Applicable law for the arbitration agreement Applicable law for the arbitration procedure Applicable for merits of the case
Arbitration agreement : contract between the parties to settle their dispute by arbitration Principles of private international law or conflict of law rules in national law
Parties autonomy Closest relationship with the contract Compulsory application of particular law in different countries
Chinese Practices
CAL, Contract Law 1999 Art.16, Judicial Interpretation of CAL in 2006 First that of selected by the parties Second that of the seat of arbitration Lastly - that of the national court
The national court should make the international arbitration agreement effect as possible as it can. Art.187 of Swiss PL: an arbitration agreement is valid if it conforms either to the law chosen by the parties, or to the law governing the subject matter of the dispute, in particular the main contract, or to Swiss law.
Zueblin Case
Construction agreement with FIDIC Green Book General Conditions by reference in its appendixArbitration 15.3 ICC Rules Shanghai shall apply Woco brought the lawsuit to the Ct. Zueblin brought the case to ICC for Arbitration
Zueblin Case 2
Court decided its jurisdiction according to local law; Arbitral tribunal decides its jurisdiction according to the arbitration agreement and the applied ICC Rules. Court refused enforcement due to the invalid arbitration agreement.
Whether the parties may select to apply procedure law of the other country? Process to negotiate NYC Nationality of the award
Deciding Authority
The applicable law of the arbitration In the event of dispute or difference arising out of or in connection with this agreement, which cannot be resolved by amicable settlement, the same shall be referred to an arbitration tribunal consisting of three membersThe arbitration shall be conducted in accordance with the procedure provided in the Indian Arbitration Act of 1940 or any reenactment or modification thereofThe seat of the arbitration proceedings shall be London
National Thermal Power Corporation (India) v. The Singer Company (USA) Construction Contract with arbitration clause: ICC Rules, seat decided by ICC, Indian law apply Award made in London Indian ct. refused enforcement and set aside the award
Conclusion of AL in Procedure
The seat decided the applicable law for the arbitration procedure; The seat could be decided by the parties, and by the arbitration institution or the court in the absence of the agreement between the parties
Chinese Practices
No special provision on the seat apart from CIETAC, but the name of arbitration commission; The location of the arbitration commission is usually considered as the seat of arbitration, since there is no distinction between the seat, the place of hearing and that of deliberation of the case by the tribunal.
Delocalized Arbitration
Denationalized arbitration International award has no relation with the legal order of any country Such award is floating until it is enforced.
Gotaverken (Sweden) v. Libyan General National Maritime Transport ICC Rules, Paris French court refused setting aside the award on the ground of lack of jurisdiction; The Swedish court enforced the award.
SEEE Case
SEEE (France) v. Yugoslavia K to build railway in 1932 Award made by two arbitrators in Vaud, Switzerland in 1956 Court in Vaud refused setting aside because Art.514 of Vaud CPL required uneven number of arbitral tribunal. The award was a Swiss award. The Dutch court enforced the award as Swiss award in 1973, while the French court enforced it as anational award made in another NYC member state.
Chromalloy Aeroservices Inc. (USA) v. Ministry of Defence (MOD) of the Republic of Egypt Contract of sale and service for 4 years MOD terminated K before it expired Arbitrated and set aside in Egypt French and US court ruled to enforce
What law should be applied to decide the merits of the case? Proper law (applicable law) of the contract
Basic Principles
Parties autonomy Closest relationship with the contract General principles of law, lex mercatoria, law merchant
Agency contract with arbitration clause Arbitrated by ICC sole-arbitrator tribunal in Vienna Tribunal applied neither law of the parties, but equity Whether the tribunal may rule in equity as amiable compositeurs
CISG: Vienna Convention on Contract for the International Sales of Contract by UNCITRAL Principles of European Contract Law UNIROIT (International Institute for Unification of Private Law) Principles for International Commercial Contract
Art.17 of ICC Rules (1) The parties shall be free to agree upon the rules of law to be applied by the Arbitral Tribunal to the merits of the dispute. In the absence of any such agreement, the Arbitral Tribunal shall apply the rules of law which it determines to be appropriate. (2) In all cases the Arbitral Tribunal shall take account of the provisions of the contract and the relevant trade usages. (3) The Arbitral Tribunal shall assume the powers of an amiable compositeur or decide ex aequo et bono only if the parties have agreed to give it such powers.
The arbitrator shall decide the dispute according to the rules of the law unless the parties have authorized him in the arbitration agreement to rule as amicable compositeur.
Chinese Practices
Contract Law 1999 Parties autonomy in general in priority: provisions in the contract Compulsory applicable law for the particular contracts: joint venture contracts Application of bilateral and multilateral convention