INTERNATIONAL COMMERCIAL ARBITRATIONS BETWEEN SINGAPORE AND INDIA

INTERNATIONAL COMMERCIAL ARBITRATIONS BETWEEN SINGAPORE AND INDIA

INTERNATIONAL COMMERCIAL ARBITRATIONS BETWEEN SINGAPORE AND INDIA

(This article is co-authored by International Commercial Arbitration lawyers of Singhania & Partners LLP, India and Kelvin Chia Partnership, Singapore)


28/2/2018  

Meet the authors

The present article focuses on International Commercial Arbitrations between Indian and overseas parties, where the seat of arbitration is in Singapore. It further discusses the issues faced by foreign companies trying to seek alternative methods of dispute resolution, obtain reliefs and remedies in India and Singapore as well as with the enforcement mechanism for Singapore seated arbitrations in both countries.

With the growth of international trade and commerce, more and more disputes arise from cross-border transactions involving ‘foreign’ parties, and parties have turned towards alternative methods of dispute resolution beyond the traditional forum of court. Given that the bedrock of arbitration is consent by parties, parties are free to agree to the procedures concerning arbitrations including the seat of arbitration. Parties normally agree to arbitration by means of an arbitration clause in a contract made by them before a dispute has arisen, although it can also be agreed to after a dispute has arisen. Arbitrations can be both institutional as well as ad-hoc arbitrations. Various institutions such as London Court of International Arbitration (LCIA), the International Chamber of Commerce (ICC), Singapore International Arbitration Centre (SIAC), etc. also administer arbitrations, and carry their own rules of procedure for arbitration.

The SIAC was established in July 1991. The SIAC administers most of its cases under its own rules of arbitration although it is able to administer arbitrations under any other rules agreed to by the parties. The SIAC has initiated provisions for the purpose of:
1. International and domestic commercial arbitration and conciliation;
2. Promotion of arbitration and conciliation as alternatives to litigation for the settlement commercial disputes; and
3. Development of a pool of arbitrators and experts in the law and practice of international arbitration and conciliation
The SIAC has assisted in rendering administrative services which include settling fees of arbitrators, providing venue for hearings, organizing dates for meetings between the tribunal and parties’ representatives and acting as a registry of pleadings, documents and correspondence.

This article deals with the basic law governing arbitrations in Singapore as well as India in respect of Singapore seated arbitrations, with a special focus on SIAC Rules.

For ready reference we are reproducing a model clause below, as per which the seat of arbitration would be Singapore and the substantive law is Indian:-

“Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration administered by the Singapore International Arbitration Centre (“SIAC”) in accordance with the Arbitration Rules of the Singapore International Arbitration Centre (“SIAC Rules”) for the time being in force, which rules are deemed to be incorporated by reference in this clause.

The seat of arbitration shall be Singapore
The language to be used in the arbitral proceedings shall be English
The governing law of the contract would be the substantive law of India”

LEGAL SYSTEMS GOVERNING AN ARBITRATION

The seat of arbitration carries with it, implications regarding the law which is attracted to the proceedings of the arbitration. This is why it is important to understand how both jurisdictions deal with different systems of law applicable to an agreement.
The SIAC rules provide primacy to party autonomy as regards the seat. However, in absence of any particular provision by the parties, the tribunal is free to determine the seat.

Singapore
In Singapore, different aspects of an arbitration proceeding can and are often governed by different systems of law including and rules, including:
1. The governing law of the conduct of the arbitration (the lexarbitri or curial law);
2. If the arbitration is an institutional arbitration, the arbitral rules of that institution;
3. The governing law of the arbitration agreement;
4. The governing law of the contract i.e. the substantive dispute; and
5. The law governing the recognition and enforcement of the arbitral award.

Each of these is discussed briefly below.

(1) Lex Arbitri / Curial Law

The selection of the seat of arbitration is crucial as the lexarbitri has profound implications on the conduct of the arbitration proceedings, from the initial stages when a party attempts to commence arbitration to the enforcement of the arbitral award. The lexarbitri can regulate, inter alia:
(a) The validity of the arbitration agreement;
(b) The commencement of arbitral proceedings;
(c) The constitution of the tribunal, grounds for challenging their jurisdiction and their ability
to rule on their own jurisdiction;
(d) Interim measures available to the parties;
(e) The court’s involvement or assistance in relation to support or supervision of the
arbitration; and
(f) The court’s power in relation to the award in terms of review and appeal .
Where the seat of an arbitration is Singapore (this is not to be conflated with the physical venue of the arbitration), the arbitration proceedings will be governed by either the Arbitration Act (Cap 10) (“Singapore AA”) if the arbitration is a domestic arbitration or the International Arbitration Act (Cap 143A) (“Singapore IAA”) if the arbitration is an international one. An arbitration is considered “international” if one of the following applies:
(a) At least one party has its place of business outside Singapore when the arbitration agreement is made;
(b) Either the place of arbitration, the place where a substantial part of the obligations is to be performed or the place with which the subject matter of the dispute is most closely connected is outside the state in which the parties have their places of business; or
(c) The parties have expressly agreed that the subject-matter of the arbitration agreement relates to more than one country.
Section 3 of the Singapore IAA provides that the UNCITRAL Model Law on International Commercial Arbitration (“Model Law”)adopted by the United Nations Commission on International Trade Law on 21st June 1985 has the force of law in Singapore.

(2) Institutional Arbitration versus Ad Hoc Arbitration

International arbitration proceedings in Singapore may be administered and supervised by an institution or conducted on an ad hoc basis. Although ad hoc arbitrations are often cheaper and faster, there are many advantages to having an arbitral institution administer and supervise the arbitration process. For instance, the institution may prescribe an established set of arbitration rules for the parties to abide by, offer administrative assistance to the parties and give them easier access to a panel of reputable, accredited arbitrators . The selection of arbitrators is discussed in a later part of this article.

Institutional arbitration rules that are often used in Singapore include the Rules of Arbitration of the International Chamber of Commerce (“ICC Rules”), the London Court of International Arbitration Rules (“LCIA Rules”) as well as the Singapore International Arbitration Centre Rules (“SIAC Rules”). The parties to an arbitration may also choose independent, stand-alone arbitration rules formulated by institutions which do not administer or supervise arbitrations. These rules include the UNCITRAL Arbitration Rules and the Singapore Institute of

Architects Arbitration Rules (frequently adopted in domestic construction disputes).
In contrast with the lexarbitri, arbitration rules provide the procedural framework for the arbitration proceedings. Put differently, arbitration rules serve as a guide on the manner in which the administration and adjudication of the dispute is to be carried out. They are therefore analogous to the Rules of Court applicable in court proceedings.

(3) Governing Law of the Arbitration Agreement

The governing law of an arbitration agreement is determined in accordance with a three-step test: (a) the parties’ express choice; (b) in the absence of an express choice, the implied choice of the parties as gleaned from their intentions at the time of contracting; or (c) in the absence of any express or implied choice, the system of law with which the arbitration agreement has the closest and most real connection.

In the absence of an express choice, how should the implied choice of the parties as to the governing law of the arbitration agreement be determined? The position in Singapore is that if there is an absence of any indication to the contrary and where the arbitration is part of the main contract, the parties are assumed to have intended the whole of their relationship to be governed by the same system of law. The natural inference is that the proper law of the main contract forming the subject matter of the dispute should also govern the arbitration agreement . However, where the arbitration agreement is free-standing, in the sense that it was not intended to be a term of any other contract, then in the absence of any express choice of law, the law of the seat would most likely be the governing law of the arbitration agreement .

Although disputes over the governing law of the arbitration agreement are rare, it is advisable that parties entering into a transaction make it very clear in their contract what the governing law of the arbitration agreement is; this is especially so when the lexarbitri is not the same as the governing law of the transaction.

(4) Governing Law of the Contract

The approach of the Singapore courts in determining the governing or “proper” law of the contract is set out in Overseas Union Insurance Ltd v Turegum Insurance Co [2001] 2 SLR(R) 285 (“Teregum Insurance”) and comprises three stages not unlike those applied in the process of determining the governing law of the arbitration agreement:
(a) Examine the contract itself to determine whether it states expressly what the governing law
should be.
(b) In the absence of an express provision, see whether the intention of the parties as to the
governing law can be inferred from the circumstances.
(c) If neither of the above can be done, then determine with which system of law the contract has
it most close and real connection .

With reference to the second stage, the following are among the relevant factors for consideration: if the contracting parties agree that the courts of a given county shall have jurisdiction in any matter arising out of a contract, if they agree that the arbitration shall take place in a certain country, the language or terminology used in the contract, the form of the documents used in the transaction, a connection with a preceding transaction, the currency of the contract or the currency of payment, the places of residence or business of the parties, and the commercial purpose of the transaction .

InTeregum Insurance the Judith Prakash J clarified there is no strict necessity for there to be proof that the second stage could not apply before the court can move on to the third stage, because the tests of inferred intention and close connection often merge into each other and because before the objection close connection test became fully established, the test of inferred intention was an objective test designed not to elicit actual intention but to impute an intention which had not been formed.

(5) Law Governing the Recognition and Enforcement of Arbitral Awards

A distinction has to be made between arbitral awards made pursuant to an arbitral award made pursuant to an arbitration seated in Singapore and an arbitral award made pursuant to a foreign arbitration. The former is recognised and enforced in accordance with the Singapore AA or Part II of the Singapore IAA, both of which have similar provisions for recognition and enforcement of such an award. The latter is recognised and enforced in accordance with Part III of the Singapore IAA, which gives effect to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”), of which India is also a contracting state. The topic of recognition and enforcement of arbitral awards is discussed in greater detail below.

India

In the Indian legal system in an arbitration containing a foreign element, there are three different systems of law which govern the arbitration :-
1. The law governing the substantive law of the contract which is the law governing substantive issues in dispute in the contract. Also referred to as “substantive law”, “applicable law”, or “proper law of the contract”.
2. The law governing the existence and proceedings of the arbitral tribunal , which is the law governing the conduct of the arbitration proceedings. It is also referred to as the “curial law” or the “lexarbitri”. This is the law which is derived from the seat of arbitration.
3. The law governing the recognition and enforcement of the award is the law which governs the enforcement, as well as filing or setting aside of the award and is also the law which governs the arbitrability of the dispute.
Furthermore, in absence of any other stipulation in the contract, proper law is the law applicable to the arbitral tribunal itself . Also the lexarbitri and the law governing the recognition and enforcement of the award are one and the same in absence of an intention/stipulation to the contrary . The place of the arbitration generally specified in a contract determines the seat of arbitration unless contrary intention is apparent from the contract.
In the Indian legal system, an International Commercial Arbitration is defined as an arbitration arising from a legal relationship which must be considered commercial, where either of the parties is a foreign national or resident or is a foreign body corporate or is a company, association or body of individuals whose central management or control is exercise in some other country, or a government of a foreign country .
The Arbitration and Conciliation Amendment Act, 2015 recognizes companies controlled byforeign hands as a foreign body corporate, the Supreme Court has excluded its application to companies registered in India and having Indian nationality. In case a corporation has dual nationality, one based on foreign control and other based on registration in India, such corporation would not be regarded as a foreign corporation.
An International Commercial Arbitration may either be seated in India, or be seated in a foreign country, and this article focuses on International Commercial Arbitrations seated only in Singapore The implication of Singapore seat is that Part I of the Arbitration and Conciliation Act, 1996 (the Indian Act), which is the curial law in India, is excluded for such arbitrations, barring certain exceptions discussed later.

INTERIM RELIEF FROM COURT

The mode of obtaining Interim Reliefs would vary depending on the seat of arbitration, as already explained above. While drafting of contracts, the parties must be extremely careful while choosing the seat of arbitration and choosing the law to be made applicable to said arbitration between them. The SIAC rules also provide that it shall be open to parties to seek interim relief from judicial authorities prior to constitution of the tribunal itself. In exceptional circumstances, parties can approach court, even after the constitution of the tribunal.

Singapore

Under Section 12 of the Singapore IAA, an arbitral tribunal have powers to make orders or give directions to any party in respect of interim measures. The arbitral tribunal can, inter alia, direct one party to give the other security for costs, give directions for the discovery of documents and interrogatories and grant injunctions including those that would ensure that any award which may be made in the arbitral proceedings is not rendered ineffectual by the dissipation of assets by a party.
However, sometimes it is necessary for the court to intervene and assist when the parties require interim relief that goes beyond the scope of the arbitral tribunal’s powers. Such situations arise where the interim relief is needed before the tribunal has been constituted, or where the interim relief sought must be applied for ex parte and on an urgent basis. Section 12A of the Singapore IAA empowers the court to make orders for:
(a) Giving of evidence by affidavit;
(b) The preservation, interim custody or sale of any property which is or forms part of the subject-matter of the dispute;
(c) Samples to be taken from, or any observation to be made of or experiment conducted upon, any property which is or forms part of the subject-matter of the dispute;
(d) The preservation and interim custody of any evidence for the purposes of the proceedings;
(e) Securing the amount in dispute;
(f) Ensuring that any award which may be made in the arbitral proceedings is not rendered ineffectual by the dissipation of assets by a party; and
(g) An interim injunction or any other interim measure.
These above remedies are available regardless of where the arbitration is seated. However, the court powers are not unlimited. These restrictions are set out in sub-sections (3) to (7) of Section 12A of the Singapore IAA, and are summarized briefly below:
(a) If the fact that the place of arbitration is outside Singapore or likely to be outside Singapore
when it is designated or determined makes it inappropriate to make such order.
(b) If the case is one of urgency, the court may make orders under Section 12A(2) of the Singapore IAA as it thinks necessary for the purpose of preserving evidence or assets.
(c) If the case is not one of urgency, the court may make orders under Section 12A(2) of the Singapore IAA only with the permission of the arbitral tribunal or the agreement in writing of the other parties to the arbitration proceedings.
(d) The court may make orders under Section 12A(2) of the Singapore IAA only if or to the extent that the arbitral tribunal has no power or is unable for the time being to act effectively.
(e) Such orders made by the court will cease to have effect if the arbitral tribunal makes an order which expressly relates to the whole or part of the order under Section 12A(2) of the Singapore IAA.
If the parties to an arbitration have opted for the application of the SIAC Rules, these rules empower the SIAC to appoint an emergency arbitrator for the purposes of adjudicating an application for emergency relief before the arbitral tribunal is constituted. The remedy thereby allows parties to dispense with the need to go to court for interim relief . The availability of this remedy, however, does not appear to preclude the parties from seeking relief in court, it is expressly provided in the SIAC Rules that a request for interim relief made by a party to a judicial authority prior to the constitution of the Tribunal, or in exceptional circumstances thereafter, is not incompatible with the SIAC Rules.

India

In India, Section 9 of the Indian Act governs the power of the courts to grant interim relief. It is based on Article 9 of the UNCITRAL Model Law . Under Section 9 of the Indian Act, a party is permitted to apply to Court for certain interim measures, before, during or after making of the award by thae Tribunal. Although Section 9 is a part of Part I of the Indian Act, owing to a recent amendment , the position has been substantially changed. Before the amendment of 2015, the law with respect to seeking interim relief from court was governed by a judgment of the Supreme Court of India. The judgment clearly laid down that Part I of the Arbitration and Conciliation Act (of which Section 9 is a part) would be inapplicable to any foreign seated arbitration. However, the 2015 amendment, in effect, nullifies the law laid down in BALCO to a limited extent and holds that even in an International Commercial Arbitration having a foreign seat, a party can approach Indian courts under Section 9 and get appropriate relief.
Therefore a Section 9 remedy would be available for a Singapore seated arbitration, only if the arbitration has been commenced after the coming into effect of the amending act .

The nature of reliefs sought under Section 9 are generally for protection, preservation or interim custody of goods, assets, properties, securing the amounts in dispute, appointment of interim receivers etc.
This provision gives a huge relief to parties in cases where assets of parties to the Singapore seated arbitration are located in India and there is a fear of disposal. Similarly, the Appeal against an Order passed in a Petition filed under Section 9 would also lie to Indian courts only as per the amendment.

APPLICATION FOR APPOINTMENT OF ARBITRATORS

The procedure for appointment of arbitrators in both territories is once again dependent upon the seat of arbitration. A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.As far as the SIAC rules are concerned, the appointment of the arbitrators as well as the tribunal is done by the parties depending on the procedure agreed between them. Further on failure of the parties SIAC itself can also constitute the tribunal having due regard to any qualifications provided by the parties’ agreement itself.

Singapore

(1) Default Appointments

Sections 9 and 9A of the Singapore IAA set out the basic guidelines for the appointment of arbitrators in international arbitrators in the absence of an agreement between parties on this matter. While parties are a liberty to determine the number of arbitrators hearing their dispute (usually one or three arbitrators), where there is no such determination or agreement, Section 9 provides that there shall be a single arbitrator. The parties will then have to jointly nominate an arbitrator, but if they are unable to agree, one of the parties will have to make an application for the appointment of the arbitrator by the President of the SIAC.
Where there are three arbitrators, Section 9A of the Singapore IAA provides that each party shall appoint one arbitrator, and the parties shall by agreement appoint the third arbitrator. Where the parties fail to agree on the appointment of the third arbitrator within 30 days of the receipt of the first request by either party to do so, the parties may apply to the President of the SIAC to appoint the third arbitrator.

(2) Appointments under the SIAC Rules

If the parties to an arbitration have elected for the arbitration to be governed by the SIAC Rules, then the mechanisms set out at Rules 9 to 11 of the SIAC Rules (2016) for the appointment of one or three arbitrators will be applied instead.

One advantage to adopting the SIAC Rules is that they provide for multi-party appointment of arbitrators (i.e. where there are multiple claimants and/or respondents). In contrast, the Singapore IAA is silent on this matter.

Rule 12 of the SIAC Rules (2016) provide that where there are more than two parties to the arbitration, and a sole arbitrator is to be appointed, the parties may agree to jointly nominate the sole arbitrator. In the absence of such joint nomination, the President of the SIAC shall appoint the sole arbitrator. Where there are more than two parties to the arbitration and three arbitrators are to be appointed, the claimants shall jointly nominate on arbitrator and the respondents shall jointly nominate one arbitrator. If the parties cannot jointly nominate the third, then the President of the SIAC will appoint the remaining arbitrator, who will also be the presiding arbitrator. If the claimants and the respondents are not able to agree among themselves on their joint nominations, the President of the SIAC will appoint all three arbitrators and designate on of them to be the presiding arbitrator.

India

The appointment of Arbitrators in India is governed by Section 11 of the Indian Act, Article 11 being the concomitant provision of the UNCITRAL Model Law. As far appointment of Arbitrators in a Singapore seated Arbitration, Part I of the Indian Act has no application and there is no exception carved out in the act itself. In these cases, it is the domestic law of Singapore which would be relevant, as explained above.

The only relief on this front which a party can obtain in the case of a Singaporeseated arbitration is, that in case an Indian court is seized of a matter in respect of which an arbitration agreement exists, it can refer the parties to arbitration .

APPLICATION FOR CHALLENGING/ENFORCEMENT OF THE AWARD

The law governing the enforcement/challenge to the award is extremely relevant, and especially so, in the case of an International Commercial Arbitration. This is because an award remains a mere dead letter until it can be enforced in the relevant country and compliance can be ensured.

Singapore

(1) Domestic International Awards

As discussed above, the recognition and enforcement of Singapore seated domestic and international arbitrations are governed by the Singapore AA and Part II of the Singapore IAA respectively.

An application under Section 19 of the Singapore IAA to enforce a domestic international award (the nomenclature for an award given in an international arbitration seated in Singapore) can be made pursuant to Order 69A rule 6 of the Singapore Rules of Court. To start the enforcement process, the applicant has to make an ex parte application for leave to enforce the award. Once the order for leave to enforce the award is granted, the applicant must serve the order on the respondent by delivering it to the respondent personally, leaving it at the respondent’s usual or last known place of residence or business or in such manner as the court may direct.

The respondent may apply to have the order set aside within a limit period after it has been served; during that time, the applicant will not be able to enforce the award until the expiry of the time given, or the disposal of the application to set aside the order (if any) . A party may therefore challenge an arbitral award in this manner, or take a more proactive approach by making an application to set aside the arbitral award without waiting for the other party to attempt to enforce it.

What are the bases on which a party may challenge an arbitral award? Although the Singapore courts are generally reluctant to interfere with arbitral awards, this policy of minimal curial intervention remains subject to the parties’ statutory rights to recourse against arbitral awards . The grounds on which a party may set aside a domestic international arbitral award are enumerated in Section 24 of the Singapore IAA and Article 34 of the Model Law. Briefly, the statutory grounds for the setting aside or challenging a domestic international award are as follows:
(a) If the making of the award was induced or affected by fraud or corruption;

(b) If a breach of the rule of natural justice occurred in connection with the making of the award by which the rights of any party have been prejudiced;

(c) If a party to the arbitration agreement was under some incapacity, or the arbitration agreement is not valid under the law to which the parties subjected it;

(d) If the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case;

(e) If the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration or contains decisions on matters beyond the scope of the submission to arbitration, provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside;

(f) If the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the seat of the arbitration;

(g) If the award has not yet become binding on the parties or has been set aside or suspended by a court of the seat of the arbitration.

(h) If the subject-matter of the dispute is not capable of settlement by arbitration under the laws of Singapore; or

(i) The award is in conflict with the public policy of Singapore.

(2) Foreign Awards

The New York Convention has been implemented in Singapore by virtue of Part III of the Singapore IAA. Section 29 of the Singapore IAA provides that a foreign award may be enforced in a court either by action or in the same manner as an award of an arbitrator made in Singapore enforceable under Section 19. Note that Part III of the Singapore IAA applies only to foreign awards made in Convention countries. However, this restriction is unlikely to present as a barrier to the enforcement of international awards as the number of countries that are parties to the New York Convention is growing every year. As at November 2017, there are 157 Convention states.

India

In an arbitration seated in a foreign territory, Part II of the Indian Act is applicable. Part II of the Act deals with enforcement of certain foreign awards in India. These awards are either awards passed in New York Convention Territories, or Geneva Convention Territories, Singapore being a New York Convention Country.

Section 44 of the Indian Act provides that in order for a foreign award to be recognized as such under Part II, Chapter I (New York Convention Awards) certain conditions need to be fulfilled, which are as under:-
i. The territory should be signatory to the New York Convention
ii. The Indian Central Government should have notified in the Official Gazette that it has reciprocal provisions with such a territory.
Since, in the case of Singapore, both the above conditions are met, the awards are recognized as Foreign Awards in India and the enforcement mechanism provided under Part II of the Indian Act needs to be followed.
Section 47 of the Indian Act provides that a party while applying for the enforcement of a foreign award, apart from the procedural aspects of certification and authenticity, also has to produce such evidence as is necessary to prove that the award fulfils the conditions as above stated.
Furthermore, Section 48 of the Indian Act provide the grounds to challenge the enforcement of a foreign award which include party incapacity, invalidity of agreement under the law of the seat, absence of proper notice to the party regarding appointment, or inability of a party to represent his case, non arbitrability of the dispute, matters beyond scope of arbitration, wrong composition of tribunal, or that the award has not become binding as per the law of the seat, or is against the public policy of India.
Once the award has survived the challenge and the Court is satisfied that the foreign award is enforceable under this Chapter, the award shall be deemed to be a decree of that Court . After this stage it can be executed under Order XXI of the Code of Civil Procedure, 1908 in the same manner as a decree from an Indian court.

APPEALS ARISING FROM ORDERS OF INTERIM RELIEFS OR ORDERS OF ENFORCEMENT OF FOREIGN AWARDS

Singapore

(1) Appeals arising from Interim Orders made in Arbitral Proceedings

Section 24 of the Singapore IAA permits the court to set aside awards made by arbitral tribunals. However, it has been held that the definition of “awards” excludes orders or directions made under Section 12 of the Singapore IAA, that is, order or directions made by an arbitral tribunal and that deal with procedural matters protective measures.
The rationale for the differential treatment of final arbitration awards and interim orders made by arbitral tribunals was summarized in the local decision of PT Pukuafu Indah and others v Newmont Indonesia Ltd and another [2012] 4 SLR 1157; [2012] SGHC 187, where Lee Seiu Kin J observed that procedural issues fell directly within the province of arbitral tribunals.Arbitration, particularly international arbitration, was conceptualised as a form of dispute settlement that is not bound by the parochial application of the procedural rules of the arbitral seat, albeit subject to a minimal level of procedural integrity. This limited control by the court should therefore only be exercised at the stage where a party seeks to set aside a final award, and not with respect to each and every order made by the tribunal .
In contrast with final awards, interim orders may require a more nuanced balance to be struck between the efficiency of arbitration and safeguards to ensure due process. This is because orders granting interim relief (such as injunctions) may have the effect of prejudging the substantive rights of one party and are dependent on the court for coercive effect. The Singapore Parliament has chosen to strike this balance by adopting the line of minimal curial intervention to limit challenges only to awards that decided the substantive merits of the case .
(2) Appeals arising from Interim Orders made by the Court and Appeals against Decisions concerning the Enforcement of Foreign Awards
Appeals arising from interim and enforcement orders made by the court under Section 12A and Section 29 respectively of the Singapore IAA may be made in accordance with Order 56 of the Singapore Rules of Court.

India

It follows from the discussion above that an interim relief is given under Section 9, then automatically an appeal against such Orders would lie to Indian Courts under Part I, Section 37 of the Indian Act. Similarly, incase an order of an Indian court in respect of a challenge to an award passed in Singapore under Part II needs to be appealed, Section 50 of Act would become applicable and again the Appeal would lie in India.

However, in a scenario, where Indian courts have not been approached forexecution/enforcement/challenge from the award passed in Singapore, then Indian Courts would not have any role to play in the appeal process either.

Conclusion

To conclude it may be said, that the courts in both countries would play different roles in International Commercial Arbitrations seated in the Singapore. Firstly it needs to be determined which is the seat of arbitration and which is the curial law which is attracted. Thereafter for different remedies, different courts can be approached.
Singapore has taken steps to ensure practical support for international arbitrations conducted in the country, with the result that it is regarded, both legally and commercially, as a preferred forum for resolving trade disputes. Singapore is widely recognised by parties trading in the region as a place for conducting arbitrations that is both neutral and geographically convenient in relation to the parties to the dispute.Moreover, the 2015 amendment has given more leeway to Indian courts as far as Interim reliefs are concerned, thus providing additional protection to Singapore based parties vis-s-a-vis Indian players. In view of the above, India is fast becoming an arbitration and foreign investor friendly country.

Firms Profile

Singhania & Partners LLP

A sharp rise in international business transactions, Global bidding for contracts and Foreign direct investment many Companies have to deal with International Arbitrations. Parties that are signatories to international contracts often want to avoid using the home courts of one of the parties in order to ensure neutrality as well as unbiased decisions thus avoiding the problem faced due to unfamiliar or unpredictable local court procedures. Singhania and Partners LLP has strong experience in handling International arbitrations keeping the seat in India and outside India like Singapore, U.K, China, Switzerland, Canada and many more. The Firm also provides consultation at the time of negotiation of contracts to incorporate effective arbitration clauses. We conduct both institutional and ad hoc arbitrations. The firm is a member of TerraLex which is a premier network of law firms offices worldwide. The membership of TerraLex provides the firm with trusted advisors in more than 153 jurisdictions in cross-border matters.

Kelvin Chia Partnership

We have a team of experienced and seasoned arbitrators who have engaged in domestic and international arbitrations. Notably, we were involved in arbitration proceedings in London over a manufacturing and trade mark licensing arrangement, and have acted for a leading Chinese tunnelling, infrastructure and engineering state enterprise in an arbitration against a Swedish multi-national transportation and infrastructure company. We also represented a large European multinational telecommunications company in enforcing a multi-million dollar foreign arbitration award in Singapore.
Our lawyers are attuned to the needs of our clients, and are committed to the amicable and hassle-free settlement of disputes, management of conflict or negotiation of contracts in the mediation process.

INTERNATIONAL COMMERCIAL ARBITRATIONS BETWEEN CHINA AND INDIA

INTERNATIONAL COMMERCIAL ARBITRATIONS BETWEEN CHINA AND INDIA

International Commercial Arbitrations between China and India

(This article is co-authored by International Commercial Arbitration lawyers of Singhania & Partners LLP, India and ZhongLun Law Firm, China)


28/2/2018  

Meet the authors

The present article focuses on International Commercial Arbitrations between Indian and overseas parties, where the seat of arbitration is in China. It further discusses the issues faced by foreign companies trying to obtain reliefs and remedies in India and China as well as with the enforcement mechanism for China Seated arbitrations in both countries.

Arbitration owes its popularity amongst investors primarily because it holds four distinct advantages over other dispute redressal mechanisms.Arbitration offers parties a great deal of confidentiality and privacy.Since arbitrations are more or less about party autonomy, parties are free to agree to the procedures concerning arbitrations, including the seat of arbitration. Arbitrations can be both institutional as well as ad-hoc arbitrations. Various institutions such as London Court of International Arbitration (LCIA), the International Chamber of Commerce (ICC), Singapore International Arbitration Centre (SIAC), China International Economic and Trade Arbitration Commission (CIETAC) etc. also administer arbitrations, and carry their own rules of procedure for arbitration. However, this article deals with the basic law governing arbitrations in China as well as India in respect of China seated arbitrations.
For ready reference we are reproducing a model clause below, as per which the seat of arbitration would be

China and the substantive law is Indian:-
“Any dispute arising from or in connection with this Contract shall be submitted to China International Economic and Trade Arbitration Commission for arbitration which shall be conducted in accordance with the Commission’s arbitration rules in effect at the time of applying for arbitration. The arbitral award is final and binding upon both parties.
The seat of arbitration shall be Beijing, China
The language to be used in the arbitral proceedings shall be English
The governing law of the contract would be the substantive law of India”

LEGAL SYSTEMS GOVERNING AN ARBITRATION

The seat of arbitration carries with it, implications regarding the law which is attracted to the proceedings of the arbitration.This is why it is important to understand how both jurisdictions deal with different systems of law applicable to an agreement.

China
Under the Chinese legal system for a foreign-related arbitration seated in China, rules of the applicable law can be perceived from the four main aspects set out as below:

1. For validity of the arbitration agreement, it is explicitly addressed by the Judicial Interpretations on Chinese Arbitration Law of the Supreme Court of China that the applicable law should be the law selected by the parties by agreement, otherwise the law of seat of arbitration shall apply.
2. For substantive issues, the Law on Application of Law in Foreign-related Civil Relations allows the parties to select by agreement the applicable law, either domestic law or foreign law, to govern the contract, provided that such selection does not violate any Chinese mandatory provisions or the social and public interests of China. The law most closely associated with the contract shall apply by default of an agreed selection.
3. For procedural issues, it is generally recognized that the Chinese Civil Procedural Law , the Chinese Arbitration Law and related judicial interpretations, as well as the arbitration rules of the selected arbitration institutions will be applied in China seated arbitrations. However, instead of a direct application of rules of the selected arbitration institutions, the currently effective arbitration rules of CIETAC (CIETAC Rules) gives an implication that arbitration rules selected by the parties by agreement shall prevail unless the agreement violates mandatory procedural provisions.
4. For recognition and enforcement of the awards made in China, the governing laws are the Chinese Civil Procedural Law, the Chinese Arbitration Law and related judicial interpretations. The Number 5 Circular of the Supreme Court of China in 1987 (the Circular) is to be applied specifically for the recognition and enforcement of foreign arbitral awards. Application of the Circular will be further discussed in this article.

India
In the Indian legal system in an arbitration containing a foreign element, there are three different systems of law which govern the arbitration :
1. The law governing the substantive law of the contract which is the law governing substantive issues in dispute in the contract. Also referred to as “substantive law”, “applicable law”, or “proper law of the contract”.
2. The law governing the existence and proceedings of the arbitral tribunal , which is the law governing the conduct of the arbitration proceedings. It is also referred to as the “curial law” or the “lexarbitri”. This is the law which is derived from the seat of arbitration.
3. The law governing the recognition and enforcement of the award is the law which governs the enforcement, as well as filing or setting aside of the award and is also the law which governs the arbitrability of the dispute.
Furthermore, in absence of any other stipulation in the contract, proper law is the law applicable to the arbitral tribunal itself . Also the lexarbitri and the law governing the recognition and enforcement of the award are one and the same in absence of an intention/stipulation to the contrary . The place of the arbitration generally specified in a contract determines the seat of arbitration unless contrary intention is apparent from the contract.
In the Indian legal system, an International Commercial Arbitration is defined as an arbitration arising from a legal relationship which must be considered commercial, where either of the parties is a foreign national or resident or is a foreign body corporate or is a company, association or body of individuals whose central management or control is exercise in some other country, or a government of a foreign country .
An International Commercial Arbitration may either be seated in India, or be seated in a foreign country, and this article focuses on International Commercial Arbitrations seated only in China. The implication of the Chinese seat is that Part I of the Arbitration and Conciliation Act, 1996 (the Indian Act), which is the curial law in India, is excluded for such arbitrations, barring certain exceptions discussed later.

INTERIM RELIEF FROM THE COURT

The mode of obtaining Interim Reliefs would vary depending on the seat of arbitration, as already explained above.The nature of interim relief sought by the parties may vary based on the facts and circumstances of the dispute. In certain situations the effective provision of interim reliefs may involve directions to third parties also.

China
It is generally recognized by the Chinese law that the parties to the arbitration may apply for preservation of property or evidence as interim remedies before or during the arbitration. The CIETAC Rules provide a new mechanism for the interim reliefs under which the parties, in addition to the right to apply for the aforementioned preservations, may also apply for emergency relief pursuant to the CIETAC Emergency Arbitrator Procedures.

Article 81 and Article 101 of the Chinese Civil Procedural Law lay down the provisions on the pre-arbitration preservation of property/evidence. Such preservation is to be applied by the interested party directly with the court only if the legitimate right of the interested party might be irreparably damaged, or the evidence might be destroyed or difficult to obtain later on due to an urgent situation. Specific rules on the pre-arbitration preservation of property include a compulsory security for the preservation to be provided by the applicant, and a strict timeline of 30 days to formally file the arbitration application after enforcing the preservation.

Article 68 of the Chinese Arbitration Law and Article 272 of the Chinese Civil Procedure Law respectively prescribes on the preservation during a foreign-relate arbitration. Unlike the pre-arbitration preservation proceedings, both provisions require the application to be filed with the foreign-related arbitration institution first and forwarded to the court by the arbitration institution afterwards.

India
In India, Section 9 of the Indian Act governs the power of the courts to grant interim relief. It is based on Article 9 of the UNCITRAL Model Law . Under Section 9 of the Indian Act, a party is permitted to apply to Court for certain interim measures, before, during or after making of the award by the Tribunal. Although Section 9 is a part of Part I of the Indian Act, owing to a recent amendment , the position has been substantially changed. Before the amendment of 2015, the law with respect to seeking interim relief from court was governed by a judgment of the Supreme Court of India. The judgment clearly laid down that Part I of the Arbitration and Conciliation Act (of which Section 9 is a part) would be inapplicable to any foreign seated arbitration. However, the 2015 amendment, in effect, nullifies the law laid down in BALCO to a limited extent and holds that even in an International Commercial Arbitration having a foreign seat, a party can approach Indian courts under Section 9 and get appropriate relief. The modification made by the amendment in case of Foreign Seated Arbitrations is a welcome change. However, from the scheme of the Act it is clear that Sections 9, 27 and 37(1) (a) and 37 (3) of the Act would apply only to arbitrations having seat in such countries with which India has reciprocal arrangements in terms of the Act.
Therefore a Section 9 remedy would be available for a Chinese seated arbitration, only if the arbitration has been commenced after the coming into effect of the amending act .

The nature of reliefs sought under Section 9 are generally for protection, preservation or interim custody of goods, assets, properties, securing the amounts in dispute, appointment of interim receivers etc.
This provision gives a huge relief to parties in cases where assets of parties to the Chinese seated arbitration are located in India and there is a fear of disposal. Similarly, the Appeal against an Order passed in a Petition filed under Section 9 would also lie to Indian courts only as per the amendment .

APPLICATION FOR APPOINTMENT OF ARBITRATORS

The procedure for appointment of arbitrators in both territories is once again dependent upon the seat of arbitration. A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.

China
Section 2 “Composition of the Arbitral Tribunal” of the Chinese Arbitration Law sets forth the general provisions on appointment of arbitrators. Each party can select or authorize the chairman of the arbitration commission to appoint an arbitrator, whereas the third arbitrator, as the presiding arbitrator of an arbitral tribunal composed of three members, or the arbitrator of a sole-arbitrator tribunal, is to be jointly selected by the parties or appointed by the chairman of the arbitration commission jointly authorized by the parties.
a. A more specific appointment process is regulated by the rules of the selected arbitration institution. The CIETAC Rules require the arbitrators to be appointed from the Panel of Arbitrators provided by CIETAC, and certain factors, e.g. the applicable law, the seat of arbitration, the language of arbitration, the nationalities of the parties shall also be taken into consideration for the appointment.

India
The appointment of Arbitrators in India is governed by Section 11 of the Indian Act, Article 11 being the concomitant provision of the UNCITRAL Model Law. As far appointment of Arbitrators in a Chinese seated Arbitration is concerned, Part I of the Indian Act has no application and there is no exception carved out in the act itself. In these cases, it is the domestic law of China which would be relevant, as explained above.

The only relief on this front which a party can obtain in the case of a Chinese seated arbitration is, that incase an Indian court is seized of a matter in respect of which an arbitration agreement exists, it can refer the parties to arbitration .

APPLICATION FOR CHALLENGING/ENFORCEMENT OF THE AWARD

The law governing the enforcement/challenge to the award is extremely relevant, and especially so, in the case of an International Commercial Arbitration. This is because an award remains a mere dead letter until it can be enforced in the relevant country and compliance can be ensured.

China
The enforcement/challenge to the award of foreign-related arbitration made by a Chinese arbitration institution is governed by the Chinese Arbitration Law, the Chinese Civil Procedural Law and the respective judicial interpretations. The Circular is applied, upon China’s reservation statement of the New York Convention , in recognition and enforcement of awards made in territory of another state, or awards not considered as domestic awards in China.

According to Article 70, Article 71 of the Chinese Arbitration Law and related provisions of the Chinese Civil Procedure Law, the award of a foreign-related arbitration made by a Chinese arbitration institution can be applied with the Chinese court for enforcement once the award comes into effect. Challenges to the award can be filed by either party within a statutory period. More specifically, the court can rule to cancel the award or not enforce the award upon the request of the entitled party, provided that the award is proved to meet one of the following circumstances.

1. No written arbitration clause is included in the disputed contract or no written arbitration agreement has been reached subsequently.
2. The respondent was not served with the notice of appointing the arbitrator or attending the oral hearings, or was unable to give statement due to reasons other than the respondent’s own fault.
3. Formation of the arbitral tribunal or the arbitration proceedings violated the arbitration rules;
4. The subject matter of the arbitration exceeded the scope of the arbitration agreement or the arbitral authority of the arbitration institution; or
5. The court determines that execution of the award will violate the social and public interest.
Another type of arbitral award is the award of a China seated arbitration made by a foreign arbitration institution. The Chinese law has no explicit provisions on the recognition and enforcement of this type of award, but in certain cases where ICC awards made in China were reviewed by the Chinese courts for recognition and enforcement, such awards were identified as “awards not considered as domestic awards” and reviewed through application of the New York Convention .

India
In an arbitration seated in a foreign territory, Part II of the Indian Act is applicable. Part II of the Act deals with enforcement of certain foreign awards in India. These awards are either awards passed in New York Convention Territories, or Geneva Convention Territories, China being a New York Convention Country.In 2012, the government of India declared that the People’s Republic of China, including the Hong Kong Special Administrative Region and the Macau Special Administrative Region, is a territory to which the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) applied for the purpose of enforcement of foreign arbitral awards in India. The formal notification was published in the official Gazette of India.
Section 44 of the Indian Act provides that in order for a foreign award to be recognized as such under Part II, Chapter I (New York Convention Awards) certain conditions need to be fulfilled, which are as under:-
i. The territory should be signatory to the New York Convention
ii. The Indian Central Government should have notified in the Official Gazette that it has reciprocal provisions with such a territory.
Since, in the case of China, both the above conditions are met, the awards are directly recognizable in India and no separate mechanism needs to be followed.

Section 47 of the Indian Act provides that a party while applying for the enforcement of a foreign award, apart from the procedural aspects of certification and authenticity, has also to produce such evidence as is necessary to prove that the award fulfils the conditions as stated above.

Furthermore, Section 48 of the Indian Act provide the grounds to challenge the enforcement of a foreign award which include party incapacity, invalidity of agreement under the law of the seat, absence of proper notice to the party regarding appointment, or inability of a party to represent his case, non arbitrability of the dispute, matters beyond scope of arbitration, wrong composition of tribunal, or that the award has not become binding as per the law of the seat, or is against the public policy of India.

Once the award has survived the challenge and the Court is satisfied that the foreign award is enforceable under this Chapter, the award shall be deemed to be a decree of that Court . After this stage it can be executed under Order XXI of the Code of Civil Procedure, 1908 in the same manner as a decree from an Indian court.

APPEALS ARISING FROM ORDERS OF INTERIM RELIEFS OR ORDERS OF ENFORCEMENT OF FOREIGN AWARDS

China
In China, appeal to the order of interim reliefs given by a court is only allowed in the form of application with the court for a review in accordance with Article 108 of the Chinese Civil Procedure Law. Enforcement of the order will not be suspended during the court review period.

Appeal to the order on not enforcing an arbitral award is prohibited by Article 478 of the Judicial Interpretation of Chinese Civil Procedure Law . Instead, the parties may choose to re-enter into a written arbitration agreement and submit the dispute to arbitration or bring a lawsuit to the competent court. In scenario of a foreign award, the order on denial of recognition and enforcement of the foreign award by the court should be subject to a mandatory double review by the Higher Court and the Supreme Court and the final order cannot be appealed neither.

India
It follows from the discussion above that an interim relief is given under Section 9, then automatically an appeal against such Orders would lie to Indian Courts under Part I, Section 37 of the Indian Act. Similarly, in case an order of an Indian court in respect of a challenge to an award passed in China under Part II needs to be appealed, Section 50 of Act would become applicable and again the Appeal would lie in India.
However, in a scenario, where Indian courts have not been approached for execution/enforcement/challenge from the award passed in China, then Indian Courts would not have any role to play in the appeal process either.

Conclusion

To conclude it may be said, that the courts in both countries would play different roles in International Commercial Arbitrations seated in China. Firstly it needs to be determined which is the seat of arbitration and which is the curial law which is attracted. Thereafter for different remedies, different courts can be approached.

Contracts relating to foreign investments in Mainland China usually provide that any dispute arising between the parties should be settled by friendly negotiation, failing which the dispute should be referred to arbitration. Foreign related arbitrations in China are mainly administered by China International Economic and Trade Arbitration Commission (CIETAC), although many other arbitration commissions may accept foreign related arbitration cases.Moreover, the 2015 amendment has given more leeway to Indian courts as far as Interim reliefs are concerned, thus providing additional protection to China based parties vis-s-a-vis Indian players. In view of the above, India is fast becoming an arbitration and foreign investor friendly country.

Firms Profile

Singhania & Partners LLP
A sharp rise in international business transactions, Global bidding for contracts and Foreign direct investment many Companies have to deal with International Arbitrations. Parties that are signatories to international contracts often want to avoid using the home courts of one of the parties in order to ensure neutrality as well as unbiased decisions thus avoiding the problem faced due to unfamiliar or unpredictable local court procedures. Singhania and Partners LLP has strong experience in handling International arbitrations keeping the seat in India and outside India like Singapore, U.K, China, Switzerland, Canada and many more. The Firm also provides consultation at the time of negotiation of contracts to incorporate effective arbitration clauses. We conduct both institutional and ad hoc arbitrations. The firm is a member of TerraLex which is a premier network of law firms offices worldwide. The membership of TerraLex provides the firm with trusted advisors in more than 153 jurisdictions in cross-border matters.

ZhongLun Law Firm
ZhongLun’s litigation and arbitration team boasts a wealth of experience in handling litigation, arbitration, enforcement and all kinds of emergencies in relation thereto, and is without a doubt a cut above other contenders in the industry.

ZhongLun is recognized as one of the firms appearing in the largest number of cases before the Supreme People’s Court of China. We also have extensive experience when it comes to arbitration cases before China International Economic and Trade Arbitration Commission (CIETAC), Hong Kong International Arbitration Centre (HKIAC), Singapore International Arbitration Centre (SIAC), Beijing Arbitration Commission, Shanghai Arbitration Commission and Shenzhen Arbitration Commission. In addition, more than ten of our partners serve as arbitrators for HKIAC, CIETAC, Beijing Arbitration Commission and other local arbitration commissions.

Our broad client base encompasses both domestic clientele and a great number of industrial heavyweights from abroad, whom are deeply impressed with and praise us for our excellent language abilities, communication skills, expertise, commitment and seamless cooperation.

INTERNATIONAL COMMERCIAL ARBITRATION FOR PARTIES IN INDIA AND UK

INTERNATIONAL COMMERCIAL ARBITRATION FOR PARTIES IN INDIA AND UK

International Commercial Arbitration for parties in India and UK

(This article is co-authored by International Commercial Arbitration lawyers of Singhania & Partners LLP, India and Reynolds Porter Chamberlain, UK)


28/2/2018  

Meet the authors

This article examines the core components of International Commercial Arbitrations between Indian and overseas parties, where the seat of arbitration is in London. It further discusses the issues faced by foreign companies trying to obtain relief and remedies in India and England, as well as addressing enforcement mechanisms.

For context, a clause providing for a London seat and an Indian-law governed arbitration might look as follows:

Any disputes arising out of or in connection with this contract, including any question regarding the existence, validity or termination, shall be referred to and finally resolved by arbitration to be conducted by a Sole Arbitrator under the LCIA Rules, which rules are deemed to be incorporated by reference into this clause.

The seat of arbitration shall be London

The language to be used in the arbitral proceedings shall be English

A growing number of international contracts provide for disputes to be referred to arbitration. In light of this trend, several countries (including India) have undertaken a rapid expansion and development of their arbitral law to make it more accessible and flexible for foreign investors. Since one of the purposes of arbitration is more or less to provide for greater party autonomy, parties are generally more free to agree the procedures governing their arbitrations, including the seat of that arbitration.The governing law of the contract would be the substantive law of India

Principally, arbitrations are either institutional (i.e. adhering to institutional rules), or ad-hoc (i.e. governed by the statutory regime of the arbitral seat).  Certain mandatory (statutory) rules still apply to an arbitration governed by institutional rules. Popular institutions that provide a procedure for international arbitration are the London Court of International Arbitration (LCIA), the International Chamber of Commerce (ICC), and the Singapore International Arbitration Centre (SIAC).


[1]
References to London-seated arbitrations throughout this article are a shorthand for England and Wales.  In the United Kingdom, there are two principal (and distinct) legal systems: England and Wales (which also applies in large part to Northern Ireland), and Scotland.  This article does not address questions of Scottish law.This article addresses the basic procedural framework in India and England.

PROCEDURAL LAW GOVERNING AN ARBITRATION

The seat of arbitration carries with it certain implications regarding the procedural law which governs the arbitration proceedings. It is therefore important to understand the procedural framework in both India and England.

London

Statute

Where the seat of arbitration is London, the Arbitration Act 1996 (The English Act) will apply certain rules to that arbitration. These are split into three main elements:

  1. The governing law of the dispute:
    • International parties to sophisticated commercial contracts typically choose the law that governs their dispute (which can be a different law to that of the seat). The English Act requires that the arbitral tribunal determine these disputes under the law chosen by the parties. If the parties have not chosen a governing law, a London-seated tribunal will apply conflicts of law rules to determine the governing law. It is therefore strongly advisable to provide for the governing law in the agreement.
    • The parties can also agree that the tribunal decides the dispute under ‘Lex Mercatoria‘ (a body of transnational trade and commercial principles) or ex aequo et bono(where the tribunal considers solely what would be a “fair and equitable” resolution). However, these two governing law choices are rare due to their inherent uncertainty, and are generally not recommended.
  1. The procedural law of the arbitration:
    • The English Act enables parties to determine the applicable procedural rules to govern the arbitration. This is often done by reference to the rules of an arbitral institution.
    • In the absence of agreement between the parties on the procedural rules, certain “default” rules will apply. In short, the tribunal: (i) shall act fairly and impartially, giving each party a reasonable opportunity of putting their case and dealing with that of his opponent; and (ii) shall adopt procedures suitable to the particular case, avoiding unnecessary delay and expense so as to provide a fair means to resolve the dispute.
  1. “Mandatory” rules: despite having the freedom to choose both the governing and procedural law applicable to the dispute, certain mandatory rules under the English Act will still apply to London-seated arbitrations (which is limited, England being an arbitration-friendly jurisdiction). These relate primarily to the powers of the English Courts to intervene in an arbitral dispute, the immunity of the arbitrator, and enforcement.

India

In the Indian legal system in an arbitration containing a foreign element, there are three different systems of law which govern the arbitration[1]:-

  1. The law governing the substantive law of the contract. This is also referred to as “substantive law”, “applicable law”, or “proper law of the contract”.
  2. The law governing the existence and proceedings of the arbitral tribunal, which is the law governing the conduct of the arbitration proceedings. It is also referred to as the “curial law” or the “lex arbitri”. This is the law which is derived from the seat of arbitration.
  3. The law governing the recognition and enforcement of the award is the law which governs the enforcement, as well as filing or setting aside of the award.

In the absence of any other stipulation in the contract, the proper law is the law that the arbitral tribunal itself will apply.  The same applies to the lex arbitri and the law governing recognition and enforcement, in absence of an intention/stipulation to the contrary. The seat of the arbitration specified in a contract generally determines the seat of arbitration, unless clear contrary intention is apparent from the contract.

In the Indian legal system, under the Arbitration and Conciliation Act 1996 (the Indian Act) an International Commercial Arbitration is defined as an arbitration arising from a legal relationship which must be considered commercial, where either of the parties is a foreign national or resident or is a foreign body corporate or is a company, association or body of individuals whose central management or control is exercise in some other country, or a government of a foreign country.

An International Commercial Arbitration may either be seated in India, or be seated in a foreign country. For London-seated arbitrations, the provisions of Part I of the Indian Act are excluded for such arbitrations, barring certain exceptions.

INTERIM RELIEF FROM THE COURT

In certain circumstances, in London-seated arbitrations interim relief is available from the English courts or the presiding institution.

London

In England, a court can only intervene in arbitration proceedings to the extent expressly permitted by the English Act.

The English Act sets out the English court’s powers that may be available in support of arbitration. Unless otherwise agreed by the parties (for example by choosing institutional framework), the court has the power to make the following orders:

  1. Taking evidence from witnesses
  2. Preserving evidence
  3. Relating to property which is the subject of the proceedings –
    • For the inspection, photographing, preservation, custody or detention of the property, or
    • Ordering that samples be taken from, or experiment conducted upon, the property;
  4. In relation to the sale of any goods the subject of the proceedings
  5. Granting an interim injunction or the appointment of a receiver

One of the most important powers of the Court is the granting of a freezing order in respect of assets, to avoid dissipation prior to the award being granted and as an aid to enforcement.

India

In India, the Indian Act governs the power of the courts to grant interim relief. It is based on Article 9 of the UNCITRAL Model Law[1]. Under Section 9 of the Indian Act, a party is permitted to apply to an Indian court for certain interim measures in support of an Indian (or, to a more limited extent, London-seated arbitration), before, during or after making of the award by a tribunal.  The law in this area has recently changed[2] to expand the scope of interim relief to foreign-seated arbitrations.  Under the terms of the amended Indian law, interim relief is only available if the arbitration has commenced after 23 October 2015.

The types of interim relief sought under Section 9 are similar to those in the English Arbitration Act, namely the protection, preservation or interim custody of goods, assets, properties, securing the amounts in dispute, and the appointment of interim receivers.

This is a huge step forward, and should give commercial parties more comfort, especially in cases where assets of parties to a London-seated arbitration are located in India and there is a fear of disposal.

APPLICATION FOR APPOINTMENT OF ARBITRATORS

The procedure for appointment of arbitrators in both territories is once again dependent upon the seat of arbitration.

London

The parties to an arbitration are free to agree on the procedure for appointing arbitrators. In the absence of such a choice, the English Act provides default appointment provisions as follows:

  1. The parties will jointly a sole arbitrator (if the parties wish to have a sole arbitrator)
  2. If the parties wish to have two arbitrators, each party will appoint one arbitrator
  3. If the parties wish to have three arbitrators:
    • Each party will appoint one arbitrator
    • The two appointed arbitrators will appoint a third arbitrator as the chairman of the tribunal

Unless the parties agree otherwise, if one party fails to appoint an arbitrator, the other party may give notice in writing to the other party to propose to appoint their arbitrator to act as sole arbitrator.

If the processes to appoint an arbitrator fail for any reason, the parties are free to agree what is to happen. In the absence of such agreement, any party to the arbitration agreement may apply to the English court for the following:

  1. Directions as to making any necessary appointments to the tribunal
  2. Directions that the tribunal must be constituted by the appointments that have already been made
  3. To revoke any appointments already made
  4. For the court to make any necessary appointments itself

By way of comment, the better course is to provide for the number of arbitrators, time frame and process for appointment. Delay may otherwise occur to the disadvantage of one or other of the parties.

India

The appointment of Arbitrators in India is governed by Section 11 of the Indian Act. As far appointment of arbitrators in a London-seated arbitration is concerned, English procedural law applies (as explained above).  There are only very limited exceptions to this rule under Indian law.

APPLICATION FOR ENFORCEMENT / CHALLENGE OF THE AWARD

The law governing the enforcement/challenge to the award is extremely relevant, and especially so in international commercial arbitration. This is because an award remains a mere “dead letter” until it can be enforced in the relevant country and compliance with its terms can be ensured.

London

England, along with another 156 countries, is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) (the New York Convention).  Enforcement of arbitral awards internationally under the New York Convention is said to be one of the significant advantages of international arbitration as a means of dispute resolution.

Section 66 of the Arbitration Act governs enforcement of arbitral awards. With the court’s permission, any award made by a tribunal pursuant to an arbitration agreement may be enforced in the same manner as a judgment or order of the English court. Where the court gives permission, judgment can be made in the terms of the arbitral award. Therefore, the party wishing to enforce an award must apply for permission. The court may refuse permission if the person against whom the award is sought to be enforced can show that the arbitral tribunal lacked “substantive jurisdiction” to make the award.

Under S.101 of the Arbitration Act, an award made by an arbitral tribunal within a New York Convention state (which includes India) shall be recognised as binding on the parties to the arbitration. A New York Convention award may, with the permission of the court, be enforced in the same manner as a judgment or order of the court to the same effect.

An arbitration award can be challenged in three ways:

  1. Under S.67 of the Arbitration Act, the “substantive jurisdiction” of the tribunal can be challenged. Under a S.67 application, a court may confirm the award, vary the award of set aside the award in whole or in part
  2. Under S.68 of the Arbitration Act, an award may be challenged on the ground of “serious irregularity affecting the tribunal”, the proceedings or the award. The court may send the award to the tribunal for reconsideration, set the award aside in whole or in part, or declare the award to be of no effect in whole or in part.
  3. Under S.69, a party to the arbitration may appeal on a question of law arising out of an award made in the proceedings. The agreement of all parties and permission of the court is needed to appeal under S.69. The court may confirm the award, vary the award, remit the award for reconsideration by the tribunal or set aside the award in whole or in part.

A party may lose its right to object before the tribunal or the court on objections if a party takes part, or continues to take part, in the arbitration without making such an objection. The party will not lose this right if they can show at the time of taking part, or continuing to take part, in the arbitration, they did not know and could not “with reasonable diligence” have discovered the grounds for the objection.

Institutional rules, such as the LCIA and ICC rules, preclude appeals except to a limited extent, and research suggests that challenges to awards are infrequently upheld.

India

In an arbitration seated in a foreign territory, Part II of the Indian Act is applicable. Part II of the Act deals with enforcement of certain foreign awards in India. These awards are either awards passed in New York Convention Territories, or Geneva Convention Territories, England being a New York Convention Country.

Section 44 of the Indian Act

provides that in order for a foreign award to be recognized as such under Part II, Chapter I (New York Convention Awards) certain conditions need to be fulfilled, which are as under:-

  1. The territory should be signatory to the New York Convention
  2. The Indian Central Government should have notified in the Official Gazette that it has reciprocal provisions with such a territory.

Since, in the case of England, both of these conditions are met, the awards are recognized as Foreign Awards in India and the enforcement mechanism provided under Part II of the Indian Act needs to be followed.

Section 47 of the Indian Act provides that a party must produce such evidence as is necessary to prove that the award satisfy the above conditions.

Furthermore, Section 48  of the Indian Act provide the grounds to challenge the enforcement of a foreign award which include party incapacity, invalidity of agreement under the law of the seat, absence of proper notice to the party regarding appointment, or inability of a party to represent his case, non-arbitrability of the dispute, matters beyond the scope of the arbitration, the wrong composition of tribunal, or that the award has not become binding as per the law of the seat, or is against Indian public policy.

Once the award has survived any challenge and the Indian court is satisfied that the foreign award is enforceable under this Chapter, the award shall be deemed to be a decree of that court and executed in the customary manner.

APPEALS ARISING FROM ORDERS OF INTERIM RELIEF OR ORDERS OF ENFORCEMENT OF FOREIGN AWARDS

London

As discussed above, Section 44 of the Arbitration Act provides that the courts have the same powers in relation to arbitration proceedings, for certain matters, as it has in legal proceedings.  An order for interim relief may only be appealed at first instance with the court’s permission.

There are several grounds to resist enforcement of a New York Convention award, namely that:

  1. a party to the arbitration agreement was (under the law applicable to him) under some incapacity;
  2. the agreement to arbitrate itself was not valid under the governing law;
  3. the party was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his case;
  4. the award deals with matters beyond the scope of the submission to arbitration;
  5. the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or the procedural law of the; or
  6. the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made.

The party seeking to resist enforcement of the award under these grounds bears the burden of proof before the court. However, successful challenges to New York Convention awards are rare, as the courts are generally supportive of the arbitration process.

India

If interim relief is granted by an Indian court under Section 9, there is an automatic right of appeal to the higher Indian court. This also applies to enforcement challenges.

However, where the Indian courts have not been approached for an execution, enforcement or other challenge arising from an English award, then the Indian courts will not play a role in the appeal process.

Conclusion

India is moving towards becoming an arbitration and foreign investor-friendly country. Indian and English courts play different roles in support of London-seated arbitrations, depending on the make-up of the arbitration procedure. The starting point is for the parties to choose the seat of arbitration, following which the established frameworks described above can be built. The critical point to remember is that a comprehensively drafted clause, taking into account the relevant advantages and disadvantages of respective legal systems, is paramount.

Firms Profile

Singhania & Partners LLP

A sharp rise in international business transactions, Global bidding for contracts and Foreign direct investment many Companies have to deal with International Arbitrations. Parties that are signatories to international contracts often want to avoid using the home courts of one of the parties in order to ensure neutrality as well as unbiased decisions thus avoiding the problem faced due to unfamiliar or unpredictable local court procedures. Singhania and Partners LLP  has strong experience in handling International arbitrations keeping the seat in India and outside India like Singapore, U.K, China, Switzerland, Canada and many more. The Firm also provides consultation at the time of negotiation of contracts to incorporate effective arbitration clauses. We conduct both institutional and ad hoc arbitrations. The firm is a member of TerraLex which is a premier network of law firms offices worldwide. The membership of TerraLex provides the firm with trusted advisors in more than 153 jurisdictions in cross-border matters.

RPC LAW

It can be a fast, cost-effective, flexible and confidential alternative to court proceedings.

It can also be complex. That’s why, with our International Arbitration service, lawyers with the experience and international outlook you need are on hand to guide you through the process. We know how the arbitral institutions across the globe operate. Equally, we understand multicultural nuances and have the sensitivity needed to bring a dispute with an overseas counterparty to a satisfactory conclusion.

Hailed by the directories as “top-notch performers”, our International Arbitration team works from our offices in London, Hong Kong and Singapore, handling arbitration cases across the world.

With this global perspective, we’re ideally placed to help you resolve disputes through bodies such as the LCIA, ICC, ICSID, SIAC, CIETAC, HKIAC, DIFC, trade associations such as FOSFA, GAFTA, LMAA , SICOM and WIPO, as well as ad hoc arbitrations including ARIAS, CIArb and UNCITRAL rules.

Where we need to work alongside lawyers in other jurisdictions, we are part of the TerraLex network and have access to over 150 law firms in 100 jurisdictions across the globe.

KEY PROVISIONS OF INTERNATIONAL ARBITRATION INSTITUTIONS

KEY PROVISIONS OF INTERNATIONAL ARBITRATION INSTITUTIONS

This is a ready reference of important provisions for some of the popular institutional arbitrations opted by parties around the world. Specifically important provisions of the following institutional arbitrations have been extracted:-

  1. London Court of International Arbitration (LCIA)
  2. ICC International Court of Arbitration
  3. Singapore International Arbitration Centre (SIAC)
  4. Hong Kong International Arbitration Centre (HKIAC)

General Provisions Common to Most Institutional Arbitrations

A. Request for Arbitration

Generally in different international institutions administering arbitrations, the rules requesting for arbitration deal with a written request for arbitration by the Claimant to the Registrar containing all the required and relevant information within a specified period of time from the date of the commencement of arbitration. Some institutions also contain a provision for a written response to the said request by the opposite party.

B. Appointment of an Arbitrator and formation of the tribunal

Pursuant to request for arbitration received, the respective institutions constitute the tribunal for the Arbitration. The Arbitrator can either be a sole arbitrator or three arbitrators depending on the agreement between the parties. The various Institutions of arbitrations around the world consider the prospective arbitrator’s nationality, residence and other relationships with the countries of which the parties or the other arbitrators are nationals and the prospective arbitrator’s availability and ability to conduct the arbitration in accordance with the Rules, while appointing arbitrators.

C. Seat of Arbitration and Place(s) of Hearing

The law applicable to the Arbitration Agreement and the arbitration shall be the law applicable at the seat of the arbitration, unless and to the extent that the parties have agreed in writing on the application of other laws or rules of law and such agreement is not prohibited by the law applicable at the arbitral seat.

D. Interim Relief

As per the rules of most institutions, parties are at liberty to approach the tribunal for interim measures of protection, custody, preservation etc., which are necessary to protect their respective rights. Furthermore, almost all arbitration institutions allow parties to approach courts before during or after the formation of the tribunal. In the case of emergency at any time prior to the formation or expedited formation of the Arbitral Tribunal, any party may apply to the Court for the immediate appointment of a temporary sole arbitrator to conduct emergency proceedings pending the formation or expedited formation of the Arbitral Tribunal

E. Awards

The Arbitral Tribunal may make separate awards on different issues at different times, including interim payments on account of any claim or cross-claim (including Legal and Arbitration Costs). Such awards shall have the same status as any other award made by the Arbitral Tribunal.

Listed below is a ready reference of important provisions of different arbitration institutions around the globe:

  1. London Court of International Arbitration (LCIA)
  2. ICC International Court of Arbitration
  3. Singapore International Arbitration Centre (SIAC)
  4. Hong Kong International Arbitration Centre (HKIAC)

KEY PROVISIONS OF HONG KONG INTERNATIONAL ARBITRATION CENTRE (HKIAC)

KEY PROVISIONS OF HONG KONG INTERNATIONAL ARBITRATION CENTRE (HKIAC)

This is a ready reference for certain important provisions of Hong Kong International Arbitration Centre (HKIAC) opted by parties.

SECTION I. GENERAL RULES

Article 1 – Scope of Application

1.1 These Rules shall govern arbitrations where an arbitration agreement (whether entered into before or after a dispute has arisen) either: (a) provides for these Rules to apply; or (b) subject to Articles 1.2 and 1.3 below, provides for arbitration “administered by HKIAC” or words to similar effect.

1.2 Nothing in these Rules shall prevent parties to a dispute or arbitration agreement from naming HKIAC as appointing authority, or from requesting certain administrative services from HKIAC, without subjecting the arbitration to the provisions contained in these Rules. For the avoidance of doubt, these Rules shall not govern arbitrations where an arbitration agreement provides for arbitration under other rules, including other rules adopted by HKIAC from time to time.

1.3 Subject to Article 1.4, these Rules shall come into force on 1 November 2013 and, unless the parties have agreed otherwise, shall apply to all arbitrations falling within Article 1.1 in which the Notice of Arbitration is submitted on or after that date.

1.4 The provisions contained in Articles 23.1, 28, 29 and Schedule 4 shall not apply if the arbitration agreement was concluded before the date on which these Rules came into force, unless otherwise agreed by the parties.

SECTION II.COMMENCEMENT OF THE ARBITRATION

Article 4 – Notice of Arbitration

4.1 The party initiating recourse to arbitration (hereinafter called the “Claimant”) shall submit a Notice of Arbitration in writing to HKIAC at its address, facsimile number or email address.

4.2 An arbitration shall be deemed to commence on the date on which a copy of the Notice of Arbitration is received by HKIAC. For the avoidance of doubt, this date shall be determined in accordance with the provisions of Articles 2.1 and 2.2.

4.3 The Notice of Arbitration shall include the following: (a) a demand that the dispute be referred to arbitration; (b) the names and (in so far as known) the addresses, telephone and fax numbers, and email addresses of the parties and of their counsel; (c) a copy of the arbitration agreement(s) invoked; (d) a reference to the contract(s) or other legal instrument(s) out of or in relation to which the dispute arises; (e) a description of the general nature of the claim and an indication of the amount involved, if any; (f) the relief or remedy sought; (g) a proposal as to the number of arbitrators (i.e. one or three), if the parties have not previously agreed thereon; (h) the Claimant’s proposal regarding the designation of a sole arbitrator under Article 7, or the Claimant’s designation of an arbitrator under Article 8; and (i) confirmation that copies of the Notice of Arbitration and any exhibits included therewith have been or are being served simultaneously on all other parties (hereinafter called the “Respondent”) by one or more means of service to be identified in such confirmation.

4.4 The Notice of Arbitration shall be accompanied by payment, by cheque or transfer to the account of HKIAC, of the Registration Fee as required by Schedule 1.

4.5 The Notice of Arbitration shall be submitted in the language of the arbitration as agreed by the parties. If no agreement has been reached between the parties, the Notice of Arbitration shall be submitted in either English or Chinese.

4.6 The Notice of Arbitration may also include the Statement of Claim referred to in Article 16.

4.7 If the Notice of Arbitration is incomplete or if the Registration Fee is not paid, HKIAC may request the Claimant to remedy the defect within an appropriate period of time. If the Claimant complies with such directions within the applicable time limit, the arbitration shall be deemed to have commenced under Article 4.2 on the date the initial version was received by HKIAC. If the Claimant fails to comply, the Notice of Arbitration shall be deemed not to have been validly submitted and the arbitration shall be deemed not to have commenced under Article 4.2 without prejudice to the Claimant’s right to submit the same claim at a later date in a subsequent Notice of Arbitration.

4.8 The Claimant shall notify and lodge documentary verification with HKIAC of the date of receipt by Respondent of the Notice of Arbitration and any exhibits included therewith.

Article 5 – Answer to the Notice of Arbitration

5.1 Within 30 days from receipt of the Notice of Arbitration, the Respondent shall submit to HKIAC an Answer to the Notice of Arbitration. This Answer to the Notice of Arbitration shall include the following: (a) the name, address, telephone and fax numbers, and email address of the Respondent and of its counsel (if different from the description contained in the Notice of Arbitration); (b) any plea that an arbitral tribunal constituted under these Rules lacks jurisdiction; (c) the Respondent’s comments on the particulars set forth in the Notice of Arbitration, pursuant to Article 4.3(e); (d) the Respondent’s answer to the relief or remedy sought in the Notice of Arbitration, pursuant to Article 4.3(f); (e) the Respondent’s proposal as to the number of arbitrators (i.e. one or three), if the parties have not previously agreed thereon; (f) the parties’ joint designation of a sole arbitrator under Article 7 or the Respondent’s designation of an arbitrator under Article 8; and (g) confirmation that copies of the Answer to the Notice of Arbitration and any exhibits included therewith have been or are being served simultaneously on all other parties to the arbitration by one or more means of service to be identified in such confirmation.

5.2 The Answer to the Notice of Arbitration shall be submitted in the language of the arbitration as agreed by the parties. If no agreement has been reached between the parties, the Answer to the Notice of Arbitration shall be submitted in either English or Chinese.

5.3 The Answer to the Notice of Arbitration may also include the Statement of Defence referred to in Article 17, if the Notice of Arbitration contained the Statement of Claim referred to in Article 16.

5.4 Any counterclaim or set-off defence shall to the extent possible be raised with the Respondent’s Answer to the Notice of Arbitration, which should include in relation to any such counterclaim or set-off defence:

a reference to the contract(s) or other legal instrument(s) out of or in relation to which it arises;

a description of the general nature of the counterclaim and/or set-off defence and an indication of the amount involved, if any;

the relief or remedy sought.

5.5 If no counterclaim or set-off defence is raised with the Respondent’s Answer to the Notice of Arbitration, or if there is no indication of the amount of the counterclaim or set-off, HKIAC shall rely upon the information provided by the Claimant pursuant to Article 4.3(e) for its determination of: (a) HKIAC’s Administrative Fees referred to in Article 33.1(f) and Schedule 1; (b) the arbitral tribunal’s fees (where Article 10.1(b) and Schedule 3 applies); and (c) whether the provisions of Article 41 (the “Expedited Procedure”) may be applicable.

5.6 Once the Registration Fee has been paid and the arbitral tribunal has been confirmed, HKIAC shall transmit the file to the arbitral tribunal.

SECTION III.THE ARBITRAL TRIBUNAL

Article 6 – Number of Arbitrators

6.1 If the parties have not agreed upon the number of arbitrators, HKIAC shall decide whether the case shall be referred to a sole arbitrator or to three arbitrators, taking into account the circumstances of the case.

6.2 Where a case is handled under an Expedited Procedure in accordance with Article 41, the provisions of Article 41.2(a) and (b) shall apply.

Article 7 – Appointment of a Sole Arbitrator

7.1 Unless the parties have agreed otherwise and subject to Articles 9, 10, 11.1 to 11.4: (a) where the parties have agreed that the dispute shall be referred to a sole arbitrator, they shall jointly designate the sole arbitrator within 30 days from the date when the Notice of Arbitration was received by the Respondent; (b) where the parties have not agreed upon the number of arbitrators and HKIAC has decided that the dispute shall be referred to a sole arbitrator, the parties shall jointly designate the sole arbitrator within 30 days from the date when HKIAC’s decision was received by the last of them.

7.2 If the parties fail to designate the sole arbitrator within the applicable time limit, HKIAC shall appoint the sole arbitrator.

Article 8 – Appointment of Three Arbitrators

8.1 Where a dispute between two parties is referred to three arbitrators, the arbitral tribunal shall be constituted as follows unless the parties have agreed otherwise:

where the parties have agreed that the dispute shall be referred to three arbitrators, each party shall designate, in the Notice of Arbitration and the Answer to the Notice of Arbitration, respectively, one arbitrator. If either party fails to designate an arbitrator, HKIAC shall appoint the arbitrator;

where the parties have not agreed upon the number of arbitrators and HKIAC has decided that the dispute shall be referred to three arbitrators, the Claimant shall designate an arbitrator within 15 days from receipt of HKIAC’s decision, and the Respondent shall designate an arbitrator within 15 days from receipt of notification of the Claimant’s designation. If a party fails to designate an arbitrator, HKIAC shall appoint the arbitrator;

the two arbitrators so appointed shall designate a third arbitrator who shall act as the presiding arbitrator of the arbitral tribunal. Failing such designation within 30 days from the confirmation of the second arbitrator, HKIAC shall appoint the presiding arbitrator.

8.2 Where there are more than two parties to the arbitration and the dispute is to be referred to three arbitrators, the arbitral tribunal shall be constituted as follows unless the parties have agreed otherwise:

the Claimant or group of Claimants shall designate an arbitrator and the Respondent or group of Respondents shall designate an arbitrator in accordance with the procedure in Article 8.1(a) or (b), as applicable;

if the parties have designated arbitrators in accordance with Article 8.2(a), the procedure in Article 8.1(c) shall apply to the designation of the presiding arbitrator;

In the event of any failure to designate arbitrators under Article 8.2(a) or if the parties do not all agree in writing that they represent two separate sides (as Claimant(s) and Respondent(s) respectively) for the purposes of designating arbitrators, HKIAC may appoint all members of the arbitral tribunal without regard to any party’s designation.

8.3 Appointment of the arbitral tribunal pursuant to Article 8.1 or 8.2 shall be subject to Articles 9, 10 and 11.1 to 11.4.

Article 9 – Confirmation of the Arbitral Tribunal

9.1 All designations of any arbitrator, whether made by the parties or the arbitrators, are subject to confirmation by HKIAC, upon which the appointments shall become effective.

9.2 The designation of an arbitrator shall be confirmed on the terms of: (a) Schedule 2; or (b) Schedule 3; as applicable, in accordance with Article 10 and subject to any variations agreed by all parties and any changes HKIAC considers appropriate.

Article 14 – Seat and Venue of the Arbitration

14.1 The parties may agree on the seat of arbitration. Where there is no agreement as to seat the seat of arbitration shall be Hong Kong, unless the arbitral tribunal determines, having regard to the circumstances of the case, that another seat is more appropriate.

14.2 Unless the parties have agreed otherwise, the arbitral tribunal may meet at any location outside of the seat of arbitration which it considers appropriate for consultation among its members, hearing witnesses, experts or the parties, or the inspection of goods, other property or documents. The arbitration shall nonetheless be treated for all purposes as an arbitration conducted at the seat.

Article 19 – Jurisdiction of the Arbitral Tribunal

19.1 The arbitral tribunal may rule on its own jurisdiction under these Rules, including any objections with respect to the existence, validity or scope of the arbitration agreement(s).

19.2 The arbitral tribunal shall have the power to determine the existence or the validity of the contract of which an arbitration clause forms a part. For the purposes of Article 19, an arbitration clause which forms part of a contract and which provides for arbitration under these Rules shall be treated as an agreement independent of the other terms of the contract. A decision by the arbitral tribunal that the contract is null and void shall not necessarily entail the invalidity of the arbitration clause.

19.3 A plea that the arbitral tribunal does not have jurisdiction shall be raised if possible in the Answer to the Notice of Arbitration, and shall be raised no later than in the Statement of Defence referred to in Article 17, or, with respect to a counterclaim, in the Reply to the Counterclaim. A party is not precluded from raising such a plea by the fact that it has designated, or participated in the designation of, an arbitrator. A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitration. The arbitral tribunal may, in either case, admit a later plea if it considers the delay justified.

19.4 If a question arises as to the existence, validity or scope of the arbitration agreement(s) or to the competence of HKIAC to administer an arbitration before the constitution of the arbitral tribunal, HKIAC may decide whether and to what extent the arbitration shall proceed. The arbitration shall proceed if and to the extent that HKIAC is satisfied, prima facie, that an arbitration agreement under the Rules may exist. Any question as to the jurisdiction of the arbitral tribunal shall be decided by the arbitral tribunal once confirmed pursuant to Article 19.1.

19.5 HKIAC’s decision pursuant to Article 19.4 is without prejudice to the admissibility or merits of any party’s pleas.

Article 23 – Interim Measures of Protection and Emergency Relief

23.1 A party may apply for urgent interim or conservatory relief (the “Emergency Relief”) prior to the constitution of the arbitral tribunal pursuant to the procedures set out in Schedule 4 (the “Emergency Arbitrator Procedures”).

23.2 At the request of either party, the arbitral tribunal may order any interim measures it deems necessary or appropriate.

23.3 An interim measure, whether in the form of an order or award or in another form, is any temporary measure ordered by the arbitral tribunal at any time prior to the issuance of the award by which the dispute is finally decided, that a party, for example and without limitation:

maintain or restore the status quo pending determination of the dispute;

take action that would prevent, or refrain from taking action that is likely to cause, current or imminent harm or prejudice to the arbitral process itself;

provide a means of preserving assets out of which a subsequent award may be satisfied; or (d) preserve evidence that may be relevant and material to the resolution of the dispute.

23.4 When deciding a party’s request for an interim measure under Article 23.2, the arbitral tribunal shall take into account the circumstances of the case. Relevant factors may include, but are not limited to:

harm not adequately reparable by an award of damages is likely to result if the measure is not ordered, and such harm substantially outweighs the harm that is likely to result to the party against whom the measure is directed if the measure is granted; and

there is a reasonable possibility that the requesting party will succeed on the merits of the claim. The determination on this possibility shall not affect the discretion of the arbitral tribunal in making any subsequent determination.

23.5 The arbitral tribunal may modify, suspend or terminate an interim measure it has granted, upon application of any party or, in exceptional circumstances and upon prior notice to the parties, on the arbitral tribunal’s own initiative.

23.6 The arbitral tribunal may require the party requesting an interim measure to provide appropriate security in connection with the measure.

23.7 The arbitral tribunal may require any party promptly to disclose any material change in the circumstances on the basis of which an interim measure was requested or granted.

23.8 The party requesting an interim measure may be liable for any costs and damages caused by the measure to any party if the arbitral tribunal later determines that, in the circumstances then prevailing, the measure should not have been granted. The arbitral tribunal may award such costs and damages at any point during the arbitration.

23.9 A request for interim measures addressed by any party to a competent judicial authority shall not be deemed incompatible with the arbitration agreement(s), or as a waiver thereof.

SCHEDULE 4

Emergency Arbitrator

1. A party requiring Emergency Relief may, concurrent with or following the filing of a Notice of Arbitration but prior to the constitution of the arbitral tribunal, submit an application (the “Application”) for the appointment of an emergency arbitrator (the “Emergency Arbitrator”) to HKIAC.

2.  The Application shall be submitted in accordance with any of the means specified in Article 2.1 of the Rules. The Application shall include the following information:

the names and (in so far as known) the addresses, telephone and fax numbers, and email addresses of the parties to the Application and of their counsel;

a description of the circumstances giving rise to the Application and of the underlying dispute referred to arbitration;

a statement of the Emergency Relief sought;

the reasons why the applicant needs the Emergency Relief on an urgent basis that cannot await the constitution of an arbitral tribunal;

the reasons why the applicant is entitled to such Emergency Relief;

any relevant agreement(s) and, in particular, the arbitration agreement(s);

comments on the language, the seat of the Emergency Relief proceedings, and the applicable law;

confirmation of payment, by cheque or transfer to the account of HKIAC, of the amount referred to in paragraph 6 of this Schedule (the “Application Deposit”); and

confirmation that copies of the Application and any exhibits included therewith have been or are being served simultaneously on all other parties to the arbitration by one or more means of service to be identified in such confirmation.

3. The Application may contain such other documents or information as the applicant considers appropriate or as may contribute to the efficient examination of the Application.

4.   Two copies of the Application shall be provided, one copy for the Emergency Arbitrator and one copy for HKIAC.

5.  If HKIAC determines that it should accept the Application, HKIAC shall seek to appoint an Emergency Arbitrator within two days after receipt of both the Application and the Application Deposit.

6. The Application Deposit is the amount set by HKIAC, as stated on HKIAC’s website on the date the Application is submitted. The Application Deposit consists of HKIAC’s administrative expenses and the Emergency Arbitrator’s fees and expenses. The Emergency Arbitrator’s fees shall be determined by HKIAC by reference to his or her hourly rate subject to the terms set out in Schedule 2. HKIAC may, at any time during the Emergency Relief proceedings, decide to increase the Emergency Arbitrator’s fees or HKIAC’s administrative expenses, taking into account, inter alia, the nature of the case and the nature and amount of work performed by the Emergency Arbitrator and HKIAC. If the party which submitted the Application fails to pay the increased fees and/or expenses within the time limit fixed by HKIAC, the Application shall be dismissed.

7.    Once the Emergency Arbitrator has been appointed, HKIAC shall so notify the parties to the Application and shall transmit the file to the Emergency Arbitrator. Thereafter, all written communications from the parties shall be submitted directly to the Emergency Arbitrator with a copy to the other party to the Application and HKIAC. A copy of any written communications from the Emergency Arbitrator to the parties shall also be copied to HKIAC.

8.    Article 11 of the Rules shall apply to the Emergency Arbitrator, except that the time limits set out in Articles 11.7 and 11.9 are shortened to three days.

9.    Where an Emergency Arbitrator dies, has been successfully challenged, has been otherwise removed, or has resigned, HKIAC shall seek to appoint a substitute Emergency Arbitrator within two days. If an Emergency Arbitrator withdraws or a party agrees to terminate an Emergency Arbitrator’s appointment under paragraph 8 of this Schedule, no acceptance of the validity of any ground referred to in Article 11.6 of the Rules shall be implied. If the Emergency Arbitrator is replaced, the Emergency Relief proceedings shall resume at the stage where the Emergency Arbitrator was replaced or ceased to perform his or her functions, unless the substitute Emergency Arbitrator decides otherwise.

10.    If the parties have agreed on the seat of arbitration, such seat shall be the seat of the Emergency Relief proceedings. Where the parties have not agreed on the seat of arbitration, and without prejudice to the arbitral tribunal’s determination of the seat of arbitration pursuant to Article 14.1 of the Rules, the seat of the Emergency Relief proceedings shall be Hong Kong.

11.    Taking into account the urgency inherent in the Emergency Relief proceedings and ensuring that each party has a reasonable opportunity to be heard on the Application, the Emergency Arbitrator may conduct such proceedings in such a manner as the Emergency Arbitrator considers appropriate. The Emergency Arbitrator shall have the power to rule on objections that the Emergency Arbitrator has no jurisdiction, including any objections with respect to the existence, validity or scope of the arbitration clause(s) or of the separate arbitration agreement(s), and shall resolve any disputes over the applicability of this Schedule.

12.    Any decision, order or award of the Emergency Arbitrator on the Application (the “Emergency Decision”) shall be made within fifteen days from the date on which HKIAC transmitted the file to the Emergency Arbitrator. This period of time may be extended by agreement of the parties or, in appropriate circumstances, by HKIAC.

13.    The Emergency Decision may be made even if in the meantime the file has been transmitted to the arbitral tribunal.

14.    Any Emergency Decision shall:

be made in writing;

state the date when it was made and summary reasons upon which the Emergency Decision is based (including a determination on whether the Application is admissible under Article 23.1 of the Rules and whether the Emergency Arbitrator has jurisdiction to grant the Emergency Relief); and

be signed by the Emergency Arbitrator.

15.    Any Emergency Decision shall fix the costs of the Emergency Relief proceedings and decide which of the parties shall bear them or in what proportion they shall be borne by the parties, subject always to the power of the arbitral tribunal to determine finally the apportionment of such costs in accordance with Article 33 of the Rules. The costs of the Emergency Relief proceedings include HKIAC’s administrative expenses, the Emergency Arbitrator’s fees and expenses and the reasonable and other legal costs incurred by the parties for the Emergency Relief proceedings.

16.    Any Emergency Decision shall have the same effect as an interim measure granted pursuant to Article 23 of the Rules and shall be binding on the parties when rendered. By agreeing to arbitration under these Rules, the parties undertake to comply with any Emergency Decision without delay.

17.    The Emergency Arbitrator shall be entitled to order the provision of appropriate security by the party seeking Emergency Relief.

18.    Any Emergency Decision may, upon a reasoned request by a party, be modified, suspended or terminated by the Emergency Arbitrator or the arbitral tribunal (once constituted).

19.    Any Emergency Decision ceases to be binding:

if the Emergency Arbitrator or the arbitral tribunal so decides;

upon the arbitral tribunal rendering a final award, unless the arbitral tribunal expressly decides otherwise;

upon the withdrawal of all claims or the termination of the arbitration before the rendering of a final award; or

if the arbitral tribunal is not constituted within 90 days from the date of the Emergency Decision. This period of time may be extended by agreement of the parties or, in appropriate circumstances, by HKIAC.

20.    Subject to paragraph 13 of this Schedule, the Emergency Arbitrator shall have no further power to act once the arbitral tribunal is constituted.

21.    The Emergency Arbitrator may not act as arbitrator in any arbitration relating to the dispute that gave rise to the Application and in respect of which the Emergency Arbitrator has acted, unless otherwise agreed by the parties to the arbitration.

22.    The Emergency Arbitrator Procedures are not intended to prevent any party from seeking urgent interim or conservatory measures from a competent judicial authority at any time.

23.    In all matters not expressly provided for in this Schedule, the Emergency Arbitrator shall act in the spirit of the Rules.

24.    The Emergency Arbitrator shall make every reasonable effort to ensure that an Emergency Decision is valid.

KEY PROVISIONS OF SINGAPORE INTERNATIONAL ARBITRATION CENTRE (SIAC)

KEY PROVISIONS OF SINGAPORE INTERNATIONAL ARBITRATION CENTRE (SIAC)

This is a ready reference for certain important provisions of Singapore International Arbitration Centre (SIAC)

Rule 1: Scope of Application and Interpretation

1.1 Where the parties have agreed to refer their disputes to SIAC for arbitration or to arbitration in accordance with the SIAC Rules, the parties shall be deemed to have agreed that the arbitration    shall be conducted pursuant to and administered by SIAC in accordance with these Rules.

1.2 These Rules shall come into force on 1 August 2016 and, unless otherwise agreed by the parties, shall apply to any arbitration which is commenced on or after that date.

1.3 In these Rules:

“Award” includes a partial, interim or final award and an award of an Emergency Arbitrator;

“Committee of the Court” means a committee consisting of not less than two members of the Court appointed by the President (which may include the President);

“Court” means the Court of Arbitration of SIAC and includes a Committee of the Court;

“Emergency Arbitrator” means an arbitrator appointed in accordance with paragraph 3 of Schedule 1;

“Practice Notes” mean the guidelines published by the Registrar from time to time to supplement, regulate and implement these Rules;

“President” means the President of the Court and includes any Vice President and the Registrar;

“Registrar” means the Registrar of the Court and includes any Deputy Registrar;

“Rules” means the Arbitration Rules of the Singapore International Arbitration Centre (6th Edition, 1 August 2016);

“SIAC” means the Singapore International Arbitration Centre; and

“Tribunal” includes a sole arbitrator or all the arbitrators where more than one arbitrator is appointed.

Any pronoun in these Rules shall be understood to be gender-neutral. Any singular noun shall be understood to refer to the plural in the appropriate circumstances.

Rule 3: Notice of Arbitration

3.1 A party wishing to commence an arbitration under these Rules (the “Claimant”) shall file with the Registrar a Notice of Arbitration which shall include:

  • a demand that the dispute be referred to arbitration;
  • the names, addresses, telephone numbers, facsimile numbers and electronic mail addresses, if known, of the parties to the arbitration and their representatives, if any;
  • a reference to the arbitration agreement invoked and a copy of the arbitration agreement;
  • a reference to the contract or other instrument (e.g. investment treaty) out of or in relation to which the dispute arises and, where possible, a copy of the contract or other instrument;
  • a brief statement describing the nature and circumstances of the dispute, specifying the relief claimed and, where possible, an initial quantification of the claim amount;
  • a statement of any matters which the parties have previously agreed as to the conduct of the arbitration or with respect to which the Claimant wishes to make a proposal;
  • a proposal for the number of arbitrators if not specified in the arbitration agreement;
  • unless otherwise agreed by the parties, the nomination of an arbitrator if the arbitration agreement provides for three arbitrators, or a proposal for a sole arbitrator if the arbitration agreement provides for a sole arbitrator;
  • any comment as to the applicable rules of law;
  • any comment as to the language of the arbitration; and
  • payment of the requisite filing fee under these Rules.

3.2 The Notice of Arbitration may also include the Statement of Claim referred to in Rule 20.2.

3.3 The date of receipt of the complete Notice of Arbitration by the Registrar shall be deemed to be the date of commencement of the arbitration. For the avoidance of doubt, the Notice of Arbitration is deemed to be complete when all the requirements of Rule 3.1 and Rule 6.1(b) (if applicable) are fulfilled or when the Registrar determines that there has been substantial compliance with such requirements. SIAC shall notify the parties of the commencement of the arbitration.

3.4 The Claimant shall, at the same time as it files the Notice of Arbitration with the Registrar, send a copy of the Notice of Arbitration to the Respondent, and shall notify the Registrar that it has done so, specifying the mode of service employed and the date of service.

Rule 4: Response to the Notice of Arbitration

4.1 The Respondent shall file a Response with the Registrar within 14 days of receipt of the Notice of Arbitration. The Response shall include:

a. a confirmation or denial of all or part of the claims, including, where possible, any plea that the Tribunal lacks jurisdiction;

b. a brief statement describing the nature and circumstances of any counterclaim, specifying the relief claimed and, where possible, an initial quantification of the counterclaim amount;

c. any comment in response to any statements contained in the Notice of Arbitration under Rule 3.1 or any comment with respect to the matters covered in such Rule;

d. unless otherwise agreed by the parties, the nomination of an arbitrator if the arbitration agreement provides for three arbitrators or, if the arbitration agreement provides for a sole arbitrator, comments on the Claimant’s proposal for a sole arbitrator or a counter-proposal; and

e. payment of the requisite filing fee under these Rules for any counterclaim.

4.2 The Response may also include the Statement of Defence and a Statement of Counterclaim, as referred to in Rule 20.3 and Rule 20.4.

4.3 The Respondent shall, at the same time as it files the Response with the Registrar, send a copy of the Response to the Claimant, and shall notify the Registrar that it has done so, specifying the mode of service employed and the date of service.

Rule 5: Expedited Procedure

5.1     Prior to the constitution of the Tribunal, a party may file an application with the Registrar for the arbitral proceedings to be conducted in accordance with the Expedited Procedure under this Rule, provided that any of the following criteria is satisfied:

  • the amount in dispute does not exceed the equivalent amount of S$6,000,000, representing the aggregate of the claim, counterclaim and any defence of set-off;
  • the parties so agree; or
  • in cases of exceptional urgency.

The party applying for the arbitral proceedings to be conducted in accordance with the Expedited Procedure under this Rule 5.1 shall, at the same time as it files an application for the proceedings to be conducted in accordance with the Expedited Procedure with the Registrar, send a copy of the application to the other party and shall notify the Registrar that it has done so, specifying the mode of service employed and the date of service.

5.2     Where a party has filed an application with the Registrar under Rule 5.1, and where the President determines, after considering the views of the parties, and having regard to the circumstances of the case, that the arbitral proceedings shall be conducted in accordance with the Expedited Procedure, the following procedure shall apply:

  • the Registrar may abbreviate any time limits under these Rules;
  • the case shall be referred to a sole arbitrator, unless the President determines otherwise;
  • the Tribunal may, in consultation with the parties, decide if the dispute is to be decided on the basis of documentary evidence only, or if a hearing is required for the examination of any witness and expert witness as well as for any oral argument;
  • the final Award shall be made within six months from the date when the Tribunal is constituted unless, in exceptional circumstances, the Registrar extends the time for making such final Award; and
  • the Tribunal may state the reasons upon which the final Award is based in summary form, unless the parties have agreed that no reasons are to be given.

5.3     By agreeing to arbitration under these Rules, the parties agree that, where arbitral proceedings are conducted in accordance with the Expedited Procedure under this Rule 5, the rules and procedures set forth in Rule 5.2 shall apply even in cases where the arbitration agreement contains contrary terms.

5.4      Upon application by a party, and after giving the parties the opportunity to be heard, the Tribunal may, having regard to any further information as may subsequently become available, and in consultation with the Registrar, order that the arbitral proceedings shall no longer be conducted in accordance with the Expedited Procedure. Where the Tribunal decides to grant an application under this Rule 5.4, the arbitration shall continue to be conducted by the same Tribunal that was constituted to conduct the arbitration in accordance with the Expedited Procedure.

Rule 9: Number and Appointment of Arbitrators

9.1 A sole arbitrator shall be appointed in any arbitration under these Rules unless the parties have otherwise agreed; or it appears to the Registrar, giving due regard to any proposals by the parties, that the complexity, the quantum involved or other relevant circumstances of the dispute, warrants the appointment of three arbitrators.

9.2 If the parties have agreed that any arbitrator is to be appointed by one or more of the parties, or by any third person including by the arbitrators already appointed, that agreement shall be deemed an agreement to nominate an arbitrator under these Rules.

9.3 In all cases, the arbitrators nominated by the parties, or by any third person including by the arbitrators already appointed, shall be subject to appointment by the President in his discretion.

9.4 The President shall appoint an arbitrator as soon as practicable. Any decision by the President to appoint an arbitrator under these Rules shall be final and not subject to appeal.

9.5 The President may appoint any nominee whose appointment has already been suggested or proposed by any party.

9.6 The terms of appointment of each arbitrator shall be fixed by the Registrar in accordance with these Rules and any Practice Notes for the time being in force, or in accordance with the agreement of the parties.

Rule 10: Sole Arbitrator

10.1 If a sole arbitrator is to be appointed, either party may propose to the other party the names of one or more persons to serve as the sole arbitrator. Where the parties have reached an agreement on the nomination of a sole arbitrator, Rule 9.3 shall apply.

10.2 If within 21 days after the date of commencement of the arbitration, or within the period otherwise agreed by the parties or set by the Registrar, the parties have not reached an agreement on the nomination of a sole arbitrator, or if at any time either party so requests, the President shall appoint the sole arbitrator

Rule 11: Three Arbitrators

11.1 If three arbitrators are to be appointed, each party shall nominate one arbitrator.

11.2 If a party fails to make a nomination of an arbitrator within 14 days after receipt of a party’s nomination of an arbitrator, or within the period otherwise agreed by the parties or set by the Registrar, the President shall proceed to appoint an arbitrator on its behalf.

11.3 Unless the parties have agreed upon another procedure for appointing the third arbitrator, or if such agreed procedure does not result in a nomination within the period agreed by the parties or set by the Registrar, the President shall appoint the third arbitrator, who shall be the presiding arbitrator.

Rule 19: Conduct of the Proceedings

19.1 The Tribunal shall conduct the arbitration in such manner as it considers appropriate, after consulting with the parties, to ensure the fair, expeditious, economical and final resolution of the dispute.

19.2 The Tribunal shall determine the relevance, materiality and admissibility of all evidence. The Tribunal is not required to apply the rules of evidence of any applicable law in making such determination.

19.3 As soon as practicable after the constitution of the Tribunal, the Tribunal shall conduct a preliminary meeting with the parties, in person or by any other means, to discuss the procedures that will be most appropriate and efficient for the case.

19.4 The Tribunal may, in its discretion, direct the order of proceedings, bifurcate proceedings, exclude cumulative or irrelevant testimony or other evidence and direct the parties to focus their presentations on issues the decision of which could dispose of all or part of the case.

19.5 Unless otherwise agreed by the parties, the presiding arbitrator may make procedural rulings alone, subject to revision by the Tribunal.

19.6 All statements, documents or other information supplied to the Tribunal and/or the Registrar by a party shall simultaneously be communicated to the other party.

19.7 The President may, at any stage of the proceedings, request the parties and the Tribunal to convene a meeting to discuss the procedures that will be most appropriate and efficient for the case.

Rule 21: Seat of the Arbitration

21.1 The parties may agree on the seat of the arbitration. Failing such an agreement, the seat of the arbitration shall be determined by the Tribunal, having regard to all the circumstances of the case.

21.2 The Tribunal may hold hearings and meetings by any means it considers expedient or appropriate and at any location it considers convenient or appropriate.

Rule 30: Interim and Emergency Relief

30.1 The Tribunal may, at the request of a party, issue an order or an Award granting an injunction or any other interim relief it deems appropriate. The Tribunal may order the party requesting interim relief to provide appropriate security in connection with the relief sought.

30.2 A party that wishes to seek emergency interim relief prior to the constitution of the Tribunal may apply for such relief pursuant to the procedures set forth in Schedule 1.

30.3 A request for interim relief made by a party to a judicial authority prior to the constitution of the Tribunal, or in exceptional circumstances thereafter, is not incompatible with these Rules.

Rule 31: Applicable Law, Amiable Compositeur and Ex Aequoet Bono

31.1 The Tribunal shall apply the law or rules of law designated by the parties as applicable to the substance of the dispute. Failing such designation by the parties, the Tribunal shall apply the law or rules of law which it determines to be appropriate.

31.2 The Tribunal shall decide as amiable compositeur or ex aequoet bono only if the parties have expressly authorised it to do so.

31.3 In all cases, the Tribunal shall decide in accordance with the terms of the contract, if any, and shall take into account any applicable usage of trade.

Rule 32: The Award

32.1 The Tribunal shall, as promptly as possible, after consulting with the parties and upon being satisfied that the parties have no further relevant and material evidence to produce or submission to make with respect to the matters to be decided in the Award, declare the proceedings closed. The Tribunal’s declaration that the proceedings are closed shall be communicated to the parties and to the Registrar.

32.2 The Tribunal may, on its own motion or upon application of a party but before any Award is made, re-open the proceedings. The Tribunal’s decision that the proceedings are to be re-opened shall be communicated to the parties and to the Registrar. The Tribunal shall close any re-opened proceedings in accordance with Rule 32.1.

32.3 Before making any Award, the Tribunal shall submit such Award in draft form to the Registrar. Unless the Registrar extends the period of time or unless otherwise agreed by the parties, the Tribunal shall submit the draft Award to the Registrar not later than 45 days from the date on which the Tribunal declares the proceedings closed. The Registrar may, as soon as practicable, suggest modifications as to the form of the Award and, without affecting the Tribunal’s liberty to decide the dispute, draw the Tribunal’s attention to points of substance. No Award shall be made by the Tribunal until it has been approved by the Registrar as to its form.

32.4 The Award shall be in writing and shall state the reasons upon which it is based unless the parties have agreed that no reasons are to be given.

32.5 Unless otherwise agreed by the parties, the Tribunal may make separate Awards on different issues at different times.

32.6 If any arbitrator fails to cooperate in the making of the Award, having been given a reasonable opportunity to do so, the remaining arbitrators may proceed. The remaining arbitrators shall provide written notice of such refusal or failure to the Registrar, the parties and the absent arbitrator. In deciding whether to proceed with the arbitration in the absence of an arbitrator, the remaining arbitrators may take into account, among other things, the stage of the arbitration, any explanation provided by the absent arbitrator for his refusal to participate and the effect, if any, upon the enforceability of the Award should the remaining arbitrators proceed without the absent arbitrator. The remaining arbitrators shall explain in any Award made the reasons for proceeding without the absent arbitrator.

32.7 Where there is more than one arbitrator, the Tribunal shall decide by a majority. Failing a majority decision, the presiding arbitrator alone shall make the Award for the Tribunal.

32.8 The Award shall be delivered to the Registrar, who shall transmit certified copies to the parties upon full settlement of the costs of the arbitration.

32.9 The Tribunal may award simple or compound interest on any sum which is the subject of the arbitration at such rates as the parties may have agreed or, in the absence of such agreement, as the Tribunal determines to be appropriate, in respect of any period which the Tribunal determines to be appropriate.

32.10 In the event of a settlement, and if the parties so request, the Tribunal may make a consent Award recording the settlement. If the parties do not require a consent Award, the parties shall confirm to the Registrar that a settlement has been reached, following which the Tribunal shall be discharged and the arbitration concluded upon full settlement of the costs of the arbitration.

32.11 Subject to Rule 33 and Schedule 1, by agreeing to arbitration under these Rules, the parties agree that any Award shall be final and binding on the parties from the date it is made, and undertake to carry out the Award immediately and without delay. The parties also irrevocably waive their rights to any form of appeal, review or recourse to any State court or other judicial authority with respect to such Award insofar as such waiver may be validly made.

32.12 SIAC may, with the consent of the parties and the Tribunal, publish any Award with the names of the parties and other identifying information redacted.

SCHEDULE 1

Emergency Arbitrator

1.  A party that wishes to seek emergency interim relief may, concurrent with or following the filing of a Notice of Arbitration but prior to the constitution of the Tribunal, file an application for emergency interim relief with the Registrar. The party shall, at the same time as it files the application for emergency interim relief, send a copy of the application to all other parties. The application for emergency interim relief shall include:

  • the nature of the relief sought;
  • the reasons why the party is entitled to such relief; and
  • a statement certifying that all other parties have been provided with a copy of the application or, if not, an explanation of the steps taken in good faith to provide a copy or notification to all other parties.

2. Any application for emergency interim relief shall be accompanied by payment of the non-refundable administration fee and the requisite deposits under these Rules towards the Emergency Arbitrator’s fees and expenses for proceedings pursuant to this Schedule 1. In appropriate cases, the Registrar may increase the amount of the deposits requested from the party making the application. If the additional deposits are not paid within the time limit set by the Registrar, the application shall be considered as withdrawn.

3. The President shall, if he determines that SIAC should accept the application for emergency interim relief, seek to appoint an Emergency Arbitrator within one day of receipt by the Registrar of such application and payment of the administration fee and deposits.

4. If the parties have agreed on the seat of the arbitration, such seat shall be the seat of the proceedings for emergency interim relief. Failing such an agreement, the seat of the proceedings for emergency interim relief shall be Singapore, without prejudice to the Tribunal’s determination of the seat of the arbitration under Rule 21.1.

5. Prior to accepting appointment, a prospective Emergency Arbitrator shall disclose to the Registrar any circumstances that may give rise to justifiable doubts as to his impartiality or independence. Any challenge to the appointment of the Emergency Arbitrator must be made within two days of the communication by the Registrar to the parties of the appointment of the Emergency Arbitrator and the circumstances disclosed.

6.An Emergency Arbitrator may not act as an arbitrator in any future arbitration relating to the dispute, unless otherwise agreed by the parties.

7. The Emergency Arbitrator shall, as soon as possible but, in any event, within two days of his appointment, establish a schedule for consideration of the application for emergency interim relief. Such schedule shall provide a reasonable opportunity for the parties to be heard, but may provide for proceedings by telephone or video conference or on written submissions as alternatives to a hearing in person. The Emergency Arbitrator shall have the powers vested in the Tribunal pursuant to these Rules, including the authority to rule on his own jurisdiction, without prejudice to the Tribunal’s determination.

8. The Emergency Arbitrator shall have the power to order or award any interim relief that he deems necessary, including preliminary orders that may be made pending any hearing, telephone or video conference or written submissions by the parties. The Emergency Arbitrator shall give summary reasons for his decision in writing. The Emergency Arbitrator may modify or vacate the preliminary order, the interim order or Award for good cause.

9. The Emergency Arbitrator shall make his interim order or Award within 14 days from the date of his appointment unless, in exceptional circumstances, the Registrar extends the time. No interim order or Award shall be made by the Emergency Arbitrator until it has been approved by the Registrar as to its form.

10. The Emergency Arbitrator shall have no power to act after the Tribunal is constituted. The Tribunal may reconsider, modify or vacate any interim order or Award issued by the Emergency Arbitrator, including a ruling on his own jurisdiction. The Tribunal is not bound by the reasons given by the Emergency Arbitrator. Any interim order or Award issued by the Emergency Arbitrator shall, in any event, cease to be binding if the Tribunal is not constituted within 90 days of such order or Award or when the Tribunal makes a final Award or if the claim is withdrawn.

11. Any interim order or Award by the Emergency Arbitrator may be conditioned on provision by the party seeking such relief of appropriate security.

12. The parties agree that an order or Award by an Emergency Arbitrator pursuant to this Schedule 1 shall be binding on the parties from the date it is made, and undertake to carry out the interim order or Award immediately and without delay. The parties also irrevocably waive their rights to any form of appeal, review or recourse to any State court or other judicial authority with respect to such Award insofar as such waiver may be validly made.

13. The costs associated with any application pursuant to this Schedule 1 may initially be apportioned by the Emergency Arbitrator, subject to the power of the Tribunal to determine finally the apportionment of such costs.

14. These Rules shall apply as appropriate to any proceeding pursuant to this Schedule 1, taking into account the urgency of such a proceeding. The Emergency Arbitrator may decide in what manner these Rules shall apply as appropriate, and his decision as to such matters is final and not subject to appeal, review or recourse. The Registrar may abbreviate any time limits under these Rules in applications made pursuant to proceedings commenced under Rule 30.2 and Schedule 1.