Interim Measures Before the Tribunal is Constituted

I.???Introduction

Interim measures can be granted before an arbitral tribunal is established, and this mandate is bestowed to the court. However, as to which court has such power is not clear from the provisions of the Arbitration and Conciliation Working Procedure Proclamation No. 1237/2021 (Arbitration Proclamation).

This post outlines the legal and practical problems that parties are facing in relation to this matter and suggests that an amendment be made to the law or be filled by the Federal Supreme Court Cassation Division.

II.?????????????Legal and Practical Problems

Article 9 of the Arbitration Proclamation reads as follows:

“With respect to matters falling under the arbitration agreement, the contracting parties may request the court interim measures to be taken before the arbitration proceeding is initiated or during the proceedings. This shall not be considered as violation of the arbitration agreement by the contracting parties and as intervention by the court.”

Similarly, Article 27 of the Arbitration Proclamation states as follows:

“Contracting parties may request a court for an order of interim measure irrespective of the place of the arbitration of the arbitral tribunal.”

Unlike other provisions of the proclamation, these provisions do not specify which court has the power to grant interim measures. Notably, Article 9 is silent as to which court may grant interim measures before the arbitration proceeding is initiated. This is creating confusion in the courts.

In Beijing Urban Construction Group Company Ltd v Ethiopian Roads Administration (F289023, 2022), the Ethiopian Roads Authority (ERA) initiated the calling of the performance guarantee provided by Beijing Urban Construction Group (BUCG) owing to BUCG’s failure to perform its contractual obligations. BUCG, disputing the reasons, filed a petition to the Federal High Court and requested an injunction order on ERA to prevent the calling of the performance guarantee until an arbitration tribunal is established. BUCG relied on Article 9 of the Arbitration Proclamation reproduced above.

The Federal High Court rejected to grant interim measures reasoning that it has no jurisdiction to do so because it is not clear from Article 9 of the Arbitration Proclamation as to which court has that jurisdiction. Further, it suggests that the Federal First Instance Court may be the relevant court to do so because the power to appoint arbitrators is given to it.

This is frustrating because there is no guarantee that the First Instance Court accepts such a request if the amount in dispute is higher than 10,000,000 ETB. Pursuant to the Federal Courts Proclamation 1234/ 2021 (Art. 11), civil cases involving the amount exceeding 10,000,000 ETB are within the Federal High Court’s jurisdiction. Below this amount is given to the Federal First Instance Court (Art. 14). According to this proclamation, the above case would be within the jurisdiction of the Federal High Court because it is worth more than 10,000,000 ETB. What would happen if the First Instance Court also rejects the request on similar grounds?

Coming to the opinion of the High Court that the First Instance Court is the appropriate court to give an injunction order, it must be noted that the Arbitration Proclamation does not give all arbitration matters to the Federal First Instance Court. Although the mandate to appoint arbitrators, entertain the rejection of challenging an arbitrator, entertain requests to remove an arbitrator that does not perform his duties properly, etc are given to the First Instance Court, other courts are also bestowed with different mandates. For example, the Federal High Court is the proper court to enforce foreign interim measures. And if the interim measure is made by domestic arbitration, the court which would have had jurisdiction had the case not been submitted to arbitration has the jurisdiction to enforce the interim measure. The power to receive evidence in support of the tribunal, entertain objections to the arbitral award, and set aside an award lies in the court that would have had jurisdiction had it not been submitted to arbitration. As long as there is no direct relationship between the appointment of arbitrators and granting interim measures, the High Court’s opinion is less convincing.

Therefore, the provision is susceptible to different interpretations, and the High Court’s opinion in the Beijing Urban Construction Private Ltd v Ethiopian Roads Administration does not have any binding force. In fact, the argument that the High Court has jurisdiction over such matters seems to be stronger because matters involving 10,000,000 ETB are within the jurisdiction of the High Court.

III.??????????The Way Forward

The existing problem creates inconvenience and does injustice. Thus, the provision must be amended along with many other provisions of the proclamation that lack clarity. If a case goes up to the Federal Supreme Court Cassation Division, in the meantime, the court may pass a binding interpretation and fill the gap.