 "We are independent, immune from political pressure: Thusantha Wijemanna")
Saarc Arbitration Council (Sarco) is the first regional arbitration centre to come up in South Asia. Thusantha Wijemanna, director general, Sarco, tells Sudipto Dey it plans to offer arbitration services that will be 40 per cent cheaper than those in Singapore and Hong Kong. Edited Excerpts:
Can you take us through the evolution of Sarco?
When Saarc leaders met in 2005 they realised one of the biggest drawbacks for growth of cross-border investment and trade was that you don't have an independent dispute resolution mechanism in the region. There was inhibition on part of the investors and traders to be subject to the jurisdiction of the other for resolution of disputes. So they decided to have an independent dispute resolution mechanism for Saarc. By 2010, the member countries ratified the agreement and then the first director general - my predecessor - was appointed, and given the task of setting up the secretariat in Islamabad. I took charge in October 2014.
For Sarco to take up cases, first the arbitration clause should get into the contract. For the first few years, my predecessor was fighting to get the infrastructure in place. My task is to publicise the centre, and make people use the procedures and the centre.
Why should companies and businesses in the region come to Sarco, when you have popular arbitration centres in Singapore and Hong Kong?
If you look at other arbitration centres in South Asia, all of them are country-oriented. We are the first region-based arbitration centre. We are completely independent, and immune from any political pressure from any other country. My budget comes from contributions by all the member countries. We can therefore provide the service which is impartial, fair, inexpensive and expeditious.
How do you ensure that?
I am in the process of amending my rules to bring in a time limit for each and every activity (in an arbitration process). If it is straight-forward arbitration, we want to finish it within six to nine months. If it is a complicated one, we want to do it within one year. No court in South Asia can give you an award or judgement in less than five years. I have compared the fee structure in all the arbitration centres in this region. Our fee structure will be competitive with them. It will depend on the value of the case, and there will be a cap on the fee. The person who goes into arbitration should know what his costs will be. We discuss all these issues in a pre-arbitration meeting.
The unique thing about Sarco is you do not have to come to Islamabad to settle your problems. You can settle it in Mumbai or Delhi. Our team will come to these cities to settle your arbitration. For instance, we have tied up with Indian Council of Arbitration for disputes in Delhi. The litigant decides where he wants to have his seat of arbitration. We are signing up memoranda of undertaking with every country in the region for arbitration venue.
What has been the response of businesses to Sarco?
I have spoken to many businessmen in India and Pakistan. Many of them do business without any dispute resolution clause in their contracts. We plan to conduct seminars and workshops in the region to make them aware of the risks, and that they can use the services of Sarco.
In this region Singapore and Hong Kong are much ahead in the curve when it comes to offering arbitration services. How do you plan to counter them?
Yes, they are much ahead, but my simple argument is - we come from South Asia, and we know the pulse of how people do their business in this region. The new entrepreneurs and investors are scared to come in as they do not get confidence in cross-border transactions. Here, Sarco provides you a solution to that fear. (Moreover) we will be around 40 per cent cheaper than Singapore and Hong Kong.
Can you take us through the evolution of Sarco?
When Saarc leaders met in 2005 they realised one of the biggest drawbacks for growth of cross-border investment and trade was that you don't have an independent dispute resolution mechanism in the region. There was inhibition on part of the investors and traders to be subject to the jurisdiction of the other for resolution of disputes. So they decided to have an independent dispute resolution mechanism for Saarc. By 2010, the member countries ratified the agreement and then the first director general - my predecessor - was appointed, and given the task of setting up the secretariat in Islamabad. I took charge in October 2014.
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What has been the progress of Sarco till now in resolving arbitration cases?
For Sarco to take up cases, first the arbitration clause should get into the contract. For the first few years, my predecessor was fighting to get the infrastructure in place. My task is to publicise the centre, and make people use the procedures and the centre.
Why should companies and businesses in the region come to Sarco, when you have popular arbitration centres in Singapore and Hong Kong?
If you look at other arbitration centres in South Asia, all of them are country-oriented. We are the first region-based arbitration centre. We are completely independent, and immune from any political pressure from any other country. My budget comes from contributions by all the member countries. We can therefore provide the service which is impartial, fair, inexpensive and expeditious.
How do you ensure that?
I am in the process of amending my rules to bring in a time limit for each and every activity (in an arbitration process). If it is straight-forward arbitration, we want to finish it within six to nine months. If it is a complicated one, we want to do it within one year. No court in South Asia can give you an award or judgement in less than five years. I have compared the fee structure in all the arbitration centres in this region. Our fee structure will be competitive with them. It will depend on the value of the case, and there will be a cap on the fee. The person who goes into arbitration should know what his costs will be. We discuss all these issues in a pre-arbitration meeting.
The unique thing about Sarco is you do not have to come to Islamabad to settle your problems. You can settle it in Mumbai or Delhi. Our team will come to these cities to settle your arbitration. For instance, we have tied up with Indian Council of Arbitration for disputes in Delhi. The litigant decides where he wants to have his seat of arbitration. We are signing up memoranda of undertaking with every country in the region for arbitration venue.
What has been the response of businesses to Sarco?
I have spoken to many businessmen in India and Pakistan. Many of them do business without any dispute resolution clause in their contracts. We plan to conduct seminars and workshops in the region to make them aware of the risks, and that they can use the services of Sarco.
In this region Singapore and Hong Kong are much ahead in the curve when it comes to offering arbitration services. How do you plan to counter them?
Yes, they are much ahead, but my simple argument is - we come from South Asia, and we know the pulse of how people do their business in this region. The new entrepreneurs and investors are scared to come in as they do not get confidence in cross-border transactions. Here, Sarco provides you a solution to that fear. (Moreover) we will be around 40 per cent cheaper than Singapore and Hong Kong.