By LUKE ANAMI

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Despite a robust legal regime on trade, the East African Community (EAC) still lacks an enforcement mechanism for its court and a functional regulatory body on trade disputes.

Two EAC partner States- Uganda and Burundi, are on the spot for delaying the ratification of an enforcement mechanism.

They are yet to ratify the protocol to operationalise the extended jurisdiction of the East African Court of Justice (EACJ), which was approved by the Heads of State Summit back in 2013.

The EAC Treaty provides for the enactment of a protocol to operationalise the extended jurisdiction of the court to cater to matters arising from the Customs Union, Common Market. On the other hand, the EAC Committee on Trade Remedies, which is ideally the go-to body in addressing trade disputes, remains in limbo.

Read: Kenya questions mandate of East African court

“On February 20, 2015, the Protocol to Operationalise the Extended Jurisdiction of the EACJ was signed by the Heads of State of the Partner States,” said Christine Mutimura-Wekesa, Deputy Registrar of the EACJ. “Since then, the protocol has been ratified by Kenya, Rwanda, and Tanzania. Uganda and Burundi are yet to ratify it.”

The newer EAC entrants, South Sudan, DR Congo and Somalia, are in the process to ratify the protocol. The EAC Summit, in its 15th meeting on November 30, 2013, approved the Council’s recommendation to extend jurisdiction of the EACJ to cover trade and investment matters.

Various stakeholders have been calling for efficient mechanisms to implement key EAC legal instruments, in particular the EAC Common Market Protocol, to improve movement of goods, services, and people across the region.

But the EACJ lacks the muscle due to failure by all the EAC partner States to ratify the instrument.

“There are certain vital issues such as sanctions, admission, that do not require consensus. There are certain urgent and important matters that we think should be subjected to a two-thirds majority decision-making process,” she explained.

The EAC Treaty, in Chapter 12, provides for investment and industrial development in partner states, but no framework exists, which specifically speaks to matters of investment, resolution of related disputes, or minimum requirements of the same at the national level.

This presents a situation where only recourse by the courts is to the Treaty itself or the Common Market Protocol, since investments are largely regulated by bilateral investment treaties.

Read: New court case exposes EAC’s weak conflict resolution measures

“The EAC still lacks a functional regulatory body on trade disputes. The EAC Committee on Trade Remedies, which is ideally the go-to body in addressing trade disputes, remains non-operational to-date,” said Dr Henry Onoria, head of law consulting and knowledge practice at ALP Advocates.

“In the meantime, on a perennial basis, there is a spreading culture of trade wars in the region. This leaves not so many options, except resort to courts and, in this case, the regional court.”

While trade is governed by multilateral agreements of the World Trade Organisation (WTO), there exists no multilateral framework that governs international investment flows within the EAC.

The latter are mostly governed by bilateral investment treaties between respective governments, and increasingly through regional agreements.

Uganda has the highest number of trade-related cases at the Court.

“The extended jurisdiction of the court to such matters is well intended. However, this calls for the streamlining of a few factors, including the drafting of a regional investment law,” Dr Onoria said.

Read: East Africa big three out to save integration agenda

“Notably, there is a need to put in place a comprehensive legal regime on investment policies within the EAC. It has the potential to grow investment within the region once adequate and operational laws and structures are in place. And take advantage of the AfCFTA.”

As the Kenya Private Sector Alliance pointed out, cross-border trade in goods and services has triggered a spike in commercial disputes across the East African region.

Mega-infrastructure projects such as roads, ports, railways, oil, gas and minerals related projects have triggered disputes involving various stakeholders. A case in point includes the Oil importation dispute between Kenya and Uganda.

“We need to strengthen our institutions to be able to handle trade disputes across the East African region,” said Jas Bedi, chairperson Kepsa.

It is posited that EACJ arbitral jurisdiction stands to be an invaluable mechanism in improving contract enforcement in the East African region by promoting an alternative avenue for businesses to resolve commercial disputes quickly and cost effectively.

But until the protocols on enforcement and dispute resolution mechanisms are ratified and implemented, partner states will continue to lament and make losses in intra trade.