He said those lapses and defaults on the part of the government to ensure Ghana’s early participation in arbitration claims brought against it had compelled various international arbitration tribunals to award huge costs against the country.

For instance, he said the sluggish approaches by the government were what led various tribunals to award damages of GH¢197 million (about $42 million), $12 million and 94 million euros to the Construction Pioneers (CP) in March 2010.

“In one of Construction Pioneers’s arbitration, the claimant was awarded 24,624,743 euros and GH¢22,168,951,051 in respect of its claims in the tribunal’s second partial award. This was after Ghana’s refusal and failure to provide a written response to the claims.

“Indeed, in this arbitration, a law firm or consultant was not retained by the government to assist it until after three years of the request for arbitration,” Prof. Oppong, who is an Associate Professor of the Faculty of Law of the Thompson Rivers University, BC, Canada, stated.

Late resurgence

Delivering his inaugural address on the topic: “The government of Ghana and international arbitration” in Accra last Friday, Prof. Oppong said in many of the awards, Ghanaian law was that which was applicable under a contract but it was neither pleaded nor argued.

He added that in such contracts, Ghana failed to comment on orders made by the tribunal when invited to do so, failed to participate in the arbitration hearings, failed to make a submission in respect of an application for an interim award, failed to sign the terms of reference, as well as failed or declined to appoint an arbitrator to the tribunal, even though it had a contractual right to do so.

According to him, more recently, in the Bankswitch Ghana Limited arbitration, the claimant’s notice of arbitration was filed on May 4, 2011, but there was no serious representation or participation of the government until after April 2012 when an external counsel was retained.

“That was more than a year after the request was made. Remarkably, in this arbitration, the government defaulted on submitting its second counter memorial; documents production request and responses to the pre-hearing questionnaire.”

“Even more shocking is the fact that the government did not participate in the evidential hearing. At the very least, a local law firm should have been hired to represent the government,” Prof. Oppong noted.

Interestingly, while the government defaulted, the claimant’s foreign counsel was working with a well-respected Ghanaian firm to effectively prosecute the claimant’s claim against the government, with the government eventually losing the arbitration, he said.

Current claims

Prof. Oppong said currently, there were at least three claims against the government pending before various international arbitration tribunals, adding that potentially the costliest might be the AngloGold Ashanti claim, pending before the International Centre for Settlement of Investment Disputes in Washington, DC.

“AngloGold Ashanti is claiming a jaw-dropping $422.9 million from the government. This is a high-stakes area of law,” he added.

Govt must assert interest

Prof. Oppong recommended that in cases of such nature, the government must engage local law firms and consultants with expertise in Ghanaian law and the international legal process to work with both the retained foreign firm and the Attorney-General’s Department.

He noted that so far, the government had been represented in international arbitrations by foreign law firms and said while such law firms provided significant expertise, they also came with significant cost.