ZAMBIA: A PRACTICAL, CONVENIENT OPTION FOR ENFORCING FOREIGN JUDGMENTS AND ARBITRATION AWARDS
Zambia has been moving up the ranks of the World Bank’s Ease of Doing Business Index for the past decade and now holds 85th position – compared to 98th in 2016 – out of 190 countries. The country has also improved its standing in the Competitiveness Index. These improvements come on the back of ongoing legal reforms and a determined commitment to the rule of law.
Further boosting Zambia’s status as a stable democracy is the peaceful transition of power now under way following the 12 August 2021 presidential elections, won by Hakainde Hichilema, leader of the opposition. This augurs well for business and investor confidence in the country.
Among the areas where Zambia has done well in ensuring its legal framework meets international best practices is the enforcement of foreign judgments – a matter of cardinal importance to international investors.
English law is applicable in Zambia, which has also been a party to the New York Convention on Enforcement of Arbitration for almost 20 years. The country’s legal framework for enforcing foreign judgments is comprehensive, making it a viable choice for parties that obtain judgments or arbitration awards in other countries. They may find Zambia to be a practical and convenient option for enforcing a foreign judgment or arbitration award.
Such creditors could potentially follow three different routes, depending on the circumstances of the matter:
- Registering a foreign judgment or order in Zambia under the Foreign Judgments Act, making the judgment binding and enforceable in the country. For this avenue to be used, the court that issued the judgment must be from a country with which Zambia has a reciprocal agreement for the enforcement of foreign judgments.
- Invoking the common law, which entails starting fresh court proceedings on the judgment in Zambia which creates a simple debt in favour of the judgment creditor against the judgment debtor. This option is relatively quick to pursue as the dispute does not go to trial. Rather, the creditor applies for summary judgment, that is granted if the creditor can demonstrate that the foreign court had jurisdiction and the debtor had a fair opportunity to be heard.
- Request Invoking Zambia’s Arbitration Act of 2000, which is fully in line with the New York Convention. The Arbitration Act provides that an arbitral award will be recognised as binding in Zambia, regardless of the country in which it was made, on applying (in writing) to the High Court of Zambia. All that is needed for the award to be recognised is to supply the court with the original arbitral award, or a certified copy, as well as the arbitration agreement (the original or a certified copy).
Perhaps more useful than the recognition of an arbitration award is the concept of enforcement. Foreign arbitral awards are enforceable in Zambia by mere registration under the Arbitration Act. Once registered, a foreign award can be enforced in the same way as a judgment of the High Court of Zambia. This means a party whose arbitration award has been registered in the High Court can use state machinery (such as the Sheriff’s Office) to enforce the award against the debtor.
In all three avenues available for recognising and enforcing foreign judgments or orders in Zambia, there are certain requirements to be met and procedures to be followed. These are not particularly onerous and creditors with all the correct paperwork and appropriate legal advice should encounter few challenges in having their judgments or awards made binding and final.