In the Name of Allah Almighty, the Most Merciful the Most Compassionate
Law of the Principles of the Commercial Courts
Part One
General Regulations
Chapter One
Introduction
Article 1: Resolving all those disputesthat arise with commercial transactions is the duty of three courts and is subject to the provisions of this law.
Article 2: None of theseCommercial Courts can resolve a lawsuit directly unless one of the parties has requested the case to be resolved based on the provisions of this law.
Article 3: The Commercial Courts are obliged to resolve the commercial lawsuits in accordance with the Commercial Legal Principles of this law.
Article 4:No one from the officials or government organs can altar the orders and decisions of the Commercial Courts or restraint its execution unless it is a court above it and specified in that law.
Article 5: If a lawsuit is referred or filed with a Commercial Court and based on the provisions of this law,the case belongs to other courts; the court then should issue a ruling that resolving this lawsuit is not the duty of this court.
Chapter 2
Jurisdiction
Article 6:Considering the provisions of this chapter, the commercial lawsuits shall be resolved in a court where the defendant resided legally. If there are several defendants and one plaintiff or several disputes (but related to each other), the lawsuit should befiled with the court related to one of defendants’ residence.
Article 7: A Legal Residence is a place that a person willingly chooses for his/her permanent residence.
Article 8: A lawsuit could be filed in a court where the contract has been made, provided that the defendant or his legal attorney lives in the same place.
Article 9:The court which has jurisdiction over a primary case may resolve the counterclaim.
Article 10: Those people, who do not have legal residence in Afghanistan, file the lawsuit with a court that has jurisdiction over their place of residence. If their residence is unknown, the claim shall be filed with the court that has jurisdiction over the defendants’ property, sureties or disputed property otherwise the claim shall be filed with Primary Commercial Court of Kabul.
Article 11: If a legal or real person has agents in different places, the claims related to transactions of the agents shall be filed with the court of real or legal person or agent/agency residence. Insolvency claims are exception.
Article 12: Those claims that corporations and commercial institutions file against the members through their dealings or a member against other members through commercial dealings are lodged in those Courts where the commercial institutions and corporations have legal residence.
Article 13: Compensation claims that arise due to the insurance protocolsshall be filed with the Courts where the property is located, in case the insured property is immovable. If the insured property is movable, the claim shall be filed with the Court where the property has been damaged or the protocol has been expired.
Article 14: If a party to the lawsuit has objections over the powers of the court that adjudicates the case, then the objection should be presented to the same court before the proceedings starts if not then it is assumed that he/she has accepted the Court’s authority.
Article 15: If differences arise between the Commercial Courts over the adjudication of a lawsuit or if it considers that it is in its jurisdiction, the Supreme Court then decides that which court has the jurisdiction.
Chapter Three
Reasons for the Rejection of the Members of the Commercial Courts
Article 16: Each member of the Commercial Courts could be restrained from adjudicating a lawsuit in the following conditions:
1-If the lawsuit is over someone who is a wife or first or second degree relative to the member.
2-If the executor or attorney in the lawsuit is mother, son, daughter or grandchild. The second degree relatives are grandfather/mother, uncle, brother, sister, brother’s offspring, sister’s offspring, father in law, mother in law, brother and sister in laws.
3-If one of the party in the lawsuit is executor or attorney.
4-If he/she has expressed his/her belief in the lawsuit as a member of the jury, judge, expert or witness.
5-If another lawsuit has been filed in an another court between the member of the court and the plaintiff or if there are clear signs of hostilities or positives reasons amongst them.
Article 17: The request for voluntary withdrawal should be written in a paper where the reasons for such action are mentioned clearly and explicitly. The plaintiff or the defendant, who wants the voluntary withdrawal, should present to the Court the necessary documents, at least 48 hours prior to the holding of the first session.
Article 18: The moment the request for a voluntary withdrawal reaches the Court it is recorded in the office of the court and a copy is immediately given to the other party. If the member finds the reasons for the withdrawal in accordance with the provisions of the court, then he/she is bound to abstain from the adjudication of the lawsuit and inform in written the court about his/her abstaining the lawsuit.
If the member finds that the rejection of the case is not in accordance with the law, then the court jury, without that person who demands the rejection, considers the rejection of the lawsuit in its next session and decides about its acceptance or rejection.
Article 19: If the text of the jury of the court is incomplete without the member whose rejection has been demanded, then the court considers the request for the rejection and issues its decision.
Article 20: If the Court jury accepts the rejection request then the rejected members cannot participate in the adjudication of this lawsuit.
Article 21: If the Court Jury does not accept request for the rejection, then those who requested for the rejection, are fined for a cash of one to two thousand Afghanis.
Article 22: No appeal can be filedin the Court of Appeal or the Supreme Court against the ruling of the court about the rejection.
Chapter Four
Capacity of Both Parties
Article 23: Sane, adult and un-interdicted persons are able to file a lawsuit and they could be defendant.
Article 24: Any party from both sides, which claims the inability of the other side, are bound to present necessary legal documents and reasons to the court, in order to prove their claim. Other than Commercial bankruptcy, the documents should have passed all legal stages in relevant courts.
Article 25: The real persons who do not have the capacity of article 23 and the legal persons including Government Departments and Government Enterprises under the Municipalities can get the status of plaintiff and defendant through their legal representatives.
Chapter Five
Attorneys for both sides
Article 26: Any person, who has the capacity to file a lawsuit, can file and prosecute a lawsuit in a Commercial Courtpersonally or through an attorney who has been chosen by the person independently.
Legal representatives too have this right.
Article 27: The generalization or specialization of an attorney’s authorities, regarding a person or an issue, must be explicitly mentioned in the power of attorney’s letter.
The power that has been bestowed upon an attorney is generally implemented in all stages of the trial unless the client himself/herself limits these powers of attorney in a specified stage or stages.
Article 28: The attorney is bound to handover his/her original or duplicate power of attorney letter for preservation in the file of the lawsuit to the relevant Commercial Court, which in principle, has been formulated in a legal or Commercial Court.
The power of attorney letter of the professional lawyers is the one that have been signed by competent authorities and sent to the court.
Article 29: If a client chooses to remove or sometimes depose his/her lawyer or if the lawyer chooses to quit from the attorneyship, they are bound to inform the court and the opposite party, three days prior to the holding of the court session so that in both cases the issue of resignation and removal are registered in the Lawsuit Registry Book of the court. Other than the above conditions, the resignation and deposal are effective only when the judge finds the resignation’s and deposal’s arguments rational and orders the recording of the resignation or deposal in the Lawsuit Registry Book of the court.
Article 30: In case of deposal or resignation of a lawyer, the relevant court informs the client to be prepared for pursuing the lawsuit himself/herself or through a new lawyer within the period allotted by the court. If it does not happen then decision shall be taken in the absence of the person.
Article 31: If a lawyer dies or is being stopped from proceedings, then the client is bound to hire another lawyer or pursue the filed lawsuit himself/herself within the period allotted by the court.
Article 32: Those power of attorney letters that have been drafted outside Afghanistan are eligible only if they have been drafted in a diplomatic mission or Consulate or have been attested by them. It needs the attestation of the Ministry of Foreign Affairs of Afghanistan in both the cases.
Article 33: A lawsuit, over the fee issue between the lawyers of both sides and their clients, could be decided in the defendant’s residential area court and or in the court where the original lawsuit has been filed.
Chapter Six
The Power of the Court and Position of Both Parties
Article 34: The court is bound to the claim and defence of both sides and it cannot increase the objects of claim or take a decision about a case which is not clear yet.
A decision is allowed on the arguments based by the investigation of the issue by decreasing the amount of the claim.
Article 35: The Court cannot inform both sides about the danger of exposure of their arguments and documents, but it can demand an explanation of their claims and reasons if it sounds ambiguous.
Article 36: Except in those situations where the Court orders an immediate process of the case, all other cases are processed in turn.
Chapter Seven
Settlement
Article 37: Both sides of the lawsuit can solve all or some of their disputes, in whatever stage it may be, before the issuance of the court’s orders.
Article 38: Both sides, on the intentions of settlement between them, can start a face to face dialogue or can appoint mediators and introduce them to the court. However, the request must come from both sides.
Article 39: The acceptance of the agreement that comes as a result of the above mentioned mediators is relevant to that accord of both sides that has been expressed in front of Court. However, the powers of the attorneys should be common and complete from the beginning of appointing an attorney.
Article 40: The relevant Court recommends just once a mutual agreement to the parties of the claim. If the parties reach an agreement through mediation, than, it should be presented to the Court within the period that has been specified by the Court. The relevant Court is bound to issue its decision without any possession in support of the mentioned agreement letter. If the agreement has been brokered by the said attorneys (mediators) in article 38, then it is necessary that the agreement letter, which is going to be deposited with the Court, must carry either signature, stamp or finger prints of the attorneys (mediators).
Article 41: If both sides do not accept an agreement through mediation, the Court should not delay them in vain. The moment it is noted that none of the parties is ready for mediation then the court should record it in the Lawsuit Registry Book, formally start the case and issue a decision.
Chapter Eight
Precautions and Security
A:Precautions
Article 42: The Court is authorized to give rulingon the request of one of the two parties, about the adoption of any measure for the protection of ‘the matter of dispute’,either before or after the filing of the lawsuit.
Article 43: If a Court notices that ‘precautionary measures’ are much easier or could be done with less expenses and lesser time in another place, then the Commercial Court of that area shall be selected for decision making and shall be appointed as a representative court for the adoption of precautionary measures.
Article 44: A decision about the precautionary measures depends upon the presentation of request to the Court. Based on this request the opposite party is summoned immediately and if he/she does not appear, a decision is made in his/her absence.
Article 45: When a decision is made in connection with the precautionary measures, the supervision of moveable and immoveable assets is assigned to the police. This supervision is performed by the executive body of the government based on the information of the relevant Court. However, the implementation of the decision and all other precautionary measures are turned over to a member of the Court or officials and or to both together.
Article 46: The party that requests the precautionary measures is bound to pay possible damages to the opposite party or the third person in accordance with the provisions of part (B) of this chapter. Moreover, if the precautionary measures requestor is a government office or government enterprise then in such cases the providing of separate safeguard is not necessary and a written commitment shall be sufficient. The appointment of the quantity of damages is the duty of that court which had accepted a request for the security.
Article 47:When the party, against which the precautionary measures have been adopted, pays the damages, then these precautionary measures could be changed or removed in accordance with the change in the situation.
Article 48: Those pages which belong to the precautionary measures are kept in the lawsuit file.
B: Security Deposits
Article 49: The Commercial Courts have the authority to retain the security deposits in case of damages to the opposite party, the third person and the Court’s expenses and taxes.
Article 50: The security deposits that could be given in a lawsuit are: cash, shares, loan documents, moveable and immoveable assets or guarantee from an authentic bank, which the Court appoints and accepts. Providing a guarantor on the basis of legal document has the orders of a security deposit as well.
Article 51: The security deposit requestors, even if they are foreign citizens and do not have legal residence in Afghanistan, are bound to deposit security in accordance with article 50.
Article 52: The demand for security should be made the moment the lawsuit is filed or during the proceedings of the case.
Article 53: Demand for a security could be made prior to the filing of the case on condition that the claim is related to a formal document.
Article 54: If a fixed guarantee is not provided by the security demander within the time frame the Court has allotted, then it is considered that the demand for the security has been given up.
Article 55: The opposite party should be notified first about the Court orders regarding security and then implemented but not at the times when immediate notification is not possible or if its delay in the implementation causes loss or damage. In this case first the orders of the security are implemented and then the notification is given out.
Article 56: If the reasons for security deposit are removed then the relevant court would remove the security deposit on request of the depositor and if the Court orders are issued for the cancellation of original claim of the plaintiff, then the security deposit vanishes itself.
Article 57: When orders from a relevant Court about the acceptance or rejection of the security deposit are issued then no appeal could be filed in a Court of Appeal or the Supreme Court.
Article 58: If a request for the security demand is cancelled by a court then the opposite party can demand compensation for the losses that incurred during the handing over of the security deposit.
Article 59: A friction over the credibility or unreliability and adequacy or inadequacy of a security deposit is decided by the Court that has the duty of resolving the case in the first place.
Article 60: If the demanded security deposit is a fixed property and its supervision is impossible then the Court cannot supervise other material instead.
Article 61: If the security deposit was not a fixed property or if it was but was impossible to be supervised, the Court then can hold undersupervision the equivalent amount of assets of the defendant.
Article 62: The person that is given as guarantor could be one or more. If the guarantors are more than one, then each one of them is bound to write in the guarantee letter the amount of security deposit that he/she is responsible for. By not doing so, each one of them has unceasing responsibility.
Article 63: The following persons cannot become guarantors unless the opposite party agrees to: