Tanzania reviews law on mediation for investors
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The East African | 8 February 2020

Tanzania reviews law on mediation for investors

By BOB KARASHANI

Tanzania is set to review the contentious arbitration law. A key part of the draft Bill for the proposed 2020 Arbitration Act, tabled in parliament on January 28, includes clauses allowing investors to access international arbitration.

The draft Bill comes on the back of new arbitration announcements filed last month by several multinational mining companies over cancelled retention licences.

It also coincided with a new profit-sharing deal between Tanzania and Canadian mining giant Barrick Gold Corp for the three Barrick-owned gold mines in the country.

One of Tanzania’s concessions to Barrick in the new deal is the right to seek international arbitration in case of disputes.

The draft Bill proposes amendments covering sovereignty over Tanzania’s natural resources and public-private-partnership (PPP) ventures with foreign parties; domestic and international commercial arbitration, as well as “enforcement of foreign arbitral awards” and related matters.

For example, on PPPs the draft proposes changes that would allow dispute resolution by outside arbitration bodies provided that the proceedings are held in Tanzania.

This follows amendments to the PPP Act in 2018 that required institutions administering all arbitrations to be from Tanzania.

The amended law will also create a Tanzania Arbitration Centre to host all mediation and deal with arbitrator accreditations.

Notice to litigate

Canadian firm Winshear Gold Corporation served noticed of intent to litigate on January 10, followed by Australian miner Indiana Resources Ltd on January 15.

Both companies are claiming that Tanzania breached the 2013 Agreement for the Promotion and Reciprocal Protection of Investments—also known as the Bilateral Investment Treaty—along with various international laws and conventions.

They have both declared that they will “pursue any means available”, including going as far as international tribunal level, to protect their investments in Tanzania.