Business Law In Africa Research Articles

A Comparative Analysis of Remedies and Challenges in the Protection of Stakeholders Rights: OHADA vs. English Corporate Law

This article provides a comparative analysis of the remedies and challenges in the protection of stakeholder rights under OHADA (Organization for the Harmonization of Business Law in Africa) and English corporate law. The study focuses on key legal remedies available to stakeholders, including the derivative action model, the unfair prejudice remedy, personal right of action, remedies for breach of contract and torts, representative actions amongst other remedies. Under OHADA, the uniform legal framework aims to harmonize business laws across member states, promoting legal certainty and economic growth. In this context, the derivative action model allows minority shareholders to seek redress for wrongs committed against the company, while the unfair prejudice remedy protects stakeholders from actions that harm their interests. Personal right of action and remedies for breach of contract and torts provide additional avenues for stakeholders to seek justice. Representative actions further enable collective redress for affected parties. In contrast, English corporate law, rooted in a common law tradition, offers flexibility and judicial interpretation in protecting stakeholder rights. The derivative action model in English law allows shareholders to bring claims on behalf of the company, while the unfair prejudice remedy addresses situations where minority shareholders are treated unfairly. Personal right of action and remedies for breach of contract and torts are well-established, providing robust protection for stakeholders. Representative actions in English law facilitate collective litigation, enhancing access to justice. In tandem with the foregoing, this paper explores challenges in the practical enforcement of these remedies, including differences in legal culture, enforcement mechanisms, and jurisdictional issues. By comparing OHADA and English corporate law, the study provides insights into the effectiveness of various legal frameworks in protecting stakeholder rights and offers recommendations for enhancing stakeholder protection through legal reforms and policy initiatives. Through a content analysis of primary and secondary data, we uphold that this article contributes to the discourse on corporate governance and stakeholder theory, offering valuable perspectives for policymakers, legal practitioners, and scholars interested in the protection of stakeholder rights in diverse legal environments.

Challenges justifying the necessary harmonization of economic and financial criminal laws in O.H.A.D.A. space

Some African countries have decided to create the Organization for the Harmonization of Business Law in Africa (O.H.A.D.A.) to build a common legal space to meet their economic and social needs. This organization results from their desire to standardize their legislation to find solutions to the persistent economic sluggishness generating endemic mass unemployment. Its primary purpose is to restore confidence to investors who, for a long time, have turned their backs on Africa because of the obsolescence, scattering, and extreme heterogeneity of its legislation of an economic nature. With this in mind, the Community body has introduced several uniform laws conducive to economic activity between Member States. That raises the question of security within this regional space. Appearing as a strategic weapon, the regional legislator has put legal means of protection on the civil level, which unfortunately proves to be insufficient. Because of this, recoursing to criminal law is necessary. However, we note that the member states of the O.H.A.D.A. consider the penal field their preserve. The corollary of this national character results in a need to move towards unifying the penal field within the framework of an organization of integration, which is O.H.A.D.A. That constitutes a problematic challenge regarding determining a penal policy in the regional space.

Exploring the Possibilities of Legal Harmonisation of Non-Tariff Barriers of RECs for the Achievement of the AfCFTA

African Union (AU) countries are expected to pursue more effective, responsive and non-discriminatory regulations to build a more productive regional economy. This article interrogates the prospects of implementing legal harmonisation of Non-Tariff Barriers (NTBs) in the African Continental Free Trade Area (AfCFTA). The article adopts a qualitative review of the literature with reference to the European Union (EU) and the Organisation for the Harmonisation of Business Law in Africa (OHADA). Analysing instruments of legal harmonisation of the AU and Regional Economic Communities (RECs) reveals lapses in the harmonisation agenda, which impedes intra-regional trade. Furthermore, the article examines the methods of legal harmonisation, benefits, setbacks and efforts RECs make to harmonise NTBs. Also, examining attempts at legal harmonisation by RECs reveals that the harmonisation objectives of the AU’s legal frameworks have not been effective. On the other hand, RECs have progressed unequally in meeting their treaty goals and essential programmes. This article establishes that the legal harmonisation model, political will and states’ inability to supranationalise community rules are the major reasons for the lack of harmonisation. In addition, overambitious targets with limited resources account for the failure of the AU and its RECs to achieve their stated objectives. Finally, the article proposes a legal harmonisation model that will directly affect domestic regulations.

Tacit Choice of Law in International Commercial Contracts. An Analysis of Future Instruments of Developmental Organisations

This article examines the various regional and supranational organisations of emerging countries that could benefit from a codification of private international law rules. They include the Organisation for the Harmonisation of Business Law in Africa (OHADA), the African Union (AU) and the Association of Southeast Asian Nations (ASEAN). In addition, the article analyses the envisaged instruments that may be especially relevant in the context of the abovementioned organisations. These include the Preliminary Draft Uniform Act on the Law of Obligations in the OHADA Region, the proposed African Principles on the Law Applicable to International Commercial Contracts and the Asian Principles of Private International Law. More specifically, the article focusses on the provisions regarding the determination of the law applicable, particularly those rules relating to a tacit choice of law in international commercial contracts.

Mediating Indigenous Disputes: Lessons from Africa and Canada

Mediation is not novel to indigenous peoples in Africa and Canada. It has been in existence long before codified regulation of mediation.[i] For instance, the ancient Yoruba peoples of Nigeria have been known to mediate street fights, trade and communal disputes long before the emergence of formal courts and institutional mediation.[ii] Indigenous mediation in Africa and Canada share certain characteristics. First, the recognition of the supernatural and/or ancestry. Secondly, these mediations possess some cultural flavour peculiar to the indigenous peoples represented at the session, particularly reflected in their language, attire and the use of proverbs. [i] ADR Institute of Canada, “Code of Conduct for Mediators” Amended 15 April, 2011 https://adric.ca/rules-codes/code-of-conduct/; In Africa, each country individually make legislative provision for regulating the conduct of mediation. Nonetheless, the African Union Mediation Support Handbook offers guidance towards the conduct of mediation in Africa – See African Centre for the Constructive Resolution of Disputes (ACCORD), “African Union Mediation Support Handbook” (2014) https://www.peaceau.org/uploads/06-au-mediation-support-handbook-2014.pdf. Additionally, the Organization for the Harmonization of Business Law in Africa (OHADA) member States have enacted a Uniform Act on Mediation, this was adopted on November 23, 2017. The OHADA Uniform Act was inspired by the 2002 UNCITRAL Model Law on International Commercial Conciliation. [ii] Adeyinka Ajayi and Lateef Buhari, Methods of Conflict Resolution in African Traditional Society African Research Review Ethiopia Vol 8 (2) Serial No 33 April 2014:138-157 [143,150]

Portée du principe de la représentation obligatoire par avocat devant la Cour Commune de Justice et d’arbitrage (CCJA) à l’aune de la pratique jurisprudentielle

The law of the Organization for the Harmonization of Business Law in Africa (OHADA) enshrines the principle of compulsory representation by lawyer before its High Court, the Common Court of Justice and Arbitration (CCJA). It follows from this principle that any appeal before the CCJA and any related procedural document such as the reply or replication, not signed by a lawyer belonging to a Bar in the OHADA geographical area, are to be declared inadmissible. Notwithstanding the explicit consecration of this principle in OHADA law, the CCJA has been called upon on many occasions to define its contour. This paper examines the interpretation of this principle by this court. It first notes the scope of this principle as defined by the CCJA in relation to the criteria retained for the exercise of the ministry of counsel before its jurisdiction. Finally, it dwells on its jurisprudence concerning the form and statements of the special mandate to be given to the lawyer, on the one hand, and on the legal consequences attached to it, on the other hand. It concludes by pointing out that OHADA law, and the High Court in its jurisprudential practice, are more flexible and better adapted to the obligation of representation by a lawyer than the law of certain OHADA member states.

The Adoption of the Vienna Convention for the International Sale of Goods (CISG) 1980 in Africa—A Critical Analysis

The adoption of the Vienna Convention for the International Sale of Goods (CISG) 1908 in Africa has been slow in comparison to other regions of the world. The Convention is widely regarded as one of the most successful instruments of international commercial law harmonisation. It has been adopted by ninety-four countries from all regions of the world representing more than eighty per cent of international sales. Despite this, only fourteen African countries have adopted it so far. The research question in this article is why African countries have been reluctant to adopt the CISG, compared to countries from other regions around the world. The aim of the article is to establish and analyse the possible reasons why African countries have been so slow in adopting the CISG and to suggest solutions to improve the situation. The reasons include an ignorance about the Convention, apathy on the side of governments and business alike and the existence of other regional harmonisation instruments such as the Organisation for the Harmonisation of Business Law in Africa (OHADA). It is argued that the impetus for greater acceptance lies within the pressure that might emanate from regional trading blocs such as the Common Market for Eastern and Southern Africa (COMESA), the Southern African Development Community (SADC) and the newly formed African Continental Free Trade Area Agreement (AfCFT). It is also argued that greater awareness amongst practitioners may play a future role if the new generation of lawyers are educated on the Convention.

Legal Innovation, Harmonisation and Regionalization of Business Law in Africa: An Examination of OHADA Business Law and its Implication for Nigerian Businesses

Legal Innovation, Harmonisation and Regionalization of Business Law in Africa: An Examination of OHADA Business Law and its Implication for Nigerian Businesses

Legal Innovation, Harmonisation and Regionalization of Business Law in Africa: An Examination of OHADA Business Law and its Implication for Nigerian Businesses

Legal Innovation, Harmonisation and Regionalization of Business Law in Africa: An Examination of OHADA Business Law and its Implication for Nigerian Businesses

COVID-19 and the Non-Repayment of Agricultural Loans in West Cameroon: A major Challenge for the Small Farmer in an Individual Loan Situation

This study raises the problem of the non-repayment of agricultural credits by producers who are members of the Community Growth Mutual (MC2), in this period of COVID-19. It questions the economic mores in force in most member countries of the Organization for the Harmonization of Business Law in Africa (OHADA), where credit has become difficult for small rural farmers; And refers to the theory of the vicious circle of poverty, which advocates an indispensable recourse to foreign capital in the event of financial breakdown, as a means of increasing capital. Since the capital of rural producers remains insufficient and their possibility of reinvestment decreases, then becomes zero because of agricultural credit. To understand the factors of the non-repayment of these credits, data were collected from 100 agro-sylvo-pastoral producers of the Bayangam group (West-Cameroon) of both sexes, aged at least 18 years, having obtained an unpaid credit from the MC2 since 2019, and a manager of this microfinance institution. After analysis, it appears that beyond overproduction and anti-COVID-19 measures that lead to the missale or fall in prices on the market, the conditions of access to credit, the non-possession of acceptable guarantees, the misuse of the object of credit and the practice of financial cavalry by the borrower, as well as the rigidity of the procedures for prosecuting debtors significantly explain this non-repayment. It is associated with determinants such as age, level of education, marital status, type of agricultural activity of the debtor. Hence the need for flexibility of microfinance institutions vis-à-vis rural agro-sylvo-pastoral producers, who are severely affected by the economic shock of the COVID-19.

Quo vadis, OHADA Private International Law?

Abstract Twenty-eight years after the creation of the Organization for the Harmonization of Business Law in Africa (OHADA), private international law remains a “Cinderella subject” in western and central Africa. Indeed, there are no coherent sets of rules regarding the law applicable to contractual obligations, international jurisdiction, as well as the recognition and enforcement of foreign judgments under OHADA law. This article contends that the main reason behind the lesser importance given to private international law in the OHADA region can be found in OHADA’s unification technique itself: OHADA unifies (and does not merely harmonize) business law. Its Uniform Acts are directly applicable and overriding in all the Member States; therefore, one could (erroneously) think that courts would never have to grapple with difficult questions as to which Member State’s law would apply to a dispute falling within the scope of a Uniform Act, as the laws of all the Member States would yield the same results. This article demonstrates that the Uniform Acts are incomplete either because they contain gaps or because they sometimes refer to the national legislations of the Member States. Thus, the unification of the substantive rules does not eliminate the need for the existence and the unification of conflict-of-laws rules. Moreover, this article provides a tour d’horizon of the existing seldom private international law rules under OHADA law. Additionally, it suggests new avenues for the development of a future OHADA legislation on the law applicable to contractual obligations, international jurisdiction, as well as the recognition and enforcement of foreign judgments.

Transition to the Revised OHADA Law on Accounting and Financial Reporting: Corporate Perceptions of Costs and Benefits

This paper examines the ongoing transition to the revised Organisation for the Harmonisation of Business Law in Africa Act on Accounting and Financial Reporting for companies in general and to the International Financial Reporting Standards for listed and group companies with a particular focus on recent institutional developments and corporate concerns. The study used 80 professional accountants, most of whom were members of the Institute of Chartered Accountants of Cameroon and academics. Using the descriptive statistics, the study shows that the transition to the revised OHADA brings about a high level of comparability and transparency of the financial statements, that the International Financial Reporting Standards can be implemented in Cameroon (but not fully), and that the benefit of the transition exceeds the cost.

Study on The Criminal Liability of Legal Persons in Vietnamese Criminal Law and Some Countries of the Organization for the Harmonization of Business Law in Africa: Comparative Law Approach

For a long period of time, both law makers and practitioners in Vietnam upheld the traditional theory claiming that legal persons could not be the subject of crimes and hence could not be held criminally liable. That notion started to change with the promulgation of the 2015 Criminal Code by the National Assembly stipulating corporate criminal liability. However, corporate criminal liability is still a new, complicating issue that is introduced into the Criminal Code for the first time and thus can not escape certain problems, shortcomings from the perspective of law-making activities. It thus needs more theoretical and practical research, conducting lessons learnt from other countries. This article presents a new research on a number of issues concerning corporate criminal liability from comparative law perspective in Vietnamese criminal law and other eight countries which are the members of the OHADA (Central African Republic, Togo, Cameroon, Guinea, Chad, Burkina Faso, Ivory Coast, Garbon) such as: legal persons are the subject of offences and the subject of criminal liability; scope of corporate criminal offences; elements of corporate criminal law; criminal liabilities aggregation; punishments. On the premise of comparative law research, the article draws some conclusions and proposes certain recommendations to improve the provisions on corporate criminal liabililty in the current Vietnamese criminal law.
 Keywords: Corporate criminal liability, application’s conditions, punishments, Vietnam, OHADA, 2015 Criminal Code’s Recommendations.

The Effectiveness of the Harmonization Tool Adopted Under the Ohada Regime

The Organization for the Harmonization of Business Law in Africa, OHADA, is a regional entity whose primary objective is to harmonize the Business Law of its members. It has adopted legislative measures and institutional setups to ensure the realization of this object. This paper critically examined the effectiveness of the harmonization tool adopted under OHADA. The paper first gives a brief overview of OHADA setups, then the advantages and shortcomings of the harmonization tool adopted under the OHADA regime and finally concluded that though OHADA is a major step towards the attainment of harmonization of business law and Integration with the view of fostering development and business activities, its harmonization tool is lacking full efficacy towards the attainment of the objectives of the organization due to prevailing limitations and challenges.

Contribution of the Hague Principles on Choice of Law in International Commercial Contracts to the codification of party autonomy under OHADA Law

The Organization for the Harmonization of Business Law in Africa (hereinafter referred to as OHADA) was created on 17 October 1993 to foster economic development in Africa by creating a uniform and secure legal framework for the conduct of business in Africa. In an effort to reform the law of contracts in its Member States, OHADA has prepared the Preliminary Draft of the Uniform Act on the Law of Obligations (hereinafter referred to as the Preliminary Draft). Several provisions of the Preliminary Draft set forth general principles concerning choice of law in international commercial contracts. Indeed, the Preliminary Draft encompasses innovative provisions on party autonomy in international contracts, such as the explicit recognition of the right of parties to choose the law applicable to their contracts and the inclusion of limited exceptions to party autonomy (overriding mandatory rules and public policy). Yet, it still needs to be improved in respect of various issues, including for instance the ability of parties to choose different laws to apply to distinct parts of their contract and the possibility for the parties to expressly include in their choice of law the private international law rules of the chosen law. This paper analyses the provisions of the Preliminary Draft in the light of the Hague Principles on Choice of Law in International Commercial Contracts (hereinafter referred to as the Hague Principles). More particularly, it explores how the Hague Principles can help refine the rules on party autonomy contained in the Preliminary Draft to enhance legal certainty and predictability in the OHADA region.

Le défi de l’Organisation pour l’harmonisation en Afrique du droit des affaires face au développement des marchés financiers africains : Quid de la protection des investisseurs

By the time the founding fathers of the Organization for the Harmonization of Business Law in Africa (OHADA) signed the Treaty of Port Louis, the financial markets in Western and Central Africa were embryonic. Nowadays the situation has changed and it seems appropriate to reconsider relationship between OHADA law and securities exchange markets. Indeed, OHADA's Community legislation has to deal with the securities markets covered and serve both the proper functioning of the market and the protection of investors. The uniform Act on Commercial Companies and Economic Interest Groupings contains provisions referring to specific financial rules. However, is this sufficient to earn the public trust? Financial market law is a complex discipline. If we supplement this the effort required for investors to find their way between the West African Economic and Monetary Union (WAEMU) or the Economic and Monetary Community of Central Africa (CEMAC) stock exchange law and national constraints throughout OHADA, the following question must be asked: How is the investor’s interest protected in this legal jungle? This paper tries to analyse the legal mechanisms of investor protection in the WAEMU Regional Stock Exchange and the Central African Stock Exchange, combining them with the uniform law for commercial companies of OHADA.

Out of Africa: The 2018 OHADA Arbitration and Mediation Law Reform

Almost twenty years after it adopted the Uniform Act on Arbitration (UAA), the Organization for the Harmonization of Business Law in Africa (OHADA) revised its UAA and adopted a new Uniform Act on Mediation (UAM), along with a fresh set of arbitration rules of the Common Court of Justice and Arbitration in Abidjan (the ‘CCJA Rules’). These three texts were revised with the assistance of an external consultant, the author of this article. Among other changes, the 2018 UAA has provided arbitral tribunals with an express power to determine whether compulsory pre-arbitral steps (such as mandatory mediation) have been complied with, and to suspend the arbitration until such requirements have been met. It has also fixed strict time limits for local judges asked to act in support of arbitration. This article further questions whether the few limited improvements to the CCJA Rules will positively impact the future of the CCJA’s arbitration centre, given its very low caseload. With the 2018 UAM, a solid legal platform for the use of mediation in the region is now in place. The training of mediators and arbitrators, and their ability to carry out both the acts and rules in an efficient manner and effectively coexist with the judiciary, remain major challenges for the region.

OHADA and the Making of Transnational Commercial Law in Africa

Abstract The Organisation for Harmonisation of Business Law in Africa (OHADA) was established in October 1993 with the ambitious aim of inciting economic development in its Member States. Through the adoption of Uniform Commercial Laws, the organisation is expected to create an enabling environment for business development, thereby providing for a path to economic growth and subsequent development. In light of this professed aim, both the transnational methodological approach and comparative law theories are used in this paper to critically analyse the various processes conducted under the OHADA banner and to engage in discussions on the highly debated role of law as a vehicle for development in sub-Saharan Africa. This exercise, which proves crucial in order to trace its origin within the global governance and law and development theories, allows us to present OHADA as a transnational legal system, while also highlighting both its strengths and limitations.

THE ATTITUDE OF OHADA LAW COUNTRIES TOWARDS THE CISG

Disparities in national laws are likely to result in uncertainty which, in turn, creates obstacles to international commerce. It is acknowledged that strong investment flows cannot be achieved without a secure legal and commercial environment. Mindful of such a need, states decided to harmonise sales law internationally. To this end, in 1980 they adopted the United Nations Convention on Contracts for the International Sale of Goods known as the Vienna Sales Convention or the CISG. The CISG has led a number of countries, including the Organisation for the Harmonisation of Business Law in Africa (OHADA) law states, to modernise their local sales law. However, only three of 17 countries that constitute the OHADA community have ratified the CISG. OHADA law countries give the impression of favouring a more regional approach to the unification of sales law rather than the CISG’s global approach by implementing a local Commercial Uniform Act. Their indifference towards the CISG is not without consequences for commerce in the OHADA region. This article seeks to demonstrate that the lack of ratification of a universal convention, as for example the CISG, poses a danger to commercial dealings. It also intends to show that the CISG is not hostile to regional uniform sales laws of the OHADA Commercial Uniform Act type. It concludes that OHADA countries do not need to be afraid of their acceptance of the CISG and recommends that it be ratified.

The Paradox at the Crossroads of US and OHADA Corporate Laws: A Comparative Study of Fiduciary Duties in Africa and the US.

From Africa to the United States of America (“US”), the people who invest money and other capital to create business ventures need protection against the people they entrust to manage and fructify their investments. The first category, known as shareholders for corporations, owns the business. The second category, known as management, has the expertise, and makes the day-to-day business decisions. As more US investors contemplate doing business in the continent of Africa, the legal protections they would be afforded there should be analyzed, and compared to the US corporate law with which they are, arguably, more familiar.In the US, the once beloved assumption that shareholders’ interests were ultimately aligned with management interests led to rather weak mechanisms designed to control management’s actions. High compensation of management combined with high profitability of companies were a testament, for proponents of that theory, that management and shareholders’ interests could only be aligned. However, repeated corporate management scandals including, recently, the Enron affair demonstrated that the ‘interest alignment’ principle is not sacred. Since then, US corporate law has refocused tremendously on protecting shareholders.In Africa, the multiplicity of laws, and, most importantly, their dissimilarities, made it very difficult to understand the legal environment as a whole and promote investments. To address this challenge, several African leaders, in the early 1990s, initiated an effort to coordinate business laws across the continent to achieve simplicity, predictability, and economic growth. This initiative, now known as the Organization for Harmonization of Business Law in Africa (“OHADA”), covers areas as diverse as corporate law, securities, bankruptcy, commercial law, and arbitration. OHADA is a multilateral treaty for business with an unprecedented pace of expansion across the continent. Both in the US and Africa, however, the main question remains how to protect investors, the people who risk money and property to create business ventures but do not necessarily possess the expertise or the time to oversee the day-to-day operations. The underlying issue is how to keep directors, or management in general, under control without harming the ability of the corporation to grow, expand, and give maximum returns. Both the US and OHADA corporate law systems rely heavily on the legal concept of fiduciary duties to achieve investor protection. However, neither the construct, nor the understanding, of fiduciary duties and the obligations thereunder are the same under US and OHADA laws. Despite the fact that both systems enunciate traditional duties such as loyalty and care, US and OHADA have fundamental differences, and their design of mechanisms to hold management accountable as fiduciaries are profoundly unalike.This paper will discuss similarities and specificities of the concept of fiduciary duties under the US and OHADA laws. The discussion of fiduciary duties under OHADA, alongside the more familiar construct of the concept under US law, will provide an easily understandable description of the legal framework. Additionally, this paper will equip all interested parties in general and investors specifically, with an added consideration in their investments decision-making process.