International Arbitration Court Research Articles

The Inside View: Companies' Needs in Arbitration

Errors, like straw, upon the surface blow, He who would search for pearls must dive below. Arbitration has come of age. The 1970s and 1980s have witnessed a formidable explosion of international commercial arbitration.1 It has become the most widely used dispute resolution mechanism in international transactions. Concepts as novel as the derealization of arbitration, the voie directe method for choosing the applicable law, or the lex mercatoria, have all been developed in international arbitration. Statistics bear out this generalization. There are more than 400 new arbitrations every year alone under the aegis of the International Chamber of Commerce's International Court of Arbitration. In the nine-year period between 1980 and 1988, there were 5,676 parties in ICC arbitration, ranging from Austrians to Jamaicans.2 Some of these arbitrations were held in locations as remote as the Seychelles or Trinidad,3 a...

Post Award Proceedings Under the UNCITRAL Arbitration Rules

A long-standing argument in favour of arbitration has been its speed, a speed gained in large measure by the ‘finality’ of the award. Article 32(2) of the UNCITRAL Rules provides that ‘[t]he award shall be … final and binding on the parties'. International arbitration practitioners will point out that motions to set aside an award or opposition to enforcement of the award in national courts may consume a great deal of time. But they would also agree that there is little question that as far as the arbitral tribunal is concerned, the award it renders is final and not subject to revision by the arbitrators. Nonetheless, there is a limited range of post award proceedings under the UNCITRAL rules and other rules that allow a tribunal not to revise, but rather to interpret, correct or make additions to an award. In some institutionally supervised arbitrations, such as in the ICC, this function is carried out by the institution, the International Court of Arbitration in the case of the ICC, and thus need not be a power explicitly provided to the tribunal. Consequently, in addressing ‘post award proceedings’ in this paper, we do not include: (i) the post award proceedings that could take place either before the courts of the place where the award was made or where recognition or enforcement is sought; or (ii) the annulment or appeal procedures that are available before specialized mechanisms such as ICSID or the WTO. Rather, we look at: (a) the very limited explicit ability of a tribunal under the UNCITRAL Rules to interpret, correct and make additions to an award: and (b) the debatable inherent power of a tribunal to reopen an award in the event of fraud or corruption. Articles 35, 36 and 37 of the UNCITRAL Rules form the exceptions to …

Multipartism: The Dutco Decision of the French Cour de cassation

The Supreme Court of France, the Cour de cassation, rendered on 7 January 1992 its decision on multiparty arbitration: Siemens v. BKMI and Dutco . This decision has rapidly become a matter of concern among those dealing with multipartism in the field of international commercial arbitration.1 In brief, the case was as follows: three companies entered into a consortium agreement for the construction of a factory on behalf of their common employer in the Middle East. The consortium agreement contained an ICC arbitration clause expressly providing for the settlement of disputes by an arbitral tribunal composed of three arbitrators. The Dutco company as claimant filed a request for arbitration in which in reality it had one particular claim against BKMI and a second (quite dissimilar) claim against Siemens, although both claims were based on alleged breaches of the consortium agreement. The time came for the designation of the arbitrators. Whilst the claimant freely nominated its arbitrator for the approval of the ICC International Court of Arbitration, each of the defendants contended for the right to nominate an arbitrator. The ICC Court refused those contentions, considering that the defendants' disagreement over the nomination of one arbitrator in their common interest amounted to a failure to make any appointment; and the ICC Court warned the defendants of its intention to apply Article 2.4 of the ICC Rules (‘If a party fails to nominate an arbitrator, the appointment shall be made by the Court’). Eventually Siemens accepted the same arbitrator as BKMI, but it expressed its strong reservation as to the validity of the constitution of the arbitral tribunal in those circumstances. Siemens duly challenged the jurisdiction of the arbitration tribunal. The tribunal rejected the challenge by its award of 19 May 1988. Siemens then filed a recourse for annulment in the …

Pathological Clauses: Frederic Eisemann's Still Vital Criteria

when preparing this article, my office was being renovated. In the course of the informal ‘inspections’ of the Works by other members of the Secretariat, one of the assistants who has been with the ICC for over 25 years advised me that I was working in the former office of Frederic Eisemann. Frederic Eisemann, who coined the phrase ‘pathological clauses’ or ‘clauses pathologiques’ had a long and distinguished career at the ICC as Secretary-General of the then Court of Arbitration (now, the ‘International Court of Arbitration’). In his seminal 1974 article,2 Eisemann presented and analyzed a series of arbitration clauses (he called them ‘pearls’), tainted with various pathologies, that he had taken from his ‘dark museum’ of arbitration. What with dark museums and pearls, I was stimulated to make a thorough search of the premises. Who could know what riches might be found? I did not find the dark...

Vicarious Hypochondria and Institutional Arbitration

international contracts do not exist in a vacuum. Nor are arbitration clauses invariably self-executing. Parties cannot be relied upon always to agree to the choice of arbitrators, to the removal or replacement of an arbitrator, or to the extension of deadlines for rendering an award. When the parties fail to self-administer their arbitrations with respect to such organizational matters, someone else must step in. This function may be performed by a judge, and that is what typically happens unless the parties have provided otherwise. In fact, parties to an international contract generally do prefer to avoid national authorities, and rather entrust the task of managing and policing their arbitrations to a neutral institution. The question then may arise whether, and to what extent, someone should police the police. Surely there ought to be some mechanism that could neutralise the decision of an institution which is found to be a sham (perhaps not an unthinkable thought in an age of proliferating institutions amongst which there may well be some whose institutional integrity and methods of governance are dubious). And even in the respect to well-known and reputable institutions, occasions may arise where a party feels impelled to test the legitimacy of a particular administrative decision. The greater the scope for such challenges, the greater the danger of subverting the very raison d'etre of the institution. Recognising this danger, leading arbitral institutions like the International Court of Arbitration of the International Chamber of Commerce (ICC) seek to anticipate and eradicate any conceivable objections by establishing procedures seen to ensure neutrality and due process. There is, however, no reason to consider institutional practices and procedures as immune from criticism To the contrary, balanced and constructive criticism is essential to the healthy evolution of any institution. The qualifications should be well noted: balanced and …