International arbitration has become the preferred mechanism for resolving cross-border disputes, ensuring efficiency and predictability in global commerce. The recent case of Kampala International University v Housing Finance Company Limited (2025) highlights crucial insights into the enforcement of foreign arbitral awards in Uganda. This decision clarifies three key principles: the enforceability of foreign awards, the permissibility of parallel enforcement, and the narrow scope of public policy objections.
- Recognition and enforceability of foreign arbitral awards
As a signatory to the New York Convention, Uganda has consistently upheld the recognition and enforcement of foreign arbitral awards. The court reaffirmed that an award remains enforceable even if it has already been recognised as a judgment in another jurisdiction. This aligns with international standards that prevent debtors from using jurisdictional loopholes to evade obligation.
A similar approach was taken in Great Lakes Energy Company NV v MSS XSABO Power Limited and Others (2020), where the court emphasised that foreign arbitral awards should be presumed enforceable unless they fall within the narrow exceptions under the New York Convention.
- Parallel enforcement: A strategic tool for creditors
The principle of parallel enforcement allows creditors to pursue the enforcement of arbitral awards in multiple jurisdictions simultaneously. The court in Kampala International University confirmed that an award can be enforced in Uganda even if enforcement proceedings are ongoing elsewhere, provided the debt remains unpaid.
This principle mirrors international decisions, such as Robert E.Schreter v Gasmac Inc. (1993), the Ontario Court of Appeal held that an arbitral award does not merge into a judgment confirming it. Similarly, in Karaha Bodas Company LLC v Perusahaan Pertambangan Minyak Dan Gas Bumi Negara (2003), the U.S. Court of Appeals ruled that multiple, concurrent enforcement actions across jurisdictions are permissible under the New York Convention. These decisions support the notion that creditors should not be limited to enforcing awards in only one jurisdiction but should be free to pursue the award debtor's assets wherever they are located.
- Public policy: A narrow exception to enforcement
Public policy remains one of the few grounds on which the enforcement of a foreign arbitral award can be denied under the New York Convention. However, Ugandan courts have maintained a strict and narrow interpretation of this exception. In Christ for All Nationals v. Apollo Insurance Co. Ltd (2002), the court held that public policy objections should only apply in cases where enforcement would contravene fundamental legal principles, constitutional provisions, or Uganda's national interests.
This approach aligns with global arbitration trends. In Parsons & Whittemore Overseas Co. v Société Générale de L'Industrie du Papier (1974), the U.S. Court of Appeals ruled that public policy provision under the New York convention should be construed narrowly to preserve the finality of arbitration and the enforcement of foreign arbitral awards may only be denied where enforcement would violate the forum state's most basic notions of morality and justice.
Similarly in UK, in the case of Alexander Brothers Ltd v Alstom Transport SA (2020), the court stated that the threshold for invoking public policy is high and must involve conduct that is repugnant to fundamental notions of justice and in Betamax Ltd v State Trading Corporation (Mauritius) (2021), the court clarified that public policy does not include a review of the merits or correctness of the arbitral tribunal's decision. Enforcement can only be refused where doing so would offend the forum state's most basic principles.
Conclusion
The case marks a pivotal moment in Uganda's arbitration jurisprudence. By upholding parallel enforcement and restricting public policy objections, the decision strengthens Uganda's legal framework for international dispute resolution. By embracing international arbitration norms, Uganda positions itself as a reliable jurisdiction for investors, ensuring that contractual obligations are upheld, and justice is efficiently served.
*Reviewed by Patrick Turinawe, a Partner in Uganda
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