European Union External Action

The European Union and OECD organised a capacity-building webinar on contract enforcement and dispute resolution with the governments of Central Asia

13/07/2021 - 12:44
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On 7-8 July 2021, the OECD and the EU organised a two-day regional capacity-building webinar on contract enforcement and dispute resolution with the governments of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. The event took place in the context of the Improving the Legal Environment for Business in Central Asia project, which forms part of the ongoing Policy Component of the EU-supported Central Asia Invest Initiative.

On 7-8 July 2021, the OECD and the EU organised a two-day regional capacity-building webinar on contract enforcement and dispute resolution with the governments of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. The event took place in the context of the Improving the Legal Environment for Business in Central Asia project, which forms part of the ongoing Policy Component of the EU-supported Central Asia Invest Initiative.

The first day of the event was focussed on foreign investment and international arbitration. Opening the introductory session, Mr Begmurat Mukhammedov, Minister of Justice of Turkmenistan, discussed ongoing legislative developments to improve the legal framework for international arbitration in the country. Ms Akerke Akhmetova, Vice-Minister of Justice of Kazakhstan, noted that the ministry has placed an increasing importance in improving and promoting the use of alternative dispute resolution (ADR) mechanisms. Johannes Stenbaek-Madsen, Head of Co-operation at the EU Delegation to Kazakhstan, noted that despite significant improvements, the Improving the Legal Environment for Business in Central Asia report showed that firms continued to consider contract enforcement and dispute resolution as impediments to development, and he welcomed the opportunity to bring together international experts and regional policy makers to discuss this important topic.

Mr Luke Mackle, Policy Analyst at the OECD Eurasia Division, then presented an overview of the key contract enforcement and dispute resolution challenges for investors in Central Asia, drawing on the findings of the recent report. Ms Aigoul Kenjebayeva, Managing Partner for Kazakhstan and Central Asia at Dentons, then went into greater detail on a number of key challenges to dispute resolution and contract enforcement in the region. Ms Kenjebayeva drew particular attention to recent efforts to decriminalise certain mistakes made by state officials, the criminalisation of which she believes acts as an impediment to efficient decision making and implementation – a key frustration of the private sector in disputes with public bodies.

The first capacity-building session was conducted by Ms Dharshini Prasad of legal and arbitration firm Wilmer Hale. Ms Prasad gave a thorough presentation of the range of arbitration and legal arrangements available to governments in the region, noting some of the key challenges to their implementation. Ms Prasad paid particular attention to the importance of non-intervention of judicial institutions in arbitration proceedings. The second of the day’s capacity-building sessions focussed on mediation as a form of ADR, and was led by Mr Alexandre Meyniel of Cartiel Meyniel Schneller and Ms Alya Ladjimi, Manager of the International Centre for ADR at the International Chamber of Commerce (ICC). Mr Meyniel and Ms Ladjimi gave a comprehensive overview of the development of mediation as a form of ADR, while noting that it continued to constitute only a small part of the dispute resolution landscape in Central Asia. Ms Ladjimi also drew particular attention to the cost effectiveness of mediation, as well as its advantage of limiting the number of cases that end up in the region’s already overburdened judicial systems.

The second day of the regional webinar focussed on dispute resolution for local firms. The session was opened by Mr Muzaffar Ashuriyon, Minister of Justice of Tajikistan, who noted that Tajikistan, through its ongoing accession to the WTO, had undertaken a number of legal reforms to support dispute resolution for both international and locally operating firms. Mr Kynatbek Smanaliev, Vice-Minister of Justice of Kyrgyzstan focussed his introductory remarks on the efforts by the Ministry to increase the digitalisation of key justice-related services for firms. The opening session then heard from Mr Alisher Karimov, Deputy Minister of Justice of Uzbekistan, who outlined the range of recent reforms undertaken by the Ministry to support firms in the country, drawing particular attention to efforts to improve coordination between different public bodies involved in contract enforcement and dispute resolution to tackled corruption and improve transparency. Mr William Tompson, Head of the Eurasia Division, concluded the opening remarks by reiterating the scope to expand the use of ADR in Central Asia, before tying the session back to the broader, long-term need to minimise impediments to private sector development.

Ms Amélie Schurich-Rey, Policy Analyst/Economist at the OECD Eurasia Division, then presented an overview of the key contract enforcement challenges for local firms as identified in the recent report. Ms Olga Savran, Head of the OECD Anti-Corruption Network, then gave an update on recent developments across Central Asia in improving business integrity. Ms Savran drew particular attention to the trend of business ombudsmen playing a greater role in dispute resolution processes across the region. Mr Edmond Dunga, Head of the Economic Crime and Co-operation Division at the Council of Europe, concluded the scene-setting by giving a short overview of the CoE’s ongoing Rule of Law Programme.

The first of the two capacity-building discussions focussed on the role of digitalisation and contract enforcement, with presentations from Mr Waleed Haider Malik, Senior Public Sector Management Specialist, and Ms Clara Maghani, Public Sector Specialist, both of the World Bank. Mr Malik looked at the development of e-justice management systems in Kazakhstan, noting that while the design and implementation had so far been relatively effective, there remained issues surrounding transparency – issues also present in other countries of the region. Ms Maghani also underlined the importance of accountability, a citizen-centric approach in policy-making, and that the implementation of digital tools are not an end in themselves, but a lever for achieving other policy outcomes.

The second capacity-building discussion took the form of a panel discussion between the business ombudsmen institutions of Kyrgyzstan, Uzbekistan and Ukraine. Mr Nurlan Musuraliev, Deputy BO of Kyrgyzstan, opened the session by describing the contract enforcement hurdles faced by firms in Kyrgyzstan, drawing particular attention to issues around pressure from public officials and inconsistent prosecution of managers and public officials. Mr Iaroslav Gregirchak, Deputy BO of Ukraine, stressed the fact that the ombudsman institution could effectively perform many of the roles of arbitrators and mediators, and echoed earlier comments on the cost effectiveness of resolving disputes through the ombudsman rather than the courts. Mr Jamshid Urunov, Deputy BO of Uzbekistan, noted that their institution had grown out of fruitful conversations with their Eurasia regional counterparts, underscoring the importance of cross-country learning, and drew particular attention to their role in protecting the rights of SMEs.

The two-day session was then concluded by Mr Tompson, who reiterated his thanks to the participating governments, the EU for their financial support, and the expert speakers for taking the time to share their experience at the event.

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