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Suggestions for Using Stone Soup this Semester

ADR Prof Blog - Tue, 2018-01-02 12:19
This post is for colleagues who will use a Stone Soup assignment this coming semester or are considering doing so. We now have posts with assessments of 19 course offerings, which include the Stone Soup assignments that faculty used.  Some posts include additional documents.  Note that this post collects assessments of five ADR courses and … Continue reading Suggestions for Using Stone Soup this Semester →

Fitzpatrick, Cella, Harper & Scinto Announces Two New Partners - Business Wire (press release)

Google International ADR News - Tue, 2018-01-02 09:18

Fitzpatrick, Cella, Harper & Scinto Announces Two New Partners
Business Wire (press release)
... leading national intellectual property law firm with offices in New York, Costa Mesa, California, and Washington, D.C. It has one of the premier patent litigation and prosecution practices, which covers the spectrum of intellectual property ...

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Some Critical Observations on the EU’s Foreign Investment Screening Proposal

Kluwer Arbitration Blog - Tue, 2018-01-02 02:00

Nikos Lavranos

The EU Foreign Investment Screening Proposal

Last September, European Commission President Juncker presented a proposal for a European foreign investment screening regulation – apparently following a request by Germany, France and Italy.

The proposal follows-up on the Commission’s “Reflection Paper on Harnessing Globalisation”, published in May 2017. The Reflection Paper notes, inter alia, that

“Openness to foreign investment remains a key principle for the EU and a major source of growth. However, concerns have recently been voiced about foreign investors, notably state-owned enterprises, taking over European companies with key technologies for strategic reasons. EU investors often do not enjoy the same rights to invest in the country from which the investment originates. These concerns need careful analysis and appropriate action.”

In other words, this proposal aims at providing a tool for the Commission and the Member States to respond to planned foreign investments of, for example, Chinse state-owned enterprises in sectors, which are considered sensitive and critical.

Screening mechanisms are not a novel tool but are used by about half of the EU Member States, i.e. Austria, Denmark, Germany, Finland, France, Latvia, Lithuania, Italy, Poland, Portugal, Spain, and the United Kingdom, as well as many states outside the EU, most notably the American CFIUS mechanism.

Accordingly, the main argument for this European screening mechanism for foreign investments is “harmonization”, by providing first and foremost legal certainty for Member States that maintain a screening mechanism or wish to adopt one. Thus, this Regulation would empower Member States to maintain their mechanisms or to create new ones in line with this Regulation.

Second, the Regulation aims at creating a “cooperation mechanism” between the Member States and the European Commission in order to inform each other about foreign direct investments that may threaten the “security” or “public order”. This cooperation mechanism enables other Member States and the Commission to raise concerns against envisaged investments and requires the Member State concerned to take these concerns duly into account. In other words, this “cooperation mechanism” is an “intervention mechanism” in disguise by giving the Member States and the Commission a tool to review and intervene against planned foreign investments in other Member States.

Third, the proposal also enables the Commission itself to screen foreign investments on grounds of security and public order in case they “may affect projects or programmes of Union interest”.

In short, Member States and the Commission will effectively be enabled to review any screening of any foreign investments and to intervene if they think that their interests may be affected.

However, the question arises whether this proposal will be an effective tool to review and ultimately prevent investments in sensitive sectors by foreign investors such as for example Chinese state-owned enterprises?

If one looks at the description of the screening grounds (“security” or “public order”), it immediately becomes clear that this proposal essentially can cover any foreign investment.
Article 4 titled Factors that may be taken into consideration in the screening of the proposal states:

In screening a foreign direct investment on the grounds of security or public order, Member States and the Commission may consider the potential effects on, inter alia:
– critical infrastructure, including energy, transport, communications, data storage, space or financial infrastructure, as well as sensitive facilities;
– critical technologies, including artificial intelligence, robotics, semiconductors, technologies with potential dual use applications, cybersecurity, space or nuclear technology;
– the security of supply of critical inputs; or
– access to sensitive information or the ability to control sensitive information.

In determining whether a foreign direct investment is likely to affect security or public order, Member States and the Commission may take into account whether the foreign investor is controlled by the government of a third country, including through significant funding.

The first point to note is the fact that this list is only an indicative list of potential effects of planned foreign investments. This means that the Member States and the European Commission can also take other potential effects into account. Nonetheless, this indicative list illustrates the sectors which the Commission considers particularly sensitive such as energy, communications, IT and cybersecurity.

The second noteworthy point is the cooperation framework between the Member States and the Commission. This cooperation framework requires the Member States to inform each other and the Commission of planned foreign investments and allows them to review and comment on them. The Commission is able to issue its comments in the form of non-binding opinions, while the affected Member State is required to take such comments duly into account.

Consequently, in order to be effective, this Regulation essentially will require all Member States – in particular those which have not yet a screening mechanism in place – to create one, otherwise these Member States and the Commission will not be able to share the required information about planned new foreign investments and the review them.

As a result, if this proposal is approved, the screening of foreign investments will become a standard practice in all Member States.

However, the proposal fails to specify what happens if an affected Member State fails to take any concerns of other Member States and/or the Commission into account. This seems an important missing element since the views among the Member States as to whether or not a certain foreign investment by – for example a Chinese state-owned enterprise – may have dangerous effects could very well differ. Also, some Member States may value the creation of jobs as more important than a potential negative impact on for example cybersecurity.

Also, the proposal does not specify who will be financially responsible if planned foreign investments fail to materialize due to the market distorting interventions by other Member States and/or the Commission.

Moreover, if seen in the context of the EU’s investment policy and FTAs, which it has already negotiated (CETA, EU-Singapore FTA, EU-Vietnam FTA) or is currently negotiating (EU-Japan FTA), the proposal raises the question to what extent this is conducive to the proclaimed aim of more openness to foreign investors and their investments. Indeed, the application of such a screening mechanism could lead to discriminatory treatment of foreign investors and hence to investment arbitration cases as result of breaches of the FTA provisions.

The same risk exists for the 1,500 bilateral investment treaties (BITs), which the Member States currently have signed with third states. After all, the aim of these investment treaties is to promote and protect foreign investments from discriminatory or unfair treatment, which could arise if the screening mechanism is applied in certain way. Interestingly, the explanatory memorandum to the proposal does not discuss this issue, neither was the EU proposal accompanied by any impact assessment.

Thus, some important issues have not been addressed and it remains to be seen whether this proposal will gain sufficient support by all Member States, and if so, to what extent it will be modified by the Council.

Convergence between the EU’s screening proposal and CFIUS

In this context, it is important to note that the scope of application of the American Committee on Foreign Investment in the United States (CFIUS system) is currently more restrictive than the proposed EU screening mechanism.

First, the CFIUS system is a “voluntary” system, which means foreign investors are not required to submit their planned investments for review but can voluntarily decide to do so if they think the planned investment may fall within the jurisdiction of the CFIUS.

Second, the current scope of review of the CFIUS is limited to “mergers, acquisitions, or takeovers” of US businesses, although the CFIUS jurisdiction may extend to international transactions, which involve one or more US subsidiaries or significant US assets or operations.

Third, the current scope of the CFIUS is limited to “national security considerations”.

However, in November 2017, a bipartisan group of lawmakers introduced a long-awaited Foreign Investment Risk Review Modernization Act of 2017 (“FIRRMA”), which would modernize the CFIUS review and approval process.

The proposed bill would broaden the scope of transactions subject to CFIUS review to include:

  • any non-passive (even non-controlling) investment by a foreign person in any US “critical technology” or “critical infrastructure” company;
  • any change in the rights that a foreign investor has with respect to a US business if that change could result in foreign control of the U.S. business or a non-passive investment in a US critical technology or critical infrastructure company;
  • any contribution (other than through an ordinary customer relationship) by a US critical technology company of both intellectual property and associated support to a foreign person through any type of arrangement, such as a joint venture;
  • the purchase or lease by a foreign person of real estate that is in close proximity to a US military installation or other sensitive US government facility or property; and
  • any transaction or agreement designed or intended to evade or circumvent CFIUS review.

If the CFIUS review system would indeed be updated and expanded as proposed by the FIRRMA, the scope of review of the CFIUS would be rather similar to the EU’s proposed screening mechanism.

In conclusion, a convergence on both sides of the Atlantic is currently taking place by expanding the available toolbox for screening planned foreign investments with the purported aim of preventing foreign – in particular Chinese – investments in sectors that are considered sensitive and critical. However, there is a risk that the screening mechanism could be abused for disguised protectionism and for gaining domestic political support.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
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The post Some Critical Observations on the EU’s Foreign Investment Screening Proposal appeared first on Kluwer Arbitration Blog.

When 2018 Comes, Let Us Thank God We Survived - Leadership Newspapers

Google International ADR News - Mon, 2018-01-01 21:53

Leadership Newspapers

When 2018 Comes, Let Us Thank God We Survived
Leadership Newspapers
Tens of millions of Nigerians are in dire need. They do not know where the next meal will come from. They are not lazy, but there are no jobs. So when two industrial giants in a largely deindustrialized country take on each other in a fratricidal war ...

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Stone Soup Assessment:  Gemma Smyth’s Access to Justice Course

ADR Prof Blog - Mon, 2018-01-01 17:47
Gemma Smyth is the Externship Program Director for the University of Windsor Faculty of Law, in Canada, which has a long tradition of focusing on access to justice.  Windsor is so committed to this mission that it requires all students to take an Access to Justice course in their first semester. Gemma is one of … Continue reading Stone Soup Assessment:  Gemma Smyth’s Access to Justice Course →

5 Insurance Dispute Trends To Watch In 2018 - Law360

Google International ADR News - Mon, 2018-01-01 14:37

5 Insurance Dispute Trends To Watch In 2018
Still, while using the courts will save firms the cost of hiring arbitrators to resolve a case, litigation has become more expensive too as the government increases the cost of issuing proceedings, according to Alison Green, a barrister at 2 Temple ...

Delhi High Court’s decision in GMR v. Doosan: Two steps forward, two steps back?

Kluwer Arbitration Blog - Mon, 2018-01-01 06:00

Shalaka Patil and Jeet Shroff

The Delhi High Court (Court) recently rendered a decision in GMR v. Doosan (“GMR”) on two critical points related to Indian arbitration– a) joinder of non-signatories to arbitration and b) whether two Indian parties can choose a foreign seat. Both issues have had conflicting decisions from courts leading to confusion in jurisprudence. Did the Court’s decision in GMR help clarify the law? In our view, no. Instead, it addled precedent by issuing a tenuously reasoned decision.


GMR Chhattisgarh (“GCEL”) and Doosan India (“Doosan”) entered into 3 EPC contracts in 2010 (“EPC Contracts”) which provided for SIAC arbitrations in Singapore.

GMR Infrastructure Ltd. (“GIL”) furnished a corporate guarantee to Doosan, on behalf of GCEL in 2013 (“Corporate Guarantee”) containing an arbitration clause (SIAC administered, in Singapore).

Two MOUs were executed between Doosan and GMR Energy (“GE”) in 2015 where GE agreed to repay Doosan in installments for GCEL’s liability under the EPC contracts. The MOUs did not contain arbitration clauses and were terminated before commencing arbitration.

Doosan invoked SIAC arbitration under the EPC contracts and the Corporate Guarantee making GCEL and GIL parties. Doosan sought GE’s joinder based on the MOUs and theories of joinder of non-parties including alter ego, group companies’ doctrine, and common directors, seeking repayment jointly and severally from GCEL, GIL and GE. In response, GE filed a suit seeking a permanent injunction against Doosan from continuing arbitration since GE was not a party to the arbitration agreement in the EPC Contracts and the Corporate Guarantee. The Court stayed the constitution of the SIAC tribunal. Doosan sought vacation of this order and applied under the Arbitration and Conciliation Act, 1996 (“AA”) to compel GE to participate in the arbitration. In this hearing, GE’s motion for injunction and Doosan’s motion for vacation and arbitral reference were heard together and decided.

Was GE’s joinder justified?

The Court examined whether Doosan had made out a prima facie case in its notice of arbitration justifying GE’s joinder. In accepting GE’s joinder was proper, it found as follows:

  • That GE, GCEL, and GIL freely “co-mingled” funds and were family run.


Family run businesses are common amongst Indian group companies. There was not much evidence of funds being co-mingled other than the corporate guarantee and MOUs. This, by itself, does not validate piercing the corporate veil to subject a party to the arbitration.

  • That the entities had common directors.


In India, common directorship or even the holding company’s control in the appointment of directors in the subsidiary does not remove the juristic and legal independence of such subsidiary. The Supreme Court’s (“SC”) landmark decision in Vodafone International Holdings B.V. v India espouses this principle and holds that directors of subsidiaries have a separate responsibility to the subsidiary. Vodafone observed that in liquidation, such subsidiary’s assets would go to the liquidator, not the parent. The Court has not taken this into account at all.


  • That there was no “corporate formality” between the various group companies.


However, it did not explain the absence of “corporate formality” when overlooking distinct corporate personalities. In fact, there are some cases that caution against the overzealous use of this power of piercing the veil (see Balwant Rai Saluja v. Air India). In India, while principles of public interest and single economic entity are accepted to pierce the veil, for the argument of agency, alter ego and control in a parent-subsidiary relationship, a high degree of control needs to be shown (see New Horizons v India).


  • The parent-subsidiary relationship and that at the material time GCEL was GE’s 100% subsidiary.


In transactions that are admittedly “sham” where entities are merely created as funnels, the corporate veil should be pierced but not in other circumstances (Balwant Rai). In this case, while GCEL was an SPV, it was not camouflaged. Creation of SPVs is routine for infrastructure projects. There was no written agreement binding GE to arbitration, the MOUs had terminated, and the 100% subsidiary relationship also did not exist.

While this case may be fit for piercing the corporate veil on merits, there was not enough to bind GE to arbitration. This matter could have been resolved by Doosan filing a civil suit against all the entities. While extending the arbitration to GIL was appropriate even in the context of the well-worn Chloro Controls regime, it is hard to find any express or implied term by which GE agreed to submit to arbitration. GE may or may not have breached its commitment to pay, but it made no commitment to arbitrate.

The Court overstated the factors purportedly evidencing GE’s intention to arbitrate. Illustratively, one of the clauses in the contracts stated that parties could consolidate disputes in one arbitration under the various contracts; but such consolidation was only permissible if all parties consented. Such consent was however absent. The Court also failed to account for lack of an arbitration clause in the MOUs.

GE relied on a clause in the contracts which stated that parties were entering into this agreement on their own behalf and not on behalf of, amongst others, shareholders and agents and that neither party shall have recourse to them including through piercing the corporate veil. The Court ignored the clear mandate of this clause.

Can two Indian parties choose a foreign seat?

There has been judicial divergence on whether two Indian parties can choose a foreign seat. The GMR judgment further muddies the waters. Relying on SC decisions in Atlas Exports and Sassan Power, the Court concluded that two Indian parties can choose a foreign seat. However, the Court’s reasoning is feeble.

Two objections have been made against Indian parties choosing a foreign seat – a) this arrangement runs afoul of Section 28 of the AA which requires the governing law of the underlying contract for all India-seated, domestic arbitrations (between Indian parties) to be Indian law; b) Under Sections 28 of the Indian Contract Act, 1872 (“CA”) two Indian parties must not be prevented from accessing legal proceedings in India. The Court conflates these objections.

The Court misread the Atlas decision where the contract was executed between two Indian and a Hong Kong party. The arbitration clause provided for London arbitration. Relying on Section 28 of the CA, it was argued that denying two Indian parties remedy of Indian courts was contrary to public policy. The SC relied on the arbitration exception under the CA to enforce the award ruling that no public-policy argument could stand merely based on the arbitration being foreign-seated. The Court’s reliance on Atlas is problematic because Atlas does not examine the legality of Indian parties submitting to a foreign seat in the context of substantive law of the contract being foreign law (and therefore hit by Section 28 of the AA). The facts in Atlas do not fit the conclusion that the Court attributes to it.

Court’s reliance on Sasan is misplaced. In Sasan, two Indian parties agreed to arbitrate in London; English law governed. The lower court had ruled that two Indian parties could arbitrate in a foreign country under foreign law. In appeal, SC skirted the issue, ruling that the American parent of the Indian company was also party to the dispute. Since the dispute involved a foreign element, English law could apply. The court made no determination on the seat.

Holding Addhar Mercantile to be per incuriam for its failure to consider Atlas was also incorrect. In Addhar, two Indian parties had agreed to arbitrate “…in India or Singapore and English law to apply.” The Bombay HC held (relying on SC’s decision in TDM Infrastructure) that Indian nationals should not be permitted to derogate from Indian law. It, therefore, ruled that the arbitration would be India seated and accordingly Section 28 of the AA would not be breached. How has the Court misread these precedents? By suggesting that Atlas and Aadhar dealt with the same issue. The decision in Atlas is not a precedent for the proposition that two Indian parties cannot have their disputes determined by foreign law. Atlas dealt with Section 28 of the CA (not, Section 28 of the AA). Aadhar, on the other hand, deals with applicability of Section 28 of the AA to arbitrations involving two Indian parties.

In ruling that two Indian parties can opt for foreign-seated arbitrations, the Court advances party autonomy. The Court’s reasoning, however, is tenuous. The Court could have arrived at the same conclusion as follows:

  • Atlas confirms that there are no public policy grounds that prevent two Indian parties from choosing a foreign seat;
  • Section 28 of the AA requires Indian law be applied only for India-seated arbitrations between two Indian parties; and
  • The SC’s decision in Sassan is not a precedent for either proposition.

In attempting to enforce the arbitration agreement, the GMR decision mirrors a welcome pro-arbitration trend adopted by Indian courts. Yet, its reasoning casts serious doubts on its standing as a precedent. Within their overarching pro-arbitration approach, Indian courts would do well to examine each case critically.


The views expressed herein are solely of the authors and do not represent any organizations or companies to which either author belongs.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240

The post Delhi High Court’s decision in GMR v. Doosan: Two steps forward, two steps back? appeared first on Kluwer Arbitration Blog.

People on the move: 1/2/18 - Pittsburgh Post-Gazette

Google International ADR News - Sun, 2017-12-31 23:03

Pittsburgh Post-Gazette

People on the move: 1/2/18
Pittsburgh Post-Gazette
Ms. Hestin handles litigation and alternative dispute resolution for financial industry clients. Mr. Zahn represents public and private companies and private equity funds in a transactional matters, including mergers and acquisitions, divestitures ...

Strikes on petty issues hinder delivery of justice: LHC CJ - The News International

Google International ADR News - Sun, 2017-12-31 18:35

Strikes on petty issues hinder delivery of justice: LHC CJ
The News International
He said that Alternative Dispute Resolution (ADR) centres, model courts and special courts can only deliver if the judges understand their true spirit. There is zero tolerance for corruption in the judiciary. He rated the Punjab judicial academy as the ...

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Why interpreting body language doesn't lead to effective communication

Communication and Conflict Blog - Sat, 2017-12-30 17:47
How interpreting body language and other non-verbal behaviour leads to disconnection between people.

Twelve Hours of Conflict, A Christmas Song by Susan Yates

ADR Prof Blog - Sat, 2017-12-30 17:04
EFOI Susan M. Yates, the executive director of Resolution Systems Institute, penned a dispute-resolution themed Christmas song, which she posted on RSI’s blog.  Hopefully, this will add to your holiday cheer.  Thanks to GFOI Jim Alfini for this suggestion.   (Click the title to access the song.)

Judicial Reform in Saudi Arabia: Recent Developments in Arbitration and Commercial Litigation

Kluwer Arbitration Blog - Sat, 2017-12-30 16:19

John Balouziyeh

Since oil prices have reached historic lows in 2014, the Kingdom of Saudi Arabia, the world’s largest oil exporter, has recognized the need to reduce its dependence on oil and diversify its economy. As part of a slew of reforms known as Vision 2030, Saudi Arabia has taken steps designed to prepare for the day when renewable energy becomes the new norm, when alternate energy effectively replaces fossil fuels and oil revenues no longer sustain state spending. In diversifying its human capital and economy, Saudi Arabia has recognized the need to cultivate an environment attractive to foreign investors, which the Kingdom views as essential partners in transferring knowhow and expertise to its local workforce.

Attracting foreign investment in turn requires building an environment that reassures investor confidence in legal institutions, courts and the rule of law. Such an environment must guarantee that decisions will not be taken arbitrarily but rather, in accordance with predictable rules. Recognizing the need to foster a landscape where foreign investors can resolve disputes fairly and with efficiency, Saudi Arabia has recently undertaken myriad reforms in the area of dispute resolution, including in international and domestic arbitration and commercial litigation. Recent developments include a Saudi legal judgment enforcing a multi-million dollar ICC arbitral award, the launch of the Saudi Center for Commercial Arbitration, the issuance of decisions in which Saudi courts deferred to foreign choice of forum and arbitration clauses and the establishment of the Commercial Courts as a forum for dispute resolution independent of the Board of Grievances.

Developments in the arbitration arena

Arbitration has deep roots in Middle Eastern culture and Islamic law, which encourages parties to peacefully resolve their disputes through the mediation of an elder or sheikh before resorting to the courts. Yet despite this rich heritage, arbitration has traditionally been underutilized as a method of dispute resolution in Saudi Arabia. This underutilization has been due to various causes, including concerns relating to the enforceability of arbitral awards in Saudi Arabia, the potential conflict between awards and Saudi public policy and the possibility that the Saudi courts would review arbitral awards on their merits.

Developments in Saudi Arabia indicate a change of direction, with the Saudi courts repeatedly upholding arbitration clauses and recognizing foreign arbitral awards in recent years, notable examples of which are discussed below. At the same time, the Saudi government has in recent years made several landmark decisions to bring the Kingdom in line with international arbitration standards. These include the 2016 launch of the Saudi Center for Commercial Arbitration (SCCA) and enactment of the 2012 Arbitration Law, issued by Royal Decree no. M/34, dated 24/5/1433 H., corresponding to 16/4/2012 G. (new Arbitration Law). These developments reflect a shift in the policies of the Saudi government, which is taking steps to encourage arbitration and streamline the dispute resolution process.

Saudi Center for Commercial Arbitration

The SCCA, which was formally launched in the fall of 2016, was created by Cabinet Decree no. 257, dated 14/6/1435 H., corresponding to 15/03/2014 G.. The purpose of the SCCA is to administer arbitration procedures in civil and commercial disputes where parties agree to refer their disputes to SCCA arbitration, in accordance with regulations in force and judicial principles of civil and commercial procedure. The SCCA has broad authority to adjudicate disputes brought before it, but personal status, administrative and criminal disputes remain excluded from SCCA jurisdiction.

Saudi case law

Finally, several cases in recent years have given deference to arbitral tribunals and have upheld arbitration clauses, thus signaling a further change in direction for Saudi Arabia. One prominent example includes the decision of a Riyadh court in 2016 to confirm that a USD 18.5 million ICC arbitral award would be enforced against a Saudi data communications service company. The Saudi-domiciled debtor was ordered to make the payment to the United Arab Emirates subsidiary of a Greek telecommunications company. Prior to enforcing the foreign arbitral award, the judge was required to find that the country in which the award was rendered (the UK) would reciprocate by enforcing awards issued in Saudi Arabia. This element was met by reference to the UK’s accession to the New York Convention, thereby becoming, to the author’s knowledge, the first arbitral award to be enforced under the New York Convention in Saudi Arabia. The judge also held that the Saudi courts had no jurisdiction to hear the dispute owing to an arbitration clause in the contract; that the arbitration complied with due process; and that the award was in final form, was not inconsistent with a judgment or order in relation to the same dispute issued by a local court and did not contradict Saudi public policy.

The judgment of the Board of Grievances in Case number 881/2/J (November 2013), which was initiated against a company and its shareholders, further indicates a shift of direction in Saudi Arabia’s dispute resolution landscape. The claimant sold his shares in the company to other shareholders, with the shares valued in accordance with the company’s financial statement. However, the claimant found out after the sale of his shares that the Company financial statement was inaccurate. The respondents submitted a motion alleging that the Court had no jurisdiction due to the arbitration clause and all rights and obligations arising out of contract had been transferred to them. The Court dismissed the case, agreeing with the respondents and holding that the arbitration clause was binding. The Court of Appeal affirmed the judgment.

The decision of a court in Mecca Al Mukarama in Case number 23699557 (January 2012) is a further example in which a court, deferring to an arbitration clause, refused to exercise jurisdiction over a case. In this case, where the parties had agreed to arbitrate any dispute that arose between them relating to the interpretation of the contract. The claimant brought the case before the Court, alleging that the scope of the arbitration agreement was limited to the interpretation of the contract, while the dispute related to non-arbitrable matters of implementation. The Court dismissed the case and ruled that a dispute related to the implementation of the contract would necessarily raise issues related to its interpretation and therefore was to be resolved by arbitration.

These cases demonstrate an important shift of direction in Saudi legal practice, where the commercial courts under the Board of Grievances have historically asserted jurisdiction, applying Saudi law in contract disputes, notwithstanding foreign choice of law or arbitration clauses. While the cases discussed above indicate a shift, a Saudi commercial court would still likely assert jurisdiction in a dispute that involves public documents, such as articles of association or bylaws registered with the Ministry of Commerce and Investment, regardless of whether the parties enter into side agreements subject to foreign law or arbitration.

Developments in the litigation arena

Dispute resolution in Saudi Arabia has historically been criticized as being riddled with uncertainty and inefficiency, with cases taking as long as two to three years or longer to find resolution. In October of 2017, in an effort to increase judicial efficiency and enhance investor confidence, the Ministry of Justice launched the opening of the Commercial Courts in Jeddah, Damam and Riyadh as independent institutions directly under the Ministry of Justice rather than as a branch of the Board of Grievances, as was historically the case. The Minister of Justice stated at the launch day that the move was part of the Vision 2030 initiative to revitalize the business environment, fuel investment and accelerate economic development in the Kingdom. The Commercial Courts opened on 1 Muharram 1439 H., corresponding to 21 Sept. 2017.

The Ministry of Justice announced that the new Commercial Courts issued more than 1,181 judgments in their second month of operation. This judicial reform indicates a shift in the practice of the Saudi courts, which have historically been criticized for their slow pace in meting out judgments and inefficiency in judicial resolution.

The creation of the SCCA, coupled with recent case law upholding arbitral clauses, the creation of the Commercial Courts as independent legal institution and the issuance of the new Arbitration Law have been hailed as signaling a change of direction for Saudi Arabia, which has historically been seen as hostile to the enforcement of foreign judgments and arbitral awards. The creation of independent Commercial Courts will further boost investor confidence by ensuring that foreign companies have an efficient forum in which to resolve their disputes. Together, these developments indicate a positive shift for foreign investors wishing to invest in Saudi Arabia’s rapidly diversifying economy.

More from our authors: International Arbitration and the Rule of Law
by Andrea Menaker
€ 240

The post Judicial Reform in Saudi Arabia: Recent Developments in Arbitration and Commercial Litigation appeared first on Kluwer Arbitration Blog.

Heading Towards GDPR In 2018–Enhanced Rights For Citizens In ... - Modern Ghana (press release) (blog)

Google International ADR News - Sat, 2017-12-30 14:41

Modern Ghana (press release) (blog)

Heading Towards GDPR In 2018–Enhanced Rights For Citizens In ...
Modern Ghana (press release) (blog)
One thing is certain for 2018. It will be marked with a milestone change in data protection for persons in the EU. Not only for EU citizens, but for anyone i...

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Heading towards GDPR in 2018– Enhanced rights for citizens in the EU - Modern Diplomacy

Google International ADR News - Sat, 2017-12-30 10:43

Modern Diplomacy

Heading towards GDPR in 2018– Enhanced rights for citizens in the EU
Modern Diplomacy
And so is the classic international law. General Data Protection Regulation ('GDPR'), which is about to be applicable as from 25 May 2018, will bring major changes in data protection introducing enhanced rights for individuals or data subjects, complex ...

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ALSD-PACT Indian Symposium on Dispute Resolution [15th-17th Jan, New Delhi] - Live Law

Google International ADR News - Sat, 2017-12-30 00:21

Live Law

ALSD-PACT Indian Symposium on Dispute Resolution [15th-17th Jan, New Delhi]
Live Law
ISDR is an endeavour which aims to make a positive difference to the very idea of dispute resolution. Mediation, being an integral part of Consensual Alternative Dispute Resolution(CADR) is the principal focus and fulcrum of the first edition of ISDR ...

Ben Davis:  Fun with Technology, Arbitration Clauses and a Mock International Commercial Arbitration

ADR Prof Blog - Fri, 2017-12-29 19:04
Here’s an exercise that TFOI Ben Davis uses and wants to share. I just came across a tool that might be of interest on building arbitration clauses.  The only thing that I would add would be a reminder about Frederic Eisemann’s article on Pathological Arbitration Clauses (La Clause d’arbitrage pathologique, Commercial Arbitration Essays in Memoriam … Continue reading Ben Davis:  Fun with Technology, Arbitration Clauses and a Mock International Commercial Arbitration →

Cops struggle to handle call money rackets - NYOOOZ

Google International ADR News - Fri, 2017-12-29 16:34

Cops struggle to handle call money rackets
Summary: "We have requested The International Centre for Alternative Dispute Resolution (ICADR) to help in improving the alternate dispute resolution method that we are following so that solutions can be delivered in an efficient manner," Sawang said ...

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Cops struggle to handle call money rackets - Times of India

Google International ADR News - Fri, 2017-12-29 16:28

Cops struggle to handle call money rackets
Times of India
The loan however comes at a high price as the interest ranges from 120-200%. This is rampant in the city and experts believe the size of the racket is close to Rs 600 crore. Lenders who intimidated or extorted borrowers have been charged with criminal ...

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New Year Honours 2018: Business, philanthopy, arts and media - The National Business Review

Google International ADR News - Fri, 2017-12-29 10:13

The National Business Review

New Year Honours 2018: Business, philanthopy, arts and media
The National Business Review
Virginia Goldblatt has been a leader in the field of conflict resolution, alternative dispute resolution and mediation for many years. She is director of the Massey University Dispute Resolution Centre from 2007-12. She has contributed to leading texts ...

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Mind the Label: Loyalists and Reformists and ISDS

Kluwer Arbitration Blog - Fri, 2017-12-29 01:49

Anne-Karin Grill


In late November, the UN Headquarters in Vienna saw the first meeting of Working Group III of the United Nations Commission on International Trade (UNCITRAL). The meeting marked the initiation of a process of analysis and reform – whatever shape it may ultimately take – of the existing Investor State Dispute Settlement (ISDS) regime. At the meeting, the Working Group agreed to proceed first by identifying concerns regarding ISDS, then considering whether reform is desirable in light of any identified concerns, and, if it concludes that it is, developing relevant solutions to be recommended to the UNCITRAL.

As per the UNCITRAL mandate, the Working Group is more government-led than is typical of UNCITRAL Working Groups (more than 300 participants representing 80 states and 35 observers, including the European Union, UNCTAD ICSID, OECD and the PCA, while a number of other intergovernmental and non-governmental organisations also participated). This is a direct reflection of the express request of UNCITRAL that the deliberations of the Working Group, while benefiting from the widest possible breadth of available expertise from all stakeholders, should be government-led with high-level input from all governments, consensus-based and fully transparent.

Unsurprisingly, participants described the Vienna debates as “highly political”.1)Anthea Roberts, UNCITRAL and ISDS Reform: Not Business as Usual, 11 December 2017 jQuery("#footnote_plugin_tooltip_5173_1").tooltip({ tip: "#footnote_plugin_tooltip_text_5173_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Internationally, there is a schism over whether to embrace ISDS and, if so, whether international claims by investors would be better heard by ad hoc arbitral bodies or a permanent investment court. Domestically, ISDS has stirred controversy at best and outright rejection at worst. While the need for fact-based analysis of the current ISDS regime was emphasised at the Vienna meeting, it was also noted that various perceptions of the relevant issues needed to be considered. The concerns of developing states, as well as access of small- and medium-sized enterprises to ISDS, were mentioned as well.

The initial discussions of Working Group III took place against the background of a note prepared by the UNCITRAL Secretariat, “Possible reform of investor-State dispute settlement (ISDS),” issued on 18 September 2017. This document lists well-known concerns regarding ISDS. Essentially, they fall within two broad categories: (i) concerns relating to the arbitral process and its outcomes (inconsistency in arbitral decisions, limited mechanisms to ensure the correctness of arbitral decisions, lack of predictability, lack of transparency, increasing duration and costs of the procedure), and (ii) concerns relating to arbitrators/decision-makers (appointment of arbitrators by the parties, the impact of party appointment on the impartiality and independence of arbitrators). Potential reform measures to be considered by the Working Group cover a broad spectrum, from relatively minor adjustments to the existing ISDS regime (eg the introduction of alternative methods for appointing arbitrators, such as designing a system with a pool of members and the strengthening – or establishing – of ethical requirements) to further institutionalising the existing ISDS regime through the creation of a permanent adjudicatory body (such as a permanent investment court or dispute settlement body).

Non-state stakeholders in the reform process that is unfolding may appreciate the following:

1. Not everyone immediately appreciated putting the UNCITRAL in charge of ISDS reform. In fact, the Working Group usually dealing with questions of arbitration is Working Group II. Since the issues discussed are usually technical in nature (eg the development of model rules), many states have delegated their representation to arbitration practitioners. There was a concern that having states represented by arbitration practitioners in the reform discussions was inappropriate. Giving the reform mandate to Working Group III created a welcome loophole to allow states to reassess who should represent them without affront. What could possibly be expected from those practitioners anyway, if not attempts to delay or even frustrate any reform? Would not that be the case given that they have a vested financial interest in maintaining the status quo?

2. The arguments of advocates for the introduction of a permanent investment court or dispute settlement body – most notably the European Commission – are remarkably divorced from reality. Where arbitrator appointments are made by disputing parties, it is argued, attention is distracted from what is assumed to be their true long term interest: recourse to adjudicative bodies that faithfully interpret and apply the substantive provisions underlying their dispute. According to the self-proclaimed reformists of the current arbitration-focused ISDS regime, this leads to a continued high concentration of persons who have gained their experience as arbitrators primarily in the field of commercial disputes and who are therefore believed to be less familiar with public international law. Throw in the regional and gender diversity cards and you have the perfect storm: incompetence, non-diversity, political colouring. Are standing adjudicative bodies as we know them indeed above suspicion?

3. While ISDS served to depoliticize conflicts between investors and states and prevent them from escalating into interstate conflicts, its reputation does not mirror its benefits – in fact, quite the contrary. While States themselves have established and consented to the current ISDS regime and confirmed its legitimacy under international law, this legitimacy is increasingly challenged by their constituencies. Public opinion is weighing heavily and the statistics have added fuel to the fire. As of 1 January 2017, there were 767 publicly known treaty-based ISDS cases, in which 109 states were respondents in one or more of them. The apparent tensions are being channelled into comparisons of the relative merits of investor-state arbitration and a multilateral investment court system, with states staking out positions as “loyalists” or “reformists”. But let’s mind the labels here: how “reformatory” is it to press ISDS into the mould of a standing investment court system? Is “same but different” really the universal cure? In terms of political marketing, the answer may be a clear yes. In terms of treating the apparent diseases of arbitration-based ISDS, which undeniably exist, would it not be more essential to focus on improving the existing ISDS regime?

Arbitration practitioners, experts, loyalists – let your voices be heard!

References   [ + ]

1. ↑ Anthea Roberts, UNCITRAL and ISDS Reform: Not Business as Usual, 11 December 2017 function footnote_expand_reference_container() { jQuery("#footnote_references_container").show(); jQuery("#footnote_reference_container_collapse_button").text("-"); } function footnote_collapse_reference_container() { jQuery("#footnote_references_container").hide(); jQuery("#footnote_reference_container_collapse_button").text("+"); } function footnote_expand_collapse_reference_container() { if (jQuery("#footnote_references_container").is(":hidden")) { footnote_expand_reference_container(); } else { footnote_collapse_reference_container(); } } function footnote_moveToAnchor(p_str_TargetID) { footnote_expand_reference_container(); var l_obj_Target = jQuery("#" + p_str_TargetID); if(l_obj_Target.length) { jQuery('html, body').animate({ scrollTop: l_obj_Target.offset().top - window.innerHeight/2 }, 1000); } }More from our authors: International Arbitration and the Rule of Law
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