South Africa's Supreme Court of Appeal clarifies challenges to international arbitral awards
Robin De Backer, Joshua Eveleigh and Michael Williams
Primerio Law International, Johannesburg
r.debacker@primerio.international
j.eveleigh@primerio.international
m.williams@primerio.international
In Kingdom of Lesotho v Frazer Solar GmbH and Others, South Africa's Supreme Court of Appeal delivered a split decision on setting aside an international arbitral award and rescinding an enforcement order. A six-judge majority rescinded the enforcement order, but a five-judge majority refused to set aside the award because the application was brought outside the three-month period in article 34(3) of the UNCITRAL Model Law. The decision confirms strict time limits while preserving a separate route to resist recognition or enforcement under article 36.1
Background and procedural history
Article 34 of the UNCITRAL Model Law on International Commercial Arbitration 1985, as amended in 2006 (the “Model Law”), provides the recourse for setting aside arbitral awards. Article 36 separately identifies the grounds on which recognition or enforcement may be refused. South Africa adopted an adapted version of the Model Law in the International Arbitration Act 15 of 2017 (the “IA Act”).2
On 24 September 2018, a supply agreement for the rollout of renewable-energy products in Lesotho was signed by Minister Temeki Tšolo, on behalf of the Kingdom of Lesotho, and by Mr Robert Frazer on behalf of Frazer Solar GmbH (“Frazer Solar”). The agreement provided for arbitration in Johannesburg. After alleging non-performance, Frazer Solar terminated the agreement and commenced arbitration proceedings in Johannesburg on 30 July 2019, and an award was issued in Frazer Solar's favour on 28 January 2020. The award required Lesotho to pay EUR50 million in contractual damages, together with interest and costs.3
Frazer Solar then applied to the Gauteng Division of the High Court, Johannesburg, to make the award an order of court. The court authorised service by edictal citation, and the application was served through diplomatic channels while further notices were sent to senior Lesotho officials. Lesotho did not appear, and the enforcement order was granted on 29 April 2021.
Although Lesotho did not originally oppose the enforcement proceedings, it later alleged that the supply agreement was fraudulent and corrupt. In the Lesotho High Court, it succeeded in bringing an application to set aside the supply agreement and the arbitration clause, finding that Minister Tšolo lacked authority to sign the supply agreement, the applicable regulatory requirements were not followed when the supply agreement was signed.4
In South Africa, Lesotho applied to rescind the enforcement order and to review and set aside the award. The Johannesburg High Court dismissed both applications, finding that Lesotho had been in wilful default and that the three-month time limit in article 34(3), insofar as it limited access to courts, was reasonable and justifiable. Lesotho appealed to the Supreme Court of Appeal (“SCA”).5
The split decision
The seven-member appeal bench delivered three judgments. A six-judge majority held that the enforcement order should be rescinded because Lesotho had not received effective notice of the enforcement proceedings and had established a bona fide defence with prima facie prospects of resisting enforcement under article 36. Modiba AJA dissented on rescission. On the separate application to set aside the award, however, a five-judge majority held that the application was time-barred and that article 34(3) conferred no general power of condonation. Molemela P, with Makgoka JA concurring, dissented and would have set the award aside.6
The strict three-month time bar
Article 34(3) gives a party three months from the date it receives an award to apply to have the award set aside. If the party has made a request under article 33, the three-month period runs from the date on which the arbitral tribunal decides that request. South Africa added a limited exception for fraud or corruption. If an applicant proves that it did not know, and could not through reasonable care have discovered, facts showing that the award was induced or affected by fraud or corruption within the ordinary period, the three months will run from the date on which those facts could reasonably have been discovered.7
The majority held that courts have no general power to allow a late application under article 34(3). The wording creates a firm time limit, while article 5 permits courts to intervene only where the Model Law allows them to do so. South Africa’s decision to create a narrow exception for fraud and corruption also shows that the legislature did not intend to give courts a broader discretion. The majority noted that courts in Singapore, New Zealand, Canada, Australia, India, Zimbabwe and Kenya have followed the same approach.8
A crucial distinction in the first judgment is that, although Lesotho relied on allegations of fraud, corruption and concealment elsewhere in its case, it did not challenge the contract or award on the statutory ground that either had been obtained through fraud or corruption. The special time rule was therefore unavailable, and the ordinary three-month bar applied. Modiba AJA agreed that the award could not be set aside and, in her dissent on rescission, went further by finding that fraud had not been established on the papers and that Lesotho's version reflected institutional inaction rather than involuntary default.9
Fraud, public policy and the minority approach
Molemela P, with Makgoka JA concurring, took a different approach. She considered the original article 34(3) capable of permitting condonation for good cause and treated South Africa's adapted provisions as a self-contained mechanism where fraud or corruption is demonstrated. On this reading, an award may be “induced or affected” by fraud or corruption not only where the award itself is directly tainted, but also where the underlying agreement is illegal and the arbitration proceeds because documents have been fraudulently concealed. Relying on the principle that 'fraud unravels all', she considered the allegations substantiated and would have set aside the award under article 34(2)(b)(ii), read with article 34(5)(b). She found support for a less rigid approach in Malaysian and Hong Kong authority, while distinguishing the Singaporean authority relied on by the first judgment because it involved no allegation of fraud.10
That reasoning did not carry the majority and is therefore not the binding holding. It nevertheless exposes the fault line at the centre of the case: whether arbitral finality should prevail when the integrity of the agreement and the process is challenged on fraud-related grounds.
Constitutional validity and the enforcement route
The five-judge majority also rejected Lesotho’s constitutional challenge to the three-month time limit. It accepted that the limit restricts access to courts but held that the restriction is justified. Under the ordinary rule, the period begins only once the party receives the award. By then, the evidence would ordinarily have been considered, and the parties should have the information needed to prepare a challenge. The court regarded three months as a generous period. A strict deadline promotes speed, certainty, finality, party choice and consistent application of the Model Law. An open-ended power to extend the deadline would weaken those objectives. The limitation of the right of access to courts in section 34 of the Constitution was therefore reasonable and justifiable under section 36.11
The judgment is equally important for what the time bar does not do. Failure to bring a timely article 34 application does not prevent the losing party from resisting recognition or enforcement under article 36. In granting rescission, the first judgment held that Lesotho had shown a bona fide defence and prima facie prospects of resisting enforcement, including on the basis of Minister Tšolo's alleged lack of capacity. The merits of that defence remain for the court hearing the enforcement application. Finality of the award therefore does not automatically determine its enforceability.12
The SCA also held that the Lesotho High Court's judgment had no binding effect on the international arbitration proceedings. Because Johannesburg was the arbitral seat, the South African courts were competent to determine the existence and validity of the arbitration agreement for purposes of the award. The court hearing the enforcement application may nevertheless determine what weight, if any, should be given to the Lesotho judgment.13
Why the decision moved the needle
For practitioners handling cross-border disputes, the decision shows that timing and careful pleading are critical. A party wishing to set aside an award in South Africa must act within three months and clearly state the exact legal ground on which it relies. It is not enough simply to mention fraud in the account of the facts. The party must rely on the fraud-and-corruption exception and explain why the relevant facts could not reasonably have been discovered sooner.
The case also confirms the important difference between setting aside an award and opposing its recognition or enforcement. Missing the deadline to set aside an award may leave it legally intact, but article 36 may still allow a party to oppose its enforcement.
Rescinding a default enforcement order allows the parties to argue again about whether the award should be enforced, but it does not revive an expired article 34 challenge.
In this case, the Lesotho High Court’s decision declaring the supply agreement and arbitration clause invalid did not bind the South African supervisory court. The court considering enforcement will decide the relevance and weight of that decision. The majority therefore favoured certainty and finality, while the minority’s focus on fraud keeps concerns about the fairness and integrity of arbitration open for future debate in South Africa.
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Notes
1 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 1-2, 142-144 and 295.
2 UNCITRAL Model Law on International Commercial Arbitration 1985, as amended in 2006, article 34 and 36; Section 6 of the International Arbitration Act 15 of 2017read with Schedule 1.
3 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 5, 19, 26-30 and 145.
4 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 28-34.
5 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 35-37 and 72.
6 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 142-144, 147, 245 and 295.
7 Article 34(3) and 34(5)(b) of Schedule 1 of the International Arbitration Act 15 of 2017; Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 74-77.
8 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 91-98 and 143.
9 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 79, 236 and 240-245.
10 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 277-290 and 295.
11 Section 34 and 36 of the Constitution of the Republic of South Africa, 1996; Frazer Solar (n 1), paras 107-116 and 143.
12 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (22 May 2026), paras 71, 115 and 138-142.
13 Kingdom of Lesotho v Frazer Solar GmbH and Others (438/2024) [2026] ZASCA 75 (