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Tackling the Backlog in Pakistan's Courts - The Asia Foundation - In Asia

Google International ADR News - Wed, 2018-08-29 17:34

The Asia Foundation - In Asia

Tackling the Backlog in Pakistan's Courts
The Asia Foundation - In Asia
Chief Justice Syed Mansoor Ali Shah of the Lahore High Court (LHC) last year told an international roundtable that some 200,000 cases were pending in district courts across Punjab and another 130,000 in the LHC. ... The Asia Foundation's alternative ...

The “state of the art” of the ADRs in Brazil - Lexology

Google International ADR News - Wed, 2018-08-29 08:18

Lexology

The “state of the art” of the ADRs in Brazil
Lexology
Brazil is being considered a interesting seat for international arbitrations. Furthermore, mediation is becaming an attractive method of dispute resolution in the country. Some practioners have already refered to this movement as “the dawn of mediation ...

Peru's Amprimo & Flury hires senior Estudio Echecopar partner - Latin Lawyer

Google International ADR News - Wed, 2018-08-29 04:58

Latin Lawyer

Peru's Amprimo & Flury hires senior Estudio Echecopar partner
Latin Lawyer
Barboza, 47, joined Amprimo & Flury yesterday, taking the firm's partner count to five. He now leads a team which focuses on private commercial contracts. His legal knowledge spans contractual, real estate and alternative dispute resolution matters.

Eureka! Foreign Attorneys Can Now Participate in California-seated Arbitrations

Kluwer Arbitration Blog - Wed, 2018-08-29 00:44

Giorgio Sassine

“Why don’t you go on west to California? There’s work there, and it never gets cold. Why, you can reach out anywhere and pick an orange.  Why, there’s always some kind of crop to work in. Why don’t you go there?”

– John Steinbeck, The Grapes of Wrath

Introduction

For many years, the answer for international arbitration practitioners had been simple: California law precluded foreign attorneys from participating in international arbitrations seated in California.  Knowing this, most often international arbitration agreements are drafted with a seat other than California.  That will soon change.  As reported on 9 July 2018 in the Global Arbitration Review, “[i]n a move aimed at overhauling California’s reputation as an arbitral hub, the lower house of the state legislature has passed a bill expressly permitting out-of-state and foreign lawyers to appear in international arbitrations seated there.”  GAR then reported on 19 July 2018 that California’s Governor Jerry Brown signed the bill into law.

So why should international arbitration not now mosey on out West?  Putting aside the idyllic sandy, golden beaches, the western sunsets drawn down over the Pacific, Karl the Fog blanketing over the rolling hills of San Francisco, and the heaven-like Napa Valley wine region, California also boasts economically powerful metropolises and is the United States’ backbone for international business throughout the Pacific Rim, if not the world.  Having grown-up in the San Francisco Bay Area, I am only amazed by Silicon Valley’s collective ambition to shape humanity’s future endeavors.  While there has been negative press lately regarding data privacy and the moral questions underpinning the same, cafés across the Bay Area are buzzing with new ideas – at a pace that I have not seen anywhere else in the world.  Not only that – the amount of international trade coming in and out of Los Angeles is staggering; and both Los Angeles and Long Beach are ranked one and two, respectively, as the largest U.S. ports.  Hundreds of billions of dollars are being poured into California for mega infrastructure and construction projects, such as the high speed rail system connecting Los Angeles and San Francisco.  San Francisco, alone, has seven billion-dollar mega projects planned over the next twenty years.  And, of course, one cannot forget about the state’s second most populous city – San Diego – where its close vicinity to Mexico and the greater-Latin American region makes it a pivotal location for trade and culture moving across borders. In all, California’s economy is the fifth largest in the world – larger than the United Kingdom, India and France – with an effective GDP in 2017 of $2.747 trillion

Background

All has not been rosy on the Western Frontier when it comes to international arbitration; but, like many great Hollywood scripts, the tale of California’s place in international arbitration has a bright start, a dramatic climax, only to be followed by a happy ending. Decades ago, when California enacted an international arbitration law based on the UNCITRAL Model Law, Andre Brunel noted in the Texas International Law Journal that “California hope[d] to become the forum of choice by creating a favorable arbitral setting …  [and needed] to send a clear message that this country (or this state) is hospitable to arbitration.”

That all changed in 1998, when the California Supreme Court in Birbrowerhad to decide “whether an out-of-state law firm, not licensed to practice law in [California] violated section 6125 when it performed legal services in California for a California-based client.”  California Business and Professional Code § 6125 provides that “[n]o person shall practice law in California unless the person is an active member of the State Bar”. However, the term “practice of law” had not been defined in Cal. Bus. & Prof. C. § 6125, so the Court traced its history to determine if the definition applied to out-of-state attorneys participating in an arbitration seated in California.  The Court concluded that “the practice of law in California entails sufficient contact with the California client to render the nature of the legal services a clear legal representation.”  Applying this rule, the Court explained that “we must consider the nature of the unlicensed lawyer’s activities in the state.  The primary inquiry is whether the unlicensed lawyer engaged in sufficient activities in the state or created a continuing relationship with the California client that included legal duties and obligations.”  The Court held that Birbrower’s contacts and activities were sufficient to amount to the unauthorized practice of law in the State of California.

In response to Birbrower, California’s legislature adopted California Code of Civil Procedure § 1282.4, which Professor Roger Alford noted as “adopt[ing] a pro hac vice approach for out-of-state attorney arbitration counsel.”  Cal. C. Civ. Proc. § 1282.4, in pertinent part, reads: “(a) a party to an arbitration has the right to be represented by an attorney at any proceeding or hearing in arbitration under this title … (b) notwithstanding any other provision of law, including Section 6125 of the Business and Professions Code, an attorney admitted to the bar of any other statemay represent the parties in the course of, or in connection with, an arbitration in this state”.  (Emphasis added).  However, Cal. C. Civ. Proc. § 1282.4 did not expressly address the participation of foreign attorneys in arbitrations seated in California.  Knowing this, companies that do international business have counsel that draft or negotiate arbitration agreements that place the venue of a potential arbitral dispute in a seat such as New York City, Singapore, or Hong Kong.

The Response From California’s International Arbitration Community

The international arbitration community in California responded with incredible resolve to amend the law.  For example, most recently, the California Supreme Court created the Supreme Court International Commercial Arbitration Working Group in February 2017, with the recommendation that:

California should join the 13 U.S. jurisdictions (including New York, Florida, Illinois, Texas, and the District of Columbia) and numerous foreign jurisdictions (including Great Britain, France, Italy, Switzerland, Singapore, and Hong Kong) that authorize foreign and out-of-state attorneys to represent parties in international commercial arbitrations without any filing or fee requirement.

Of all the potential proposals, the Working Group unanimously recommended that California adopt a rule based on the American Bar Association’s Model Rule for Temporary Practice by Foreign Lawyers (ABA Model Rule). The Working Group found the ABA Model Rule was “clearer and more inviting” than any alternative.

California’s legislature responded to the Working Group’s findings and drafted Senate Bill 766, which has now been signed into law.  This is an important achievement and much credit is due to California’s international arbitration community and those outside California who see no reason why California should not be a hub for international arbitration.

California – the next hub for international arbitration

As Lao Tzu said, “the journey of a thousand miles begins with one step.”  For California, it is a significant step in the right direction.  As Maria Chedid, partner at Arnold & Porter, explained: “Our legislature has now spoken: when it comes to international arbitration, California’s doors should be opened wide”. California has the multi-cultural diversity, open and peaceful climate, large international metropolises, and top-tier international law firms and universities to attract international arbitration.  California has also set the foundation to be a burgeoning international arbitration hub when it enacted its international arbitration law based on the UNCITRAL Model Law.  In time, California will be on par with Singapore and Hong Kong and New York and Miami as an international arbitration hub of the Pacific Rim and Latin America, respectively.  The journey out West has only just begun.

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


The post Eureka! Foreign Attorneys Can Now Participate in California-seated Arbitrations appeared first on Kluwer Arbitration Blog.

Last Chance to Register for Works in Progress

ADR Prof Blog - Tue, 2018-08-28 09:51
Hosted by FOI Deborah Eisenberg and her great team at the University of Maryland School of Law, our annual works-in-progress conference will be October 4-6.  Registration link is here. Come hear great papers, hang out with colleagues, get inspired for your own work, and start the academic year with a bang!  Hope to see you … Continue reading Last Chance to Register for Works in Progress →

HEPI v. India: Stay Denied but Public Policy Prevents Enforcement

Kluwer Arbitration Blog - Mon, 2018-08-27 17:53

Thomas Snider

In Hardy Exploration & Production (India), Inc. v. Government of India, Ministry of Petroleum & Natural Gas, Civ. Action No. 16-140 (D.D.C. 7 June 2018), the U.S. District Court for the District of Columbia (“District Court”) refused to stay the enforcement of a foreign arbitral award that ordered the Indian Government (“India”) to reinstate an investor as the operator of a hydrocarbons block in India pending set-aside proceedings in Indian courts.  However, the District Court went on to conclude that it could not enforce the award because the award’s order of specific performance against India violated the public policy of the United States.  The District Court also refused to confirm a portion of the award that had granted interest on the investment up until the time that the investor was reinstated as the operator of the block.

Background to the Dispute

Hardy Exploration & Production (India), Inc. (“HEPI”) entered into a production sharing contract with India that allowed HEPI to search for and extract hydrocarbons from a block in southeast India.  In 2006, HEPI claimed that it had discovered natural gas, which, under the contract, granted HEPI a five-year appraisal period to determine whether the extraction was commercially viable.  India, however, claimed that the discovery was of crude oil, which only entitled HEPI to a two-year appraisal period.  After this two-year period ended, India relinquished HEPI’s rights to the block on the basis that HEPI failed to submit its declaration of commercial viability in a timely manner.

HEPI then initiated arbitration proceedings against India.  The tribunal consisted of three former Chief Justices of the Supreme Court of India, and the “venue” for the arbitration was Kuala Lumpur, Malaysia, as per the contract.  In 2013, the tribunal issued an award in which it concluded that the discovery was of natural gas and ordered India to allow HEPI back into the block for another three years to continue to assess whether the natural-gas discovery was commercially viable.  The tribunal also awarded HEPI interest on its original investment in the block until such time it was reinstated.

India thereafter filed a petition with the Delhi High Court to invalidate the award, and HEPI filed a separate application with the same court to enforce the award.  The High Court initially dismissed India’s plea for lack of jurisdiction on the ground that the proper venue for the application was the Madras High Court (because it was the court in closest geographical proximity to the block) and, following an appeal, on the ground that the seat of arbitration was in Malaysia.  India filed for leave to appeal the dismissal and stay the award with the Supreme Court of India.

In 2016, HEPI, having not been granted access to the block, filed a petition with the District Court for enforcement of the arbitral award.  India responded by arguing that (1) the District Court should stay enforcement of the award pending a final decision from the Indian courts and (2) confirmation of the portions of the award on specific performance and interest would contravene U.S. public policy.  In a Memorandum Opinion (“Mem. Op.”) dated 7 June 2018, the District Court refused to grant a stay but concluded that enforcement of the award would violate U.S. public policy.

Request for Stay

India maintained that the District Court should stay enforcement of the award pending a final decision from the Indian courts on set aside pursuant to Article VI of the New York Convention.  In response, HEPI argued that Article VI did not apply because India had brought proceedings in India rather than Malaysia, the seat of the arbitration.

The District Court noted that the record before it did not indicate whether the Supreme Court of India had ruled yet in the set-aside proceedings.  The District Court also noted the disagreement between HEPI and India regarding whether the Indian courts were a competent authority under the New York Convention given that the arbitration occurred in Malaysia.  Rather than delving into this issue directly, the District Court turned to the broader issue of whether it was proper for it to issue a stay assuming that the Indian courts were a competent authority.

In assessing whether to grant a stay of proceedings, the District Court looked to Europcar Italia, S.p.A v. Maiellano Tours, Inc., 156 F.3d 310 (2d Cir. 1998), which set forth six factors to be considered by courts when assessing whether to stay an enforcement proceeding, namely (1) the expeditious resolution of disputes, (2) the estimated time for foreign proceedings to be resolved, (3) whether the award will receive greater scrutiny in the foreign proceedings, (4) the characteristics of the foreign proceedings, (5) a balance of the hardships of the parties, and (6) any other circumstance that could shift the balance in favour of or against granting the stay.

The District Court denied India’s request to stay the proceedings on the basis of these factors.  In relation to the first, second, fourth, and fifth factors, the District Court focused on the delay of the proceedings in India.  The District Court noted that the proceedings in India have “been delayed over and over again due to the actions of the Government of India and the Supreme Court” and the parties could provide no “indication of how long they expect it will take the Indian court system to reach a final resolution in this case.” (Mem. Op. at 14.)

With respect to the third factor, the District Court accepted India’s argument that Indian courts would apply a greater level of scrutiny since they would consider whether the award comports with Indian law in determining whether to enforce it.

In relation to the sixth factor, the District Court noted “in particular the fact that the Supreme Court of India has already declined to stay the arbitration award pending India’s appeal regarding the Delhi High Court’s jurisdiction over the set-aside suit….  This Court is disinclined to question that assessment.” (Mem. Op. at 17.)

Specific Performance

On the basis of Article V(2)(b) of the New York Convention, India also argued that confirmation of the portion of the award on specific performance “would violate the U.S.’s clear public policy preference of respecting the sovereignty of foreign nations, including their right to control their own lands and national resources.”  (Mem. Op. at 20.)  India also maintained that an order of specific performance under these circumstances would contravene Indian law, would be difficult to enforce and supervise, and would violate the doctrines of comity and act of state.  In response, HEPI argued that India overstated the sovereignty issue.

The District Court confirmed that the public-policy exception should be narrowly construed but found that “India does not overstate the United States’ public policy interest in respecting the right of other nations to control the extraction and processing of natural resources within their own sovereign territories.”  (Mem. Op. at 21.)  The District Court highlighted three reasons why it believed enforcing the order of specific performance would contravene public policy.  First, while the District Court made clear that it did not believe that enforcing the award would be complicated for the District Court to supervise or that allowing HEPI back into the block would amount to HEPI possessing the block, the District Court nevertheless concluded that its “forced interference with India’s complete control over its territory violates public policy to the extent necessary to overcome the United States’ policy preference for the speedy confirmation of arbitral awards.”  (Mem. Op. at 26.)

Second, the District Court was “persuaded that the FSIA’s contemplation of jurisdiction over foreign countries in suits seeking compensatory (but not punitive) damages, and allowing for specific, domestic methods of ensuring that plaintiffs receive those damages, demonstrates the United States’ public policy commitment to respecting the sovereignty of foreign nations by only holding them liable for certain forms of relief.” (Mem. Op. at 27.)

Third, the District Court noted that the United States had not waived its own sovereign immunity in U.S. courts in relation to specific performance in contractual disputes.  As a matter of international comity, therefore, it would be inappropriate for a U.S. court to order specific performance over a foreign state in relation to acts occurring in that foreign state’s territory, and “it would defy comprehension” for U.S. public policy to allow for a foreign court to order specific performance against the United States within U.S. territory.  (Mem. Op. at 28.)

Interest

India also urged the District Court to decline the tribunal’s decision to award interest on HEPI’s USD 113 million investment in the block until HEPI was reinstated.  The District Court, however, held that “[t]his portion of the award is so inseparable from the specific performance portion of the award, the confirmation of which would violate U.S. public policy, that the confirmation of the interest portion of the award must also be found, necessarily, [to] violate U.S. public policy.” (Mem. Op. at 31.)

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


The post HEPI v. India: Stay Denied but Public Policy Prevents Enforcement appeared first on Kluwer Arbitration Blog.

Pepperdine Launches Jewish Divorce Mediation Clinic

ADR Prof Blog - Mon, 2018-08-27 15:36
In partnership with the Jewish Divorce Assistance Center of Los Angeles, Pepperdine is launching the Jewish Divorce Mediation Clinic.  According to Pepperdine’s Surf Report (best ever name for a law school news update) this description The School of Law is launching the Jewish Divorce Mediation Clinic in Fall 2018. Open to JD and LL.M. students … Continue reading Pepperdine Launches Jewish Divorce Mediation Clinic →

Hon. Hiram E. Puig-Lugo Elected Secretary to the National Council of Juvenile and Family Court Judges Board of ... - EIN News (press release)

Google International ADR News - Mon, 2018-08-27 15:00

Hon. Hiram E. Puig-Lugo Elected Secretary to the National Council of Juvenile and Family Court Judges Board of ...
EIN News (press release)
He has presented on numerous topics that include rule of law, evidence law, trial advocacy skills, human trafficking, judicial independence, child welfare, and alternative dispute resolution. He has taught at the American University Washington College ...

Act allowing foreign international arbitration lawyers to operate in California widely welcomed - Northern California Record

Google International ADR News - Mon, 2018-08-27 13:30

Northern California Record

Act allowing foreign international arbitration lawyers to operate in California widely welcomed
Northern California Record
It makes sense, said Howard Miller, a mediator and arbitrator with JAMS, the largest alternative dispute resolution (ADR) provider in the world, because California is one of the largest economies in the world. "(The act) means the opportunity to ...

Demystifying Laos' International Arbitration Scene - Lexology

Google International ADR News - Mon, 2018-08-27 09:37

Demystifying Laos' International Arbitration Scene
Lexology
The CEDR and OEDR are gaining the attention of local investors as an alternative dispute resolution mechanism compared to the court system, though majority of the matters are referred to mediation rather than arbitration. Note at present, CEDR does not ...

6th Annual Economic Times Infra Focus Summit to focus on the Theme Transition towards Futuristic and Resilient ... - MENAFN.COM

Google International ADR News - Mon, 2018-08-27 03:17

6th Annual Economic Times Infra Focus Summit to focus on the Theme Transition towards Futuristic and Resilient ...
MENAFN.COM
(MENAFN Editorial) As India travels on a trajectory poised to become the worlds third largest economy by 2050, its infrastructure needs to be upgraded to meet modern-day demands. The quantum of this investment is staggering, India needs a financial ...

Arbitration of Smart Contracts Part 2 – Recommendations for the Future Landscape of Smart Contracts

Kluwer Arbitration Blog - Sun, 2018-08-26 22:34

Ibrahim Mohamed Nour Shehata

Following up on a previous post, this post provides a number of recommendations for the future landscape of smart contracts.

(1) Un-Anonymizing the Identity of the Parties to Smart Contracts: From a purely legal perspective, having a contract entered into by pseudonymous parties raises more than one question. First and foremost, how would one be able to validate the capacity of such parties to the first place? Also, what if both parties wanted to amend their agreement to be in line with the new economic conditions or amend it for any reason; would the parties be able to do so if they do not even know the identity of each other. What if one of the parties thinks there is a force majeure that should allow him to terminate the smart contract? As discussed in Primavera and Wright’s Blockchain and the Law: The Rule of Code (2018), would such a party be able to proceed with such an argument if he does not even know the identity of his counter party? This party cannot even file a lawsuit; against whom will he file such a lawsuit. Even if such a party were able to obtain a default judgment (against “John Doe”), such a default judgment would not be of much use or effect as long as the identity of John Doe remains unknown.

(2) Enabling the Amendment and Termination of Smart Contracts: Public blockchains are immutable; this makes amending or terminating a smart contract on a public blockchain a far more complicated process than modifying any software code. This could result in (1) yielding higher transaction costs; and (2) increasing the margin of error for effectuating such amendments. Further, smart contracts do not yet offer analogous self-help remedies similar to those available under traditional contracts. For instance, as described here, under a traditional contract, a party can engage in the so-called “efficient breach”. This is simply not available under smart contracts. That’s why there are currently projects underway to create smart contracts that are amendable and terminable at any time.

(3) The inclusion of Oracles in Complex Smart Contracts: The promise of smart contracts as a decentralized mechanism for contracting is extremely overestimated and overhyped. This promise is true only when all the obligations resulting from the smart contract will take place on the blockchain (“on-the-chain”). If inputs are rather required from the real world (“off-the-chain”), then the promise of decentralization will completely evaporate in the air. In addition, supporting the process of completely “on-the-chain” smart contracts especially concerning dispute resolution would also require a trusted third party. Fortunately, as discussed here, there is a solution; use a trusted third party or what is commonly referred to as an “oracle.”

Oracles can be individuals or programs that store and transmit information from “off-the-chain,” thereby providing a means for blockchain platforms to interact with real-world persons and potentially react to such external events. For example, oracles can be connected to a data feed from a third party conveying the latest London Interbank Offered Rate (LIBOR). Also, as discussed by Michael del Castillo here, we can make an oracle convey the insights of human beings or support private dispute resolution and private arbitration systems. With oracles, smart contracts can respond to changing conditions in near real time. Parties to a contract can reference an oracle to modify payment flows or alter encoded rights and obligations according to newly received information.

In this regard, oracles could be used to determine or update obligations based on the subjective judgment of certain individuals. In this way, parties can rely on “the deterministic and guaranteed execution of smart contracts for objective promises that are readily translatable into code.”[6]At the same time, they can choose a human oracle to assess promises that cannot easily be encoded into a smart contract, either because they (1) are too ambiguous, or (2) require a subjective assessment of real-world events. Despite the benefit of using oracles, using them introduces a potential “point of failure.” For example, as discussed here, an oracle might provide erroneous data or simply go out of business. Therefore, parties to smart contracts should be vigilant when choosing their oracles. 

Smart Contract Disputes are Inevitable? Some technologists had proclaimed that smart contracts will avoid disputes altogether on the basis that the parties’ bargain is automatically implemented in a decentralized manner, when the conditions agreed between the parties are satisfied. This view is very much overestimated; it does not take into consideration how disputes generally arise in real life. Self-executing smart contracts and blockchain applications might have the potential to increase the efficiency of dispute resolution dramatically. However, disputes will not disappear altogether. On the contrary, as Craig Tevendale and Charlie Morgan have observed here, the nature of the blockchain makes it crucial that any aspects of parties’ agreement are anchored within a valid legal framework and that the parties’ identify at the outset the applicable dispute resolution mechanism. Further, smart contracts’ disputes would most likely take the form of cross-border disputes because trade is a cross-border activity. Therefore, legal advice on the applicability and enforceability of smart contracts based on the legal framework of each participating jurisdiction will be required beforehand. In this regard, we can identify at least five main potential disputes that could arise in the realm of smart contracts as follows:

  1. Is the Smart Contract legally binding?

In most jurisdictions, as discussed here and here, a contract would only be valid if it is entered into by a person with legal capacity to do so. The fact that pseudonymous parties can enter into smart contracts would make it impossible to validate whether they have the capacity to perform the obligations under such contracts or not. Some civil-law jurisdictions lay down some legal requirements (i.e., writing and signing requirements) for the formation of a legally binding contract.

  • Coding limitations as mentioned in the previous part might cause unexpected performance issues.
  • Parties might want to terminate a smart contract on the grounds of misrepresentation, mistake or duress or fraud. Also conflicts regarding the definition, interpretation, and general frameworkof smart contracts might arise, as discussed by Gauthier Vannieuwenhuyse here.
  • Subsequent changes of law or regulations might make the performance of smart contracts illegal, as discussed here.
  • Smart contracts might perform on the basis of an inaccurate data feed.[15]

 Is Arbitration the Favourable Dispute Resolution Mechanism for Smart Contract Disputes?

As discussed here, the key features that make arbitration the optimal dispute resolution mechanism for smart contract disputes are arguably the flexibility of arbitral proceedings and the straightforward enforcement of arbitral awards under the New York Convention:

(1) Resolving Uncertainty over Jurisdiction &Governing Law. As smart contracts operate via distributed nodes, it might be difficult to determine the applicable law and the concerned jurisdiction; especially that most of smart contract disputes will take the form of cross-border disputes.

(2) Protecting Confidential Information. Some smart contract disputes are likely to involve evidence about proprietary software and/or hardware. The fact that parties can agree to arbitration to make their disputes confidential will enable the parties to limit their exposure.

(3) Having a Tribunal with Specialist Technical Knowledge.  Some smart contract disputes will be fairly vanilla contract law disputes, but others will be of a highly technical nature, for example, where the code does not operate as expected or a technical bug takes place. The courts in many jurisdictions are experienced at dealing with technical issues quickly, but the parties to a smart contract can agree to an arbitration clause which enables them to appoint someone, for example, with an understanding of coding and smart contracts on a certain blockchain.

(4) Ease of World-Wide Recognition and Enforcement. Arbitration offers parties the potential to agree to flexible procedures that might help overcome the challenges presented by smart contracts. In addition, the fact that 159 jurisdictions have adopted the New York Convention facilities the process of recognition and enforcement of any arbitral award resulting from a smart contract dispute on a global basis.

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


The post Arbitration of Smart Contracts Part 2 – Recommendations for the Future Landscape of Smart Contracts appeared first on Kluwer Arbitration Blog.

Squatters living in fear of demolitions - kenyanews.go.ke

Google International ADR News - Sun, 2018-08-26 06:24

kenyanews.go.ke

Squatters living in fear of demolitions
kenyanews.go.ke
A family stands next to their demolished house, after hired goons flattened their homes in a disputed parcel of land in Jomvu constituency. Photo by Hussein Abdullahi/KNA. A long-standing land dispute between squatters and tycoons at Mwaeba, Chamunyu ...

Have PRC Courts Ordered Interim Relief Measures in Support of HKIAC Arbitrations without an Express Legal Basis: What Lies Ahead?

Kluwer Arbitration Blog - Sun, 2018-08-26 03:45

Helen H. Shi

HK45

Under the current Chinese legal framework, while PRC Courts are granted exclusive power to grant interim relief measures in support of arbitration 1) Chinese courts are granted the exclusive power to grant interim relief measures pursuant to the following provisions under PRC law:
Article 28 of the PRC Arbitration Law (hereinafter “Arbitration Law”) provides that: “[a] party may apply for property preservation if it may become impossible or difficult for the party to implement the award due to an act of the other party or other causes.
If a party applies for property preservation, the arbitration commission shall submit the party’s application to the people’s court in accordance with the relevant provisions of the Civil Procedure Law.”
Article 272 of the PRC Civil Procedure Law (hereinafter “CPL”) provides that: “[w]here a party applies for a preservation measure, the international arbitral institution of the People’s Republic of China shall submit the party’s application to the intermediate people’s court at the place of domicile of the respondent or at the place where the respondent’s property is located.”
Article 100 of the CPL provides that: “[f]or a case where, for the conduct of a party or for other reasons, it may be difficult to execute a judgment or any other damage may be caused to a party, a people’s court may, upon application of the opposing party, issue a ruling on preservation of the party’s property, order certain conduct of the party or prohibit the party from certain conduct; and if no party applies, the people’s court may, when necessary, issue a ruling to take a preservative measure.” jQuery("#footnote_plugin_tooltip_1733_1").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });, there is lack of an express legal basis for Courts to do so in support of “off-shore” arbitrations.

However, two recently released Chinese court cases seem to have broken the mold by ordering interim relief in support of HKIAC arbitrations:

1) Civil Ruling on the Preservation Measures in relation to Ocean Eleven Shipping Corporation v. Lao Kaiyuan Mining Sole Co., Ltd., decided by the Wuhan Maritime Court on 14 October 2016 (hereafter “Wuhan Ruling”); 3) Civil Procedure Preservation Ruling regarding Ocean Eleven Shipping Corporation v. Lao Kaiyuan Mining Sole Co., Ltd., Wuhan Maritime Court, (2016) E 72 Cai Bao No.427 (“Wuhan Ruling”). jQuery("#footnote_plugin_tooltip_1733_3").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_3", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); and

2) Civil Ruling relating to the Recognition and Enforcement of the Arbitral Award in Guangdong Yuehua International Trade Group Co., Ltd. v. Sinotide Holdings Limited & Ke Junxiang decided by the Guangzhou Intermediate People’s Court on 22 March 2016 (hereafter “Guangzhou Ruling“). 4) Civil Ruling regarding Guangdong Yuehua International Trade Group Co., Ltd. v. Sinotide Holdings Limited & Ke Junxiang, Guangzhou Intermediate People’s Court, (2014) Sui Zhong Fa Min Si Chu Zi No.42 (“Guangzhou Ruling”). jQuery("#footnote_plugin_tooltip_1733_4").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_4", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

In the first case, the court granted interim measures pre-award, during the course of the arbitral proceedings. In the second case, the court ordered injunctive relief post-award, during the recognition and enforcement stage.  While encouraging, both rulings appear to have been decided without legal basis, we shall take a quick look below.

The Wuhan Ruling

After filing its claim at the HKIAC, the Claimant preemptively applied to the Wuhan Maritime Court to either freeze the Respondent’s bank account in an amount of USD 300,000 or seal, seize or freeze Respondent’s property of up to USD 300,000 in value to ensure that sufficient assets would be preserved for which a subsequent award in its favor could be satisfied.

Given the Dongwon F&B decision rendered by the Shanghai First Intermediate People’s Court in 2014, 2) Civil Procedure Preservation Ruling regarding the Dongwon F&B Arbitral Procedure, Shanghai First Intermediate People’s Court, (2014) Hu Yi Zhong Shou Chu Zi No.2. jQuery("#footnote_plugin_tooltip_1733_2").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_2", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); which refused an application for property preservation in support of an arbitration administered by the Korean Commercial Arbitration Board for the reason that there was no legal basis to grant the application as the arbitration was not initiated in China, one would have thought that the application in the Wuhan Ruling would be similarly dismissed.

However, the court granted the application pursuant to Article 28 of the Arbitration Law 5) See footnote 2. jQuery("#footnote_plugin_tooltip_1733_5").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_5", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); and Article 103(1) of the CPL 6) Article 103 of the CPL provides that: “[p]roperty shall be preserved by seizure, impoundment, freezing of account or any other means prescribed by law. After preserving any property, a people’s court shall immediately notify the person whose property is preserved.
Property which has already been seized or frozen shall not be repeatedly seized or frozen.”
jQuery("#footnote_plugin_tooltip_1733_6").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_6", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });.  While at first glance one may assume that there was a legal basis for the ruling, upon closer examination, the provisions that the court cited do not expressly endorse the granting of interim relief in support of “offshore” HKIAC arbitration.

Under Article 28 of the Arbitration Law, applications for interim measures (including preservative measures and injunctive relief) in support of arbitrations must be transferred by arbitration commissions to the Courts but the term “arbitration commission” here, is limited to Chinese arbitration commissions by virtue of Article 10 of the same.

Furthermore, Article 103(1) of the CPL does not directly address the court’s authority to grant interim measures in support of arbitration, it merely addresses general procedural issues relating to property preservation measures.

As such, neither provision cited by the Court seems to expressly provide a legal basis to support its ruling.

The Guangzhou Ruling

The relevant HKIAC award in the case was issued in 2013. The successful Claimant thereafter applied to the Guangzhou Intermediate People’s Court for recognition and enforcement of the arbitral award and during the proceedings, it made a further application for preservation of the Respondent’s property.  The court granted the application in 2014, ordering that the Respondent’s accounts and shares be frozen.  The award was recognized and enforced in 2016.

The court did not identify an express legal basis for its decision. Whereas Chinese courts are given the express power to grant interim measures before or after accepting an application for the recognition and enforcement of arbitral awards rendered in Macao 7) Article 11 of the Arrangement between the Mainland and the Macau SAR on Reciprocal Recognition and Enforcement of Arbitration Awards (hereinafter “Macau Arrangement”) provides that: “[b]efore or after a court accepts the application for recognition and enforcement of an arbitration award, it may take preservation measures against the respondent’s property pursuant to the application by the party concerned and in accordance with lex fori.” jQuery("#footnote_plugin_tooltip_1733_7").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_7", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); and Taiwan 8)Article 10 of the Provisions of the Supreme People’s Court on Recognition and Enforcement of the Arbitral Awards of the Taiwan Region (hereinafter “Taiwan Provisions”) provides that: ”[b]efore or after accepting an application for the recognition of an arbitral award rendered in Taiwan region, the competent people’s court may, in accordance with the Civil Procedure Law and relevant judicial interpretations, render a ruling to take preservation measures according to the application by the applicant concerned.” jQuery("#footnote_plugin_tooltip_1733_8").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_8", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });, the same cannot be said for arbitral awards made in Hong Kong. 9) Please see the Arrangements of the Supreme People’s Court on the Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong SAR (hereinafter the “HK Arrangements”). jQuery("#footnote_plugin_tooltip_1733_9").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_9", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

The Guangzhou Ruling is an interesting development as Chinese courts do not typically grant interim measures in support of “offshore” arbitrations during the recognition and enforcement stage because there is no legal basis for them to do so.

This principle was upheld in an application for asset preservation decided by the Haikou Maritime Court involving a LMAA award – KoreaLine Corporation v. HNA Group arbitration – in 2016.10)Civil Ruling on Asset Preservation in relation to KoreaLine Corporation v. HNA Group, Haikou Maritime Court, (2016) Qiong 72 Xie Wai Ren No.1-1. jQuery("#footnote_plugin_tooltip_1733_10").tooltip({ tip: "#footnote_plugin_tooltip_text_1733_10", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); The Claimant’s application for preservation measures during the recognition and enforcement stage was refused.  The court held that granting an interim measure under the circumstances would constitute international judicial assistance, which could only be granted upon a legal basis such as a treaty or a relationship of mutual reciprocity with the jurisdiction of the administering arbitration commission.

However, the United Kingdom, where the LMAA is based, and China were not party to any relevant judicial assistance agreement and neither the New York Convention nor Chinese legislation provided any basis for the granting of the application. The application was dismissed accordingly.

Potential Developments

The fact that the Wuhan Ruling and the Guangzhou Ruling were rendered without legal basis seemingly reflects a shift in judicial practice and may be a sign that Chinese courts have moved ahead of the curve as compared to Chinese legislation.

As both rulings in support of HKIAC arbitration cases, it seems possible that PRC courts favor Hong Kong arbitrations and will provide assistance both during the arbitral proceedings and during the recognition and enforcement stage.

From the perspective of offering necessary judicial assistance to arbitration, this practice may in time be fully legitimized through:

1) appropriate amendments to the Arbitration Law and CPL defining “arbitration commission” under the Arbitration Law as including foreign arbitration institutions as well; or

2) amending the HK Arrangements to give the courts express power to order interim measures in support of Hong Kong arbitrations.

Importantly, the judicial sovereignty of PRC courts would remain intact as neither option would affect the PRC courts’ exclusive power to order interim measures.

With regards to legitimizing judicial assistance at the recognition and enforcement stage, it is very possible that the HK Arrangements will be updated and brought in line with the Macau Arrangements and Taiwan Provisions through the inclusion of provisions which grant PRC courts the power to order the interim measures after an application for recognition and enforcement of an arbitral award is accepted.

Conclusion

Regardless of whether the above changes take place, it seems like Chinese courts have already slightly opened the door to HKIAC. Hopefully with the SPC’s establishment of the China International Commercial Courts and their relevant guideline, Chinese Courts will be able to provide interim measures in support of not only Chinese arbitrations but also of international arbitrations without differential treatment.

References   [ + ]

1. ↑ Chinese courts are granted the exclusive power to grant interim relief measures pursuant to the following provisions under PRC law:
Article 28 of the PRC Arbitration Law (hereinafter “Arbitration Law”) provides that: “[a] party may apply for property preservation if it may become impossible or difficult for the party to implement the award due to an act of the other party or other causes.
If a party applies for property preservation, the arbitration commission shall submit the party’s application to the people’s court in accordance with the relevant provisions of the Civil Procedure Law.”
Article 272 of the PRC Civil Procedure Law (hereinafter “CPL”) provides that: “[w]here a party applies for a preservation measure, the international arbitral institution of the People’s Republic of China shall submit the party’s application to the intermediate people’s court at the place of domicile of the respondent or at the place where the respondent’s property is located.”
Article 100 of the CPL provides that: “[f]or a case where, for the conduct of a party or for other reasons, it may be difficult to execute a judgment or any other damage may be caused to a party, a people’s court may, upon application of the opposing party, issue a ruling on preservation of the party’s property, order certain conduct of the party or prohibit the party from certain conduct; and if no party applies, the people’s court may, when necessary, issue a ruling to take a preservative measure.” 2. ↑ Civil Procedure Preservation Ruling regarding the Dongwon F&B Arbitral Procedure, Shanghai First Intermediate People’s Court, (2014) Hu Yi Zhong Shou Chu Zi No.2. 3. ↑ Civil Procedure Preservation Ruling regarding Ocean Eleven Shipping Corporation v. Lao Kaiyuan Mining Sole Co., Ltd., Wuhan Maritime Court, (2016) E 72 Cai Bao No.427 (“Wuhan Ruling”). 4. ↑ Civil Ruling regarding Guangdong Yuehua International Trade Group Co., Ltd. v. Sinotide Holdings Limited & Ke Junxiang, Guangzhou Intermediate People’s Court, (2014) Sui Zhong Fa Min Si Chu Zi No.42 (“Guangzhou Ruling”). 5. ↑ See footnote 2. 6. ↑ Article 103 of the CPL provides that: “[p]roperty shall be preserved by seizure, impoundment, freezing of account or any other means prescribed by law. After preserving any property, a people’s court shall immediately notify the person whose property is preserved.
Property which has already been seized or frozen shall not be repeatedly seized or frozen.”
7. ↑ Article 11 of the Arrangement between the Mainland and the Macau SAR on Reciprocal Recognition and Enforcement of Arbitration Awards (hereinafter “Macau Arrangement”) provides that: “[b]efore or after a court accepts the application for recognition and enforcement of an arbitration award, it may take preservation measures against the respondent’s property pursuant to the application by the party concerned and in accordance with lex fori.” 8. ↑ Article 10 of the Provisions of the Supreme People’s Court on Recognition and Enforcement of the Arbitral Awards of the Taiwan Region (hereinafter “Taiwan Provisions”) provides that: ”[b]efore or after accepting an application for the recognition of an arbitral award rendered in Taiwan region, the competent people’s court may, in accordance with the Civil Procedure Law and relevant judicial interpretations, render a ruling to take preservation measures according to the application by the applicant concerned.” 9. ↑ Please see the Arrangements of the Supreme People’s Court on the Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong SAR (hereinafter the “HK Arrangements”). 10. ↑ Civil Ruling on Asset Preservation in relation to KoreaLine Corporation v. HNA Group, Haikou Maritime Court, (2016) Qiong 72 Xie Wai Ren No.1-1. 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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California loosens restrictions on counsel in international arbitrations - Lexology

Google International ADR News - Sat, 2018-08-25 18:48

California loosens restrictions on counsel in international arbitrations
Lexology
SB 766 will take effect on 1 January 2019. Overview. SB 766 states that "a qualified attorney [as defined] may provide legal services in an international commercial arbitration or related conciliation, mediation, or alternative dispute resolution ...

'Some Lawyers Now Charge Their Clients Extra Bribes For Judges' - Nene Amegatcher - Peace FM Online

Google International ADR News - Sat, 2018-08-25 05:04

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'Some Lawyers Now Charge Their Clients Extra Bribes For Judges' - Nene Amegatcher
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... Ghana Arbitration Centre, Pupillage Committee of the Ghana Bar Association, International Bar Association, Board of Legal Aid Scheme, National Alternative Dispute Resolution Task Force/Committee, American Arbitration Association and Board of ...

“It’s called ‘flipping’ and it almost ought to be illegal”

ADR Prof Blog - Sat, 2018-08-25 01:21
President Trump said this in response to the plea bargain of his former lawyer, Michael Cohen. However, Michael Cohen did not, in fact, “flip.” Cohen’s plea deal is not conditioned on him giving any evidence in a future or concurrent prosecution. Michael Cohen did plead guilty in federal court to eight counts including tax fraud, … Continue reading “It’s called ‘flipping’ and it almost ought to be illegal” →

'Some Lawyers now charge their clients extra bribes for Judges' - Nene Amegatcher - GhanaWeb

Google International ADR News - Sat, 2018-08-25 00:30

GhanaWeb

'Some Lawyers now charge their clients extra bribes for Judges' - Nene Amegatcher
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... Ghana Arbitration Centre, Pupillage Committee of the Ghana Bar Association, International Bar Association, Board of Legal Aid Scheme, National Alternative Dispute Resolution Task Force/Committee, American Arbitration Association and Board of ...

Confidentiality in International Commercial Arbitration: Does Australia Meet International Expectations?

Kluwer Arbitration Blog - Fri, 2018-08-24 22:45

Michael Pryles and Imogen Kenny

Australia has been known for taking a somewhat controversial approach to the confidentiality of arbitral proceedings. However, the legislature, to the international arbitration community’s sigh of relief, has intervened to change the law and bring opt-out confidentiality to international commercial arbitrations seated in Australia (see Michael Pryles, ‘National Report – Australia’ in The ICCA International Handbook on Commercial Arbitration). Issues, however, remain in relation to how Australian courts will treat confidentiality of foreign international arbitral proceedings.

Judicial approach to confidentiality

Notoriously, in Esso Australia Resources v Plowman (1995) 183 CLR 10 (Esso), the High Court of Australia held that confidentiality was not “an essential attribute” of arbitration and therefore, in the absence of express party agreement, there is no right to confidentiality (see Michael Pryles, ‘Confidentiality’ in Leading Arbitrators’ Guide to International Arbitration, edited by Newman & Hill (2nd ed, Juris Publishing, 2008)). In so doing, the High Court distinguished between the two concepts of ‘privacy’ and ‘confidentiality’ (see for example, Mayank Samuel’s post on the distinction).

The High Court acknowledged that while arbitral proceedings and hearings are ‘private’ because strangers have no right to admission, it does not follow that they are ‘confidential’. Mason CJ rejected submissions that an implied obligation of confidentiality exists because the efficacy of the parties’ arbitration agreement would be damaged, even defeated, if arbitral proceedings were made public by the disclosure of documents relating to the arbitration.

Rather, the High Court held there was no obligation, in Australia, to keep confidential the arbitral proceedings or documents and information provided in and for the purposes of arbitration. However, the High Court did find one instance where confidentiality attached, namely where documents were produced compulsorily, such as, pursuant to a direction by the tribunal for disclosure.

The High Court of Australia is the highest court in the Australian judicial system, and its decision binds all lower courts. In the absence of express abrogation by the Australian legislature, this is the binding law of Australia.

Legislative intervention on confidentiality

First reform

 In 2010, the Australian legislature recognised that confidentiality was one of the significant attractions of arbitration. Citing Esso, Parliament considered that, while the Australian common law provided an appropriate level of confidentiality in most circumstances, parties to an international arbitration seated in Australia may have a legitimate interest in ensuring a greater level of confidentiality with respect to sensitive commercial information put before an arbitral tribunal (see the Revised Explanatory Memorandum to the International Arbitration Amendment Bill 2010 (2010 Bill) at [149]-[153]).

Consequently, Part III (including sects. 23C to 23G, which deal with confidentiality) was inserted into the International Arbitration Act 1974 (Cth) (IAA) to encourage international arbitration taking place in Australia (see Malcolm Holmes and Chester Brown, The International Arbitration Act 1974: A Commentary (2nd ed, Lexis Nexis, 2015) at p. 5).

Section 23C of the IAA provides that parties to arbitral proceedings commenced in reliance on an arbitration agreement must not disclose confidential information, unless:

  • the disclosure falls within one of the circumstances outlined in sect. 23D of the IAA, including that all parties to the proceedings consent to the disclosure; the disclosure is to a professional or other adviser to any of the parties; or if the disclosure is necessary for the purpose of enforcing an arbitral award, and the disclosure is no more than reasonable for that purpose (sect. 23D);
  • the arbitral tribunal makes an order allowing the disclosure in certain circumstances (sect. 23E) and no court has made an order prohibiting a party from disclosing confidential information (sect. 23F); or
  • a court makes an order allowing disclosure in certain circumstances (sect. 23G).

‘Confidential information’ is defined broadly in sect. 15(1) of the IAA and includes, inter alia, pleadings, submissions, information supplied to the tribunal by a party, documentary and other evidence, transcripts of hearings and rulings and awards of the arbitral tribunal.

These provisions applied on an ‘opt-in’ basis on or after 6 July 2010 (see sect. 2 of the International Arbitration Amendment Act 2010 (Cth)). In other words, parties had to expressly agree that the confidentiality provisions of the IAA applied to their arbitration. The legislature did not consider that confidentiality should be available as a matter of course, but rather, that it was one of the “matters to which the parties should expressly turn their minds before they apply” (see the Supplementary Explanatory Memorandum to the 2010 Bill at [20]-[25]).

Second reform

In 2015, the Australian legislature again acknowledged the need to amend the IAA to ensure that international arbitrations in Australia received confidentiality in line with community expectations and international best practice, namely that proceedings are confidential unless the parties agree to conduct their arbitration in another manner (see the Explanatory Memorandum to the Civil Law and Justice (Omnibus Amendments) Bill 2015 (2015 Bill) at [42], [213]-[214] and Luke Nottage’s post discussing the 2015 Bill).

Consequently, sect. 22 of the IAA was amended to provide that the confidentiality provisions (sections 23C to 23G) applied on an ‘opt-out’ basis, which means that they will apply unless the parties choose to exclude them. These provisions govern arbitral proceedings arising from arbitration agreements made on or after 14 October 2015 (see sect. 2(1) and Sch. 1 sect. 61 of the Civil Law and Justice (Omnibus Amendments) Act 2015 (Cth)).

This amendment provides better protection for parties, and their representatives, who might not be familiar with Australian law and who agreed to arbitrate in Australia on the presumption that the Australian approach to confidentiality would be similar to that in many other countries.

Remaining confidentiality issues

Recent judicial authority has indicated that Australian courts may decline to make orders protecting the confidentiality of foreign-seated international arbitrations on the basis that Part III, Division 3 of the IAA (which includes the confidentiality provisions) only applies to Australian-seated international arbitrations.

This concern stems from the Federal Court of Australia’s decision in Samsung C&T Corporation, in the matter of Samsung C&T Corporation [2017] FCA 1169. Gilmour J declined an application, by a party to an international arbitration seated in Singapore, to order subpoenas to third parties in Australia under Part III, Division 3 of the IAA. This decision was made on the grounds that the Court only had jurisdiction to make such orders in relation to international arbitrations seated in Australia (see the Resolution Institute’s post). Gilmour J went on to find that, after interpreting the legislation, the provisions in Part III, Division 3 of the IAA only applied to parties who have commenced their arbitral proceedings in Australia, and not foreign-seated international arbitrations. While this case only deals with orders for document production, the interpretation of the application of Part III, Division 3 of the IAA could likewise apply when seeking an order from an Australian court to restrain disclosure of confidential information.

Consequently, parties to foreign-seated international arbitrations may not be able to avail themselves of Australian court orders under sects. 23C or 23F of the IAA prohibiting the disclosure of ‘confidential information’ within the meaning of sect. 15(1). Rather, they may only receive the protection of confidentiality granted in Esso, that is, only documents produced compulsorily in the arbitration have a claim to confidentiality.

Parties will obviously be able to circumvent this unsatisfactory result by expressly providing for confidentiality in their arbitration agreement or adopting arbitration rules that deal with confidentiality. Further, the parties could potentially bypass this issue by selecting a national law that provides for confidentiality to govern their arbitral proceedings (lex arbitri) and asking an Australian court to test confidentiality in accordance with the lex arbitri. However, there is an unresolved choice of law issue governing confidentiality (see Filip De Ly, Mark Friedman, Luca Radicati Di Brozolo, ‘International Law Association: International Commercial Arbitration Committee’s Report and Recommendations on “Confidentiality in International Commercial Arbitration”’, 28(3) Arbitration International 355). The most obvious choice is between the lex arbitri and the law of the place where the issue of confidentiality arises (lex fori) (see Michael Pryles, ‘Confidentiality’ in Leading Arbitrators’ Guide to International Arbitration, edited by Newman & Hill (2nd ed, Juris Publishing, 2008) pp. 450-451). In these authors’ opinion, the lex arbitri should prevail over the lex fori, in this case Australian law, to determine confidentiality.

Concluding remarks

Australia has made most welcome reforms to bring the law regulating confidentiality of international commercial arbitrations seated domestically more closely in line with international best practice. However, further reform would be helpful to ensure that foreign-seated arbitrations will consistently receive the same protection.

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GC Cheat Sheet: The Hottest Corporate News Of The Week - Law360

Google International ADR News - Fri, 2018-08-24 14:09

GC Cheat Sheet: The Hottest Corporate News Of The Week
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So far, the corporate legal community has generally praised the program, which the AAA has said is the first of its kind offered by a national provider of alternative dispute resolution services. .... A guest faculty member at Harvard Law School's ...

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