by Dragana Nikolić, MVP in cooperation with Schoenherr

Legislation

Albania adopted a new Arbitration Act in July 2023, 10 years after the provisions of the Albanian Civil Procedure Code governing arbitration proceedings were repealed. This self-standing arbitration law governs both domestic and international arbitrations, as well as the recognition, enforcement and annulment of arbitration awards.

The long-awaited Arbitration Act which entered into force on 11 August 2023 is generally based on the UNCITRAL Model Law on International Commercial Arbitration, and reflects Albania’s generally arbitration-friendly approach.

by Beatrice Von Tornout, Fieldfisher

Court decision

In a decision rendered on 7 April 2023 (C.21.0325.N), the Belgian Supreme Court reversed almost 50 years of jurisprudence regarding the arbitrability of disputes concerning the termination of exclusive distribution agreements of indetermined duration performed in Belgium. Following this decision, disputes concerning the termination of distributorship agreements performed in Belgium are considered arbitrable even when governed by a foreign law chosen by the parties (on condition that the Rome I Regulation on the law applicable to contractual obligations is applicable to such agreements). 

Court decision

In a decision rendered on 24 April 2023 (C.21.0548.F/1), the Belgian Supreme Court affirmed a controversial first instance court decision that ICC awards can be drafted by tribunal secretaries on condition that their work is reviewed by the arbitrators. The Supreme Court found that only part 6 of the Belgian Judicial Code, which specifically concerns arbitration proceedings, applies to arbitrations seated in Belgium. There is no automatic application of the rest of the Judicial Code, which includes a provision that precludes judges from delegating their decision-making powers, to arbitral proceedings.

by Nicolás Rosero, Estudio Echecopar

Legislation

The Colombian Congress is processing a bill (S008/2023) for the implementation of a new type of arbitration applicable to debt enforcement proceedings, the purpose of which is to reduce the currently congested caseload in the Courts. 

Among the characteristics of this proposal are: (i) exclusively institutional arbitration; (ii) third party guarantors adhere to the arbitration agreement; (iii) sole arbitrator, as a general rule; (iv) specialized arbitrators in charge of taking interim measures; (v) use of information technology; (vi) arbitrators may adopt measures to guarantee the enforceability of debts (e.g., auctioning of assets); (vii) arbitral awards may also be enforced by the same tribunals that issued them. If approved, this proposal would be a milestone for Latin American arbitration law. 

by Aracelly López, Dentons Muñoz

Legislation

The Costa Rican Congress is currently studying a proposal to modify the country’s arbitration laws. Costa Rica currently has two arbitration laws: the Alternative Dispute Resolution Law which governs domestic arbitrations, and the International Commercial Arbitration Law which governs international arbitrations and is based in the UNCITRAL Model Law. The proposed amendments are directed to standardize arbitration proceedings by applying the International Commercial Arbitration Law to domestic arbitrations.

by Jarret Huang, Lecturer, University of Oxford, One Essex Court

Court decision

In R (PACCAR Inc & Ors) v Competition Appeal Tribunal & Ors (available here), the UK Supreme Court held that the provision of litigation funding in return for a share of the damages recovered will constitute a “damages-based arrangement” which falls foul of section 58AA of the Courts and Legal Services Act 1990 such that the funding arrangement is unenforceable. This case leaves uncertainty as to whether the Court’s reasoning will be applied to arbitration funding as well. The point will have to be clarified in subsequent jurisprudence, but funders of arbitration are likely to be understandably wary in the interim, particularly since section 58AA expressly covers “any sort of proceedings for resolving disputes”.

Court decision

In LMH v EGK (available here), the English High Court recognised that “computational errors” by an arbitral tribunal within the meaning of Art 36.1 of the ICC Rules can extend beyond mere “2+2=5” errors to errors which require a “degree of unpacking”, beyond the “ordinary principles of mathematics”. However, if the error is a computational one, failing to seek correction of it where such an application might be sought is likely to prove an “insurmountable bar” to a setting aside application.

Court decision

In Deutsche Bank AG v Central Bank of Venezuela (available here), the English High Court observed that arbitrations conducted in England are subject to the Arbitration Act 1996, which confers supervisory and ancillary powers to the English Court. Importantly, the effect of s.9(1) of the State Immunities Act 1978 is that agreeing to arbitration in England & Wales will constitute a waiver of state immunity for the purposes of proceedings in the English Courts in relation to such arbitral proceedings.

by Liana Cercel, Sciences Po Law School

Court decision

In a judgment delivered on 17 May 2023 (Albaniabeg Ambient sh.p.k v. v. Enel Spa), the Cour de Cassation clarified the concept of “fraud to the arbitration” (fraude à l'arbitrage) for the first notable time and made it clear that French courts will not assist parties seeking a second bite of the apple after they lost in arbitration. 

The case, ongoing for over 20 years, concerns a hydroelectric project in Albany jointly pursued by two Italian companies, Enel Spa (ENEL) and Bechetti Energy Group S.p.a. (BEG). The French Court refused the enforcement of a foreign Albanian court judgment ordering ENEL to pay damages to ABA (an Albanian subsidiary founded by BEG), interestingly because it found that this foreign judgment contradicts an earlier arbitral award which had dismissed BEG's claims against Enel relating to the same project. Its enforcement would constitute an unlawful evasion of that award – a “fraud to the arbitration”.

by Nefeli Lamprou, Linklaters

Legislation

In February 2023 Greece enacted Law No. 5016/2023 on international commercial arbitration thereby replacing Law No. 2735/1999 (the “Act”). Drafted based on UNCITRAL Model Law (2006), the Act was heralded as a progressive piece of legislation which is aimed at modernising the law on international commercial arbitration in Greece. The Act introduces sweeping reforms across the board. Notably, it widens the scope of arbitrability by providing that all disputes are arbitrable unless otherwise provided by Greek legislation (Art. 3). It prescribes various means by which parties may record an arbitration agreement, including by letter, facsimile, and electronic communication methods (Art. 10(2)), and clarifies that an arbitration agreement is presumed valid according to the parties’ chosen law, the law of the contract or the law of the seat (Art. 11). The Act also expressly allows for joinder and consolidation of disputes (Art. 24), and empowers tribunals to issue interim measures, including ex parte preliminary orders (Art. 25). Although designed to govern international commercial proceedings, the Act may also apply to purely domestic arbitrations, if parties so agree.

Court decision

In Decision No. 246/2022, the Supreme Administrative Court of Greece (also known as Greek Conseil d’Etat) ruled that a tribunal lacked jurisdiction to decide on a dispute arising out of a concession agreement between the Greek State and a consortium of German companies for the development of the Athens International Airport. The consortium had commenced arbitration proceedings against the Greek State based on an arbitration clause contained in the concession agreement, alleging that the imposition of Value Added Tax (VAT) was unlawful. The tribunal confirmed jurisdiction and ruled in the consortium’s favour. However, the Court subsequently held that, in its award, the tribunal had exceeded its jurisdiction as the arbitration agreement in the concession agreement was contrary to primary EU law. In reaching its decision, the Court noted that the concession agreement qualified as an “investment agreement” and, drawing upon the Court of Justice of the European Union's (CJEU) reasoning in Achmea (C-284/16) and PL Holdings (Case C-109/20), concluded that the tribunal’s jurisdiction was incompatible with Article 3 of the Treaty on European Union and Articles 267 and 344 of the Treaty on the Functioning of the EU. The Court held that the award was not binding on the administrative courts of Greece and remitted the case to be heard de novo. The Court’s decision has been heavily criticised since, not least because it extends the scope of the Achmea, notwithstanding that Achmea contains an express carve-out in respect of commercial arbitrations. It also casts doubt over the enforceability of arbitration agreements contained in existing and future contracts between private actors and the Greek state (or other EU member states).

Court decision

In a recent decision, the Athens Single-Member Court of First Instance issued a judgment upholding a USD 2.4bn award against National Iranian Oil Company. The Court rejected public policy arguments that the underlying contract was procured by corruption and undermined EU/US sanctions against Iran, and held that inadequate reasoning, possible misapplication of foreign legal rules and/or incorrect assessment of the merits by arbitrators do not render an award contrary to international public policy. The Court also held that the factual assumptions made within the underlying award were binding upon it, irrespective of whether these were correct, thereby confirming its limited scope of review.

by Elizabeth Chan, Tanner De Witt

Court decision

The Hong Kong Court of First Instance held in Re Shandong Chenming Paper Holdings Limited [2023] HKCFI 2065 (available here) that where the petitioner of a winding-up application was unable to argue that the subject matter of an underlying arbitration was frivolous or amounted to an abuse of process, the petition should be stayed pending future arbitration. Several decisions, including those from the Court of Final Appeal, lean towards giving prominence to exclusive jurisdiction or arbitration clauses. However, the court’s discretion still remains, and nothing is certain.

Court decision

The Hong Kong Court of First Instance in G v P [2023] HKCFI 2173 (available here) set aside an order enforcing an arbitral award, on the basis that the Notice of Arbitration had not been sent to the email address specified in the applicable arbitration agreement. The Claimant had served the Notice of Arbitration on the Respondent using XYZ@CHINAT.HK instead of XYZ@CHINA.HK (without the letter ‘t’ after China), which was the Respondent’s email for service under the relevant contract.

Court decision

The Hong Kong Court of First Instance upheld a jurisdictional challenge to an arbitral award in R v A, B and C [2023] HKCFI 2034 (available here). The jurisdictional issues concerned a third party who sought to replace the claimant in the arbitration for a surprising purpose: so that she could drop the Claimant’s claims and end the arbitration altogether. The third party contended that the Claimant had entered into the relevant contract as her agent, thus making her the true party to the arbitration. The tribunal decided in favour of the third party. The Court upheld the Claimant’s challenge, on the evidence, and in the process confirmed that the issue of joinder was a jurisdictional question and which was a matter that the Court could review de novo. The Court could also consider newly introduced evidence even if that evidence had been available during the arbitration. 

by Tarunima Vijra, Hanotiau & van den Berg

Court decision

In Magic Eye Developers Pvt. Ltd. v. M/s Green Edge Infrastructure (available here), a two-judge bench of the Indian Supreme Court elucidated on the types of enquiries and the scope of judicial intervention that are required to be conducted by Indian courts at the stage of appointment of an arbitrator. The Court ruled that under Section 11(6) of the Indian Arbitration and Conciliation Act 1996, the supervisory court is faced with two types of enquires: the first concerning the existence and validity of an arbitration, and the second concerning the arbitrability of the dispute. Before proceeding to appoint the arbitrator, the concerned court must conclusively decide on the existence and validity of an arbitration agreement while the arbitrability of claims may be examined on a prima facie basis.

Court decision

In NN Global Mercantile Pvt Ltd v. Indo Unique Flame Ltd & Ors (available here), in the context of examining the validity of an arbitration agreement forming part of an insufficiently stamped substantive contract between the parties, the Indian Supreme Court ruled that when faced with an application to appoint an arbitrator under Section 11 of the Indian Arbitration and Conciliation Act 1996, the supervisory court is bound to examine the existence as well as the validity of the arbitration agreement. The Court ruled that such insufficiently stamped arbitration agreements would not be enforceable even for the limited purpose of appointment of the arbitrator. 

by David Siagian, Widyawan & Partners in association with Linklaters

Court decision

In PT Adhya Tirta Batam and Badan Arbitrase Nasional Indonesia (BANI) v. Badan Pengusahaan Kawasan Perdagangan Bebas dan Pelabuhan Bebas Batam (Decision 199 B/Pdt.Sus-Arbt/2023, issued 3 May 2023) (available  here), the Indonesian Supreme Court overturned the earlier decision from the Batam District Court that set aside the award issued by the Tribunal in a domestic arbitration administered by BANI, on the basis that the award was obtained by fraud. The Supreme Court took the view that the argument on fraud was raised only to persuade the court to reassess the Tribunal’s legal reasoning and found that in setting aside the award, the district court delved into matters which had previously been considered at length by the Tribunal in the arbitration. The Supreme Court decision essentially promoted respect to arbitral awards and cautioned against setting aside the award without robust evidence backing the grounds for setting aside being relied on. 

Legislation

The Government of Indonesia is currently preparing a draft law titled “Private International Law” with the objective of updating the currently applicable Private International Law rules which are considered outdated. One of the provisions in the latest draft which was circulating in March earlier this year concerns the Indonesian courts’ ability to assume jurisdiction regardless of the parties’ arbitration agreement. This authority can be triggered for several reasons including a deemed submission to the court’s jurisdiction in the absence of a challenge, annulment of the arbitration agreement by the court and the respondents’ failure to engage in the commencement of arbitration. Although it appears that the rule, as currently drafted, could adversely impact the essence of a binding arbitration agreement (and questions might be raised to clarify the court’s authority to rule on the validity of the arbitration agreement), further changes to the draft are expected as the law is still in the drafting stage.

by Fabio Giuseppe Santacroce, ARBLIT Milan

Court decision

In a decision issued on 4 August 2023 (Judgment no. 393/2023) (available here), the Trieste Court of Appeal refused to enforce a foreign ICC award that had been partially annulled by the court of the seat. The decision rests on Article 840(3)(5) of the Italian code of civil procedure, which provides that enforcement must be denied where the award “has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made” (the text reflects Article V(1)(e) of the New York Convention). 

Relying on a precedent by the Italian Supreme Court, the Court of Appeal held that such provision applies also to partially annulled awards, because it does not distinguish between partial and total set aside. The Court of Appeal also stated that the applicant could enforce the surviving portions of the award in Italy by requesting the recognition or enforcement of the set aside judgment that had confirmed them.

by Nurbek Zhangaliyev, Squire Patton Boggs

Legislation

The Law of the Republic of Kazakhstan “On arbitration” has seen some modifications over the years, since its adoption in 2016 (available here). The following are three of the most significant.

First, an arbitral tribunal may now consider disputes involving a Kazakhstan state entity, so long as the entity's authorized body has consented to the arbitration (paragraph 10, Article 8 of the Law).

Second, an arbitration agreement is valid now so long as it contains the consent of parties. Other requirements, such as indication of the subject of the dispute and the intention of the parties, are no longer mandatory (paragraph 4, Article 9 of the Law). Where a state entity is involved, the consent from the entity's authorized body must be included in the arbitration agreement.

Third, the principle that the arbitration clause, which is part of the contract, is interpreted as an agreement independent of other terms of the contract has been codified (paragraph 1, Article 20 of the Law).

by June Ong, University of Oxford, Breakpoint LLC

Court decision

In Masenang Sdn Bhd v Sabanilam Enterprise Sdn Bhd [2021] 6 MLJ 255 (available here), the Federal Court held that the theory of the juridical seat is applicable to domestic arbitrations and not just international arbitrations. The identification of the seat has the consequential effect of ascertaining the court that enjoys exclusive jurisdiction to regulate and supervise the arbitration. The exercise of identifying the seat does not end by simply stating that the seat is in Malaysia. The seat cannot amount to a reference to the entire country. In this case, the issue was whether both the High Court in Malaya and the High Court in Sabah and Sarawak enjoy concurrent jurisdiction. They do not. Therefore, for arbitrations seated in Malaysia, parties need to specify the city or state within Malaysia as its seat of arbitration.

Court decision

In Macsteel International Far East Ltd v Lysaght Corrugated Pipe Sdn Bhd [2023] 4 MLJ 551, the Court of Appeal proposed a flexible approach to the issue of who has jurisdiction to determine the validity of an arbitration agreement in question. It held that both the High Court and the arbitral tribunal have concurrent jurisdiction to investigate the validity of the arbitration agreement. The determination of which is the more appropriate forum is based on which forum is on balance more just and convenient to investigate and determine the validity of the arbitration agreement having regard to the facts and circumstances in issue. 

In relation to the test to be applied in evaluating whether there was an arbitration agreement in the first place, the High Court had preferred the full merits test set out in Albon (trading as NA Carriage Co) v Naza Motor Trading Sdn Bhd and another (No 3) [2007] 2 All ER 1075 as opposed to the prima facie test set out other jurisdictions such as Singapore (Tomolugen Holdings Ltd v Silica Investors Ltd [2015] SGCA 57) and Canada (Dell Computer Corp v Union des consommateurs [2007] 2 SCR 801). This approach was not overruled by the Court of Appeal, although in a subsequent Court of Appeal decision, Cockett Marine Oil (Asia) Pte Ltd v Misc Berhad [2023] 1 CLJ 20 (available here), the prima facie test was adopted.

Arbitral Institutional Rules

The Asian International Arbitration Centre recently released the revised AIAC Arbitration Rules 2023 (available here). The new updates include: 

1. adoption of the UNCITRAL Arbitration Rules 2010;

2. reduction of the default maximum amount in dispute eligible for the Fast Track Procedure from USD500,000 (international arbitration)/RM2,000,000 (domestic arbitration) to USD300,000 (international arbitration)/RM1,000,000 (domestic arbitration);

3. a new default time limit in the Fast Track Procedure where an award shall be made within six months from the date of the constitution of the Arbitral Tribunal unless otherwise agreed; and

4. an Emergency Decision on interim measures shall be made no later than 14 days from the date the application was referred to the Emergency Arbitrator. 

by Nicoleta Iftodi, Derains & Gharavi

Court decision

In Stork International GmbH v Atai SRL (available here), the Supreme Court of Justice of the Republic of Moldova affirmed the jurisdiction of territorially competent Courts of Appeal in Moldova to rule on claims related to the enforcement of arbitral awards. The Supreme Court further noted that while the Moldovan Insolvency Act explicitly designates insolvency courts as having jurisdiction over “disputes” and “cases” related to a debtor’s estate, this jurisdiction does not extend to the enforcement of arbitral awards. This is because arbitral awards conclusively resolve – and thus terminate – any civil “dispute” and “case”. 

by Ibukunoluwa Owa, Independent Arbitration Lawyer

Legislation

In May 2023, Nigeria marked a significant milestone with the enactment of the Nigerian Arbitration and Mediation Act 2023 (available here). This transformative legislation modernises the country's arbitration framework to align with international standards, introducing innovative measures for enhancing the legal and business landscape. 

Notably, the Act introduced the Award Review Tribunal providing parties with an optional mechanism for reviewing awards based on specific grounds, mirroring the New York Convention's Article V. This expedited process is required to be concluded within 60 days, permitting parties to pursue court actions concurrently. 

Furthermore, the Act abolishes the tort of champerty and maintenance, allowing Third Party Funding in Arbitration proceedings, thereby increasing access to justice. 

by Matthew Suen, Denis Chang’s Chambers

Court decision

In C21st Investments Ltd. v. China Petroleum Engineering & Construction Corporation  (available here), the Beijing Higher People’s Court enforced foreign emergency relief for the first time. In that case, enforcement of an SCAI’s award (the “Award”) was sought by Company C. Company S then commenced a new arbitration with SCAI, arguing that it was not jointly and severally liable under the original Award. Meanwhile to preserve its position, Company S invoked the Emergency Arbitrator (“EA”) procedure and sought interim relief that Company S be restrained from seeking the enforcement of the Award, and be mandated to apply for a stay of the enforcement proceedings pending before the competent Court. The Beijing Court acceded to the stay application, relying on, inter alia, the EA’s decision. These developments show that EA mechanism is “showing a slow uptake in China mainland”.

Arbitral Institutional Rules

The China International Economic and Trade Arbitration Commission (“CIETAC”) has just published its latest 2024 edition of arbitration rules (“2024 Rules”) (available here). Various new features have been introduced to CIETAC’s 2024 Rules. Inter alia, the 7-day time limit for party-appointed arbitrators to jointly designate the presiding arbitrator is one of the mechanisms designed to expedite the constitution of the arbitral tribunal. The 2024 Rules also make clear that, following the international tread, the pre-arbitration steps are not matters that go to jurisdiction of the tribunal. They also expanded the scope for CIETAC to proceed with a single arbitration for multiple contracts and to consolidate different arbitrations. 

by Nicoleta Iftodi, Derains & Gharavi

Arbitration proceedings

Earlier this year, OMV Petrom, an Austrian-controlled company, lodged an ICC claim against Romania under its petroleum concession agreement for the Neptun Deep project. This project represents Romania’s first deepwater offshore project and is expected to produce 100 billion cubic meters of natural gas, requiring an EUR 4 billion investment. OMV Petrom holds a 50% stake in the project, with the remaining 50% being owned by Romgaz, a Romanian state entity. OMV is challenging provisions in the Offshore Law that impose limits on the way investors can dispose of natural gas production from the Black Sea and which, notably, grant the government the authority to temporarily direct a portion of gas production, at regulated prices, to household use or other purposes stipulated by European solidarity mechanisms. 

by Joel Quek, WongPartnership LLP

Court decision

In Anupam Mittal v Westbridge Ventreus II Investment Holdings (available here), the Singapore Court of Appeal set out a composite approach to the question of arbitrability of a dispute at the pre-award stage. In the first instance, the Court would apply the law of the arbitration agreement, and in the second, the law of the seat of arbitration. If, under either the law of the arbitration agreement or under Singapore law, the subject matter of the arbitration is non-arbitrable, then the parties would not be able to resolve their disputes via arbitration. This approach is informed by the importance of public policy in determining the question of arbitrability, and the Court of Appeal observed that nations have an interest in what issues should only be determined in public forums because some issues have wider public impact beyond the individual interests of the disputants.

The Court also affirmed the conventional three-stage test in determining the proper law of the arbitration agreement, which involves: (1) whether parties expressly chose the proper law of the arbitration agreement; (2) in the absence of an express choice, whether parties made an implied choice of the proper law to govern the arbitration agreement, with the starting point for determining the implied choice of law being the law of the contract; (3) if neither an express choice nor an implied choice can be discerned, which is the system of law with which the arbitration agreement has its closest and most real connection. In particular, for stage 1, the Court held that specifying that the contract shall be governed by a particular law is insufficient to constitute an express choice of the proper law of the arbitration agreement; an express choice of law for an arbitration agreement would only be found where there is explicit language stating so in no uncertain terms.

Court decision

In The Republic of India v Deutsche Telekom AG (available here), the Singapore Court of Appeal found that although the court’s power to grant privacy orders is statutorily provided for in sections 22 and 23 of the International Arbitration Act 1994 (“IAA”), this is ultimately rooted in protecting the confidentiality of the arbitral proceedings by ensuring that the related court proceedings are heard in private. There is no independent interest in the confidentiality of court proceedings. In line with this, where the confidentiality of the arbitration has been lost, the hallowed principle of open justice would weigh strongly in favour of lifting the cloak of privacy that has been statutorily provided for in the IAA.

In this case, the Court declined to grant the confidentiality orders as the confidentiality of the underlying arbitral proceedings had been lost. There had already been multiple disclosures of considerable information relating to the Arbitration, the identity of the parties and enforcement proceedings in Singapore and abroad, including that (1) the Interim and Final Awards issued in the arbitration were available online, (2) there were foreign court decisions related to the arbitration which were publicly available where the identity of parties and the outcome of the arbitration were made known, (3) there was a GAR article which expressly identified the parties, (4) a LinkedIn post by the applicant’s lawyers naming the parties to the proceedings, stating the size of the Final Award, and providing a web link to the GAR article, and (5) information pertaining to enforcement proceedings in other jurisdictions had entered the public domain.

Court decision

In CZT v CZU (available  here), the Singapore International Commercial Court ruled on the confidentiality of tribunal deliberations. The plaintiff applied to set aside an arbitral award issued against it by a 2:1 majority of the tribunal. The minority issued a dissenting opinion in which he made several serious allegations against the majority. In support of its setting aside application, the plaintiff filed three applications seeking production of the records of deliberations from all three members of the tribunal.

The Court dismissed the plaintiff’s applications, recognising as a general principle that arbitrators’ record of deliberations are confidential. While there is no statutory provision in Singapore expressly to this effect, such confidentiality, like the confidentiality of the arbitration proceedings generally, exists as an implied obligation in law. There were also well-recognised policy reasons for this, which are that: (1) confidentiality is a necessary pre-requisite for frank discussion between the arbitrators; (2) freedom from outside scrutiny enables the arbitrators to reflect on the evidence without restriction, and, where they are so inclined, to change any conclusions reached on further reflection without fear of criticism or need for explanation; (3) the duty on the tribunal to keep deliberations confidential protects the tribunal from outside influence; (4) the rule helps to minimise spurious annulment or enforcement challenges based on matters raised in deliberations and is thereby critical to the integrity and efficacy of the whole arbitral process.

by Eunice Chan, Lukas Lim, Ascendant Legal (formal law alliance with Norton Rose Fulbright)

Arbitral Institutional Rules

The Singapore International Arbitration Centre (“SIAC”) has announced the commencement of the Public Consultation on the Draft 7th Edition of the SIAC Rules (“ProposedNew SIAC Rules”) (available here), which will replace the 6th Edition of the SIAC Rules that have been in force since 1 August 2016. The consultation period runs from 22 August 2023 to 21 November 2023. The key features of the Proposed New SIAC Rules include: 

1. incorporate and implementation of SIAC’s new case management system, the SIAC Gateway; 

2. a new requirement that the parties shall include a statement in the Notice of Arbitration and Response on the existence of any third party funding relationship and the identity and contact details of the third-party funder (Rule 6.3(h) and 7.1(g)). A similar statement must be included in an application for consolidation or joinder (Rule 16.2(e) and 18.2(f)); 

3. broaden the criteria for consolidation to include: (i) consolidation of two or more arbitrations pending under “SIAC’s administration”, instead of only arbitrations under the SIAC’s Rules; and (ii) consolidation of two or more arbitrations where “a common question of law or fact arises out of or in connection with all the arbitrations”; 

4. provide for “coordinated proceedings”, where the same tribunal is constituted in two or more arbitrations and a common question of law or fact arises out of or in connection with all the arbitrations (Rule 17); 

5. provides the tribunal with express powers in dealing with parties that fail to participate in or comply with the SIAC Rules and/or the Tribunal’s directions; 

6. extensive rules on appointment of the arbitrator. For example, in making an appointment of the arbitrator, the President may make a direct appointment or, upon the request of a party, consider the use of a list procedure, which involves each party proposing a list of at least five names in the order of its preference with the entitlement to strike one candidate to which it objects (Rule 19.8). There is also a new provision that provides that the President should bear in mind “as appropriate, principles of diversity and inclusion” in appointing an arbitrator (Rule 19.5);

7. change in the timelines in respect of an Emergency Arbitrator application. The Proposed New SIAC Rules now allow an applicant to file an Emergency Arbitrator application before the filing of the Notice of Arbitration, with the Notice to be filed within 5 days (Schedule 1, para 2 and 6); 

8. introduces a new “Streamlined Procedure” which is designed to provide an efficient and low-cost method of resolving disputes that do not exceed the equivalent amount of S$1 million at the time of the application (Rule 13 read with Schedule 2); and

9. allowing the tribunal to make a preliminary determination of any issue that arises for determination in the arbitration if the parties agree, the applicant can demonstrate it would be more efficient and cost-effective to do so, or if the circumstances so warrant (Rule 46). 

by Dragana Nikolić, MVP in cooperation with Schoenherr

Arbitral Institutional Rules

The new Arbitration Rules of the Ljubljana Arbitration Centre at the Chamber of Commerce and Industry of Slovenia ("LAC Rules 2023") entered into force on 1 June 2023, replacing the Ljubljana Arbitration Rules from 2014.

The LAC Rules 2023 (available here) introduce numerous changes reflecting the key trends in international arbitration, including an obligation to disclosure third-party funding; the possibility of organizing remote hearings; mandatory case management conference; appointment of the administrative secretary of the tribunal; and the more nuanced approach to confidentiality. 

The Ljubljana Arbitration Centre is one of the leading arbitration institutions in the CEE region that administers the resolution of domestic and international disputes through arbitration and other forms of alternative dispute resolution since 1928.

by Nguyen Vu Lan, TSMP Law Corporation

Legislation

On 25 August 2023, the Vietnam Lawyers Association (“VLA”) organised a conference to invite comment on the proposal to develop a law amending and supplementing a number of articles of Vietnam’s Law on Commercial Arbitration (“LCA”). This continued the VLA’s efforts since 2021 when it was tasked by the National Assembly to review the LCA and prepare a report on the same. A dossier with proposals on amending and supplementing the LCA is expected to be completed and sent to the National Assembly by December 2023. It is hoped that the LCA will be amended to align more with international standards, as well as the UNCITRAL Model Law on International Commercial Arbitration. The LCA (in Vietnamese) can be found here. 

Court decision

In Appeal Decision No. 09/2023/QD-PT, the High People’s Court in Hanoi refused to recognise a multi-million arbitral award from the Singapore International Arbitration Centre. One of the grounds for the refusal was the High People’s Court’s view that if the arbitral award was recognised, it would be enforced against the respondent’s assets in Vietnam which included immovable assets. The High People’s Court considered that the Vietnamese courts had exclusive jurisdiction on disputes relating to rights over immovable assets in Vietnam. As such, the arbitral award could not be enforced as the dispute was not arbitrable. The Vietnamese version of this decision can be found here.

Court decision

In Decision No. 12/2023/QD-PPT, the Hanoi’s People Court set aside an arbitral award from the Vietnam International Arbitration Centre (“VIAC”) on the ground that the Power of Attorneys and board resolutions signed outside of Vietnam to authorise the signing and filing of the arbitration in VIAC ought to have received consular authorisation in Vietnam, but were not. The Court considered that this was contrary to fundamental principles of Vietnamese law. This decision has initiated debate regarding how strict Vietnamese courts would and should be when it comes to formal requirements regarding arbitral awards. The Vietnamese version of this decision can be found here.