Originally from Arbitration in the MENA

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[1] INTRODUCTION

Despite recurring phases of instability, Libya has known a continuous flow of arbitrations proceedings over the last fifty years and its arbitration practice has constantly ranked amongst the most intense in the Arab world, both in terms of the number of cases involving national parties and of the amount of the disputes being submitted to arbitration.

While many cases relating to the consequences of the Libyan Revolution on international contracts and foreign investment are currently being referred to arbitration, Libya offers a contrasted environment for arbitration. Despite a relatively outdated legal framework, arbitration remains the most common method for dispute resolution in respect of international contracts and is almost systematically used within large and middle scale international transactions involving the Libyan State and the public sector companies.

Practically, Libya is rarely selected as a seat of the arbitration proceedings, even when the arbitration agreement provides for such a possibility (generally as an optional seat electable by the party filing the request for arbitration). However, a precise knowledge of the Libyan Law on arbitration remains essential to practitioners - whether counsels or arbitrators - involved in proceedings involving a Libyan party: besides the classical issues related to the enforcement of awards, Libyan law is characterized by a particular importance of mandatory rules of public policy potentially affecting all phases and aspects of the proceedings, from the arbitration agreement to the amicable settlement of the dispute.

Very special care will be taken in this chapter to explain the specific requirements that should be taken into account when conducting an arbitration in a Libyan environment, with a view to assisting the practitioner in identifying the most common pitfalls of such practice.