Parties In Arbitration Research Articles

Recognition and Enforcement of Annulled Arbitral Awards Under the New York Convention 1958

Purpose: The arbitral awards are enforceable internationally under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958. The Convention provides the discretion to the courts in enforcing State either to enforce or reject the international arbitral awards. The award set aside at the seat of arbitration is not enforceable, however the courts in some jurisdictions enforced such awards. In this context the paper examines how the courts in different jurisdictions justified while enforcing the annulled awards. Theoretical framework: Arbitration mechanism is frequently used for settlement of international commercial disputes. It enables party autonomy in drafting arbitration agreements, choosing the applicable law and determining the arbitration seat. According to Article V (1)(e) of the New York Convention the national courts may refuse to recognize or enforce the foreign award if it was set aside or annulled at the seat of arbitration or under law of which such award was given. In some jurisdictions the enforcing courts considered the annulment procedure followed by the courts and if such procedure was unfair, the courts in enforcing country have agreed to enforce the set aside awards. Design/methodology/approach: The author followed the legal analysis method to examine the approach of the courts from different jurisdictions that have enforced the annulled foreign arbitral awards and the legal comparative method observed to study the judicial decisions from various jurisdictions. Findings: The study concludes that Article V (1) of the New York Convention gives discretionary power to the enforcing courts regarding enforcement of foreign arbitral award. Hence, the courts in some jurisdictions enforced the annulled award if the set aside procedure was unfair, based on local grounds, biased, violated basic norms of justice, against the parties’ agreement or applied domestic law instead of the New York Convention. To secure the enforcement of award, the parties to the arbitration may agree that the arbitral award is not subject to challenge in any court at the arbitration seat or in the state in which the award is enforced and prefer a pro-arbitration State as a seat of arbitration. Research, Practical & Social implications: The study provides practical guidance to the arbitrating parties in drafting arbitration agreements to ensure the enforcement of an arbitration award internationally. Originality/value: The research on enforcement of annulled award under the New York Convention immensely helpful in guiding the arbitration parties in drafting the arbitration agreement, choosing arbitration procedure and seat of arbitration.

The “Arbitral Immunity” Dilemma – What is the Balance?

As recipients of bad news are inclined to blame the messenger, a losing party in arbitration will tend to blame the arbitrator. Arbitrators will usually respond by asserting the doctrine of arbitral immunity. The main objective of this paper is to investigate how arbitrators and the parties who appointed them are protected from certain liabilities imposed on them. Since arbitrators carry out some judicial or quasi-judicial functions that render them comparable to judges, is it fair to compare them to court judges? Do they possess the same powers as court judges? It is often said that arbitrators should be treated as mere professionals hired to provide their services and they should not be protected by the shield of immunity. Some scholars would argue that if immunity is not granted to them, they will work under constant fear of reprisals from unsatisfied parties. Emphasis, in this paper, is laid on the similarities and differences between arbitrators and judges and also in how different legal and arbitral rules approach the concept of arbitral immunity under different jurisdictions. Also, a comprehensive analysis is made on how arbitrators and aggrieved parties to the arbitration are duly protected. A close examination is also undertaken on how to improve the system and move towards a more unified model. After having critically analyzed the basis of arbitral immunity, it is firmly believed that some degree of immunity is important in order to maintain the independence and impartiality of the arbitration process. It can be postulated that arbitral immunity should be qualified and not absolute. By qualified immunity it is understood that when an arbitrator has committed gross negligence, has had a willful conduct or has acted in bad faith, he should not be shielded by the blanket of immunity.

Safeguarding Confidential Arbitration Awards in Uncontested Confirmation Actions

Two bedrock principles of American jurisprudence collide when courts are called upon to decide whether to seal confidential awards that prevailing arbitration parties petition to confirm in court. On the one hand, the strong public policy in favor of arbitration dictates that courts should honor arbitration parties' confidentiality agreements by sealing confidential awards that are the subject of confirmation petitions. On the other hand, the public interest in court proceedings suggests that motions to seal should be infrequently granted. Courts continue to struggle with how to harmonize these two important values when they conflict with each other in actions to confirm confidential arbitration awards. To clarify and improve the law in this area, this article proposes the following rule to guide the adjudication of motions to seal confidential arbitration awards in confirmation actions: deny the motions when the losing arbitration party challenges the underlying award and grant the motions when the award is uncontested. Such a rule would provide arbitration parties with clarity, consistency, and the confidence to submit their confidential disputes to arbitration without risking public disclosure in the event they lose and their adversary initiates a confirmation action. It also would prevent prevailing arbitration parties from misusing the confirmation process to engage in undesirable strategic behavior, and empower arbitration parties to request that their arbitrators issue reasoned awards without fear that those awards will end up in the public domain whenever the prevailing party petitions to confirm them.

INCAPACITY OF A PARTY IN ARBITRATION: GENERAL APPROACHES AND LIMITATIONS OF DEFENSE

According to Article V(1)(a) of the New York Convention, the recognition and enforcement of an arbitral award may be refused, if the parties involved, under the ‘law applicable to them’, were under some incapacity when entering into an arbitration agreement. However, this specific provision is considered one of the most uncertain aspects of the Convention as it has caused challenges from its structure and wording which do not explicitly set the concept of capacity nor the governing law and other essential circumstances related to this defense. Furthermore, the absence of standards in this defense makes a significantly different interpretation by courts causing legal uncertainties to all the parties involved in the proceeding. In this paper, the author examines general approaches for determining the governing law on a capacity of a party in arbitration and analyzes limitations on the defense of incapacity in arbitration-friendly jurisdictions. The approach employed is normative juridical, relying on qualitative analysis of secondary data. This paper covered the choice of law method and the substantive law method in determining the law governing capacity of a party in entering an arbitration agreement. In the end, the paper explored various laws that limit the state from invoking incapacity initially established in the Lizardi case in France.

Joinder of Third Party in Arbitration under Indonesian Arbitration Law

Arbitration proceeding derives from an arbitration agreement, hence if there is no consent from all of the disputing parties, it is impossible for a third-party that is a non-signatory to an arbitration agreement to join an on-going arbitral proceeding in most jurisdictions. In Indonesia, joinder of third-party is regulated under Article 30 Law Number 30 of 1999 on Arbitration and Alternative Dispute Resolution. This study will analyze the joinder regulation in Indonesia, comparing it with the practice in Indonesia and arbitration laws in another countries. This paper is written in normative juridical method that will be connected to the practice of joinder in Indonesia. Conclusively, joinder of third party is stipulated in Article 30 Law Number 30 of 1999. However, this article absents on explaining further about the form of joinder and also the condition should be applied. For more certainty, Law No 30/ 1999 needs to be revised, namely regarding the form of third-party joinder, justification for the joinder of third parties, and whether third parties can defend their own interests or must defend the interests of the disputing parties. Moreover, further requirements such as at what stage a third party can join in the arbitration process and the criterions of “elements of related interest” under this article must also be explained. Keywords: Arbitration, Joinder of Third Party, Indonesia Arbitration Law DOI: 10.7176/JLPG/123-04 Publication date: August 31 st 2022

Image Copyright Protection Based on Blockchain and Zero-Watermark

Generally, image protection is often accomplished by digital watermark, which is also widely used in the field of data protection and data ownership authentication. However, the existing digital watermark has inherent disadvantages, it needs completely trusted third parties to act as the arbitration parties, which may be difficult to achieve. Second, an image watermark algorithm will inevitably lead to the loss of image data when operating on the image data, while it is usually irreversible. The zero-watermark algorithm can solve the problem of data loss but relies more on the trusted third party than a traditional digital watermark, which makes its prospects limited. With the development of blockchain technology in recent years, its features of de-trusted third parties combine the fairness and process automation of smart contracts to make up for the shortcomings of the zero-watermarking algorithm. This paper studies image storage and authentication frameworks. This framework utilizes the advantages of zero-watermarking algorithm and blockchain, using the Inter-Planetary File System to solve the data expansion problem of blockchain, which well avoids the shortcomings of zero-watermarking algorithm and blockchain. Experiment and inference illustrate that the proposed framework is feasible.

THE LEGAL SYSTEM OF ARBITRATION IN INTERNATIONAL CONTRACTS

The legal system of arbitration in international contracts. Arbitration is defined as the establishment of a special judicial system to be undertaken by individuals with the power to adjudicate in Disputes and parties are the ones who evaluate it and determine its competence. Arbitration has been considered one of the most successful means of resolving disputes by peaceful means since ancient times The rulers of ancient China took it, and before the state-imposed recourse to the judiciary by enacting laws, the Greeks took it since their early times as a means for a political and judicial settlement, just as religious and ethnic minorities in Europe resorted to it, which did not recognize the authority of the Church or the authority of the king, In the old European law, the “Moulin” order issued in 1566 considered arbitration necessary not only in commercial cases, but in all other settlements, and for its part, Article 01 of the French decree dated 16-20 August 1790 considered that arbitration is the most rational way to end individual disputes. The arbitration system is characterized by some characteristics such as speed in procedures, flexibility, and confidentiality, in addition to the great freedom that the arbitration parties enjoy in agreeing on the legal rules that govern them, based on the principle of the authority of the will. In addition, the study of arbitration in international contracts derives its importance from the role it plays in the economies of developing and developed countries alike, because countries are often bound by bilateral or collective agreements aimed at protecting their organization through the conclusion of contracts between the state. Key words: The Legal System, International Contracts.

Confidentiality as a Justification for Resorting to Arbitration in Investment Contracts Disputes

The study aimed to identify the extent of the arbitration parties' commitment to confidentiality in arbitration and to identify the extent to which the principle of confidentiality is assumed in arbitration. The study adopted the comparative analytical and descriptive method. The study reached results, the most important of which are: Confidentiality is the most important characteristic of arbitration, which makes arbitration distinct from the state’s judiciary, and that confidentiality is one of the justifications for resorting to arbitration, to preserve the commercial, industrial and technical secrets of the parties to the dispute. Confidentiality is an assumed principle in arbitration in investment contract disputes without stipulating it in the arbitration agreement. The study recommended: The arbitral institutions should confirm the extent to which the principle of confidentiality is applied in investment contract disputes in their arbitral procedures. Arbitral institutions should organize their position when justifications for transparency are achieved in the arbitral process. The contracting parties shall clarify in the arbitration agreement what is related to applying the principle of confidentiality and what is related to the application of transparency. Keywords: confidentiality, arbitration of disputes, investment contracts DOI : 10.7176/JLPG/110-13 Publication date : June 30th 2021

A figura do third-party funding no processo arbitral brasileiro: natureza jurídica do contrato de financiamento e os efeitos processuais

The increasing use of arbitration in Brazil arouses the need for the permanent development of arbitration doctrine. In this perspective, the promotion of skillful measures to encourage the use of arbitration. To clarify, the presence of third-party investors has great aptitude for the development of this dispute settlement mechanism. Under that context, methods should be devised in order to enable the third-party funder to have the legal security necessary to carry out its investment, so as not to suffer undesired procedural effects. A controversial issue in the specialized literature, the participation of third parties in arbitration, defended in this article as an alternative to the financier, presupposes knowledge of the nature of the legal business and the broad view of the concept of part of the arbitration clause, which was sought to outline in this work. By considering all the values involved in the theme, Brazilian national arbitration will have a great ally in favor of its development.

Implementation of the digital agenda by international commercial arbitrations

It is almost impossible to astonish anyone in the era of global digitalization and the Internet of Things. Modern digital technologies and artificial intelligence have become an integral part of everyday life. Neural networks analyze information and photographs that we post on the Internet, and artificial intelligence programs have learned to reproduce and create intellectual property objects independently. Undoubtedly, this situation contributes to an increase in cross-border disputes, and arbitration procedures are becoming more attractive for participants. The development of the information and communication environment significantly impacts the means and methods used by arbitrators and parties in arbitration. Online arbitration, video conferencing, electronic databases, systems for analyzing court and arbitration practice, and templates and document designers are used daily. Due to the wide distribution and diversity of digital tools, this area, like nothing else, needs effective regulation. In this regard, the author of this article concludes on the possibility of conducting an analysis on the implementation of the digital agenda by international commercial arbitration tribunals, identifying the main trends in the development of the arbitration procedure, and improving the legislation in this area.

The Restrictive Approach to Legal Representation in Arbitration Proceedings and Its Unintended Consequences in Nigeria

The issue of legal representation in arbitration proceedings accounts for one of the sub-factors of ‘formal legal structure’ and ‘national arbitration law’ that disputing parties consider before choosing a seat of arbitration. Indeed, the ability of disputing parties in arbitration to freely select their desired representatives is embedded in the foundational principle of party autonomy. In Nigeria, a literal interpretation of the national arbitration rules prevents parties from selecting persons not admitted to the Nigerian bar as their representatives in arbitration proceedings. This article examines the impact of this restrictive approach on the attractiveness of Nigeria as a seat of arbitration. The article identifies scope for reform in the law and makes suggestions to create a more liberal legislative and judicial framework in order to promote Nigeria as a preferred seat for arbitration. Arbitration, Legal representation, Seat, Nigeria

Principles of Judicial Conciliation, Mediation and Arbitration: Comparative Legal Aspects

The paper discusses the principles of judicial conciliation, mediation and arbitration in a comparative perspective. A special attention is paid to guarantees of their implementation. Examples of judicial practice that demonstrate the prevalence of violations of certain principles are considered. On the basis of a systemic analysis of legal provisions and a relevant draft law, regulations of Russian and foreign arbitration institutions, taking into account the views of prerevolutionary, Soviet and modern researchers, the authors formulate conclusions about the declarative nature of principles of judicial reconciliation and significant differences of this procedure from mediation. In judicial reconciliation, the autonomy of the will of the parties to a dispute may be limited by choosing the conciliator’s candidature, the active role of the conciliator. The authors argue in favor of using such a form of reconciliation, in which the conciliator may be the judge who is considering the specific case. The unconditional advantages of mediation as the only one of the considered dispute resolution methods, which is really characterized by confidentiality and co-operation of the parties, are noted. The authors reveal the issues of the adversarial principle and equality of the parties in arbitration, due to abuse of rights by the parties to the dispute. The study of characteristics of formation of individual principles in the Russian pre-revolutionary and Soviet legislation allowed to formulate conclusions about the possible development of provisions on the principles of cooperation and confidentiality, on the prospects for judicial reconciliation.

The Effects of Arbitrator's Lack of Impartiality and Independence on the Arbitration Proceedings and the Task of Arbitrators under the UNCITRAL Model Law

This paper aims to investigate the effect of arbitrators’ lack of impartiality or independence on the arbitration process in accordance with the Model Law. The reasons for choosing the latter is that it is the origin for most modern national arbitration laws and any amendments to it would likely to be followed by national laws. The research problem lies in the fact that the Model Law does not tackle in detail the issue of challenging arbitrators for lacking impartiality or independence. A challenge application would have an immediate effect on both the arbitration proceedings and the task of arbitrators. This study concludes that grounds for challenging arbitrators’ impartiality or independence under the Model Law are broad and general. Hence, regulating the scope, grounds and limitations related to the lack of impartiality or independence on the part of arbitrators should be addressed in depth in the Model Law to safeguard the interests of arbitration parties and therefore justice at large.

Arbitration in international tax law: legal obstacles to agreeing

Article 25 (5) of the OECD Model Convention contains a provision that defines the failure of the mutual agreement procedure to solve a dispute whether a person has been taxed in a manner that is not in accordance with the provisions of the Convention within two years as a deferred condition for activating the arbitration clause. The parties in arbitration are the Contracting States rather than the taxpayer who initiated it. Despite the advantages of the arbitration dispute resolution, numerous developing countries do not accept the arbitration clause stating that it would violate their fiscal sovereignty from two reasons. Firstly, the authors point out that relying on the „baseball arbitration“ would diminish the relevance of the objection that arbitration jeopardises administrative independence. Secondly, the objection that the state cannot renounce its right to tax is also untenable since it overlooks the difference between the state’s sovereign inalienable right to introduce tax and its right to collect a disputed amount. Neither remaining two constitutional-law arguments are valid. From the point of view of the rule of law principle, there is no justification to confine arbitration only to the issues concerning the interpretation of facts. From the point of view of the principle of equality, the constitutional courts will not require symmetrical access to arbitration in domestic tax disputes since they tend to interpret this principle in the manner that it applies to the persons in the same or similar legal situations – namely, to those who meet the requirements for arbitration stipulated in a tax treaty. The authors conclude that Serbia should reassess its negative attitude on tax arbitration, which will make it easier for her to deal with the obligation emerging in the accession negotiations to adopt the EU Arbitration Convention as a part of the acquis.

Arbitraža u međunarodnom poreskom pravu - pravne prepreke za ugovaranje

Article 25 (5) of the OECD Model Convention contains a provision that defines the failure of the mutual agreement procedure to solve a dispute whether a person has been taxed in a manner that is not in accordance with the provisions of the Convention within two years as a deferred condition for activating the arbitration clause. The parties in arbitration are the Contracting States rather than the taxpayer who initiated it. Despite the advantages of the arbitration dispute resolution, numerous developing countries do not accept the arbitration clause stating that it would violate their fiscal sovereignty from two reasons. Firstly, the authors point out that relying on the 'baseball arbitration' would diminish the relevance of the objection that arbitration jeopardises administrative independence. Secondly, the objection that the state cannot renounce its right to tax is also untenable since it overlooks the difference between the state's sovereign inalienable right to introduce tax and its right to collect a disputed amount. Neither remaining two constitutional-law arguments are valid. From the point of view of the rule of law principle, there is no justification to confine arbitration only to the issues concerning the interpretation of facts. From the point of view of the principle of equality, the constitutional courts will not require symmetrical access to arbitration in domestic tax disputes since they tend to interpret this principle in the manner that it applies to the persons in the same or similar legal situations - namely, to those who meet the requirements for arbitration stipulated in a tax treaty. The authors conclude that Serbia should reassess its negative attitude on tax arbitration, which will make it easier for her to deal with the obligation emerging in the accession negotiations to adopt the EU Arbitration Convention as a part of the acquis.

Revisiting the Problem of Non‐Paying Parties

A New York Law Journal article by Neal M. Eiseman, “Falling Through the Cracks: Non‐Paying Parties in Arbitration,” (Oct. 15, 2014)(available at http://bit.ly/2yWu5cK), was of interest to, and met with rueful recognition by many arbitrators and participants in arbitrations, including this author.

The Autonomy of the Parties’ Free Will and Its Limits When Selecting an Arbitrator

Summary The party autonomy, known as one of the basic principles in private law, is one of the fundamental pillars of arbitration and one of the fundamental differences between the arbitration procedure and the proceeding before the ordinary courts. Although a wide degree of party autonomy is provided to the parties in arbitration, this “freedom” is not boundless and is limited by a number of different limitations. This article point out limitations and diversity of national regulations in the matter of appointment of arbitrator.

The Appearance of Foreign Counsel in International Arbitration: The Case of Egypt

The ability of arbitrating parties to select their representatives in international arbitration is an extension of the principle of party autonomy. In Egypt, some uncertainty has existed as to the ability of the parties to appoint non-lawyers and foreign counsel as their representatives in arbitral proceedings. The Egyptian Legal Profession Law restricts the right to appear before arbitral tribunals to members of the Egyptian bar, who must be Egyptian nationals. Recent decisions by the Cairo Court of Appeal and the Egyptian Court of Cassation go some way in amending this position, holding that foreign lawyers can represent parties in arbitrations conducted in Egypt, subject to the parties’ agreement. However, unless the Legal Profession Law and the Arbitration Law are amended, uncertainty will remain.

Blurred Lines: Are Non-Attorneys Who Represent Parties in Arbitrations Involving Statutory Claims Practicing Law?

Over the last thirty years, businesses have increased their use of arbitration, while, at the same time, expanding the types of disputes that are subject to arbitration. As statutory claims are routinely moved to arbitral forums, concerns may arise about the potential impact on party representation. Historically, parties in arbitration did not need and were not required to utilize legal representation in arbitration because arbitrators used customs and norms to evaluate and resolve parties' claims. Today, arbitration differs considerably from this model. In addition to evaluating statutory claims, modern arbitrators often assist the parties in conducting expansive discovery, rule on motions and preside over pretrial hearings. If, as a practical matter, the majority of consumer and employee claims against businesses will be heard in arbitration, representation of parties in arbitration is likely to require considerably greater legal knowledge and expertise than it has in the past. Disputants attempting to arbitrate statutory claims will need legal counsel to properly present their cases in the arbitration forum.The need for more frequent legal representation in arbitration likely extends to all forms of arbitration, including consumer, labor, securities, and employment arbitration. While critics focus on whether arbitrators are capable of adjudicating such claims, scant attention has been paid to whether non-lawyer representatives, who commonly appear in these kinds of arbitral proceedings, can properly traverse the increasingly complex landscape of legal claims at issue in arbitration. As statutory claims become increasingly prevalent in arbitration, concern and focus on who is representing parties in arbitration must change. The current practice of permitting non-lawyer representation in arbitrations involving statutory claims is sanctioning the unauthorized practice of law. This burgeoning problem, perhaps unlike those that have come before it, may provide the impetus needed for Congress to consider realistic reform of the Federal Arbitration Act to ensure that arbitration agreements do not become a mechanism by which vulnerable populations are further harmed. This Article explores the problem, evaluating the consequences of non-legal representation for parties in arbitration and considers what steps legislatures, courts, lawyers and bar associations might take to address this growing concern.

Damages in International Arbitration under Complex Long-term Contracts, by Herfried Wöss, Adriana San Román Rivera, Pablo T. Spiller, Santiago Dellepiane, edited by Loukas Mistelis

Damages in International Arbitration under Complex Long-term Contracts , by Herfried Woss, Adriana San Roman Rivera, Pablo T. Spiller, Santiago Dellepiane, edited by Loukas Mistelis, Oxford International Arbitration Series, 2014. Lamenting the fact that too little attention is paid to damages, Lucy Reed once proposed that parties in arbitration disputes begin with dessert—by hearing damages right after opening arguments—rather than leave them for the end.1 Notwithstanding that refreshing proposal, it remains true that damages are too often given short shrift, resulting in grumbling from all corners of the international arbitration community. Scholars, experts, and practitioners are dissatisfied with the way in which tribunals approach damages or fail to explain how they have reached their conclusions on damages.2 Arbitral tribunals are unhappy with certain party-appointed damages experts. One tribunal, after awarding the largest damages award in the history of international arbitration, observed that the claimants’ expert’s fees were ‘plainly excessive’ and that the claimants’ expert had been of ‘limited assistance to the Tribunal in its determination of Claimants’ damages’.3 Another tribunal, having noted with thanks the assistance of party-appointed damages experts, belied reliance on those experts in its damages analysis.4 More recently, a tribunal turned the tables on party-appointed experts by appointing its own damages expert, whose report the parties were required to address as the final round of a 12-year long investment arbitration dispute.5 The authors of Damages in International Arbitration under Complex Long - t erm Contracts address a number of causes for this current state of discontent. Their over-arching mission is to instruct practitioners and arbitrators on how to deal with uncertainty. According to the authors:This book underlines the fundamental necessity for arbitral tribunal to learn to deal with uncertainty and not to spare any effort to make a learned, fair and well-reasoned estimate of income profits lost, rather than taking a shortcut to reliance interest or ‘splitting the baby’. (11) The authors emphasize that the solution for uncertainty is not to … [↵][1]* Ruth Teitelbaum is a deputy general editor of Arbitration International and a senior associate in the international arbitration group of Freshfields Bruckhaus Deringer US LLP. The views expressed are hers only and do not reflect those of her employer. ruth.teitelbaum{at}freshfields.com [1]: #xref-corresp-1-1