INTERNATIONAL ARBITRATION BY SUSHIL DHANGI
Types of dispute resolution-disputes may not be avoidable altogether but can be minimized by using standard terms and commercial practices and these are as:
Ø law suit
Ø Arbitration
Ø Collaborative law
Ø Meditation
Ø Conciliation
Ø Many types of negotiation
Ø Facilitation
International arbitration
International arbitration is the established method for resolving disputes between parties to international commercial agreements. As with arbitration generally, it is a creature of
contract, i.e., the parties' decision to submit any disputes to private adjudication by one or more arbitrators appointed in accordance with rules the parties themselves have agreed to adopt, usually by including a provision for the same in their contract. The practice of international arbitration has developed so as to allow parties from different legal and cultural backgrounds to resolve their disputes, generally without the formalities of their underlying legal systems.
Meaning of Arbitration- The hearing and determination of a cause between parties in controversy by a person or persons chosen by the party.
Arbitrator’ means an arbitrator selected from the panel of arbitrators.
‘Arbitral Tribunal’ mean one or more arbitrators constituting a tribunal to
adjudicate a reference to arbitration.
‘Arbitration and Conciliation Act’ means Arbitration and Conciliation Act,
1996 and any amendments thereto.
‘Applicant’ means a person who makes a reference to arbitration by filing an
application as prescribed by the Exchange.
‘Respondent’ means a person against whom the applicant makes a reference
to arbitration whether or not there exists a transaction or is a claim against
such person.
‘Panel of Arbitrators’ means a body of arbitrators, constituted by the
Releva.nt Authority from time to time.
Arbitration is international if:
The parties to the agreement have, at the time of the conclusion of execution of that agreement, their places of business in different countries; or
one of the following places is situated outside the country or countries in which the parties have their places of business: (i) the place of arbitration if determined in, or pursuant to, the arbitration agreement; (ii) the place where the predominant part of the obligations of the commercial relationship is to be performed or the place with which the subject matter of the dispute is mostly closely connected; or
the parties have expressly agreed that the subject matter of the arbitration agreement relates to more than one country.
Main Features of International Arbitration
The main reason that parties elect to have their international disputes resolved through arbitration is to avoid the uncertainties associated with litigation in national courts and the resulting need to enforce judgments in a foreign court.
Causes of Arbitration with the Company
The claims, differences or disputes between a company and any party may be:
arising out of or in relation to transfer, non-transfer, delay in transfer, nonreceipt
of dividend, interest, securities and/or any other corporate
entitlements, delay in conversion into demat or non-demat or keeping in
abeyance any one or more of the aforesaid actions;arising from and in connection with any one or more of the actions mentioned in Bye-law 15.5.1 above, which affects the right to ownership of securities and / or any entitlement thereon, or
arising out of or in relation to issue or non-issue of company objections /
duplicate company objections, delay in issue of company objections and /
or non-submission of valid, requisite and supporting papers / documents
thereto Provided that all the causes/actions mentioned under Bye-laws 15.5.1,
15.5.2 and 15.5.3 arise out of or in relation to or with reference to the
provisions in the Bye-laws, Rules and Regulations of the Exchange and /
or with reference to Good/Bad Delivery Guidelines, Depository
Guidelines, provisions under the Companies Act and/or any other
guidelines or circulars issued by the Government or statutory bodies and/or any depository.
.
Trades, Contracts and Transactions Subject to Arbitration
In all trades, contracts and transactions, which are made or deemed to be made
subject to the Rules, Bye-laws and Regulations of the Exchange, the provisions
relating to arbitration as provided in these Bye-laws and Regulations shall form
and shall be deemed to form part of the trades, contracts and transactions and
the parties shall be deemed to have entered into an arbitration agreement in
writing by which all claims, differences or disputes of the nature referred to in
Bye-law 15.5 shall be submitted to arbitration in accordance with the provisions
of these Bye laws and Regulations that may be in force from time to time.
Jurisdiction
All parties to a reference to arbitration under these Bye-laws and Regulations
and the persons, if any, submitting claims under them, shall be deemed to have
submitted to the exclusive jurisdiction of the courts in or any other court, as may be prescribed by the Governing Board or Managing Director or Relevant Authority for the purpose of giving effect to the provisions of the Arbitration and Conciliation Act, these Bye-laws and Regulations.
Construction of References
For the purpose of the Arbitration and Conciliation Act, in all claims, differences
or disputes which are required to be submitted to arbitration in accordance with
the provisions of these Bye-laws and Regulations, wherever the Arbitration and
Conciliation Act leaves the parties free to determine a certain issue, the parties
shall be deemed to have authorized the Managing Director or Relevant Authority
to determine that issue.
Administrative Assistance
For the purpose of the Act, in all claims, differences or disputes which are
required to be submitted to arbitration in accordance with the provisions of these
Bye-laws and Regulations, the parties shall be deemed to have agreed for
administrative assistance of the Relevant Authority in order to facilitate the
conduct of the arbitral proceedings.
Trading Members Liable for Transactions Executed on the ATS
The provisions of these Bye-laws shall become applicable to all claims,
differences and disputes between the parties mentioned therein for all trades,
contracts and transactions executed on the ATS of the Exchange and made
subject to the Bye-laws, Rules and Regulations of the Exchange provided such
trades, contracts and transactions had been entered into between the parties
mentioned therein upto and including the date on which the clearing member or
trading member was either declared a defaulter or expelled or has surrendered
his clearing membership or trading membership.
Explanation :
Rules, Bye-laws and Regulations and circulars, orders, directions, or rulings
issued by the Exchange or Clearing Agency shall form part of all trades,
contracts and transactions.
Reference of the Claims, Differences or Disputes
Save as otherwise specified by the Governing Board or Managing Director or
Relevant Authority, if the value of the claim, difference or dispute is more than
such value, as may be specified in the relevant Regulations on the date of
application, then such claim, difference or disputes shall be referred to an
arbitral tribunal comprising of odd number of arbitrators who are more than
one , as may be decided by the Regulatory Authority from time to time and if
the value of claims, difference or dispute is upto the value referred to above,
then the same shall be referred to an arbitral tribunal comprising a sole
arbitrator .Provided no claim, difference or dispute which is less than such value, as may
be specified in the relevant Regulations on the date of the application, shall be
allowed to be submitted to arbitration by the Exchange and the same may be
decided administratively by the Managing Director or Relevant Authority from
time to time.
Limitation Period for Reference to Arbitration
All claims, differences or disputes referred to in the Bye-laws above shall be
submitted to arbitration within six months from the date of the transaction or from
the date on which the client claims to have given instruction/order to buy or sell a
security or from the date on which the client claims to have paid money or given
a security, whichever is earlier, provided where the claim/complaint is not
settled/resolved through the process of the Investors’ Grievance Cell of the
Exchange within three months of the receipt of the claim / complaint, the
Exchange shall in such cases advise the concerned client to refer the case to
arbitration. The time taken in dispute resolution and/or conciliation proceedings,
if any, initiated and conducted in accordance with the provisions of the Arbitration
and Conciliation Act and these Bye-laws and the time taken by the Managing
Director or Relevant Authority or the investors’ Grievance Cell to administratively
resolve the claims, differences or disputes shall be excluded for the purpose of
determining the limitation period of six months under the Rules, Bye-laws and
Regulations of the Exchange. Any claim made or any difference/dispute raised
by any complainant/aggrieved person, after expiry of the time limit specified
herein, shall become time-barred for the purpose of availing of the remedy under
the Rules, Bye-laws and Regulations of the Exchange and may not, however, be
invalid for seeking remedy under appropriate civil laws.
Provided where a company fails or refuses to submit or abide or comply with any
award in arbitration, such company shall render itself liable for suspension of
trading in its security. The other party in whose favour the arbitration award has
been given shall be entitled to institute legal proceedings to enforce the award.
Penalty on Failure to Submit to or Abide by Award in Arbitration
A trading member/clearing member, who fails or refuses to submit to or abide by
or comply with any award in arbitration between clearing members, between a
clearing member and a trading member, between a clearing member and a nontrading
member, between trading member or between a trading member and a
non-trading member, as may be provided in these Bye-laws and Regulations,
shall be declared a defaulter or expelled by the Relevant Authority, as is
applicable, and thereupon the other party shall be entitled to institute legal
proceedings to enforce the award under the Civil Procedure Code in the same
manner as if it is a decree of the court.
Selection of Arbitrators
The procedure for selection of arbitrators shall be in accordance with the
provisions, as may be specified by the Relevant Authority from time to time.
Procedure for Appointment of Arbitrators
The procedure for appointment of arbitrators, in each case, by the applicant and
the respondent, or the Exchange shall be, as may be provided in the relevant
Regulations from time to time.
Vacancy in the Office of the Arbitrator
At any time before making of the arbitral award, if the office of the arbitrator falls
vacant for any reason whatsoever, including any vacancy due to the illness or
death of the arbitrator or termination of the mandate of the arbitrator by the
Managing Director or Relevant Authority, or for any other reason, the vacancy
shall be filled in by the Managing Director or Relevant Authority by following the
same procedure as specified by the Exchange for appointment of the arbitrator.
Recorded Proceedings and Evidence
Unless otherwise agreed upon by the parties, any arbitrator who has been
appointed by the Managing Director or Relevant Authority to fill the vacancy of
the office of the arbitrator may rely on the proceedings and evidence recorded
earlier or may conduct any hearing afresh for any hearing previously held.
Order or Ruling of Previous Arbitrator
An order or ruling of the arbitrator made prior to the termination of his mandate
shall not be invalid solely because his mandate has been terminated;
Provided that when the termination has been effected pursuant to Bye-laws
15.21 and 15.22.4, the order or ruling of the arbitrator made prior to termination
of his mandate shall become invalid, unless otherwise agreed upon by parties.
Disclosure by Person to be Appointed as Arbitrators
Every person, who is approached in connection with his possible appointment as
an arbitrator, shall disclose to the Managing Director or Relevant Authority in
writing, any circumstances likely to give rise to justifiable doubts as to his
independence and impartiality. If the person discloses any circumstances,
which, in the opinion of the Managing Director or Relevant Authority, are likely to
give rise to justifiable doubts as to his independence and impartiality, then he
shall not be appointed as an arbitrator in respect of such case.
Termination of Mandate of the Arbitrator
The mandate of the arbitrator shall terminate if;
The arbitrator withdraws from office for any reason; or
In the opinion of the Managing Director or Relevant Authority, which
shall be final and binding on the parties, the arbitrator becomes de jure
or de facto unable to perform his functions or for other reasons, fails to
act without undue delay, including failure to make the arbitral award
within the time period prescribed; or
the mandate of the arbitrator is terminated by the Managing Director or
Relevant Authority upon receipt of written request for the termination of
the mandate of the arbitrator from both the parties to arbitration; or the arbitrator discloses any circumstances referred to in Byelaws 15.21
which in the opinion of the Relevant Authority are likely to give rise to
justifiable doubts as to his independence and impartiality; or
the arbitral proceedings are terminated as provided for herein.
Place of Arbitration
The place of arbitration shall be any office of the Exchange, as may be notified
by the Exchange from time to time, or any such other place, as may be
designated by the Exchange or the Regulatory Authority from time to time.
Fees and Charges
The fees for arbitration and the charges for submitting to and for regulating the
proceedings of the reference prescribed in the relevant Regulations shall be
payable in advance and when there is a failure, neglect or refusal on the part of a
party or parties to pay accordingly, the other party shall be responsible for
making such payment in advance without prejudice, however, to its right, if any,
to recover the same from such party or parties failing, neglecting or refusing to
pay. It shall be a condition precedent to the hearing of any reference that the
prescribed fees and charges shall have been paid in advance to the Exchange
by the party or parties to the reference. The Exchange shall collect all such fees
and charges and make the necessary payments for regulating the proceedings of
the reference, provided that the sum collected shall not be greater than the sum
to be paid, and provided further that the fees and charges payable by the other
party shall not be collected from a client, who may lodge a claim against a
trading member, whether active or inactive or a trading member who has been
declared a defaulter or has been expelled from the trading membership if there
is no adequate asset vesting in the Committee for Settlement of Claims Against
Defaulters and such defaulter/expelled trading member has not paid the fees.
his counsel, attorney or advocate, after
obtaining necessary approval from the arbitral tribunal.
.
Differences with Domestic Arbitration and Mediation
International arbitration is a significant variant of the practice in many countries of arbitration, from which it is derived and shares many features. It is not just the fact that international arbitration arises in the context of international contracts that makes it different. In the international dispute resolution community, it is widely accepted to be a different animal entirely, involving different practices and rules, and being represented by a different community of arbitrators and legal practitioners.
Although the procedural laws of many countries provide for "international" arbitrations to take place, an "internationalized" form of a provincial or domestic arbitration practice should not be confused with genuine international arbitration, which can be fairly said to exist outside and beyond the rules of any particular jurisdiction. (See Redfern, Hunter, Blackaby & Partasides, Law and Practice of International Commercial Arbitration (2004), at 1-21, "an international arbitration will usually have no connection with the state in which the arbitration takes place, other than the fact that it is taking place on the territory of that state.").
In the international context, it is also worth making a firm distinction between Arbitration and Mediation, which are both sometimes characterized as forms of ADR (Alternative Dispute Resolution). In countries where mediation is new or struggling to be introduced as a concept, this association has given rise to the misleading impression that mediation is a form of non-binding arbitration, with the arbitrator "proposing" or suggesting outcomes based on an assessment of the parties' rights. In fact, arbitration and mediation are fundamentally different: the former is a determination of legal rights, the latter a form of facilitated negotiation which looks beyond rights and allows the parties to focus on their underlying interests. The one leads to a binding determination (arbitration), the other only in the event the parties agree to settle their dispute on mutually satisfactory terms (mediation).
The Advantages of International Arbitration
For international commercial transactions, parties may face many different choices when it comes to including a mechanism for resolving disputes arising under their contract. If they are silent, they will be subject to the courts of wherever a disaffected party decides to initiate legal proceedings and believes it can obtain jurisdiction over the other party. This may not sit well with parties that need to know at the time of entering into their contract that their contractual rights will be enforced. The alternative to silence is to specify a method of binding dispute resolution, which can be either litigation before the domestic tribunal of one of the parties or arbitration. If the parties choose to resolve their disputes in the courts, however, they may encounter difficulties. The first is that they may be confined to choosing one or the others' courts, as the courts of a third country may decline the invitation to devote their resources to deciding a dispute that does not involve any of that country's citizens, companies, or national interests. The second, and perhaps more significant difficulty, is that judicial decisions are not very "portable" in that it is difficult and sometimes impossible to enforce a court decision in a country other than the one in which it was rendered.
Neutrality and Enforceability of Arbitration Awards
The ability to resolve disputes in a neutral forum and the enforceability of binding decisions are often cited as the main advantages of international arbitration over the resolution of disputes in domestic courts. And there is solid legal support for this view. An international award originating in a country that is a party to the New York Convention of 1958 may be enforced in any other country that is also a signatory, as if they were rendered by domestic courts. Here is an example of this important concept: assume that parties from countries A and B have agreed to resolve their disputes in country C, and all three countries are parties to the New York Convention. This will mean that even though the arbitration will take place in country C, the resulting award can be enforced in the countries A (or B), as if it were a court decision rendered in the domestic courts of that country. (By contrast, there is no equivalent treaty for the international recognition of court decisions, although a draft treaty was initiated in 2005.)
Thus, parties to international contracts can decide to site their disputes in a third, neutral country, knowing that the eventual award can be easily enforced in any country that is a signatory to the New York Convention, which has been ratified by a significant majority of commercial nations, with notable exceptions like Qatar, which not having ratified the New York Convention cannot be assumed to give effect to arbitration decisions rendered in other countries. An international award therefore has substantially greater executory (legal) force than a domestic court decision.
International Commercial Arbitration
The resolution of disputes under international commercial contracts is widely conducted under the auspices of several major international institutions and rule making bodies. The most significant are the International Chamber of Commerce (ICC), the International Centre for Dispute Resolution (ICDR), the international branch of the American Arbitration Association), the London Court of International Arbitration (LCIA), the Hong Kong International Arbitration Centre, and the Singapore International Arbitration Centre (SIAC).
Association of international arbitration (AIA)
The association for international arbitration (AIA) was founded in 2001 in Paris. The AIA works towards promotion of ADR in general and Arbitration in particular, as a means of dispute resolution and strives to bring together the global community in this field, namely the professionals such as Judges, Lawyers, Arbitrators, and Mediators or as Academicians as well Research Scholars and Students. With this unique blend of people, it is our endeavor to inculcate an interest in ADR, not only in the professional sphere but also create awareness and interest in it among budding professionals in law schools/universities all around the globe. In the past AIA organized a Conference on critical issues raised in the “The Commission of The European Communities” Green Paper on Alternative Dispute Resolution in Civil and Commercial Law (Paris 2003).
For the present, the Association for International Arbitration would work from the intellectual aspect and endeavor to bring together all interested professionals in this field and work towards finding ways and means of promoting cooperation and understanding between them, to the common benefit of all.
International Investment Arbitration
The last few decades have seen the promulgation of numerous Bilateral Investment Treaties (BITs), as well as Multilateral Investment Treaties, which are designed to encourage investment in signatory countries by offering protections to investors from other signatory states. One of the significant features of BITs is that they provide investors with the ability to resolve disputes with the host states before the International Centre for the Settlement of Investment Disputes (ICSID).
]
Ø law suit
Ø Arbitration
Ø Collaborative law
Ø Meditation
Ø Conciliation
Ø Many types of negotiation
Ø Facilitation
International arbitration
International arbitration is the established method for resolving disputes between parties to international commercial agreements. As with arbitration generally, it is a creature of
contract, i.e., the parties' decision to submit any disputes to private adjudication by one or more arbitrators appointed in accordance with rules the parties themselves have agreed to adopt, usually by including a provision for the same in their contract. The practice of international arbitration has developed so as to allow parties from different legal and cultural backgrounds to resolve their disputes, generally without the formalities of their underlying legal systems.
Meaning of Arbitration- The hearing and determination of a cause between parties in controversy by a person or persons chosen by the party.
Arbitrator’ means an arbitrator selected from the panel of arbitrators.
‘Arbitral Tribunal’ mean one or more arbitrators constituting a tribunal to
adjudicate a reference to arbitration.
‘Arbitration and Conciliation Act’ means Arbitration and Conciliation Act,
1996 and any amendments thereto.
‘Applicant’ means a person who makes a reference to arbitration by filing an
application as prescribed by the Exchange.
‘Respondent’ means a person against whom the applicant makes a reference
to arbitration whether or not there exists a transaction or is a claim against
such person.
‘Panel of Arbitrators’ means a body of arbitrators, constituted by the
Releva.nt Authority from time to time.
Arbitration is international if:
The parties to the agreement have, at the time of the conclusion of execution of that agreement, their places of business in different countries; or
one of the following places is situated outside the country or countries in which the parties have their places of business: (i) the place of arbitration if determined in, or pursuant to, the arbitration agreement; (ii) the place where the predominant part of the obligations of the commercial relationship is to be performed or the place with which the subject matter of the dispute is mostly closely connected; or
the parties have expressly agreed that the subject matter of the arbitration agreement relates to more than one country.
Main Features of International Arbitration
The main reason that parties elect to have their international disputes resolved through arbitration is to avoid the uncertainties associated with litigation in national courts and the resulting need to enforce judgments in a foreign court.
Causes of Arbitration with the Company
The claims, differences or disputes between a company and any party may be:
arising out of or in relation to transfer, non-transfer, delay in transfer, nonreceipt
of dividend, interest, securities and/or any other corporate
entitlements, delay in conversion into demat or non-demat or keeping in
abeyance any one or more of the aforesaid actions;arising from and in connection with any one or more of the actions mentioned in Bye-law 15.5.1 above, which affects the right to ownership of securities and / or any entitlement thereon, or
arising out of or in relation to issue or non-issue of company objections /
duplicate company objections, delay in issue of company objections and /
or non-submission of valid, requisite and supporting papers / documents
thereto Provided that all the causes/actions mentioned under Bye-laws 15.5.1,
15.5.2 and 15.5.3 arise out of or in relation to or with reference to the
provisions in the Bye-laws, Rules and Regulations of the Exchange and /
or with reference to Good/Bad Delivery Guidelines, Depository
Guidelines, provisions under the Companies Act and/or any other
guidelines or circulars issued by the Government or statutory bodies and/or any depository.
.
Trades, Contracts and Transactions Subject to Arbitration
In all trades, contracts and transactions, which are made or deemed to be made
subject to the Rules, Bye-laws and Regulations of the Exchange, the provisions
relating to arbitration as provided in these Bye-laws and Regulations shall form
and shall be deemed to form part of the trades, contracts and transactions and
the parties shall be deemed to have entered into an arbitration agreement in
writing by which all claims, differences or disputes of the nature referred to in
Bye-law 15.5 shall be submitted to arbitration in accordance with the provisions
of these Bye laws and Regulations that may be in force from time to time.
Jurisdiction
All parties to a reference to arbitration under these Bye-laws and Regulations
and the persons, if any, submitting claims under them, shall be deemed to have
submitted to the exclusive jurisdiction of the courts in or any other court, as may be prescribed by the Governing Board or Managing Director or Relevant Authority for the purpose of giving effect to the provisions of the Arbitration and Conciliation Act, these Bye-laws and Regulations.
Construction of References
For the purpose of the Arbitration and Conciliation Act, in all claims, differences
or disputes which are required to be submitted to arbitration in accordance with
the provisions of these Bye-laws and Regulations, wherever the Arbitration and
Conciliation Act leaves the parties free to determine a certain issue, the parties
shall be deemed to have authorized the Managing Director or Relevant Authority
to determine that issue.
Administrative Assistance
For the purpose of the Act, in all claims, differences or disputes which are
required to be submitted to arbitration in accordance with the provisions of these
Bye-laws and Regulations, the parties shall be deemed to have agreed for
administrative assistance of the Relevant Authority in order to facilitate the
conduct of the arbitral proceedings.
Trading Members Liable for Transactions Executed on the ATS
The provisions of these Bye-laws shall become applicable to all claims,
differences and disputes between the parties mentioned therein for all trades,
contracts and transactions executed on the ATS of the Exchange and made
subject to the Bye-laws, Rules and Regulations of the Exchange provided such
trades, contracts and transactions had been entered into between the parties
mentioned therein upto and including the date on which the clearing member or
trading member was either declared a defaulter or expelled or has surrendered
his clearing membership or trading membership.
Explanation :
Rules, Bye-laws and Regulations and circulars, orders, directions, or rulings
issued by the Exchange or Clearing Agency shall form part of all trades,
contracts and transactions.
Reference of the Claims, Differences or Disputes
Save as otherwise specified by the Governing Board or Managing Director or
Relevant Authority, if the value of the claim, difference or dispute is more than
such value, as may be specified in the relevant Regulations on the date of
application, then such claim, difference or disputes shall be referred to an
arbitral tribunal comprising of odd number of arbitrators who are more than
one , as may be decided by the Regulatory Authority from time to time and if
the value of claims, difference or dispute is upto the value referred to above,
then the same shall be referred to an arbitral tribunal comprising a sole
arbitrator .Provided no claim, difference or dispute which is less than such value, as may
be specified in the relevant Regulations on the date of the application, shall be
allowed to be submitted to arbitration by the Exchange and the same may be
decided administratively by the Managing Director or Relevant Authority from
time to time.
Limitation Period for Reference to Arbitration
All claims, differences or disputes referred to in the Bye-laws above shall be
submitted to arbitration within six months from the date of the transaction or from
the date on which the client claims to have given instruction/order to buy or sell a
security or from the date on which the client claims to have paid money or given
a security, whichever is earlier, provided where the claim/complaint is not
settled/resolved through the process of the Investors’ Grievance Cell of the
Exchange within three months of the receipt of the claim / complaint, the
Exchange shall in such cases advise the concerned client to refer the case to
arbitration. The time taken in dispute resolution and/or conciliation proceedings,
if any, initiated and conducted in accordance with the provisions of the Arbitration
and Conciliation Act and these Bye-laws and the time taken by the Managing
Director or Relevant Authority or the investors’ Grievance Cell to administratively
resolve the claims, differences or disputes shall be excluded for the purpose of
determining the limitation period of six months under the Rules, Bye-laws and
Regulations of the Exchange. Any claim made or any difference/dispute raised
by any complainant/aggrieved person, after expiry of the time limit specified
herein, shall become time-barred for the purpose of availing of the remedy under
the Rules, Bye-laws and Regulations of the Exchange and may not, however, be
invalid for seeking remedy under appropriate civil laws.
Provided where a company fails or refuses to submit or abide or comply with any
award in arbitration, such company shall render itself liable for suspension of
trading in its security. The other party in whose favour the arbitration award has
been given shall be entitled to institute legal proceedings to enforce the award.
Penalty on Failure to Submit to or Abide by Award in Arbitration
A trading member/clearing member, who fails or refuses to submit to or abide by
or comply with any award in arbitration between clearing members, between a
clearing member and a trading member, between a clearing member and a nontrading
member, between trading member or between a trading member and a
non-trading member, as may be provided in these Bye-laws and Regulations,
shall be declared a defaulter or expelled by the Relevant Authority, as is
applicable, and thereupon the other party shall be entitled to institute legal
proceedings to enforce the award under the Civil Procedure Code in the same
manner as if it is a decree of the court.
Selection of Arbitrators
The procedure for selection of arbitrators shall be in accordance with the
provisions, as may be specified by the Relevant Authority from time to time.
Procedure for Appointment of Arbitrators
The procedure for appointment of arbitrators, in each case, by the applicant and
the respondent, or the Exchange shall be, as may be provided in the relevant
Regulations from time to time.
Vacancy in the Office of the Arbitrator
At any time before making of the arbitral award, if the office of the arbitrator falls
vacant for any reason whatsoever, including any vacancy due to the illness or
death of the arbitrator or termination of the mandate of the arbitrator by the
Managing Director or Relevant Authority, or for any other reason, the vacancy
shall be filled in by the Managing Director or Relevant Authority by following the
same procedure as specified by the Exchange for appointment of the arbitrator.
Recorded Proceedings and Evidence
Unless otherwise agreed upon by the parties, any arbitrator who has been
appointed by the Managing Director or Relevant Authority to fill the vacancy of
the office of the arbitrator may rely on the proceedings and evidence recorded
earlier or may conduct any hearing afresh for any hearing previously held.
Order or Ruling of Previous Arbitrator
An order or ruling of the arbitrator made prior to the termination of his mandate
shall not be invalid solely because his mandate has been terminated;
Provided that when the termination has been effected pursuant to Bye-laws
15.21 and 15.22.4, the order or ruling of the arbitrator made prior to termination
of his mandate shall become invalid, unless otherwise agreed upon by parties.
Disclosure by Person to be Appointed as Arbitrators
Every person, who is approached in connection with his possible appointment as
an arbitrator, shall disclose to the Managing Director or Relevant Authority in
writing, any circumstances likely to give rise to justifiable doubts as to his
independence and impartiality. If the person discloses any circumstances,
which, in the opinion of the Managing Director or Relevant Authority, are likely to
give rise to justifiable doubts as to his independence and impartiality, then he
shall not be appointed as an arbitrator in respect of such case.
Termination of Mandate of the Arbitrator
The mandate of the arbitrator shall terminate if;
The arbitrator withdraws from office for any reason; or
In the opinion of the Managing Director or Relevant Authority, which
shall be final and binding on the parties, the arbitrator becomes de jure
or de facto unable to perform his functions or for other reasons, fails to
act without undue delay, including failure to make the arbitral award
within the time period prescribed; or
the mandate of the arbitrator is terminated by the Managing Director or
Relevant Authority upon receipt of written request for the termination of
the mandate of the arbitrator from both the parties to arbitration; or the arbitrator discloses any circumstances referred to in Byelaws 15.21
which in the opinion of the Relevant Authority are likely to give rise to
justifiable doubts as to his independence and impartiality; or
the arbitral proceedings are terminated as provided for herein.
Place of Arbitration
The place of arbitration shall be any office of the Exchange, as may be notified
by the Exchange from time to time, or any such other place, as may be
designated by the Exchange or the Regulatory Authority from time to time.
Fees and Charges
The fees for arbitration and the charges for submitting to and for regulating the
proceedings of the reference prescribed in the relevant Regulations shall be
payable in advance and when there is a failure, neglect or refusal on the part of a
party or parties to pay accordingly, the other party shall be responsible for
making such payment in advance without prejudice, however, to its right, if any,
to recover the same from such party or parties failing, neglecting or refusing to
pay. It shall be a condition precedent to the hearing of any reference that the
prescribed fees and charges shall have been paid in advance to the Exchange
by the party or parties to the reference. The Exchange shall collect all such fees
and charges and make the necessary payments for regulating the proceedings of
the reference, provided that the sum collected shall not be greater than the sum
to be paid, and provided further that the fees and charges payable by the other
party shall not be collected from a client, who may lodge a claim against a
trading member, whether active or inactive or a trading member who has been
declared a defaulter or has been expelled from the trading membership if there
is no adequate asset vesting in the Committee for Settlement of Claims Against
Defaulters and such defaulter/expelled trading member has not paid the fees.
his counsel, attorney or advocate, after
obtaining necessary approval from the arbitral tribunal.
.
Differences with Domestic Arbitration and Mediation
International arbitration is a significant variant of the practice in many countries of arbitration, from which it is derived and shares many features. It is not just the fact that international arbitration arises in the context of international contracts that makes it different. In the international dispute resolution community, it is widely accepted to be a different animal entirely, involving different practices and rules, and being represented by a different community of arbitrators and legal practitioners.
Although the procedural laws of many countries provide for "international" arbitrations to take place, an "internationalized" form of a provincial or domestic arbitration practice should not be confused with genuine international arbitration, which can be fairly said to exist outside and beyond the rules of any particular jurisdiction. (See Redfern, Hunter, Blackaby & Partasides, Law and Practice of International Commercial Arbitration (2004), at 1-21, "an international arbitration will usually have no connection with the state in which the arbitration takes place, other than the fact that it is taking place on the territory of that state.").
In the international context, it is also worth making a firm distinction between Arbitration and Mediation, which are both sometimes characterized as forms of ADR (Alternative Dispute Resolution). In countries where mediation is new or struggling to be introduced as a concept, this association has given rise to the misleading impression that mediation is a form of non-binding arbitration, with the arbitrator "proposing" or suggesting outcomes based on an assessment of the parties' rights. In fact, arbitration and mediation are fundamentally different: the former is a determination of legal rights, the latter a form of facilitated negotiation which looks beyond rights and allows the parties to focus on their underlying interests. The one leads to a binding determination (arbitration), the other only in the event the parties agree to settle their dispute on mutually satisfactory terms (mediation).
The Advantages of International Arbitration
For international commercial transactions, parties may face many different choices when it comes to including a mechanism for resolving disputes arising under their contract. If they are silent, they will be subject to the courts of wherever a disaffected party decides to initiate legal proceedings and believes it can obtain jurisdiction over the other party. This may not sit well with parties that need to know at the time of entering into their contract that their contractual rights will be enforced. The alternative to silence is to specify a method of binding dispute resolution, which can be either litigation before the domestic tribunal of one of the parties or arbitration. If the parties choose to resolve their disputes in the courts, however, they may encounter difficulties. The first is that they may be confined to choosing one or the others' courts, as the courts of a third country may decline the invitation to devote their resources to deciding a dispute that does not involve any of that country's citizens, companies, or national interests. The second, and perhaps more significant difficulty, is that judicial decisions are not very "portable" in that it is difficult and sometimes impossible to enforce a court decision in a country other than the one in which it was rendered.
Neutrality and Enforceability of Arbitration Awards
The ability to resolve disputes in a neutral forum and the enforceability of binding decisions are often cited as the main advantages of international arbitration over the resolution of disputes in domestic courts. And there is solid legal support for this view. An international award originating in a country that is a party to the New York Convention of 1958 may be enforced in any other country that is also a signatory, as if they were rendered by domestic courts. Here is an example of this important concept: assume that parties from countries A and B have agreed to resolve their disputes in country C, and all three countries are parties to the New York Convention. This will mean that even though the arbitration will take place in country C, the resulting award can be enforced in the countries A (or B), as if it were a court decision rendered in the domestic courts of that country. (By contrast, there is no equivalent treaty for the international recognition of court decisions, although a draft treaty was initiated in 2005.)
Thus, parties to international contracts can decide to site their disputes in a third, neutral country, knowing that the eventual award can be easily enforced in any country that is a signatory to the New York Convention, which has been ratified by a significant majority of commercial nations, with notable exceptions like Qatar, which not having ratified the New York Convention cannot be assumed to give effect to arbitration decisions rendered in other countries. An international award therefore has substantially greater executory (legal) force than a domestic court decision.
International Commercial Arbitration
The resolution of disputes under international commercial contracts is widely conducted under the auspices of several major international institutions and rule making bodies. The most significant are the International Chamber of Commerce (ICC), the International Centre for Dispute Resolution (ICDR), the international branch of the American Arbitration Association), the London Court of International Arbitration (LCIA), the Hong Kong International Arbitration Centre, and the Singapore International Arbitration Centre (SIAC).
Association of international arbitration (AIA)
The association for international arbitration (AIA) was founded in 2001 in Paris. The AIA works towards promotion of ADR in general and Arbitration in particular, as a means of dispute resolution and strives to bring together the global community in this field, namely the professionals such as Judges, Lawyers, Arbitrators, and Mediators or as Academicians as well Research Scholars and Students. With this unique blend of people, it is our endeavor to inculcate an interest in ADR, not only in the professional sphere but also create awareness and interest in it among budding professionals in law schools/universities all around the globe. In the past AIA organized a Conference on critical issues raised in the “The Commission of The European Communities” Green Paper on Alternative Dispute Resolution in Civil and Commercial Law (Paris 2003).
For the present, the Association for International Arbitration would work from the intellectual aspect and endeavor to bring together all interested professionals in this field and work towards finding ways and means of promoting cooperation and understanding between them, to the common benefit of all.
International Investment Arbitration
The last few decades have seen the promulgation of numerous Bilateral Investment Treaties (BITs), as well as Multilateral Investment Treaties, which are designed to encourage investment in signatory countries by offering protections to investors from other signatory states. One of the significant features of BITs is that they provide investors with the ability to resolve disputes with the host states before the International Centre for the Settlement of Investment Disputes (ICSID).
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