CHAPTER ONE

GENERAL INTRODUCTION

1.1 Background of the Study

The complexities of modern commercial and civil interactions make conflict inevitable, thus necessitating dispute resolution mechanisms which provides a platform for a wronged party in a contract to seek redress in order to enforce their rights. The rise of online commercial transactions has transformed the landscape of international trade, raising complex legal questions about how cross-border disputes should be effectively resolved. The maxim ubi jus ibi remedium “where there is a right, there is a remedy” underscores the foundational principle that every individual whose legal right has been infringed should have access to a remedy through due process.^[1] This principle has fueled 1the emergence of disputes in contractual relationships, as parties seek to enforce their rights and obtain appropriate relief when those rights are violated.^[2] Dispute resolution mechanisms are broadly categorized into two: litigation and alternative dispute resolution (ADR). ADR further encompasses methods such as negotiation, mediation, conciliation, and arbitration.^[3] Each of these methods serves as a means for resolving conflicts without necessarily resorting to the formal court system.

The use of arbitration as a means of resolving commercial disputes has undergone a complex and dynamic transformation. Initially emerging as an alternative to litigation in domestic courts, arbitration has evolved both in scope and form, from informal merchant practices to a sophisticated international system supported by legal frameworks, institutions, and conventions. This transformation has been further intensified in the digital age, where the rise of online commerce has necessitated the rethinking of dispute resolution mechanisms to cater for virtual environments.^[4] Historically, arbitration dates back to ancient civilizations, including in ancient civilization where merchants resolved disputes through informal processes presided over by respected community figures or trade guilds. These practices were driven by a need for expediency, neutrality, and specialization needs that remain relevant today. In ancient Greece, for instance, commercial disputes among traders were often settled in agoras (marketplaces) through oral contracts and mediated by neutral elders.^[5] In Roman law, the concept of compromissum allowed disputing parties to submit their disagreements to private individuals known as arbitri, who gave binding decisions.^[6] These early practices laid the foundation for modern arbitration by emphasizing party autonomy and speed. During the medieval period, particularly in Europe, commercial transactions expanded due to the revival of trade routes and fairs. Merchant guilds emerged and began handling commercial disputes internally through their own tribunals. The Lex mercantoria, or “law merchant,” was the common set of principles and customs developed by and for merchants across different jurisdictions in the 11th and 13th century. This transnational legal order enabled uniformity in handling trade conflicts without reliance on national laws. The law merchant focused on fairness, good faith, and commercial convenience, often preferring quick resolution over procedural rigidity.  Merchants were both the litigants and the adjudicators, ensuring expertise and community trust. This period witnessed the resolution of disputes related to weights, measures, credit, delivery times, and quality of goods. The disputes that arose in this era in the 11th and 13th century were usually related to delivery failures, fraud, defective goods, or non-payment. The dispute resolution processes were informal but effective, relying on commercial reputation, community enforcement, and exclusion from trade networks as consequences for non-compliance.^[7] Merchant courts operated within trade fairs and port cities, using simplified procedures and oral testimony. The judgments rendered were recognized and enforced across trade centers due to shared values and mutual interests. Over time, these practices influenced the emergence of equity-based legal principles in formal state systems and paved the way for arbitration as a formal alternative.^[8]As the modern state emerged in the 17th and 18th centuries, with centralized authority and codified laws, arbitration began to take a more formal structure. Commercial disputes became more complex, involving maritime trade, colonial trade, and multi-jurisdictional issues.^[9] The courts gradually recognized arbitration agreements and awards, allowing merchants to continue using non-judicial means while ensuring legal enforceability. However, the growing formality also introduced challenges such as judicial oversight, appeal mechanisms, and procedural constraints that reduced the speed and flexibility of early arbitration.^[10]

The 19th and 20th centuries witnessed significant institutionalization of arbitration. National arbitration laws emerged, granting legal effect to arbitration clauses and recognizing arbitral awards. The creation of arbitration institutions such as the international Chamber of Commerce (ICC) founded in 1923), the London Court of Justice (LCIA) 1892, and the (AAA) American Arbitration Association 1926 reflected the need for standardized rules and neutral administration. These institutions addressed disputes related to shipping, insurance, finance, construction, and cross-border investments. Commercial disputes now included breach of contract, payment default, intellectual property violations, and tortious interference. Arbitration provided confidentiality, flexibility, expertise, attractive features for international businesses. The law merchant evolved into modern commercial law, influencing legal doctrines such as contract formation, usage of trade, good faith, and reasonableness. International instruments like the Geneva Protocol (1923) on arbitral clause.^[11] The Geneva Convention (1927) Convention on the Execution of Foreign Arbitral Awards, signed at Geneva on 26 September 1927, under the auspices of the League of Nations., and most notably, the New York Convention (1958) provided a robust legal framework for recognizing and enforcing foreign arbitral awards. The New York Convention, with over 160 member states, significantly increased arbitration’s legitimacy as an international dispute resolution mechanism.^[12]

 In Africa, the need for harmonized commercial law led to the establishment of OHADA in 1993, aimed at unifying business regulations and enhancing legal certainty across its member states, Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Comoros, Republic of the Congo, Côte d’Ivoire, Equatorial Guinea, Gabon, Guinea, Guinea-Bissau, Mali, Niger, Senegal, Togo, and the Democratic Republic of the Congo. The adoption of the Uniform Act on Arbitration in 1999,was a major milestone, codifying arbitration procedures and aligning them with international standards.^[13] The Act permits institutional and ad hoc arbitration, recognizes party autonomy, and limits court interference. The OHADA Common Court of Justice and Arbitration (CCJA) plays a dual role acting both as a final court of appeal and as an arbitration center. Commercial disputes under OHADA typically involve contract enforcement, shareholder conflicts, construction contracts, and cross-border investment disagreements and generally settlement of commercial disputes. However, unlike the Lex mercantoria, OHADA’s arbitration framework is codified and formal, though it maintains flexibility in procedure. It lacks explicit provisions for handling digital disputes, an omission that becomes significant as e-commerce grows.^[14]

The 21st century has ushered in a shift from physical commerce to digital platforms. E-commerce through platforms like Amazon, Alibaba, and Jumia has created new dispute typologies: delivery failures, unauthorized charges, digital fraud, breach of online terms of service, and data protection violations. These disputes are typically rapid, cross-border, and involve small to medium-sized claims that may not justify traditional arbitration’s cost and formality.^[15] Often, parties to these disputes are located in different jurisdictions, making issues of applicable law, enforcement of arbitral awards, and jurisdictional competence particularly problematic. Furthermore, the involvement of third-party intermediaries such as online marketplaces, logistics providers, and digital payment services complicates the attribution of responsibility when disputes arise.

To address these gaps, Online Dispute Resolution (ODR) emerged as a digital extension of arbitration. Initially developed for consumer transactions (e.g., eBay’s dispute resolution system), ODR now includes complex commercial disputes. It combines technology with traditional arbitration principles to allow remote filing, virtual hearings, and digital award issuance. Block chain, for example, can help ensure that submitted evidence remains unchanged. Some ODR platforms are even testing AI tools to filter cases. However, such technologies are not referenced in the OHADA UAA.”Despite these advances, OHADA’s framework remains paper based.^[16] Aspects of dispute arising from online transactions are not formally  addressed in the OHADA Arbitration framework. This legal vacuum hinders the enforceability of online arbitral awards, particularly when national courts are required to interpret outdated provisions. Cameroon, an OHADA member, exemplifies this gap. While it has domestic laws and institutions, digital arbitration is underutilized due to infrastructure challenges, legal ambiguities, and limited practitioner training^[17]

While arbitration has evolved from informal trade practices to a sophisticated international legal mechanism, the rise of digital commerce presents new challenges that existing frameworks like OHADA have yet to adequately address. The absence of explicit provisions for online dispute resolution, digital evidence, and technology-assisted arbitration processes underscores a pressing need for modernization. As cross-border e-commerce continues to grow, legal systems must adapt to ensure that arbitration remains an effective, accessible, and enforceable means of resolving commercial disputes.

1.2 Statement of the problem:

The rise of online commercial transactions have changed how business is done across borders, especially in Africa,^[18] as transactions are increasingly taking place online, involving businesses and consumers from different OHADA member states.^[19] Arbitration has been seen as an effective, efficient and inexpensive dispute resolution measure. It is on this basis that the Uniform Act on Arbitration of 1999 as amended in 2017 was enacted to aid the process of arbitration in member states. Despite the enactment of the instrument, the advancement of E-commerce and the disputes thereof has posed a serious threat to its effectiveness.^[20] This is because the current OHADA Uniform Act on Arbitration,  does not contain specific rules or clear guidance for resolving disputes that result from online commercial transactions.^[21] The legislators when  drafting the OHADA Arbitration Law did not foresee the rapid development in technology through online commercial transactions and dispute arising thereof. Article 1 defines the Act’s scope, as applicable to commercial contract disputes while establishing arbitration as the primary resolution method. It does not specifically address the complexities of online commerce, such as remote hearings, digital evidence submission, and challenges in enforcing arbitral awards for cross-border transactions.^[22] This gap contrasts with the broad and flexible interpretation of arbitration clauses endorsed in Fiona Trust & Holding Corp. v Privalov, where the court affirmed that arbitration clauses should be interpreted expansively to cover all disputes arising from the relationship unless explicitly excluded.^[23] “The construction of an arbitration clause should start from the assumption that the parties, as rational businesspeople, are likely to have intended any dispute arising out of the relationship to be decided by the same tribunal.” Despite the fact that Article 31 ensures that foreign arbitral awards are enforceable in all member states. It does not adequately address the complexities of enforcing digital agreements, this problem is further compounded by jurisdictional issues, anonymity of parties in online transactions, and the difficulty in tendering evidence from electronic transactions. The consequence has been the inability of parties to online transactions to seek redress for violation of their contractual rights. The challenges of resolving online commercial disputes through traditional legal and arbitration frameworks have been witnessed in various jurisdictions. This questions therefore questions the effectiveness of the Uniform Act on arbitration to adequately address disputes arising from online commercial transactions.

1.3 Research Question

The research question is divided into the main research question and specific research questions.

1.3.1 Main research Question

How effective is the OHADA Uniform Act on arbitration in regulating online commercial disputes?

1.3.2 Specific Research Questions

From the main research question above the study is based on the following specific questions

1. What are the basis for the settlement of commercial disputes under the OHADA Uniform Act on Arbitration?
2. What is the procedure for the settlement of arbitration disputes under the OHADA Uniform Act?

3.What are the threats posed by online commercial disputes to the effective settlement of disputes under OHADA Uniform Act?

4 What can be done to enhance the effective settlement of online commercial disputes under the Uniform Act on Arbitration?

1.4 Hypothesis of the study

The research is based on the assumption that; the OHADA Uniform Act Arbitration does not effectively regulate the settlement of Online Commercial Disputes.

1.5 Objective of the study

The objective of the study is divided into the main objective and specific objectives

1.5.1 Main Objective of the study

To critically examine the effectiveness of OHADA Arbitration in regulating online commercial disputes.

1.5.2 Specific Objectives of the study

1.To examine the basis for the settlement of commercial disputes under the OHADA Uniform Act on Arbitration

2. To analyze the procedure for settling arbitration disputes under the OHADA Uniform Act.
3. To identify the threats posed by online commercial disputes to the effective settlement of disputes under the OHADA Uniform Act.
4. To propose reforms to enhance the effective settlement of online commercial disputes under the OHADA Uniform Act on Arbitration.

[1] Snell, E. H. (2020). Snell’s Equity (34th ed., pp. 25–26). Sweet & Maxwell.

[2] Born,G.B.(2021) “International Commercial Arbitration” (3rd.) Kluwer Law International.

[3] Redfern, A., & Hunter , M.(2015). Law and Practice of international Commercial Arbitration (6th Ed).Oxford University Press.

[4] Bongkiyi, J. P. (2021).” Online Dispute Resolution: Its prospects and potential for Cameroon”. Zien Journal of Social Sciences and Humanities, 1, p 86–95.

[5] Ndongo D.C. (2021, June).” Les centres d’arbitrage de l’espace OHADA face aux technologies de l’information et de la communication (TIC).” Revue juridique de la Sorbonne, 3, p12

[6] Nicholas, B. (1962). An introduction to Roman law. Oxford University Press.

[7] Trakman, L. E. (2011).”The twenty-first century law merchant”. University of New South Wales Law Research Series, 32.

[9] Goddard, R. (2015). Market courts and lex mercatoria in late medieval England. Past & Present, 228(1), 55–97. https://doi.org/10.1093/pastj/gtv030

[10] Mann, B. H. (1984). “The formalization of informal law: Arbitration before the American Revolution”. New York University Law Review, 59, 443–488.

[11]  League of Nations. (1923). Protocol on Arbitration Clauses, Geneva, 24 September 1923.

[12] Redfern, A.et Al.. (2009). Law and Practice of International Commercial Arbitration. Oxford University Press. P.32.

[13] Organisation for the Harmonization of Business Law in Africa. (n.d.). Presentation of OHADA.

[14] Piers, M., & Aschauer, C. (Eds.). (2021). Arbitration in the digital age: The brave new world of arbitration. Cambridge University Press.

[15]  Ngkiyi, J. P. (2021). “Online Dispute Resolution: Its prospects and potential for Cameroon.” Zien Journal of Social Sciences and Humanities, 1, 86–95.

[16] United Nations Commission on International Trade Law (UNCITRAL). (2016). Technical Notes on Online Dispute Resolution. United Nations.

[17] Nguena, C. A. (2018). Arbitration law under the OHADA Uniform Act: Achievements and challenges. African Journal of International and Comparative Law, 26(1), p 88–105

[18] Ndala, A. (2022).”The admissibility of electronic evidence in e-commerce contracts disputes: Comparative study of the case of Cameroon, Belgium, and the United States.” International Journal of Law Management & Humanities, 5(6) , pp 1137–1157.

[19] CMS Law. (2018) New arbitration and mediation regulations introduced in the 17 OHADA member states.(Report)

[20] Kaufmann-Kohler, G., & Schultz, T. (2004). Online dispute resolution: “Challenges for contemporary justice. The Hague: Kluwer Law International.

[21] OHADA. (2017). Acte uniforme relatif au droit de l’arbitrage de Organisation pour l’harmonisation en Afrique du droit des affaires (OHADA).

[22] Howell, J. (2008). Electronic disclosure in international arbitration. Huntington, N.Y: Juris Net.justice.

[23] Fiona Trust & Holding Corp. v Privalov, [2007] UKHL 40, [2008] 1 Lloyd’s Rep 254. (Case Law – UK House of Lords).