Lebanon has been experiencing an ongoing severe financial, economic and social crisis, which has been further exasperated by the COVID-19 pandemic and the Beirut Port explosion. This situation may give rise to arbitration claims which are subject to Lebanese law or seated in Beirut. As such, this article provides a brief overview of the legislative framework for arbitration in Lebanon.
In line with Lebanon's pro-alternative dispute resolution attitude, a further option in the form of judicial mediation was recently made available to parties through the implementation of Law 82. Judicial mediation offers an alternative mechanism for settling disputes in an efficient, fair, timely and confidential manner and should help to lessen the increasingly overwhelming workload faced by judges.
Due to its status as a commercial hub, Lebanon has its fair share of disputes arising from commercial representation agreements, particularly those concerning compensation for the termination of such agreements. However, while recourse to the court system is well established as the traditional method of settling this type of dispute, significant controversy remains regarding their submission to arbitration.
In 2013 Lebanon commenced and concluded the initial pre-qualification licensing round for offshore oil and gas exploration, which was based on a draft model exploration and production agreement (EPA). This update focuses on the dispute resolution mechanism provided in the draft model EPA and the issues that may arise in the face of divergent interests of the parties involved.
A series of recent decisions of the Beirut Court of First Instance has affirmed the Lebanese judiciary's liberal approach to arbitration. In each case, the court intervened in an arbitration proceeding to preserve the validity of an arbitration agreement when it had been called into question. Issues considered include invalid terms within arbitration agreements and formal insolvency proceedings involving parties to arbitration.
The COVID-19 pandemic has highlighted the importance of using force majeure to repudiate the performance of burdensome contractual obligations that were undertaken before the pandemic. This article discusses Lebanon's approach with regard to the COVID-19 outbreak and its potential characterisation as a force majeure event by discussing recent developments and the general framework for force majeure under Lebanese law.
The government has adopted exceptional measures to manage the spread of COVID-19. These measures have had an unprecedented impact on employers and employees, which have been adjusting to the rapidly changing situation triggered by the pandemic and the national economic crisis. Faced with the intensifying economic impact of both crises, business owners have been forced to introduce adequate changes to the way in which they work.
The Council of Ministers recently launched the second offshore licensing round for oil and gas exploration in numerous blocks. It also approved the updated tender protocol and approved updates to some articles of the model exploration and production agreement. The Lebanese Petroleum Administration has invited interested companies to combine their bidding efforts by forming consortiums. This article examines the pre-qualification process and reviews how bids will be assessed up until the award stage.
Despite the lockdown and its impact on court activities, decisions have been handed down by judges of summary proceedings in an attempt to restore the rule of law in response to the de facto capital controls imposed by local banks. This article provides an overview of the judicial measures adopted in response to the COVID-19 pandemic and an overview of court decisions rendered against local banks.
The Beirut Supreme Court has ruled that arbitration clauses in exclusive distribution agreements signed with Lebanese representatives are invalid. Thus, only Lebanese courts have jurisdiction to settle disputes between the parties to such agreements. By adopting this approach, the Beirut Supreme Court has enforced the traditional position which grants Lebanese exclusive distributors a high level of protection.
In a notable decision, the Beirut Appeal Court highlighted the requirements that shareholders must meet in order to submit claims against their company or its chair or directors. In its decision, the court held that while shareholders' personal rights are protected by their ability to challenge their company's management through an individual or company action, their claims should be restricted to damage which they have personally suffered and limited to their participation in the company.