International Commercial Arbitration

Function and legal frameworkUniversity of Oslo

Giuditta Cordero-Moss, Ph.D., Dr.Juris

Professor, Oslo University

Arbitration

• Private settlement of disputes

• Alternative to courts

Two main effects

• It excludes national court’s jurisdiction

• It results in an enforceable award

Contractual or judicial?

• Based on will of the parties

• Enjoys judicial recognition

Arbitration v. Courts

• Neutrality• Expertise• Confidentiality• Finality• Enforceability (New

York Convention of 1958) • Jurisdiction (New York

Convention of 1958)

• Costs

• One party’s country• General legal background• Publicity• Appeals• Limited and not harmonised

enforceability (Lugano Convention, Brussels I, Hague convention)

• Limited and not harmonised regulation of jurisdiction (Lugano Convention, Brussels I, Hague convention)

• Length

”International” Arbitration

• Character of the dispute (France)

• Residence of the Parties (Swiss, Sweden, Belgium)

• Character or residence (Italy)

• Character, residence or choice (UNCITRAL)

• No need to distinguish (Holland, Germany, Norway)

International v. domestic arbitration

• Less formal requirements

• Less interference by courts

Is International Arbitration International? (”Delocalisation”)

• Mostly voluntarily carried out

• Venue chosen out of practical convenience

• Parties want flexibility

• If not voluntarily carried out, courts must intervene

• Venue determines arbitration law (e.g. Arbitrators’ injunctive powers), arbitrability, validity of award

• Parties want predictability

Legal framework

• Arbitration agreement (contractual nature)

• Arbitration rules (contractual nature)

• Domestic arbitration law (legislative nature, but few mandatory rules)

• International conventions (legisltive nature, few rules mandatory for the parties)

• Soft law (voluntary nature)

Arbitration agreement

• Consent of the parties is the basis for the arbitral tribunal’s powers

Arbitration agreement

• Type of arbitration

• Scope

• [Seat]

• [Number of arbitrators]

• [Language]

• [Procedural rules]

Arbitration rules

• Rules of the chosen institution

• UNCITRAL Rules if chosen by the parties (in case of ad hoc arbitration)

• Rules written by the parties in case of ad hoc arbitration

• Rules determined by the arbitral tribunal in the absence of an agreement between the parties

Arbitration rules

• Constitution of the arbitral tribunal

• Seat

• Powers of the arbitral tribunal

• Procedural rules

• Costs

Arbitration law

• The arbitral procedure is regulated by arbitration law of the place of arbitration

Arbitration law

• Part of domestic legal system in each state• To a large extent harmonised thanks to the

UNCITRAL Model Law• Model Law is not binding • Even Model Law countries may have different

regulation• Always check the local arbitration law!

UNCITRAL Model Law

• http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_arbitration.html

• Adopted in nearly 70 countries: http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_arbitration_status.html

• Autonomous interpretationhttp://www.uncitral.org/uncitral/en/case_law.html

Arbitration law

• Recognition of arbitration agreements

• Arbitrability

• Role of courts

• Constitution of the arbitral tribunal

• Seat

• Powers of the arbitral tribunal

• Procedural rules

• Costs

• Mandatory principles on due process

• Validity of arbitral awards

• Enforcement of arbitral awards

New York Convention

• http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention.html

• Ratified by 146 countries: http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention_status.html

Convention

• Recognition of arbitration agreements

• Enforcement of arbitral awards

Soft law

• IBA Rules on taking of evidence http://www.ibanet.org/Document/Default.aspx?DocumentUid=68336C49-4106-46BF-A1C6-A8F0880444DC

• IBA Rules on conflict of interest http://www.ibanet.org/Document/Default.aspx?DocumentUid=e2fe5e72-eb14-4bba-b10d-d33dafee8918

Soft law

• Matters within the discretion of arbitral tribunal