Out-Law News 2 min. read

LCIA statistics show doubling of arbitration parties from Africa

Africa has become the fastest-growing region from which parties involved in London Court of International Arbitration (LCIA) cases originate, as the institution’s latest statistics shows that a vast majority of its cases are of an international nature.

While parties from Western Europe continue to account for the largest number of parties in LCIA arbitration cases, Africa has seen the sharpest rise in terms of the proportion of parties in LCIA arbitrations, according to LCIA’s 2023 casework report. The figures show the percentage of parties from Africa doubling from 4% in 2022 to 8% in 2023. Mauritius and Nigeria remained as the top two countries in the African region, while parties from North Africa saw a notable year-on-year rise, from 5% to 8%.

In contrast, the proportion of parties from Asia plummeted from 24% in 2022 to 8% last year. The percentage of parties from Singapore, China, Hong Kong and Pakistan more than halved during the same period.

Rob Wilkins, arbitration expert at Pinsent Masons, said: “The continued growth of international trade and levels of foreign investment into many African countries have long been expected to drive an increase in the number of international arbitration cases involving African parties. The LCIA statistics for 2023 seem to support that view, with a doubling of their cases involving at least one African party. Whilst this appears to reflect both the LCIA’s popularity and the importance of international arbitration in resolving disputes arising on the continent, it should be noted that the overall percentage involving African parties is still down on the 11.7% figure recorded in LCIA’s 2020 Casework report.”

“In the absence of up to date regional statistics from other major arbitral institutions – notably the International Chamber of Commerce (ICC), which has historically administered the highest volumes of cases involving African parties – it is difficult to state with any certainty whether we are now seeing the long-awaited surge in African arbitration. However, the LCIA’s figures, when taken alongside increased caseloads at leading African arbitral institutions such as the Cairo Regional Court of International Commercial Arbitration (CRCICA) and the Arbitration Foundation of Southern Africa (AFSA) seems to support the view that Africa cases are on the rise,” he said.

The LCIA also reported a strong increase in the number of referrals for its services last year, up by 13% from 333 cases in 2022 to 377. Of the 377 cases referred to the LCIA in 2023, 327, or 87%, are for LCIA arbitration.

Among all of its cases in 2023, the vast majority - 96% - are of an international nature, while 79% percent of cases do not involve UK parties. Around 4% of cases involved only UK parties.

In terms of sectors, transport and commodities cases continue to dominate the LCIA’s caseload, making up 36% of the total cases in 2023. The LCIA attributed this to “the ongoing impact of global developments on energy prices and supply chains”. Wilkins said: “The prevalence of disputes in these sectors is not surprising, given the geopolitical and economic disruptions that have affected global trade and supply chains over the past few years”.

For the same reason, as the majority are related to commodities, sale of goods contracts were the most-common type of agreement in LCIA arbitrations, accounting for 31% of its caseload.

Another development highlighted in the LCIA report was a jump in amounts sought by claimants in arbitration. Almost 30% of quantified claims were over $20 million in value, compared to 19% in 2022.

Achieving diversity in court appointments and arbitrator appointments has been an area of focus of the LCIA. Its annual report demonstrated an improvement particularly on gender diversity across all stakeholders, with the LCIA court being the main driver and almost reaching gender parity in its selection of arbitrators. Among arbitrators appointed by the LCIA Court, 48% are women, up from 45% in 2022; while 39% of all co-arbitrator appointments are of women, compared to 23% in 2022. However, female arbitrators appointed by parties only stood at 21%, slightly higher than 19% in 2022.

“More input is needed from the parties and co-arbitrators to improve the overall percentage of appointments of women (33%), while being mindful of the need to minimise appointments of the same arbitrators,” said the LCIA in its annual report.

We are processing your request. \n Thank you for your patience. An error occurred. This could be due to inactivity on the page - please try again.