked the rules and procedures of this Protocol with regards to a specific matter, shall not invoke another forum for dispute settlement on the same matter’.45 The reference to ‘another forum for dispute settlement’ entails that the AfCFTA dispute settlement framework does not have exclusive jurisdiction over AfCFTA matters. This approach is reflected in several treaty-making practices of Free Trade Agreements (FTAs) and regional integration arrangements.46 The Association of Southeast Asian Nations (ASEAN) Protocol on Enhanced Dispute Settlement Mechanism is emphatic on the right of ASEAN members to choose another forum, if they wish, instead of the frameworks established under the Protocol. Hence, the ASEAN state party involved in a dispute can resort to other fora at any stage before a party has made a request to the Senior Economic Officials Meeting to establish a panel.47 Thus, state parties are expected to utilize ‘the special or additional rules and procedures in the Agreement’ to manage disputes arising from non-tariff measures and/or NTBs.

AfCFTA provides a mechanism for the identification, categorization and progressive elimination of NTBs in intra-African trade to ensure the realization of set objectives. Hence, such mechanism principally functions through the provision for (a) institutional structures for the elimination of NTBs; (b) general categorisation of NTBs in the AfCFTA; (c) reporting and monitoring tools; and (d) facilitation of resolution of identified NTBs.48 These frameworks and procedures, which largely mirror regional integration norms of the East and Southern African countries (e.g. SADC, EAC, COMESA and Tripartite Free Trade Agreement), are intended to achieve timeous and efficient elimination of NTBs to hasten intra-African trade and sustainable development.

6.0 THE LIMITATIONS (GAPS) IN THE AfCFTA AGREEMENT’S DISPUTE SETTLEMENT MECHANISM AS POTENTIAL OBSTACLES TO CROSS-BORDER TRADE AND COMMERCIAL TRANSACTIONS BY PRIVATE COMMERCIAL ENTITIES.

The first limitation is the combined effect of articles 1, 3 and 20 of the Protocol on the AfCFTA Rules and Procedures for the settlement of Disputes, is that:

Only states parties have the locus standing to complain about a dispute as a disagreement between State Parties regarding the interpretation and/or application of the Agreement, its phase 1 agreed and adopted protocols on Trade in Goods Services and Dispute Settlement Mechanism, their Annexes and Schedules, in relation to their rights and obligations thereunder;

The Dispute Settlement Mechanism (DSM) under the Protocol is meant ONLY for the settlement of trade disputes between States Parties, and provides for a specialized Disputes Settlement Body (DSB) to act as the FORUM WITH JURISDICTION. The DSB is empowered to establish Dispute Settlement Panels and an Appellate Body, adopt reports of the Panel and Appellate Body, appropriate remedies, maintain surveillance of provide implementation of rulings and recommendations of Panel and Appellate Body, and authorize the suspension of concessions and other obligations under the Agreement;

The Protocol on DSM preserves only the Rights and Obligations of State Parties. Even AfCFTA Secretariat CANNOT bring application before the DSB to enforce AfCFTA Rules.

The First implication of the above apparent EXCLUSION OF NON- STATE Actors including Individuals. Civil Society Organization. exporters importers, investors, producers, and other commercial entities, is that they cannot lodge a complaint before the DSB, as non-state parties, because they are strictly, NOT parties to the AfCFTA Agreement;

The second implication of the above provisions on DSM is that despite the fact that the bulk of trade in goods and services are being carried out by private entities and they feel the effect of the decisions of decision makers on tariff and non-tariff measures, trade facilitation on goods and services and investment, their grievances relating to non-compliance with or breaches of AfCFTA Agreement by state parties, can only be handled on their behalf by the same member states if they deem fit to so act and seek redress for their citizens. This approach to dispute settlement ignore the entities whose interest, money and time are probably at stake, are left at the mercy of political will or not or unnecessary bureaucratic protection regime that may be uncertain, unpredictable, non transparent, non-compliant and lack adequate remedies in instances of breaches of Agreement. All these factors impact negatively on robust cross border trade and other commercial activities in the African Continent.

The second Limitation is that the ATCFTA DSM will not entertain and decide disputes about human rights violations as the courts of Justice in COMESA, ECOWAS and EAC often do. These Courts Seldom decide trade related disputes, unless they are brought as human rights violations. The 2012 Polytol case is the only known exception. In this instance, a private entity succeeded in an application in the COMESA Court of Justice for setting aside the re: introduction by Mauritius of a tariff on goods that had to be traded duty free amongst member states of the COMESA regional bloc Free Trade Area.

More recently, in a landmark decision by the East African Court of Justice (EACJ), delivered on 2nd December, 2022, The EACJ in the case of Christopher Ayeko v. Attorney General of Kenya (Ref. No.5/2019), reviewed the framework of conclusion of agreements between EAC Member States and Third Countries (outside the region). It declared that Kenya, through the acts and omissions of entering into negotiating and or intending to negotiate an Free Trade Area (FTA) with the USA violated its commitments to the Community, specifically the principles of rule of law, transparency, and cooperation for mutual benefit guaranteed under Articles 6 and 7 of the EAC Treaty. That Kenya’s actions and or omissions of intending to or negotiating an FTA with the USA, violated Article 37 of The EAC Common Markets Protocol and Article 37 of the EAC Customs Union Protocol. Hence the proposed FTA negotiated or intended to be negotiated was declared illegal, null and void, for not involving EAC Partner States. This case is pending before the court.

On January 8, 2024, it was reported that Uganda sued Kenya at the EACJ for denying government owned oil marketer, Uganda National Oil Company, a licence to operate and handle fuel imports at the Mombasa Port headed for Kampala. This a non-tariff Barrier case (NTBs).

The implication of this apparent limitation is the denial of access to Justice to No-State actors, on trade related disputes, by the AfCFTA DSM, on matters such as protections against discrimination/on non- discrimination principles (National Treatment, Most-Favoured Treatment, Special and Differential Treatment, Market Access), trade facilitation, and customs administration. This denial of access to Justice under the AfCFTA DSM Compounds the Plight of Non-State Actors, as entities active in cross border trade normally affected by unlawful State Policy action; and private entities that are already in a disadvantaged position, are made to push or lobby for their own Member States to take up cases/complaints on their belief.

Apparently, such Non-State Actors are better off under the Regional Economic Communities (RECs) DSM where they have both locus standing to bring disputes/lodge complaints and access to Justice for remedies in the Courts of Justice of ECOWAS, COMESA and East African Community (EAC).

The third Limitation or gap is found potentially in the Conflict of Law Rules in the AfCFTA Scheme of co-existence of several African Free Trade Areas (FTAs) and other trade arrangements, with each other under Articles 19(2) of the AICFTA Agreement and Article 8 of the Trade in Goods Protocol. Under this scheme of things, disputes about compliance with the relevant rules will be linked to the applicable legal instruments and the RECs/FTAs own dispute settlement mechanisms. E.g when the AICFTA is implemented. Kenya will continue to trade with Uganda under the EAC rules, because they are both EAC members. The same applies to all other RECS and regional trading arrangements, which, in the words of Articles 19(2) and 8, referred to earlier, have attained themselves higher levels of elimination of customs duties and trade barriers than those provided for in the Protocol on Trade in Goods. These AfCFTA State Parties, “shall maintain, and where possible improve upon, those higher levels of trade liberalization among themselves”.

Note: Applicable Forum with Jurisdiction: AfCFTA, WTO and RECS DSMS? In the above example of Kenya and Uganda, Trade-Related Disputes between them will be decided (if referred to it) by the Court of the EAC. The DSM of AfCFTA WILL NOT have JURISDICTION over disputes governed by EAC legal instruments.

In the case of Nigeria trading with Kenya, under AfCFTA rules, presently they belong to different RECs-FTAS (ECOWAS and EAC), the AFCFTA DSM WILL HAVE JURISDICTION as the applicable Forum over trade- related disputes between them that fall under the instruments of the AfCFTA.

Note: As long as Kenya and Nigeria trade with each other under the Most Favoured Nation Rules, the applicable forum with Jurisdiction, as WTO members, is the WTO Dispute Settlement System.

Note: South Africa, Zimbabwe, Malawi and Zambia etc, members of the REC known as the Southern Africa Development Cooperation (SADC), may not be as lucky as Nigeria, Kenya and Uganda with multiple fora for dispute settlement, especially in RECs Tribunal/Courts of Justice, because of the GLARING GAP in the AfCFTA scheme of co- existence under Articles 19(2) and 8 (referred to earlier) which did not anticipate the fact that SADC does not have a REC Tribunal/Court for dispute settlement. The Protocol on the SADC Tribunal adopted in 2014 has not entered into force. This oversight in terms of the protection of rights of the relevant State may be justified by arguing that Article 19(2) of the AfCFTA Agreement and Article 8 of the Protocol on Trade in Goods mean exactly what they say. But in SADC’s case, this comes without the existence of a DSM. It will be for the SADC member states to remedy the situation, if they so want. It may also be that they are quite happy with the status quo.

The alternative is to settle trade disputes involving SADC legal instruments through international ARBITRATION. The member states of SADC are free to opt for international Arbitration to resolve disputes between them in a BINDING and IMPARTIAL manner, and adopt adhoc decisions to that effect.

While Article 20 of AfCFTA Agreement establishes a DSM as the Forum with Jurisdiction for settling trade disputes in accordance with the provisions of the Protocol on Rules and Procedures on the settlement of Disputes (PRPSD), the AfCFTA State Parties may also opt for settling their disputes through ARBITRATION, by virtue of Article 27 of the Protocol on PRPSD. However, there is a glaring omission to clarify whether the term “Arbitration” under Articles 27 and 4(4) of the Protocol on PRPSD (or DSM) covers State-State Arbitration only or it includes investor-state Arbitration or both. Similar clarification is needed on which “Arbitration body” would be charged with the mandate to conduct Arbitration process up to Arbitral Awards. Further, the AfCFTA Protocol on DSM made no reference to notable International Arbitration bodies like the Permanent Court of Arbitration (PCA), the London Court of International Arbitration, the UN Commission on International Trade Law (UNCITRAL) and the International Centre for Settlement of Investment Disputes (ICSID).

Note: is the above omission perhaps due to the increasing criticism leveled against the above mentioned notable bodies, and the growing demand by African Arbitration Practitioners to adjudicate commercial disputes involving African Countries?

Note: Possible Conflict of Low Rules Scenario:- In respect of intra-African Trade Disputes, it might be possible that more than one forum could have Jurisdiction. E.g, if two African States that are members of both AfCFTA. WTO and a particular REC, have a dispute over a phytosanitary issue, the application for enforcing the relevant rights and obligation might be brought under WTO rules, before the relevant REC Court/Tribunal or under the AfCFTA DSM (Articles 1-25). The deciding factor is whether the forum in question has jurisdiction over the matter in dispute and whether the applicant and respondent have locus standing to lodge a complaint at the chosen forum.

Note: A state party which has invoked the rules and procedures of the AfCFTA Protocol on DSM shall NOT invoke another Forum for dispute settlement on the matter. A dispute settlement proceeding shall be considered to have been initiated in accordance with the AfCFTA Protocol on DSM when a Complaining Party/State party requests for the Primary and mandatory consultations pursuant to Article 7 of the DSM Protocol. State parties to a dispute may at anytime voluntarily explore other ADR Processes like Good offices, Conciliation, Mediation and Arbitration for settling a dispute.

Note: The above choice of ADR processes is consistent with the practice of African Union Member State who hardly litigate and prefer to explore alternative options under the rules of those RECs, they belong to, with their own dispute settlement mechanisms, like the Community Courts of Justice or Tribunal of COMESA, EACJ and ECOWAS. Whether the AfCFTA State Parties will ever use the AfCFTA Protocol DSM to resolve their trade- related disputes is another matter.

Finally, in the light of the implications of the above mentioned limitations/gaps on Non-State Actors, where does the answer in streamlining DSM under AfCFTA lies: –

In inclusion of Judicial bodies to settle state v. State disputes as in COMESA and in reference to notable international Arbitration bodies?

Or in the use of Regional Courts for State-State Arbitration as in the ECCJ or EACJ or as in Articles 28(b) and 26 of COMESA on the following three options for Investor-State Disputes: Either a COMESA Arbitral Tribunal, as a Court of Justice, or an Independent Arbitration Tribunal

Or in the need to activate the African Court of Justice whose Statute is yet to come into force, as originally envisaged by the Abuja African Economic Community Treaty of 1991;

Or to save cost and bureaucracy for the ongoing African Union Institutional reform, by merging the existing African Court of Human Rights with that of the Court of Justice, with an expanded mandate to cover all trade and investment disputes (state v. state and Investor v. state) etc.

Note: One possible barrier to fulfilling the full benefit of the AfCFTA Protocol on DSM lies in the African States’ poor history of litigated cases/tending to shy away from going through a legal process; and in the lack of culture of respecting their treaty obligations and their own laws.

The exclusion of Non-State actors might lead to the under-utilization of the AfCFTA Protocol’s DSM. (as the forum with Jurisdiction), since the private sector lacks the scale to lobby governments to litigate on its behalf. (This is the lesson to be learnt from the ECCJ’s experience in the first five years inception stage. The case Afolabi v. FRN (ECW/CCJ/JUD 01/04) revealed how an aggrieved citizen of Nigeria sued his own Country that ought to have filed an action on his behalf against another Member State or institution of ECOWAS for violation of his right to free movement of person, goods and services due to Nigeria’s unilateral border closure with the Republic of Benin, resulting in losses incurred and inability to fulfil his contractual obligations.

The ECCJ held that Afolabi lacks locus standing to sue his country or any Member State because under Article 9(3) of the Protocol of the Community Court of Justice (A/RI/7/91) the ECCJ lacked competence to adjudicate on a dispute between a community citizen against his country or Member State. That only a Member State can sue another Member State or an institution of ECOWAS on behalf of its nationals, and not otherwise, as in this case.

7.0 LESSONS FROM THE ECOWAS DSM JURISPRUDENCE AS A BUILDING BLOC FOR AfCFTA

ECOWAS as a reliable and functional building bloc of AfCFTA is seen in the following areas: – a) Led and still leading the West African regional grouping in AfCFTA negotiations on Critical matters such as Harmonized Customs Union Code, Tariff Offers, Schedules of Tariff Concessions and Rules of Origin; b) Experimenting the pilot phase of the AfCFTA payments system as the lifeblood of trade, namely, the Pan African Payments and Settlement System(PAPSS) in the West African Monetary Zone (WAMZ) with participating Central Banks of the following ECOWAS Member States: – Ghana, Nigeria, Guinea, Senegal, Liberia, Sierraleone and the Gambia, with the aim of ensuring instant payments for cross-border trade transactions without the hassle of currency conversion, and to reduce Africa’s reliance on third Currencies, like the dollar, in order to significantly boost intra-African trade.

7.1 ECOWAS Community Court of Justice (ECCJ): –

ECCJ Established by Article 15 of ECOWAS Revised Treaty and set up in  January 2001 following swearing in of 7 pioneer judges on 30th January, 2001

1991 Constitutive Protocol of ECCJ and 2005 Supplementary Protocol amending the initial Protocol prescribed its  composition, jurisdiction and practice and procedure.

Legal organ of ECOWAS with 4 mandates: Community Court; ECOWAS Public Service Administrative Tribunal; Human Rights Court; and Arbitration Tribunal.

Article 76 of the Revised Treaty: … amicable settlement of disputes between Member states regarding the interpretation and application of the Treaty failing which either party may refer the dispute to the ECCJ

Article 9 of  Protocol A/P1/7/91  as amended by Supplementary Protocol A/ SP.1/01/05: resolution of disputes relating to the interpretation and application of the Treaty, Conventions and Protocols of the Community, the failure by Member States to honour their obligations under the Treaty, Conventions  and Protocols, Regulations, Directives, or Decisions of ECOWAS, or disputes relating to the provisions of the Treaty, Conventions, Protocols, Regulations, Directives or Decisions of ECOWAS Member States.

Article 9(4): determine cases of human rights violations that occur in any Member State.

Article  9(5):  act as an Arbitration Tribunal pending the establishment of the  Arbitration Tribunal  provided for under 16 of the Revised Treaty.

Article 19 of the initial Protocol : examine the disputes before it in accordance with the provisions of the Treaty and its Rules of Procedure, and apply, as necessary, the body of laws as contained in Article 38 of the Statutes of the International Court of Justice.

Plays a crucial role in the resolution of economic disputes under other ECOWAS economic integration Protocols and Supplementary Acts for the establishment of Customs Union/ Common Market.

 

7.2 ECOWAS Dispute Settlement Mechanism (DSM)  for Economic Disputes: –

Resolution of Economic Disputes by ECCJ under its Human Rights Mechanism.

Article 9(4)  of the ECCJ Protocol granted it  jurisdiction to determine cases of violations of human rights that occur in any Member State.

ECCJ has developed a vibrant, authoritative and unique human rights mechanism that does not require the exhaustion of domestic remedies.

ECCJ has held that the scope of its human rights mandate is expansive. Extends to Civil and Political Rights and Economic and socio-cultural rights.

ECCJ applies regional and universal human rights Standards: eg ACHPR, UDHR, ICCPR, ICESCR, etc.

ECCJ has resolved some economic disputes arising from the expropriation of investments of individuals and corporate bodies by some Member States by enforcing the Right to property under Article 14 ACHPR. See decisions of ECCJ in  Chude Mba v. Ghana, Societe Bedir Sarl v. Niger and K Energie v. Guinea.

In CHUDE  MBA v. THE REPUBLIC OF GHANA, ECW/CCJ/APP/01/13,  the Applicant, a dual Nigerian/ British citizenship had withdrawn his investments in New York Stock exchange to invest in the construction  of two residential towers in Accra after obtaining all necessary approvals. The property was subsequently seized by the government of Ghana. The ECCJ gave judgement in favor of the Applicant and awarded $800,000 USD as monetary compensation.

In LA SOCIETE BEDIR SARL v. NIGER, ECW/CCJ/ APP/ 09/17, Judgment No ECW/ CCJ/ JUD/11/20, the Applicant, a Turkish undertaking, had invested heavily in establishing a school in Niamey. Following an attempted coup in Turkey, the Government of Turkey exerted pressure on the Government of Niger to seize the school, which it did.  The Court condemned Niger Republic for the violation of the right to property of the Applicant contrary to Article 14 of the African Charter, when it expropriated its property and awarded over six billion CFA as special damages in favour of the applicant.

In K ENERGIE SA v. GUINEA, ECW/CCJ/APP/ 19/18,  the Court ordered Guinea to pay the Applicant, USD 47,500,000 as compensation for the violation of its right to property in depriving it of the use of its assets and ordered the Defendant State to return all the assets of the company, which were unlawfully dispossessed from the Applicant by the Defendant and transferred its management to a third party and not for public interest.

7.3 Conferment of Jurisdiction on ECCJ under Article 9(6) of its Protocol

ECCJ can resolve economic disputes when conferred with jurisdiction by the Parties to an Agreement. Article 9 (6) of the Protocol on ECCJ as amended, gives the Court jurisdiction over any matter provided for in an agreement where the parties provide that the Court shall settle disputes arising from the agreement.

See  ECOWAS Bank for Investment and Development v. Cross  River. Suit No: ECW/CCJ/ APP/ 14/19, Judgment No: ECW/ CCJ/ JUD/ 01/21. The Applicant which is a financial institution of ECOWAS and carries on business as a banker, promoting Investment, economic development and entrepreneurial activity in the West African sub region. The applicant extended a loan facility to the Defendant in various currencies  equivalent to ten million USD to part finance  the  development of a mixed-use business and resort development known as TINAPA in Calabar, Cross River State, near the Calabar Free Trade Zone. The parties in the loan agreement gave the ECCJ jurisdiction to resolve disputes arising from the agreement. It also provided for amicable settlement. Following the default of the defendant in repaying the loan, the Applicant instituted this action before the ECCJ seeking several reliefs. The ECCJ held that it had jurisdiction to hear the matter and ordered the respondent to repay the outstanding sum of 6.4m USD plus interest.

See also  Petrostar Nig. Ltd v. Blackberry Nig. Ltd & Anor, where  the parties by agreement, had resolved to settle any dispute that arose from their contract at the ECOWAS Community Court of Justice. In the said case, the Plaintiff averred that it delivered Automotive Gas Oil (AGO) to SHELL on credit upon the instruction of the 1st Defendant for a consideration of 485 million Naira to be paid by the 1st Defendant. The 1st Defendant paid part of the money owed to the Plaintiff and subsequently failed to pay the outstanding sum of 255 million naira. The Plaintiff then instituted this action against the Defendants jointly and severally. The ECCJ held that it had jurisdiction to hear the matter and ordered the defendant to repay the outstanding debt of 255 million Naira plus interest.

7.4 DSM For Economic Disputes Under ECOWAS Economic Integration Legal Regime

7.4.1 Key ECOWAS Protocols and Supplementary Acts on different aspects  of the economic integration normative framework have inbuilt DSMs.

The DSMs are mostly rules based and usually give the disputants opportunity for amicable Settlement through Consultations, Good Offices, Mediation, Conciliation and Arbitration.

Party Autonomy

Some of the DSMs give a role to the ECCJ where amicable settlement fails, or where there is disagreement as to the ADR to be adopted or  give the ECCJ Appellate jurisdiction to entertain appeals on decisions of Authorities or Tribunals under the DSM.

The DSM is not only between Member States, but includes Investors , Corporate bodies and individuals.

7.4.2 Dispute Settlement Mechanism under the ECOWAS Protocol on Rules of Origin

Article 13 of the Protocol

The DSM under the Scheme is essentially Rules based as there is no involvement of the ECCJ or any other Court. The Protocol  provides a dispute settlement procedure which  involves the good offices  of the parties, the ECOWAS  Trade & Customs experts Commission  (now Committee) and the ECOWAS Council of Ministers.

Article 13 (1) of the Protocol on Settlement of Disputes provides that in the event that the origin of a product is contested, the Member States contesting  the Community origin of the product shall, on its own initiative or that of any other party concerned, bring the issue to the attention of the competent authority in the issuing country.

The  exporting Member State shall,  within a period of 45 working days, furnish all necessary information on the conditions under which the contested certificate was issued. (Article 13(2)) .

While  the settlement is  in progress under the Mechanism, products whose origin is in dispute shall not be denied the advantages granted to originating products, provided that the importer deposits an amount as guarantee for the duties and taxes payable in the importing Member State. (Article 13(3) ).

Disputes which remain unresolved, by the Member States concerned within the aforesaid 45 days, shall be brought before the Trade & Customs Commission (Committee), one of the technical expert Committees established under Article 22 of the Treaty, by any of the parties concerned through the intermediary of the Executive Secretariat (Now ECOWAS Commission)  Article 14).

The Trade & Customs Committee shall determine the merits and demerits of the case at its next session, and transfer the matter to the Council of Ministers which shall take a decision thereon and inform the parties concerned accordingly. (Article 15).

7.4.3 Dispute Settlement Mechanism under the ECOWAS Investment Act

Article  33 of the Supplementary Act

Article 33 of the Supplementary Act is on the Dispute Settlement Procedures and provides a combination of rules based Alternative Dispute Resolution Mechanism  that  seeks amicable settlement of disputes through private dispute Resolution methods like good offices, conciliation, mediation, arbitration, etc. and public adjudicatory method that involves the national courts and the ECCJ when the Rules based methods fail.

Dispute Settlement Procedures

party wishing to raise the dispute shall issue a notice of intention to initiate arbitration to the other potential disputing Party or Parties

minimum period of six months between the date of a notice of intention to initiate a dispute settlement process and the date a Party or investor may formally initiate a dispute. During this period, Member States make efforts to reach an amicable settlement of possible disputes, using good offices, conciliation, mediation, etc.

Where mediation is adopted as the dispute resolution process, the disputants shall use an approved mediator for this purpose.

If  no mediator is chosen by the disputing parties before the expiration of the amicable settlement period, a mediator who is not a national of one of the State Parties to the dispute shall be appointed.

Any dispute between a host Member State and an Investor, as envisaged under this Article that is not amicably settled through mutual discussions may be submitted to arbitration.

Where in respect of any dispute envisaged under this Article, there is disagreement as to the method of dispute settlement to be adopted; the dispute shall be referred to the ECOWAS Court of Justice.

7.4.4. Dispute Settlement Mechanism Under The ECOWAS Common Investment Code

Article 53- State to State

Any dispute between Member States regarding the implementation of this Code shall be resolved through the use of consultations, good offices, mediation, conciliation or any other agreed dispute resolution mechanisms.

Where the parties are unable to resolve dispute through the preceding methods, they may proceed to arbitration.

Where recourse is made to arbitration, the arbitration may be conducted at any established public or private alternative dispute resolution centres or the arbitration division of the ECOWAS Community Court of Justice. Member States are encouraged to utilise regional and national alternatives dispute settlement institutions.

Where the Member States are unable to resolve any dispute regarding the interpretation and application of this Code through any of the preceding methods, they may refer the matter to the ECOWAS Community Court of Justice whose decision shall be final.

7.4.5 Dispute Settlement Mechanism Under The ECOWAS Common Investment Code

Article 54 – State-Investor or Investor-Investor

Any dispute between a Member State and an investor or between investors may  be resolved through the use of consultations, good offices, mediation, conciliation, arbitration or any other agreed dispute resolution mechanism.

Where recourse is made to arbitration, the arbitration may be conducted at any established public or private alternative dispute resolution centres or the arbitration division of the ECOWAS Court of Justice. Member States and investors are encouraged to utilise regional and national alternatives dispute settlement institutions.

Where recourse is made to arbitration, the rules of procedure of the relevant forum shall be applicable, including rules for the submission of claims, selection of arbitrators and conduct of the arbitration.

Except where the investment contract between a Member State and an Investor provides for the use of international mechanisms such as ICSID or UNCITRAL, parties to the investment contract shall exhaust all local remedies including the ECOWAS Court of Justice or national dispute settlement systems, before resorting to the international mechanisms.

7.4.6 Dispute Settlement Mechanism Under The ECOWAS Common Investment Code

Article 55 – Enforceability of Final Awards

The final awards or decisions on investment disputes made by arbitration panels and judicial bodies shall be enforceable. To this end, decisions or awards rendered in another Member State shall be enforced as if there were decisions or awards rendered by a judicial body or arbitration panel located in a Member State requested to enforce the award or decision.

Decisions of ECOWAS Court of Justice shall be enforced in accordance with its own rules and existing protocols.

Article 56: Interpretation and Application

Any dispute regarding the interpretation and application of this Code shall be referred to the ECOWAS Court of Justice whose decision shall be final.

Article 57: Access to the ECOWAS Court of Justice

For the purposes of instituting or maintaining any action under chapter 16 of this code, access to the ECOWAS Court of Justice is open to Member States, ECOWAS Institutions, corporate bodies, investors and individuals.

7.4.7 Sanctions Regime Under The ECOWAS Competition Rules

SUPPLEMENTARY ACT A/SA.1/12/08 ADOPTING COMMUNITY COMPETITION RULES AND MODALITIES FOR THEIR APPLICATION WITHIN ECOWAS.

SUPPLEMENTARY ACT A/SA.2/12/08   ON THE ESTABLISHMENT, FUNCTIONS, AND OPERATION OF THE REGIONAL COMPETITION AUTHORITY FOR ECOWAS.

Article 7 (1) of Supplementary Act A/SA.2/12/08 empowers the Competition Authority to sanction offenders.

Appeals  against the Authority’s decision lie to the ECCJ. Under Article 7(3) of the Act Decisions taken by the Authority under Article 7(1) & (2) may be subject to appeal and the ECCJ shall sit as an appellate court and its decision shall be final.

Article 8(3) of the Act provides that any person who has suffered losses as a result of any prohibited anti-competitive arrangement may apply for compensation to the Authority. The Authority and the Community Court of Justice shall order the parties to such prohibited arrangement to pay to the Applicant(s) such compensation as they shall determine.

Article 11 of the Act is on the Modalities for enforcement of the Decisions of the Competition Authority and the ECCJ. It provides that the decisions of the Authority and the ECCJ that entail pecuniary obligations on individuals and or corporate bodies shall be binding.

Member States are required to appoint a competent national authority which shall receive or implement the decisions of the Competition Authority and those of the ECCJ and enforced in accordance with the Rules of Civil Procedure of the Member State concerned.

7.4.8 The Supranationality of ECOWAS Court of Justice

The ECOWAS practiced inter-governmentalism for about thirty years (1975-2006) under both the Founding Treaty as revised in 1993 and their related protocols and conventions. For 30 years, the lofty goals of the founding fathers of ECOWAS were sacrificed at the shrine of state sovereignty: resulting from the lack of political will and commitment to implement regional economic community decisions and economic nationalism as the twin major stumbling blocks to integration efforts49.

NOTE

THE ECOWAS COURT OF JUSTICE AS A SUPRANATIONAL COURT AND ENGINE OF REGIONAL INTEGRATION IN WEST AFRICA

The Court will continue to uphold the supra-nationality50 of ECOWAS introduced by the Revised Treaty into its decision making for the realization of Community integration objectives.51 Accordingly, the court has been holding Member States accountable for their Treaty obligations and has refused to be constrained by the domestic laws of Member States, including national constitutions that are inconsistent with their Treaty obligations.52 The Court’s Jurisprudence on the supra-nationality of ECOWAS and the ECOWAS Court of Justice in Musa Saidykhan,53 SERAP,54 Mukhtar Ibrahim Aminu55 and Peter David,56 is anchored on Articles 9 (4), 12 (3) and 15 (4) of the 1993 Revised ECOWAS Treaty and cemented by the provisions of Articles 1-7 of the Supplementary Protocol Amending the Revised Treaty, especially, the new Article 9 on the new legal regime of the Community earlier discussed above.57

Another evidence of the application of Supranationalism in ECOWAS is the change of motto/philosophy from the “ECOWAS of states to the ECOWAS of peoples”58, emphasizing the need for commitment of member states to redefine regional integration in a way that moves the process beyond state-centred approach to people’s centred thereby involving community citizens, CSOs and the private sector in regional integration decision making and implementation processes.

Hence, both supranationalism and Constitutional supremacy in Member States’ national constitutions aimed at ensuring that sovereign states are bound by the law and not above the law. Their decisions actions or inactions must reflect the best interest of the people59.

Supranationalism has several political ramifications demanding complex institutions and structures, extensive political will, unity of objectives and commitments at both national and regional levels. The success of any economic integration effort will depend on the commitment of Member States to redefine regional integration in a way that moves the process beyond state-centred approach to people oriented process that is both inclusive and participatory of relevant stakeholders in Member States (citizens, CSOs the private sector and other non-state actors)60.

CONCLUSION

It is evident from the above analysis that, to the extent that State Sovereignty reminds us that the challenge of subjection of states to law is an aim, though very imperfectly realized, it remains a doctrine which we cannot afford to disregard.

The understanding of Supranationality as a situation where a regional organization is empowered to take decisions that are binding on itself and on all its Member States is quite clear. ECOWAS, with the support of an efficiently run and adequately funded supranational Commission and Supranational Court of Justice, can facilitate and accelerate the process of regional economic integration in West Africa. Member States however, must demonstrate greater commitment to their treaty obligations by addressing the fundamental operational and financial challenges facing the Community Institutions and the capacity deficits to implement Community Laws, Programmes and Decisions at National Levels.

In conclusion, engaging all relevant stakeholders, including State Parties, businesses, legal experts, and civil society organisations, is crucial in considering and implementing the above recommendations. By taking these steps, the AfCFTA can strengthen its Protocol on Dispute Resolution, foster confidence in the system, and promote a fair and efficient resolution of disputes among its State Parties.

The  AfCFTA Agreement  Protocol on the Rules and Procedures on the Settlement of Disputes provides the framework for settlement of disputes. Since the AfCFTA Agreement  provides that the Regional Economic Communities (RECs) will serve as the building blocks for the continental common market, the normative framework of ECOWAS common market was examined in this presentation as an exemplar of the RECs in Africa. These RECs have also established their regional Courts and adopted their legal regimes on regional common markets. This also includes their regional dispute settlement mechanisms for economic disputes. Since the AfCFTA dispute settlement mechanism does not allow for any other mechanism, there is the likelihood of conflict or overlapping between regional and continental mechanisms. There is therefore a need to fine tune the relationship between the AfCFTA Agreement dispute settlement mechanism and that of RECs in respect of economic disputes.

Although there is emphasis at the continental and ECOWAS regional levels on Rules based mechanism for resolution of economic disputes, it is commendable that ECOWAS has provided a hybrid system that provides a role for the the ECOWAS Court of Justice. Unlike the AfCFTA Dispute Protocol that only settles disputes between State Parties, the ECOWAS DSM grants access to State Parties, Investors, corporate bodies and individuals. It is also interesting that the ECCJ has also been able to use its human rights mechanism to settle economic disputes. Finally, although the regional and continental DSMs appear workable on paper, implementation is always a challenge in Africa.

REFERENCES

Victor, A (2016):- Principles and Practice of Supranationalism in ECOWAS and the Implications for Regional Integration in West Africa. Political Science Review, Vol. 7, No. 1, pp. 17 – 34.

Ibid

Articles 9, 12 and 15 (3) of the 1993 Revised ECOWAS Treaty.

Ibid, Article 4.

Ibid, Article 3.

Ibid, Article 4.

Ibid, Article 5.

AfCFTA Agreement, Article 5.

See Article 9-14 of AfCFTA Agreement on institutional structure.

Article 8(2) AfCFTA Agreement.

Article 4 of the Protocol on Trade in Goods

Flaminio Costa v E.N.E.L. (Ente Nazionale Energia Elettrica) (Case 6-64) [1964].

Algemene Transport- en Expeditie Onderneming Van Gend en Loos (N.V.) v. Nederlandse Administratie der Belastingen, (Case 26/62) [1963] E.C.R. 1, E.C.J.

Andrea Francovich and Danila Bonifaci and others v Italian Republic, Joined cases C-6/90 and C-9/90 [1991].

Ibid. EU treaty provisions, regulations, decisions and directives are capable of direct effect. See Michael Dougan, ‘When worlds collide! Competing visions of the relationship between direct effect and supremacy’, Common Market Law Review, 44(4), (2007) pp. 931 – 963

Article 41 of the ECOWAS Revised Treaty 1993. While Nigeria has often relied on the national security exception in Article 41:3, Article 41:4 clearly requires that “Member States shall not so exercise the right to introduce or continue to execute the restrictions or prohibitions referred to in paragraph 3 of this Article as to stultify the free movement of goods envisaged in paragraph 1 of this Article.”

Supplementary Protocol A/SP.2/5/90 on the Implementation of the Third Phase (Right of Establishment) of the Protocol on Free Movement of Persons, Right of Residence and Establishment. Article 1 states that – “Right of Establishment” means the right granted to a citizen who is a national of the Member State to settle or establish in another Member State other than his State of origin, and to have access to economic activities, to carry out these activities as well as to set up and manage enterprises, and in particular companies, under the same conditions as defined by the legislation of the host Member State for its own nationals”

See Kofi Oteng Kufuor, ‘When Two Leviathans Clash: Free Movement of Persons in ECOWAS and the Ghana Investment Act of 1994’, African Journal of Legal Studies 6 (2013) pp.1–16

Section 27 of the Ghana Investment Promotion Centre Act 2013 reserves some economic activities for only Ghanaians – e.g. sale of goods or provision of services in a market, petty trading, operation of taxi or hire car enterprise below a fleet of 25 or more vehicles, and the operation of a beauty salon or barber shop

R (Factortame Ltd) v Secretary of State for Transport (No 2) [1991] 1 AC 603

i.e. pre-Brexit

i.e. Spain

i.e. the Assembly and the Council of Ministers

Article 10(2) of the AfCFTA Agreement

Article 11(3)(o) of the AfCFTA Agreement

Emphasis mine.

Article 4(6) of the AfCFTA Dispute Settlement Protocol explicitly states that “In their findings and recommendations, the Panel and the AB shall not add to or diminish the rights and obligations of State Parties pursuant to the Agreement.

Appellate Body Report, Japan—Taxes on Alcoholic Beverages II, WTO Doc WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R (1 November 1996)

Appellate Body Report, Japan—Taxes on Alcoholic Beverages II, WTO Doc WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R (1 November 1996)

Ibid, 13.

Appellate Body Report, United States – Measure Affecting Imports of Woven Wool Shirts and Blouses from India, WTO Doc WT/DS33/AB/R and Corr.1 (23 May 1997).

Ibid, 19–20.

Robert H. Jackson, Sovereignty: Evolution of an Idea, Cambridge: Polity Press (2007), at 58.

Article 3

Art. 27

Arts. 9 & 10

Art. 20

Art. 17

Art. 8

K Kugler, ‘The AfCFTA’s Success Depends on Effective Dispute Settlement Mechanisms for the Private Sector’ (2021) Global Trade and Customs Journal.

Article 3 of PRPSD.

Appellate Body Report, Guatemala — Cement I, paras. 65 and 66.

Article 3(4) of PRPSD.

Article 14 of Annex on Trade Remedies. Article 6.8(3) of CPTPP completely excludes the application of dispute settlement provisions to matters concerning antidumping and countervailing duties.

This contrasts with the WTO approach which provides under Article 23(1) of the WTO’s DSU that it is the sole forum for the authoritative determination of disputes among WTO members.

Article 28.4 of CPTPP, Article 29.3 of CETA and Article 20.4 of US-Morocco FTA which allow these forms of alternatives in the choice of dispute settlement forum.

Article 1(3) of ASEAN Protocol on Enhanced Dispute Settlement Mechanism.

Article 2 of Annex on NTBs.

Ladan, M.T. (2021): – Fundamental Legal, Economic and Political Obstacles to Regional Integration in Africa:- Which Way Forward? In Jurispedia, https://muhammedtawfiqladan.substack.com

In this context, supra-nationality refers to a situation where an international institution is endowed with powers to take decisions binding on Sovereign States either generally or in specific areas of State activity. In effect, most legal instruments adopted by ECOWAS are now directly applicable within member States. See also the Supplementary Protocol Amending the Revised Treaty, op. cit.

See ECOWAS, Abuja (1992); – Review of the Treaty, op. cit, p. 16, para 42.

See Musa Saidykhan v. Republic of the Gambia (2009) ECW/CCJ/APP/11/07, See paras 48- 50 of the Ruling of 30th June 2009.

Ibid.

Registered Trustees of the SERAP v. Federal Republic of Nigeria and UBEC (2009), ECW/CCJ/APP/08/08, Ruling of 27th October 2009 at paras 18 – 20.

Mukhtar A.I. v. Government of Jigawa State (2011) ECW/CCJ/APP/02/11 Ruling of 7th July 2011 paras 42- 45.

Peter David v. Ambassador Ralph Uwechue ECW/CCJ/APP/04/09.

See item 3.2 of this paper on analysis of the nature of ECOWAS Community Law.

Part of the new vision and mission of the ECOWAS.

See Sections 1, 14 (2)(b) and 19 of the 1999 Constitution of Nigeria, op. cit.

FAO (2018): – Institutional Aspects of Regional Integration. www.fao.org/3/y4793e/y4793e07.html

Leave a Reply

Your email address will not be published. Required fields are marked *