The 2010 FIFA World Cup has stirred renewed interest in South Africa as a potential international trade and investment partner and in the country’s ability and readiness to host international arbitrations. In light of the global movement toward the modernization of arbitration laws, South Africa seems to be lagging behind other developing countries which are eagerly reaping the benefits that come with being a place of arbitration. Despite the fact that South Africa is Africa’s economic powerhouse, it is neglected as a place of arbitration. This article examines why this is so, noting in particular that South Africa’s main arbitration laws are perceived as “outdated” and “inadequate,” which discourage parties from choosing South Africa as a place of arbitration. In particular, the article shows that the South African Arbitration Act (SAAA) of 1965 gives excessive discretionary powers to local courts, allowing them to obstruct the arbitration process, and that subsequent legislation fails to give adequate effect to the New York Convention. In acknowledging recent developments that reaffirm arbitration as a means of dispute resolution in South Africa, the article concludes with a call for legal reform in this field of law beyond the efforts already made by the South African Law Commission.
Journal of International Arbitration