Arshad Mahmood Awan
Pakistan has been facing numerous challenges in recent times, and amidst the gloom, it’s hard to see the positive work being done to keep the country afloat and thriving. One such positive initiative is the creation of Pakistan’s trade dispute resolution regime, aimed at providing a modern and efficient system for resolving disputes related to international trade. This article discusses the work being done to build this infrastructure and the benefits it will bring.
The task of creating a modern trade dispute resolution system was undertaken by the USAID IPA, run by Chemonics International, in collaboration with the Ministry of Commerce. The team was tasked with building the infrastructure for the nascent Trade Dispute Resolution Organization, an initiative that had been lingering due to a lack of substantive law. The passing of the Trade Dispute Resolution Act of 2022 has helped to cover this gap and provided a legal framework for the system.
To create a roadmap for the successful implementation of the Act, the team undertook two simultaneous activities. Firstly, a review of the best international practices was conducted, studying existing models such as the ICC and UNCITRAL. Secondly, local stakeholders, including chambers of commerce, industry associations, export bodies, and government organizations, were consulted. The objective was to hear what they were currently doing when facing disputes with foreign traders and what the ideal system would look like.
The Act has created a Trade Dispute Resolution Commission, which will be a mix of public and private individuals specializing in business, trade, and dispute resolution. The Commission will receive complaints from parties aggrieved by trade disputes, including international and local bodies. This is a new concept for the legal system in Pakistan, and the entire procedure will have to be revamped to facilitate international disputes and online case management.
The Commission will first attempt to assist the parties in reaching an amicable resolution. If that fails, the parties will be asked to choose between mediation, arbitration, or Commission determination. This is a new and excellent feature, placing mediation and arbitration at the forefront of the process. Another new feature is the ability to impose cost orders and recover them directly without needing any intervening body.
The new system brings with it a host of benefits, such as international trade desks in Pakistani embassies, TDRO-affiliated ADR Centers, a roster of mediators and arbitrators, and many other facets. The USAID IPA has been a critical supporter of this work, and they are spearheading more incredible initiatives that will enhance Pakistan’s ability to market itself in the international sphere, fostering a sense of optimism and hope for the future of international trade in Pakistan.
Finally, this new trade dispute resolution regime is not just a step but a significant leap forward in facilitating international trade and ensuring Pakistan’s competitiveness in the global market. The system is designed to be efficient, cost-effective, and accessible to all parties involved, reaffirming Pakistan’s commitment to fair and efficient international trade. The work being done by the USAID IPA, the Ministry of Commerce, and other stakeholders throughout Pakistan is a testament to the country’s perseverance and determination to succeed. Pakistan will continue to thrive, and this new system is just one of the many bricks being laid to ensure its continued success.
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