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Part A: General Topics - 20. Dispute Resolution | 20.1 Jurisdiction

A mining law may choose to address jurisdiction as a topic on its own or as part of provisions addressing the function and collaboration among regulating bodies.

As noted above, jurisdiction provisions detail what forum(s) will resolve disputes arising out of activities in the sector and what matters may come before such forums. For a clear stable regime, the mining law should seek to streamline dispute resolution processes to eliminate forum shopping and promote consistent resolution of disputes.

20.1. Example 1:

Article [_]

(1) Where a dispute arises between a holder of a mineral right and [Country] in respect of a matter expressly stated under this [Act][Code][Law] as a matter which shall be referred for resolution, good faith efforts shall be made through mutual discussion and alternative dispute resolution procedures, to reach an amicable settlement.

(2) Where a dispute arises between a holder who is a citizen and [Country] in respect of a matter expressly stated under this Act as a matter which shall be referred for resolution, which is not amicably resolved as provided in subsection (1) within thirty days of the dispute arising or a longer period agreed between the parties to the dispute, the dispute may be submitted by a party to the dispute, to arbitration for settlement in accordance with the [Domestic Arbitration Law] or any other enactment in force for resolution of disputes.

(3) Where a dispute arises between a holder who is not a citizen and the [Country] in respect of a matter expressly stated under this Act as a matter which shall be referred for resolution under this section, which is not amicably resolved as provided under subsection (1) within thirty days of the dispute arising or a longer period agreed between the parties to the dispute, the dispute may, by a party to the dispute giving notice to all other parties, be submitted to arbitration:

(a) in accordance with a[n] international machinery for the resolution of investment disputes, as agreed to by the parties, or

(b) if the parties do not reach an agreement under paragraph (a) within thirty days, or a longer period agreed between the parties, of the matter being submitted to arbitration, in accordance with

(i) firstly, the framework of a bilateral or multilateral agreement on investment protection to which the [Country] and the country of which the holder is a national, are parties, or

(ii) secondly, if no agreement contemplated by subparagraph (i) exists, the rules of procedure for arbitration UNCITRAL Rules.

(4) Each agreement granting a mineral right shall contain provisions on the method of resolution of disputes that may arise under the agreement.

Annotation

Inspired by Ghana’s mining law (2006), this provision first indicates the scope of disputes justiciable under the provision, namely all disputes arising from a matter expressly covered by the law. It then creates a dual step that requires the use of alternative dispute resolution as the primary forum before the use of an arbitral forum. The provision also distinguishes between disputes between the Government and nationals and disputes between the Government and foreign nationals. However, it does not clarify the definition of a national. It would be important to clarify if a mining operating company which is established subject to the national laws of the country but is wholly owned by a foreign company is deemed a national or a foreign national.

This bifurcation of forums between nationals and non-nationals is attractive to foreign investors, who generally prefer for forum to be determined by contract.

Paragraph 4 is a good clarifying/streamlining element for a provision that provides for several different forms of dispute resolution because it requires parties to specify in the contract the specific method of dispute resolution, selected from the options offered by the mining law.

20.1. Example 2:

Article [__]

(1)Any dispute arising between the holder of a mining right and [Country] in respect of the interpretation and application of this Act, its Regulations and the terms and conditions of mining rights shall be resolved, in the first instance, on an amicable basis.

(2)Where the dispute is in the nature of a bona fide investment dispute, and such dispute is not amicably settled as provided under subsection (1) of this section, it shall be resolved in accordance with the provisions of the [Domestic Arbitration Law] [or any other enactment in force for resolution of disputes].

(3)Any other dispute between the holder of a mining right and the [Country] shall be resolved in the Federal High Court, if not settled in accordance with the provisions of subsection (1) or (2) of this section.

Annotation

Drawn from Nigeria’s mining law (2007), this provision also provides for the scope of disputes justiciable under the provision (albeit more detailed to include terms and conditions deriving from the mining right, i.e. the contract). It also provides for a multiple step forum though in this case, a three step forum, incorporating the courts as the third and final forum. Unlike in Example 1, it does not provide for a duration for the progression of disputes from one forum to the next.

As noted above, to the extent that national courts are neutral and efficient, foreign investors may be persuaded to use the national courts in lieu of international arbitration. The use of national courts is also likely to contribute to building capacity within the respective national judiciary in handling mining disputes. The exhaustiveness of the scope which eliminates the use of contracts to multiply potential forums and the non-discriminatory approach to all mining rights holders also promotes consistent resolution of disputes.