COMPANY X. a central European company, has manufactured and marketed in Czech Republic, Poland and Hungary since 1993 sophisticated peripherals to be integrated in office work stations.

In September 1997, Mr Lubovic, President of COMPANY X, met Mr. Kouakou, President of COMPANY Y, a West African company, at the Berlin Trade Fair.

Mr. Kouakou expressed interest in distributing certain of the COMPANY X peripherals throughout Togo and Senegal. Mr. Kouakou was particularly interested in the peripheral known as the PHOTRON (a combination telephone/telefax/voice mail/Internet access machine) for which he foresaw, after his intense marketing efforts, tremendous growth opportunities in Togo and Senegal.

Mr. Kouakou and Mr. Lubovic remained in contact after the Trade Fair and, in March 1998, Mr. Lubovic invited Mr. Kouakou to visit COMPANY X's PHOTRON plant. During this meeting, the parties began to discuss the type of cooperation that could be developed. In April 1998, Mr. Lubovic visited COMPANY Y as well as several of the independent distributors in the COMPANY Y distribution network in Togo and Senegal.

A test shipment of five PHOTRONs was delivered in July 1998. All were immediately sold by Mr. Kouakou.

A Distributorship Contract was signed on 30 September 1998, under which COMPANY Y was granted the right to be the exclusive distributor for the markets in Togo and Senegal of the PHOTRON peripheral for a period of two years. The term was subject to extensions of one year at the request of either party. Such request had to be made 90 days prior to the expiration of the contract. COMPANY Y was granted the exclusive right to market any improvements to the PHOTRON product during the term of the agreement.

The business relationship between COMPANY X and COMPANY Y was flourishing until COMPANY Y started to slip on its payments for the PHOTRON product, making excuses, and making payments months after they had agreed. Then, COMPANY X brought to market a new product which it did not offer (or even mention) to COMPANY Y as an improvement of the PHOTRON. Both Mr. Kouakou and Mr. Lubovic feel that the other did not live up to his end of the bargain and find themselves angry and frustrated at this relationship turned sour.

What do Mr. Kouakou and Mr. Lubovic do now?

• How does Mr. Lubovic get Mr. Kouakou to make his payments in a timely manner? Should he stop delivery until payments are made?
• How does Mr. Kouakou exert rights over the improved product? Should he stop payment until he has access to the improved product?
• Does their contract give them any recourse? Did they include a dispute resolution clause?
• Do they try to salvage their business relationship?
• What can arbitration offer them?
• How do they manage a business arbitration? What is involved?

To find out the answers to these questions from renown experts in international commercial arbitration: Register now on www.iccwbo .org/home/business_law/upcoming_events/pida41/registration.asp

The above facts, and names of persons and companies cited in the simulated arbitration case
are in all respects hypothetical and have been designed purely for the needs of the PIDA seminar "Study of a mock case under the 1998 ICC Rules of Arbitration" in Paris on 18-22 September 2000. Any resemblance with facts known to the reader are entirely coincidental.

Unless otherwise authorized, these facts may not be used for any purpose.