The Afghanistan Center for Commercial Dispute Resolution (ACDR) welcomed more than 120 participants at its Inauguration and ribbon-cutting ceremony held on Tuesday, June 30, 2015.
ACDR, based in Kabul, is the first center of its profile in Afghanistan, which has started to provide domestic, and international mediation services, calculation services (and will provide arbitration services in the near future) for commercial disputes in Afghanistan.
ACDR is a new center for dispute resolution initiated by Afghanistan Chamber of Commerce and Industries (ACCI), and funded by Harakat – Afghanistan Investment Climate Facility Organization (AICFO) with the technical assistance of ADR Center. ACDR, which is based in Kabul will provide a rapid, professional and transparent alternative method of dispute resolution. The aim of the ACDR is to attract and maintain business and commercial enterprises to the country by providing dispute resolution that is fast, fair, cost-effective and reliable. To learn more about the ACDR, please visit www.acdr.af.
It’s worth mentioning that in serving the private sector, the ACCI looks back on a long history, which started 84 years ago. For the first time in 1931, Afghan traders established Commercial Arbitration Association to integrate their business activities and also defend their rights. Now, based on Article No 8 of Law on ACCI, the chamber provides arbitration and mediation services for its members.
The inauguration ceremony was attended by Minster of Commerce and Industry, ACCI’s Board of Directors and CEO of Harakat– AICFO.
Mr. Khanjan Alokozay Senior Vice-Chairman of ACCI, highlighted ACCI’s activities and the services which this entity has provided in legal terms and arbitration, since its inception at 1931. He also counted the commercial disputes among the barriers which impedes economic developments in Afghanistan. Meanwhile, he added, over the decades of its operation ACCI has always cooperated with Afghan courts and the experts of private sector and technical team of ACCI has shared its advisory opinion with them.
Mr. Alokozay, appreciated the American Embassy in Kabul and the Department of Commerce of United States for their great support in the context of devising technical training programs for the employees of this institution inside the country and abroad, and termed those programs very effective for better implementation of international norms and standards in commercial dispute resolution. Moreover he urged the government to issue working license for private dispute resolvers in order to prevent unnecessary working load on Afghan courts.
Mr. Homayon Rasaw Minister of Commerce and Industries, during his speech in the inauguration ceremony, declared his full support for this center which will be operating under the supervision of ACCI. He termed the establishment of such a credible center a great step toward providing more facilities for traders and investors. “Legal Services and Arbitration is part the ACCI’s activities to private sector.” He said.
Mr. Rasaw promised that will assign a liaison officer between the ministry and ACCI to coordinate and find out how to overcome the challenges facing the center. He added that providing impartial services is one of the duties of this center and said that in case of need, he is ready to attend the Stream Committee of the center under the chairmanship of ACCI.
Mr. Nasim Akbar, CEO of Harakat, called the establishment of such a center a critical need for every business community and termed it as an effective tool for attraction of Local and foreign investments.
Furthermore he stressed on aim fullness of this center’s activities and said: “The confidentiality and safety of commercial cases should be top priority of the center.”
Mr. Akbar praised the leadership and employees of ACCI for their full cooperation in efficient allocation of the budget for this center’s building and maintaining transparency in procurement processes. And he also called on the employees of this center to maintain and keep their impartiality while addressing the commercial disputes.
Harakat– AICFO has provided $1.8 million funding and technical assistance to establish the ACDR, from its systems and staffs to a brand new building. The objective here is to simplify the contract enforcement, shorten the length of dispute settlements through mediation mechanisms as much as possible and reduce the cost of dispute resolution from the current 25% of total claimed amount to an affordable level.
Disputes regularly arise between commercial firms, often resulting in lengthy, costly and time-consuming processes. Most of these disputes gradually become adversarial, which in most cases damage business relationships between the disputing firms. Over the past 30 years, Alternative Dispute Resolution (ADR) has encouraged more cost-effective and collaborative resolutions to such problems, enabling companies to preserve relationships.
According to the World Bank/IFC Doing Business Report 2014, contract enforcement in Afghanistan involves 47 procedures and takes over 1642 days. An average of 25% of the claimed amount is spent on dispute settlement in the formal justice system. The realities of the existing contract enforcement clearly demonstrate inefficiencies in the court system. Lack of effective contract enforcement serves as a crucial disincentive for investment by domestic and international investors, adversely impacting job creation and revenue generation.