Feed aggregator

Lawyers Who Misconduct Themselves To Face Tough Sanctions - Modern Ghana (press release) (blog)

Google International ADR News - Sat, 2018-10-06 00:11

Modern Ghana (press release) (blog)

Lawyers Who Misconduct Themselves To Face Tough Sanctions
Modern Ghana (press release) (blog)
The Chief Justice was speaking at the 56th Enrolment of 279 lawyers at a ceremony held at the Accra International Conference Centre. Justice Sophia Akuffo announced that the GLC has now decided to revert to a two-year programme for the Professional ...

Legal Council tightens rules against lawyers who misbehave - GhanaWeb

Google International ADR News - Fri, 2018-10-05 22:48

Legal Council tightens rules against lawyers who misbehave
GhanaWeb
According to the Chief Justice, it was important that the lawyers also aspired to emulate great legal luminaries such as the late V.C.R.A.C Crabbe, who distinguished himself on both local and international scenes and left behind a legacy for the ...

and more »

CIETAC Arbitration Award Enforced in the U.S. Despite Alleged Forgery in the Underlying Agreement

Kluwer Arbitration Blog - Fri, 2018-10-05 21:00

Katharine Menéndez de la Cuesta and Arantxa Cuadrado Pérez-Broseta

Allegations of fraud and forgery of a sales agreement are for an arbitral tribunal to decide and a party should not ignore a notice of arbitration. This is according to a federal judge who enforced an award against a party that claimed the agreement was forged and did not participate in the arbitral proceedings. On May 30, 2018, U.S. District Court Judge Joanna Seybert of the Eastern District of New York granted a petition to enforce an arbitral award rendered in Tianjin, China, by the China International Economic and Trade Arbitration Commission (“CIETAC”) and denied a motion to dismiss the petition to enforce. The Court found that none of the grounds to deny enforcement of an arbitral award alleged by the Respondent under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “NYC”) were satisfied. The case is Tianjin Port Free Trade Zone Int’l Trade Serv. Co., Ltd. v. Tiancheng Chempharm Inc.USA, No. 17-CV-4130 (JS)(AYS), 2018 LEXIS 90106 (E.D.N.Y., May 30, 2018).

The dispute arose out of an agreement for the sale and purchase of dietary supplements entered into between Tianjin Port Free Trade Zone International Trade Service Co., Ltd., (the “Seller”) and Tiancheng Chempharm, Inc. USA (the “Buyer”) (the “Sales Agreement”). According to the Seller, the goods were delivered, but the Buyer failed to pay the agreed purchase price. The arbitrator found in favor of the Seller and ordered the Buyer to pay the purchase price, including interest, and the costs of the arbitration.

The Buyer asserted three grounds to oppose the enforcement of the award, namely, that (i) it did not receive “notice of the arbitration proceedings;” (ii) the Sales Agreement “in question was in fact fabricated, and the Buyer’s representative signature was forged;” and (iii) the Seller failed to make “a good faith effort to amicably settle [the] dispute” before starting the arbitration as required by the Sales Agreement. 1) Resp’t Mem. Of P. & A. In Supp. Of Its Mot. To Dismiss Pet. To Confirm Arbitration Award, ECF No. 23, Jan. 4, 2018. jQuery("#footnote_plugin_tooltip_9967_1").tooltip({ tip: "#footnote_plugin_tooltip_text_9967_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Judge Seybert rejected all three arguments.

The Notice of Arbitration

Article V(1)(b) of the NYC provides that the party against whom an award is sought to be enforced must have been given “proper notice of the appointment of the arbitrator or of the arbitration proceedings” and must have been “able to present his case.” Here, the Buyer claimed it “never received any notice of the arbitration proceeding in China” being “unable to appoint an arbitrator” and “deprived of its right to have the opportunity” to serve a petition to vacate the award. 2) Resp’t Mot., p. 7. jQuery("#footnote_plugin_tooltip_9967_2").tooltip({ tip: "#footnote_plugin_tooltip_text_9967_2", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

In the EDNY, the party opposing enforcement under Article V(1)(b) must show that it was not given “ ‘notice reasonably calculated’ to inform [it] of the proceedings and ‘an opportunity to be heard’ ” Jiangsu Changlong Chem., Co., Inc. v. Burlington Bio-Medical & Sci. Corp., 399 F. Supp. 2d 165, 168 (E.D.N.Y. 2005). Consistent with this standard, the Court in Tianjin Port Free found that “CIETAC provided Tiancheng with the opportunity to participate in the arbitration in a meaningful manner.” CIETAC verified that the notice of arbitration and the other documents were properly delivered to the Buyer who, according to the Court, “simply chose not to participate in the arbitration proceedings.” Tianjin Port Free, at 4.

The Alleged Forgery of the Sales Agreement

The second argument alleged by the Buyer was that the Sales Agreement was forged. The Buyer alleged that the Sales Agreement was “fraudulent and void” because the Buyer’s representatives never signed the document, never had a direct business relationship with the Seller and never traveled to Tianjin, China, the city where the Sales Agreement was allegedly signed.

The Buyer’s attack was to the contract as a whole. Judge Seybert rejected the Buyer’s argument because “the issue of whether the underlying contract that is the subject of the arbitrated dispute was forged or fraudulently induced [is] a matter to be determined exclusively by the arbitrators.” Tianjin Port Free, at 5 (citing the Second Circuit’s landmark decision on this issue, Europcar Italia, S.p.A. v. Maiellano Tours, Inc., 156 F.3d 310, 315 (2d Cir. 1998)). The decision is consistent with Second Circuit precedent.

In Europcar, the party resisting enforcement alleged that enforcement of an award based on a forged contract would be contrary to United States public policy, invoking Article V(2)(b) of the NYC. The Second Circuit found that the enforcement would not violate public policy and distinguished two separate issues, “the issue of a fraudulently obtained arbitration agreement or award, which might violate public policy and therefore preclude enforcement,” and “the issue of whether the underlying contract that is the subject of the arbitrated dispute was forged or fraudulently induced—a matter to be determined exclusively by the arbitrators.” Europcar, at 315. The Second Circuit relied on Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 403-04 (1967) to frame the discussion within the old distinction between attacks to arbitration agreements in particular—for the court to decide—or attacks to the contract in which they are contained as a whole—for the arbitrators to resolve. But Prima Paint dealt with the issue of the validity of the entire contract tainted with fraud in its inducement. It did not involve allegations of forgery, which would arguably go to the existence of the contract instead of its validity.

Other U.S. circuits have approached the issue of forged contracts containing arbitration agreements differently. In China Minmetals Materials Imp. & Exp. Co v Chi Mei Corp., 334 F.3d at 290 (3d Cir. 2003), the Third Circuit vacated a district court decision confirming a CIETAC arbitration award holding that under First Options, a party opposing enforcement of a foreign arbitration award under the NYC on the grounds that the contract which contains the arbitration agreement “was void ab initio is entitled to present evidence of such invalidity to the district court, which must make an independent determination of the agreement’s validity…” China Minmetals, at 289. The China Minmetals court distinguished the case from Europcar reasoning that in Europcar “the party resisting enforcement did not argue that the agreement containing the arbitration clause (…) was forged or fraudulent; rather, it argued that one of the agreements on which the arbitrators based their substantive decision (…) [which did not include the arbitration clause] was forged.” China Minmetals, n. 12.

In Will-Drill Resources, Inc. v. Samson Resources Co., 352 F.3d 211 (5th Cir. 2003), another case dealing with allegedly forged contracts, the Fifth Circuit concluded that “where a party attacks the very existence of an agreement, as opposed to its continued validity or enforcement, the courts must first resolve that dispute.” Will-Drill Resources, at 219.

Accordingly, for the Third and Fifth Circuits, attacks to the validity of the contract as a whole are distinct from attacks to its existence. The U.S. Supreme Court has not yet decided the question of whether challenges to the existence of an agreement to arbitrate are for the court or for the arbitrator to decide. In Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006), the Supreme Court held that a challenge to the validity of a contract as a whole must go to the arbitrator. Buckeye, at 1210. However, in a frequently cited footnote, the Supreme Court clarified that, “[t]he issue of the contract’s validity is different from the issue [of] whether any agreement between the alleged obligor and obligee was ever concluded,” and that the Court was only deciding the former. Buckeye, at 441 n.1.

The Pre-Arbitration Negotiations

The third argument raised by the Buyer was also dismissed because the Court found that the Seller did attempt to amicably settle the dispute before commencing the arbitration. The Buyer claimed the arbitration clause provided that “entering into ‘friendly negotiations’ for the settlement of a dispute is a condition precedent to instituting arbitration” but the Seller failed to do so. 3) Resp’t Mot., p. 9. jQuery("#footnote_plugin_tooltip_9967_3").tooltip({ tip: "#footnote_plugin_tooltip_text_9967_3", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); The Court determined that the Seller tried to resolve the dispute with the Buyer before starting the arbitration but that, “as the arbitration panel found,” the Seller did not cooperate (Tianjin Port Free, at 5). In other words, the Court did not decide the issue de novo but gave deference to the arbitrator’s finding that the condition precedent to the obligation to arbitrate had been satisfied.

The Court’s conclusion is consistent with BG Group Plc. v. The Republic of Argentina, 134 U.S. 1198 (2014), where the U.S. Supreme Court held that the issue of whether the parties complied with a prerequisite to an obligation to arbitrate set forth in an arbitration agreement is a procedural arbitrability issue that is for the arbitrator to decide.

New York is an international transactions hub and, accordingly, a leading jurisdiction for recognition and enforcement proceedings of foreign arbitral awards. The E.D.N.Y. decision is consistent with the liberal federal policy in the U.S. favoring arbitration of commercial disputes.

References   [ + ]

1. ↑ Resp’t Mem. Of P. & A. In Supp. Of Its Mot. To Dismiss Pet. To Confirm Arbitration Award, ECF No. 23, Jan. 4, 2018. 2. ↑ Resp’t Mot., p. 7. 3. ↑ Resp’t Mot., p. 9. 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: Arbitration in Belgium: A Practitioner’s Guide
by Edited by Niuscha Bassiri, Maarten Draye
€ 185


The post CIETAC Arbitration Award Enforced in the U.S. Despite Alleged Forgery in the Underlying Agreement appeared first on Kluwer Arbitration Blog.

Arbitration, Mediation Can Solve Cyber Insurance Disputes - Law360

Google International ADR News - Fri, 2018-10-05 20:01

Arbitration, Mediation Can Solve Cyber Insurance Disputes
Law360
Many of these cyber policies contain alternative dispute resolution provisions mandating that the parties participate in binding or nonbinding mediation and/or arbitration in place of, or prefatory to, litigation.[2] So, the question should be asked ...

SC Judge says mediation best way to tackle pending cases - Daily Excelsior

Google International ADR News - Fri, 2018-10-05 16:50

Daily Excelsior

SC Judge says mediation best way to tackle pending cases
Daily Excelsior
He recalled how a successful mediation between a leading brand of Denim clothing and a local business establishment accused of infringing the trademark had led to the latter becoming a supplier for the international brand. Judges must be trained to ...

and more »

Arbitration, Mediation Can Solve Cyber Insurance Disputes - Law360

Google International ADR News - Fri, 2018-10-05 14:44

Arbitration, Mediation Can Solve Cyber Insurance Disputes
Law360
Many of these cyber policies contain alternative dispute resolution provisions mandating that the parties participate in binding or nonbinding mediation and/or arbitration in place of, or prefatory to, litigation.[2] So, the question should be asked ...

Arbitration And Mediation Can Solve Cyber Insurance Disputes - Law360

Google International ADR News - Fri, 2018-10-05 14:44

Arbitration And Mediation Can Solve Cyber Insurance Disputes
Law360
Many of these cyber policies contain alternative dispute resolution provisions mandating that the parties participate in binding or nonbinding mediation and/or arbitration in place of, or prefatory to, litigation.[2] So, the question should be asked ...

Using I-statements in effective communication

Communication and Conflict Blog - Fri, 2018-10-05 05:43
Why and how I-statements support effective communication and conflict resolution. Examples of I-statements to illustrate.

What’s in a Name Change? For Investment Claims Under the New USMCA Instead of NAFTA, (Nearly) Everything.

Kluwer Arbitration Blog - Fri, 2018-10-05 01:10

Robert Landicho and Andrea Cohen

Young ITA

President Trump’s October 1, 2018 announcement that the United States, Canada, and Mexico have reached an agreement to replace the 1994 North American Free Trade Agreement (NAFTA) marks a veritable sea change in investor-state dispute settlement in the region. Previous and prospective users of NAFTA’s dispute resolution procedures will immediately note that this new free-trade agreement departs substantively and significantly from the NAFTA’s investment chapter—which has been on the books since 1994. More than just a change in name, the new United States-Mexico-Canada Agreement (USMCA), is an identity change.

This brief note discusses preliminary impressions from the released text of the USMCA and addresses only the investor-state arbitration provisions in USMCA, Chapter 14, that purport to replace Chapter 11 of the NAFTA. It begins with a discussion of the implications for those with cases already before NAFTA tribunals, then moves to the relevant considerations for investors in Canada and Mexico, and then presents some key definitional changes in the new text. The note concludes with some initial takeaways and a watchlist for readers while the USMCA Parties await U.S. Congressional approval. This note is far from comprehensive – no doubt, the applicability, interpretation, and application of the USMCA’s provisions will be the subject of increased discussion and scrutiny in the coming months.

Part I

For now, the USMCA is not yet the law of the land in the United States – as with any U.S. treaty, it must first be approved by Congress. Nonetheless, there are (at least) three key takeaways at this initial stage:

1. Under this proposed USMCA text, current NAFTA litigants need not fear that the USMCA will disrupt ongoing NAFTA arbitrations (i.e., the shift to the USMCA will have no effect on the fourteen cases that have already been filed under Chapter 11 of the NAFTA).

2. Although the NAFTA has not yet been terminated, the USMCA provides that, once terminated, investors may nevertheless file NAFTA claims within three years, provided the investments were validly made in accordance with Chapter 11 of the NAFTA already (or are made during the short remaining interval while NAFTA is still in force).

3. The USMCA would completely eliminate future investor-state arbitration between U.S. and Canadian parties under the USMCA. Moreover, the USMCA would limit the type of disputes that may be brought by investors of investments made between the United States and Mexico, and would force investors to file claims in national courts first, and then wait 30 months before initiating arbitration (unless the investor has a contract with the government relating to an “covered sector” expressly specified in the USMCA).

Thus, investors with existing investments covered by the NAFTA who wish to bring arbitration against Canada pursuant to Chapter 11 of NAFTA would need to do so within three years of the NAFTA’s termination if the USMCA is approved by Congress and the NAFTA is terminated, or otherwise risk losing their ability to file investor-state arbitration under the new USMCA altogether. Investors with qualified investments in Mexico may still have the option to bring an investor-state arbitration under the USMCA after filing a claim in national courts and waiting the requisite 30 months after initiating that lawsuit, but would do well to confirm whether their potential investment claims are part of a covered sector under the USMCA (thereby enabling them to take advantage of the full remedies available under the USMCA), or if they will be limited in the types of claims they can file.

No change for current litigants of NAFTA claims, but claims for investments established or acquired while NAFTA is in force must be brought within three years of NAFTA’s termination.

For those parties with arbitrations that have already been filed under Chapter 11 of the NAFTA, the current text of the USMCA would allow these NAFTA arbitrations to proceed uninhibited. Moreover, Annex 14-C of the USMCA, pertaining to “Legacy Investment Claims and Pending Claims,” directly addresses whether (and in which circumstances) prospective claims might be “grandfathered” into the NAFTA’s existing investment protection regime.

A “legacy investment” is defined in Article 6(a) of Annex 14-C as “an investment of an investor of another Party in the territory of the Party established or acquired between January 1, 1994, and the date of termination of NAFTA 1994, and in existence on the date of entry of force of this agreement.” Accordingly, an investment must have been “established or acquired” when the NAFTA is still in force, and remain “in existence” on the date of the USMCA’s entry into force.

As users of investment arbitration are no doubt familiar, a State must express its consent to arbitrate investment claims against an investor from another State. In the context of the “legacy investments” discussed above, the new USMCA makes clear that an investor cannot wait to file its NAFTA claims ad infinitum. Rather, each State Party’s consent to arbitrate in accordance with Section B of Chapter 11 of the NAFTA expires “three years after the termination of NAFTA 1994,” under Article 3 of Annex 14-C.1) Notably, under Article 2 of Annex 14-C, the consent and submission to arbitration must “satisfy the requirements” of Chapter II of the ICSID Convention. jQuery("#footnote_plugin_tooltip_6214_1").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

Chapter 14 also provides that “an arbitration initiated pursuant to the submission of a claim under Section B of NAFTA 1994 while NAFTA 1994 is in force may proceed to its conclusion […] the tribunal’s jurisdiction with respect to such a claim is not affected by the termination of NAFTA 1994.” Thus, Annex 14-C clarifies that the USMCA creates no jurisdictional impediment to the completion of already-filed NAFTA claims.

No investment claims for future U.S. investors in Canada (or vice-versa) after the NAFTA’s Termination.

The USMCA’s current text eliminates the possibility of future investor-state arbitration between U.S. and Canadian parties under the USMCA for investments made after the termination of the NAFTA.2) Although investor-state arbitration is dead between the U.S. and Canada, state-to-state arbitration between the two very much survives. Canada won its fight over NAFTA Chapter 19, paying for it in dairy concessions, and there will be no change to those provisions. This means that Canada may continue to bring suit before a special panel over alleged unfair trade practices by the U.S. and Mexico, including anti-dumping and countervailing duties. jQuery("#footnote_plugin_tooltip_6214_2").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_2", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); This is unequivocal in the text of Article 14.2 of the USMCA, which limits the scope of investor-state arbitration to Legacy Investment Claims and Pending Claims, Mexico-U.S. Investment Disputes, and Mexico-U.S. Investment Disputes Related to Government Contracts only:

For greater certainty, an investor may only submit a claim to arbitration under this Chapter as provided under Annex 14-C (Legacy Investment Claims and Pending Claims), Annex 14-D (Mexico-United States Investment Disputes), or Annex 14-E (Mexico-United States Investment Disputes Related to Covered Government Contracts).

Investors wishing to arbitrate claims will be forced to arbitrate in a forum other than a NAFTA investment tribunal (likely pursuant to a contract or other applicable instrument containing a valid arbitration clause), or be forced to bring claims in local courts if a domestic remedy is available.

The USMCA imposes limits on investment arbitration for U.S. investors in Mexico (or vice-versa).

Although not as clear-cut as the prohibition on claims of U.S. investors against Canada (or vice-versa), the new USMCA provisions would substantially limit the availability of investor-state dispute settlement for claims pertaining to investments made by U.S. investors in Mexico (and vice-versa).

Investor-state arbitration for U.S.-Mexico investment claims survives under Annex 14-D, but only as to claims of direct expropriation,3) Direct expropriation under Annex 14-B, Clause 2 occurs when “an investment is nationalized or otherwise directly expropriated through formal transfer of title or outright seizure.” jQuery("#footnote_plugin_tooltip_6214_3").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_3", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); claims for violations of national treatment,4) USMCA Article 14.4.1 defines national treatment as “treatment no less favorable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.” jQuery("#footnote_plugin_tooltip_6214_4").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_4", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); or for violations of the most-favored-nation (MFN) provision of the USMCA5) Under the USMCA Article 14.5.1, most-favored-nation claims arise when a state’s treatment of an investor is “less favorable than the treatment it accords, in like circumstances, to investors of any other Party or of any non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.” Readers of the new USMCA will be particularly careful to read footnote 22 in Chapter 14, which provides that “the ‘treatment’ referred to in Article 14.5 (Most-Favored-Nation Treatment) excludes provisions in other international trade or investment agreements that establish international dispute resolution procedures or impose substantive obligations; rather, ‘treatment’ only includes measures adopted or maintained by the other Annex Party, which may include measures adopted or maintained pursuant to or consistent with substantive obligations in other international trade or investment agreements.” (emphases added) Like other provisions in Chapter 14 of the USMCA, the language of this provision may depart substantially from the definitions used in other investment agreements. jQuery("#footnote_plugin_tooltip_6214_5").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_5", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); (except for any MFN or national treatment claims “with respect to the establishment or acquisition of an investment,” which are expressly excluded).

An exception to the above limitation is found in Annex 14-E of Chapter 14, entitled “Mexico-United States Investment Disputes Related to Covered Government Contracts.” As the title of the annex suggests, Annex 14-E does not apply unless the claimant is “a party to a covered government contract”6) Article 6 of Annex 14-E defines “covered government contract” as “a written agreement between a national authority of an Annex Party and a covered investment or investor of the other Annex Party, on which the covered investment or investor relies in establishing or acquiring a covered investment other than the written agreement itself, that grants rights to the covered investment or investor in a covered sector.” jQuery("#footnote_plugin_tooltip_6214_6").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_6", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); that grants rights in a “covered sector” expressly named in Article 6 of Annex 14-E, in which case a claimant may rely on other benefits in the treaty, including the possibility of bringing claims for violations of the minimum standard of treatment afforded under customary international law,7) The USMCA defines the minimum standards of treatment due to investors “in accordance with customary international law, including fair and equitable treatment and full protection and security.” (Article 14.6.1). It adds that “(a) “fair and equitable treatment” includes the obligation not to deny justice in criminal, civil or administrative adjudicatory proceedings in accordance with the principle of due process embodied in the principal legal systems of the world; and (b) “full protection and security” requires each Party to provide the level of police protection required under customary international law.” (Article 14.6.2(a),(b)) jQuery("#footnote_plugin_tooltip_6214_7").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_7", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); claims of indirect expropriation,8) Indirect expropriation refers to a situation “in which an action or series of actions by a Party has an effect equivalent to direct expropriation without formal transfer of title or outright seizure.” (Annex 14-B, Clause 3) jQuery("#footnote_plugin_tooltip_6214_8").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_8", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); or claims with respect to the establishment of acquisition of an investment. The five “covered sectors” are:

(i) activities with respect to oil and natural gas that a national authority of an Annex Party controls, such as exploration, extraction, refining, transportation, distribution, or sale;
(ii) the supply of power generation services to the public on behalf of an Annex Party;
(iii) the supply of telecommunications services to the public on behalf of an Annex Party;
(iv) the supply of transportation services to the public on behalf of an Annex Party; or
(v) the ownership or management of infrastructure, such as roads, railways, bridges, canals, or dams, that are not for the exclusive or predominant use and benefit of the government of an Annex Party.9) See Article 6 of Annex 14-E (emphases added). It should be noted that the preservation of investor-state arbitration in these key sectors is likely due to successful lobbying by American industry groups during negotiations.

jQuery("#footnote_plugin_tooltip_6214_9").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_9", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

The USMCA also adopts fundamental procedural changes for all remaining US/Mexico claims submitted to arbitration, even those in the covered sectors. Prospective claimants and their counsel will need to carefully plan a litigation strategy to comply with preconditions to arbitration under Annex 14-D.

1.
Prior to initiating investor-state arbitration under the USMCA, under Article 5 of Annex 14-D, U.S. and Mexican claimants must file suit in national courts. The dispute may proceed to arbitration only after “30 months have elapsed from the date the proceeding [in national courts] was initiated,” or after a final decision has been rendered in the national court of last resort (e.g., in the case of the United States, the U.S. Supreme Court). Recourse to national courts is not required where it would be “obviously futile or manifestly ineffective” – but it remains to be seen how national courts (or USMCA tribunals) will interpret this provision.

2. Appendix 3 of the USMCA also provides that U.S. investors “may not submit to arbitration a claim that Mexico has breached an obligation under this Chapter[…] if the investor or the enterprise, respectively, has alleged that breach of an obligation under this Chapter in proceedings before a court or administrative tribunal of Mexico.” Investors will likely question how Appendix 3 will be interpreted in light of Article 5 of Annex 14-D.

3. Moreover, arbitration under the USMCA must be filed within four years (i.e. 48 months) of the alleged breach by the claimant under Article 5 of Annex 14-D. As a practical matter therefore, assuming that a final decision in the national court of last resort has not been rendered prior to the 30 month waiting period, and assuming that the investor had filed suit in national court immediately after “the claimant first acquired, or should have first acquired, knowledge of the breach alleged … and knowledge that the claimant … or enterprise … has incurred loss or damage,” parties will have only 18 months (at most) to file their claims – roughly half of the time previously permitted under Chapter 11 of the NAFTA.

4. Importantly, where the claimant is party to a “covered government contract” under Annex 14-E, i.e., investors contracting with a government to provide services in one of the five “covered sectors,” the national courts requirement is waived10) See Footnote 31 to USMCA Chapter 14: “For greater certainty, Article 5.1(a)-(c) of Annex 14-D do not apply to claims under paragraph 2 [of Annex 14-E].” jQuery("#footnote_plugin_tooltip_6214_10").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_10", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); and claimant may file anytime within a 3-year window. This means that – under the current USMCA text – those contracting with the government with respect to oil and gas activities, power generation, telecommunications, transportation, and infrastructure may not need to file in national courts first.

Regarding arbitrators, the USMCA explicitly adopts the IBA Guidelines on Conflicts of Interest in International Arbitration, including the guidelines on direct and indirect conflicts of interest, and any supplemental guidelines, in Article 6.5 of Annex 14-D. It also imposes a so-called “two-hats” bar, prohibiting arbitrators from “acting as counsel or as party appointed expert or witness in any pending arbitration under the annexes to this Chapter.”

Canada-Mexico investment arbitration might survive elsewhere, but not under the USMCA

Because no consent for investment arbitration has been included in the USMCA for investments between Canada and Mexico, investors seeking to bring investment claims are likely to rely on the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) rather than the USMCA. The CPTPP, to which both Canada and Mexico are signatories, offers many of the same protections accorded to investors under both the NAFTA and the USMCA.11) Comprehensive and Progressive Agreement for Trans-Pacific Partnership, Article 9: Investment jQuery("#footnote_plugin_tooltip_6214_11").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_11", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Mexico has already ratified the CPTPP and Canada has pledged to do so.12) “Canada Move Closer to CPTPP Ratification, Malaysia Calls for Trade Deal Review”, International Centre for Trade and Sustainable Development (Jun. 28, 2018) jQuery("#footnote_plugin_tooltip_6214_12").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_12", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); The CPTPP will enter into force after 6 of the 11 signatory countries complete their ratification processes.

Part II

The USMCA uses lessons learned from NAFTA to clarify legal terms and amend arbitral procedure

Incorporating lessons from past NAFTA arbitrations, the USMCA Parties took steps to clarify certain key terms (including the standards of investment protection) throughout the agreement, often in footnotes, which may prove relevant in the USMCA’s interpretation. Some important changes are noted below:

1. Under the national treatment and most-favored-nation provisions of the USMCA, tribunals would be required to determine whether treatment is accorded in “like circumstances” based on a totality-of-the-circumstances test: “For greater certainty, whether treatment is accorded in “like circumstances” under this Article depends on the totality of the circumstances, including whether the relevant treatment distinguishes between investors or investments on the basis of legitimate public welfare objectives.”

2. The USMCA offers more guidance on the definition of an “investment,” stating that “investment means every asset that an investor owns or controls, directly or indirectly, that has the characteristics of an investment, including such characteristics as the commitment of capital or other resources, the expectation of gain or profit, or the assumption of risk.”

3. In determining whether an “indirect expropriation” occurred within the meaning of Article 14.8.1 (as defined in Annex 14-B), the USMCA expressly states that this “requires a case-by-case, fact-based inquiry.” (It should be recalled that, under the current USMCA text, only claimants with a “covered government contract” in one of five “covered sectors” may file a claim for breach of the USMCA, Article 14.8.1, for an indirect expropriation).

a. Annex 14-B instructs tribunals to consider “the economic impact of the government action” (though economic impact alone is not determinative), “the character of the government action, including its object, context, and intent,” and “the extent to which the government action interferes with distinct, reasonable investment-backed expectations.”

b. Regarding “reasonable, investment-backed expectations,” it offers the following factors as guidance: “whether the government provided the investor with binding written assurances and the nature and extent of governmental regulation or the potential for government regulation in the relevant sector.”

4.
In contrast to the USMCA’s above definition of “indirect expropriation,” the USMCA specifically rejects that the “minimum standard of treatment under customary international law” should be defined by reference to an investor’s legitimate, investment-backed expectations. Specifically, Article 14.6(4) provides that “[f]or greater certainty, the mere fact that a Party takes or fails to take an action that may be inconsistent with an investor’s expectations does not constitute a breach of this Article, even if there is loss or damage to the covered investment as a result.” This departs from investment tribunals’ interpretation of the fair and equitable treatment standard under other investment treaties, or (some argue) the minimum standard of treatment under customary international law.

Codifying the interpretation from the NAFTA’s Free Trade Commission’s trilateral “Notes of Interpretation of Certain Chapter 11 Provisions” from 2001,13) NAFTA Free Trade Commission, “Notes of Interpretation of Certain Chapter 11 Provisions” (2001) (1. “Article 1105(1) prescribes the customary international law minimum standard of treatment of aliens as the minimum standard of treatment to be afforded to investments of investors of another Party. 2. The concepts of “fair and equitable treatment” and “full protection and security” do not require treatment in addition to or beyond that which is required by the customary international law minimum standard of treatment of aliens.”) jQuery("#footnote_plugin_tooltip_6214_13").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_13", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); Article 14.6(2) of the USMCA specifies that the term “minimum standard of treatment” is the customary international law standard, stating “[f]or greater certainty, paragraph 1 prescribes the customary international law minimum standard of treatment of aliens as the standard of treatment to be afforded to covered investments. The concepts of “fair and equitable treatment”14) Article 14.6(2)(a) defines “fair and equitable treatment” as “includ[ing] the obligation not to deny justice in criminal, civil or administrative adjudicatory proceedings in accordance with the principle of due process embodied in the principal legal systems of the world.” jQuery("#footnote_plugin_tooltip_6214_14").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_14", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); and “full protection and security”15) Article 14.6(2)(b) defines “full protection and security” as “requi[ring] each Party to provide the level of police protection required under customary international law.” jQuery("#footnote_plugin_tooltip_6214_15").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_15", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); do not require treatment in addition to or beyond that which is required by that standard, and do not create additional substantive rights.”

Things to watch

As current and prospective investors await congressional approval for the USMCA and the termination of the NAFTA, it might be asked: what happens next? The USMCA has created uncertainty for North American investors, which is likely to affect future foreign investment flows and raise new legal issues. Prudent investors and practitioners will watch for the following developments in the coming months:

Will NAFTA officially be terminated, and if so, when? What date will the USMCA come into force?

What are the likely issues that will emerge during the congressional approval process? How will industries respond to these changes, and what effect will their voices have on the USMCA’s approval? Will there be any proposed changes to the text of Chapter 14 of the USMCA?

Will the CPTPP be ratified before the NAFTA’s termination, and will it really offer Canadian and Mexican investors an effective avenue for future investor-state arbitration?

Finally, in light of well-known developments in Europe pertaining to investor-state arbitration,16) See, e.g., Laurens Ankersmit, “Achmea: the Beginning of the End for INVESTOR-STATE ARBITRATION in and with Europe?”, Investment Treaty News, International Institute for Sustainable Development (Apr. 24, 2018). jQuery("#footnote_plugin_tooltip_6214_16").tooltip({ tip: "#footnote_plugin_tooltip_text_6214_16", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] }); is the USMCA part of a global trend away from investor-state arbitration?

Given this uncertainty, current and prospective investors may consider whether certain investments may be structured (or restructured) through effective nationality planning. Investors should consult qualified counsel to discuss investment-protection alternatives to the new USMCA, including analysis of investment treaties between USMCA Parties and other States. These other investment treaties may contain more favorable standards of investment protection (or more advantageous procedural provisions) than those in the proposed USMCA text.

References   [ + ]

1. ↑ Notably, under Article 2 of Annex 14-C, the consent and submission to arbitration must “satisfy the requirements” of Chapter II of the ICSID Convention. 2. ↑ Although investor-state arbitration is dead between the U.S. and Canada, state-to-state arbitration between the two very much survives. Canada won its fight over NAFTA Chapter 19, paying for it in dairy concessions, and there will be no change to those provisions. This means that Canada may continue to bring suit before a special panel over alleged unfair trade practices by the U.S. and Mexico, including anti-dumping and countervailing duties. 3. ↑ Direct expropriation under Annex 14-B, Clause 2 occurs when “an investment is nationalized or otherwise directly expropriated through formal transfer of title or outright seizure.” 4. ↑ USMCA Article 14.4.1 defines national treatment as “treatment no less favorable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.” 5. ↑ Under the USMCA Article 14.5.1, most-favored-nation claims arise when a state’s treatment of an investor is “less favorable than the treatment it accords, in like circumstances, to investors of any other Party or of any non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.” Readers of the new USMCA will be particularly careful to read footnote 22 in Chapter 14, which provides that “the ‘treatment’ referred to in Article 14.5 (Most-Favored-Nation Treatment) excludes provisions in other international trade or investment agreements that establish international dispute resolution procedures or impose substantive obligations; rather, ‘treatment’ only includes measures adopted or maintained by the other Annex Party, which may include measures adopted or maintained pursuant to or consistent with substantive obligations in other international trade or investment agreements.” (emphases added) Like other provisions in Chapter 14 of the USMCA, the language of this provision may depart substantially from the definitions used in other investment agreements. 6. ↑ Article 6 of Annex 14-E defines “covered government contract” as “a written agreement between a national authority of an Annex Party and a covered investment or investor of the other Annex Party, on which the covered investment or investor relies in establishing or acquiring a covered investment other than the written agreement itself, that grants rights to the covered investment or investor in a covered sector.” 7. ↑ The USMCA defines the minimum standards of treatment due to investors “in accordance with customary international law, including fair and equitable treatment and full protection and security.” (Article 14.6.1). It adds that “(a) “fair and equitable treatment” includes the obligation not to deny justice in criminal, civil or administrative adjudicatory proceedings in accordance with the principle of due process embodied in the principal legal systems of the world; and (b) “full protection and security” requires each Party to provide the level of police protection required under customary international law.” (Article 14.6.2(a),(b)) 8. ↑ Indirect expropriation refers to a situation “in which an action or series of actions by a Party has an effect equivalent to direct expropriation without formal transfer of title or outright seizure.” (Annex 14-B, Clause 3) 9. ↑ See Article 6 of Annex 14-E (emphases added). It should be noted that the preservation of investor-state arbitration in these key sectors is likely due to successful lobbying by American industry groups during negotiations.

10. ↑ See Footnote 31 to USMCA Chapter 14: “For greater certainty, Article 5.1(a)-(c) of Annex 14-D do not apply to claims under paragraph 2 [of Annex 14-E].” 11. ↑ Comprehensive and Progressive Agreement for Trans-Pacific Partnership, Article 9: Investment 12. ↑ “Canada Move Closer to CPTPP Ratification, Malaysia Calls for Trade Deal Review”, International Centre for Trade and Sustainable Development (Jun. 28, 2018) 13. ↑ NAFTA Free Trade Commission, “Notes of Interpretation of Certain Chapter 11 Provisions” (2001) (1. “Article 1105(1) prescribes the customary international law minimum standard of treatment of aliens as the minimum standard of treatment to be afforded to investments of investors of another Party. 2. The concepts of “fair and equitable treatment” and “full protection and security” do not require treatment in addition to or beyond that which is required by the customary international law minimum standard of treatment of aliens.”) 14. ↑ Article 14.6(2)(a) defines “fair and equitable treatment” as “includ[ing] the obligation not to deny justice in criminal, civil or administrative adjudicatory proceedings in accordance with the principle of due process embodied in the principal legal systems of the world.” 15. ↑ Article 14.6(2)(b) defines “full protection and security” as “requi[ring] each Party to provide the level of police protection required under customary international law.” 16. ↑ See, e.g., Laurens Ankersmit, “Achmea: the Beginning of the End for INVESTOR-STATE ARBITRATION in and with Europe?”, Investment Treaty News, International Institute for Sustainable Development (Apr. 24, 2018). 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: Arbitration in Belgium: A Practitioner’s Guide
by Edited by Niuscha Bassiri, Maarten Draye
€ 185


The post What’s in a Name Change? For Investment Claims Under the New USMCA Instead of NAFTA, (Nearly) Everything. appeared first on Kluwer Arbitration Blog.

Easing Access to Justice & Boosting Business Development - Georgia Today

Google International ADR News - Thu, 2018-10-04 10:52

Georgia Today

Easing Access to Justice & Boosting Business Development
Georgia Today
Challenges and opportunities of the New Era in Dispute Resolution were discussed at the fifth annual international conference GIAC Arbitration Days opened in Tbilisi on October 4. ... Georgian International Arbitration Centre (GIAC) signed an agreement ...

and more »

Easing Access to Justice & Boosting Business Development - Georgia Today

Google International ADR News - Thu, 2018-10-04 10:52

Georgia Today

Easing Access to Justice & Boosting Business Development
Georgia Today
Challenges and opportunities of the New Era in Dispute Resolution were discussed at the fifth annual international conference GIAC Arbitration Days opened in Tbilisi on October 4. ... Georgian International Arbitration Centre (GIAC) signed an agreement ...

The Contents of Asian International Arbitration Journal, Volume 14, Issue 1, 2018

Kluwer Arbitration Blog - Thu, 2018-10-04 03:32

Lawrence Boo and Gary Born

Kluwer Law International and the Singapore International Arbitration Centre (SIAC) are pleased to announce their new partnership in publishing the latest edition of the Asian International Arbitration Journal (AIAJ). In this 2018 publication, Mr Gary Born, President of the SIAC Court of Arbitration, joins Professor Lawrence Boo as a General Co-Editor of the AIAJ.

The AIAJ seeks to be a thought leader on issues in international commercial arbitration in the Asia-Pacific region. Published twice yearly since 2005, this cutting edge, practical publication will provide insights into latest institutional developments and regulatory changes, as well as updates on recent case law, legislative enactments and arbitral awards in Asia.

The contents of the latest issue of the journal is now available and includes the following contributions:

 

V. K. Rajah, The Case For Singapore To Take The Lead In International Arbitration Ethics

There has in recent times been much hand wringing within the international arbitral community about the difficulties of reaching a consensus on ethical standards. This paper presents a simple thesis: it is in Singapore’s enlightened self-interest to set the highest pragmatic standards for its professionals regardless of where they operate and to ensure that all matters seated here are ethically policed by common standards. While Singapore should continue to steadfastly contribute to international thought leadership in this area, it cannot afford to adopt ‘wait-andsee’ approach for the rules to be imposed internationally. First, being ethics agnostic is not the Singapore way. Second, instead of harming its competitive edge, stricter ethical standards will pay dividends both professionally and commercially. To this end, greater weight should be given to the business and financial community in assessing both the desirability and urgency for reform. Third, Singapore should not be ethically disingenuous by upholding one standard of ethics before the courts and another lower standard before arbitral tribunals. Axiomatically, it is in Singapore’s self-interest to take the lead. The jurisdictions that best address the very patent desire by users for enforceable ethical standards will over time benefit enormously as first movers.

 

Gracious Timothy Dunna, Supreme Court In Centrotrade 2016: Too Quick To Nod At The Validity Of The Two-Tier Arbitration Clause?

In a decade’s time since the Supreme Court’s ruling in Centrotrade in 2006, a plethora of questions opened relating to two-tier arbitrations: What is the nature of the awards in the first and second instances; where is the appellate tribunal seated; what may be the grounds of appeal; and what authority is exercised by appellate tribunals? In 2016, nevertheless, the Supreme Court reflected upon several of these questions, and answered them using certain fundamental principles of arbitration. This piece tries to holistically understand appellate arbitrations and its entailments, and provides an alternative view as to why the Supreme Court erred in enforcing the appellate arbitration clause in Centrotrade.

 

Sai Anukaran, ‘Scope Of Arbitrability Of Disputes’ From The Indian Perspective

Arbitration essentially involves ouster of jurisdiction of civil courts by mutual consent of the parties in lieu of jurisdiction conferred upon a specific set of persons known as arbitrators to adjudicate the dispute. International Arbitral Standards require the states to keep their National Arbitral Legislation open-ended without limiting the scope of arbitrability of disputes, providing grounds only for setting aside of arbitral awards in violation of the Public Policy of the country. Thus, the interpretation of ‘Scope of arbitrability’ is left to the determination of the courts. The instant article explores the meaning of term ‘arbitrability of disputes’ and discusses the ‘Scope of arbitrability of disputes’ in Indian Perspective. The article critically analyses the case of Booz Allen and Hamilton Inc. v. SBI Home Finance Ltd., wherein the Supreme court for the first time evolved test of arbitrability of disputes and further enumerated an illustrative list of disputes, which are incapable of being decided by arbitration. The article then maps the evolution of tests of arbitrability by various courts based on the Judgement of the Supreme Court and critically analyses them.

 

Mohamed H. Negm and Huthaifa Bustanji, Particularity Of Arbitration In International Intellectual Property disputes: Fitting Square Peg Into Round Hole

With the world more and more dependent upon technology of all types, the continued and growing importance of intellectual property cannot be understated. There has been, and will continue to be, an accompanying explosion in the number and complexity of transactions in which intellectual property is a critical, if not the critical, element. Many of these transactions cross national boundaries; as do the disputes which inevitably arise from them. This article will serve as a handy reference and guide for navigating through the complex maze of intellectual property and arbitration. The main characteristics of intellectual property disputes and the results offered by domestic litigation and arbitration are scrutinized in this article. It starts by exploring how and why arbitration can provide a better way to resolve these disputes. It then deals with the issue of arbitrability of intellectual property disputes with special emphasis placed on public policy rationales. Finally, the questions of the applicable law and limitations to party autonomy are adequately addressed.

 

Elizabeth Wu and Lawrence Boo, Of Moving Frontiers And Notes Verbales: Ascertaining The Intentions Of State Parties In Bits

The 1969 Vienna Convention on the Law of Treaties (the VCLT) provides an interpretive framework to ascertain State parties’ respective treaty obligations. In bilateral investment treaties (BITs), State parties mutually undertake to protect investments made by the nationals of the other contracting State. In its decision in Sanum Investments Ltd v. Government of the Lao People’s Democratic Republic [2016] SGCA 57, the Singapore Court of Appeal held that a Macanese investor was a protected national under a BIT between the Lao People’s Democratic Republic (Laos) and the People’s Republic of China (China). This ruling was made against the views of Laos and China, expressed through an exchange of Notes Verbales after the dispute arose, that the BIT did not cover Macau. This article examines the Court’s use of an evidentiary ‘critical date rule’ to exclude the consideration of these Notes Verbales. It questions whether the Court’s approach coheres with the principles of treaty interpretation encapsulated in the VCLT.

 

Contributions to the AIAJ should be submitted by softcopy, in a word document, to [email protected]. The editorial guidelines for the AIAJ may be found at the following link.

More from our authors: Arbitration in Belgium: A Practitioner’s Guide
by Edited by Niuscha Bassiri, Maarten Draye
€ 185


The post The Contents of Asian International Arbitration Journal, Volume 14, Issue 1, 2018 appeared first on Kluwer Arbitration Blog.

Senate Conducted Six Committee Hearings on Oct. 2 - Insurance News Net

Google International ADR News - Wed, 2018-10-03 21:45

Senate Conducted Six Committee Hearings on Oct. 2
Insurance News Net
S. 2160, to establish a pilot program under the Chief of the Forest Service may use alternative dispute resolution in lieu of judicial review of certain projects, with an amendment in the nature of a substitute;. - S. 2166, to maintain annual base ...

Buratai tasks Army chaplains, assistants to embrace dialogue in resolving crises - The Eagle Online

Google International ADR News - Wed, 2018-10-03 14:21

The Eagle Online

Buratai tasks Army chaplains, assistants to embrace dialogue in resolving crises
The Eagle Online
Buratai tasks Army chaplains, assistants to embrace dialogue in resolving crises. The Chief of Army Staff, Lt.-Gen. Tukur Buratai, has tasked the Army chaplains and their assistants to embrace Alternative Dispute Resolution and dialogue in resolving ...

and more »

Litigation Conduct Waivers and the New York Convention

Today’s post concerns waiver of the right to arbitrate by an ambivalent plaintiff in a US District Court, and under what conditions it might be appropriate for a US District Court, applying the New York Convention and FAA Section 206 (governing motions to compel arbitration under arbitration agreements covered by the Convention), to decide that such a waiver by virtue of the litigation conduct of the plaintiff renders an arbitration agreement “null and void” (or “inoperative”) under Article II (3) of the Convention*. Every sermon needs its text, and today our text is a recent case from Silicon Valley: Hebei...
Read More »

The post Litigation Conduct Waivers and the New York Convention appeared first on Marc J. Goldstein - Arbitration & Mediation.

Seminar sessions to check out at this year's Trade Days - THIIS

Google International ADR News - Wed, 2018-10-03 09:31

THIIS

Seminar sessions to check out at this year's Trade Days
THIIS
Speaker: Matt Major, Director of International Sales at MK Battery. About the session: MK Battery has over 35 ... a business. Learning outcomes: Understand the requirements for traders in the Alternative Dispute Resolution for Consumer Disputes ...

UK Gambling Commission publishes new complaints processes standards - Yogonet International (press release) (blog)

Google International ADR News - Wed, 2018-10-03 09:17

Yogonet International (press release) (blog)

UK Gambling Commission publishes new complaints processes standards
Yogonet International (press release) (blog)
The gambling regulatory body announced Monday new standards for how complaints are handled by alternative dispute resolution (ADR) providers in the gambling industry. T. he new standards, which come into effect from 31 October, set out how consumer ...

and more »

UK Gambling Commission publishes new complaints processes standards - Yogonet International (press release) (blog)

Google International ADR News - Wed, 2018-10-03 09:17

Yogonet International (press release) (blog)

UK Gambling Commission publishes new complaints processes standards
Yogonet International (press release) (blog)
The gambling regulatory body announced Monday new standards for how complaints are handled by alternative dispute resolution (ADR) providers in the gambling industry. T. he new standards, which come into effect from 31 October, set out how consumer ...

and more »

Delhi High Court Rejects Arguments against Enforcement Based on CIETAC Split

Kluwer Arbitration Blog - Tue, 2018-10-02 21:00

Li Haifeng

Background on CIETAC Split

Up until May 1, 2012 CIETAC had a branch in Shanghai named CIETAC Shanghai Sub-commission (the “Old Sub-commission”). This Old Sub-commission used the same CIETAC arbitration rules but was administered by a secretariat semi-independent of that of the head office of CIETAC in Beijing.

On May 1, 2012 CIETAC launched its 2012 edition of arbitration rules. Some disagreements arose between the Old Sub-commission and the head office of CIETAC, which triggered the Old Sub-commission declaring independence from CIETAC.

On April 11, 2013 the Old Sub-commission renamed itself as Shanghai International Arbitration Center (“SHIAC”) (the “Re-naming”). CIETAC then established a new CIETAC Shanghai Sub-commission (the “New Sub-commission”) shortly after the Re-naming. 1) See e.g. Justin D’ Agostino, Kluwer Arbitration Blog, 2 May 2014, The Aftermath of the CIETAC Split: Two years on, lower courts take clashing views on arbitration agreements and awards– but higher courts strive for consistency. jQuery("#footnote_plugin_tooltip_1172_1").tooltip({ tip: "#footnote_plugin_tooltip_text_1172_1", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

To clarify uncertainties surrounding the competence of CIETAC and SHIAC over cases with an underlying clause providing for arbitration by CIETAC Shanghai Sub-commission, the Supreme People’s Court of China (the “SPC”) issued a circular in June 2015 (the “SPC Interpretation”). Article 1 states that disputes in connection with contracts signed before the Re-naming carrying an arbitration clause providing arbitration by CIETAC Shanghai Sub-commission shall be administered by SHIAC. It also provides in article 3 that no party shall be upheld in its application for the set-aside or non-enforcement of an award on the ground of no competence if either CIETAC or SHIAC had accepted the case which it should not have as per the SPC Interpretation prior to the issuance date thereof.

Delhi Court’s Decision on Enforcement

As reported in Global Arbitration Review, a Chinese solar power company, LDK Solar Hi-Tech (“LDK”), attempted to enforce a CIETAC award against an Indian counterpart, Hindustan Clean Energy (“Hindustan”), in India. 2) https://globalarbitrationreview.com/article/1171818/chinese-company-enforces-award-in-delhi-despite-arguments-based-on-cietac-split jQuery("#footnote_plugin_tooltip_1172_2").tooltip({ tip: "#footnote_plugin_tooltip_text_1172_2", tipClass: "footnote_tooltip", effect: "fade", fadeOutSpeed: 100, predelay: 400, position: "top right", relative: true, offset: [10, 10] });

The underlying arbitration clause carried in a guarantee agreement entered into between LDK, as the beneficiary, and Hindustan, as the guarantor, provides that “any and call claims, disputes, controversies or differences arising between the Parties out of or in connection with this Bond shall be submitted for arbitration before China International Economic and Trade Arbitration Commission (CIETAC) in Shanghai by three arbitrators appointed in accordance with the corresponding rules of arbitration…

LDK brought arbitration before New Sub-commission in October 2013 and the award was made in February 2015.

When LDK applied for enforcement of the award in the Delhi High Court, Hindustan tried to resist the enforcement raising the following arguments:

1) That the New Sub-commission had no jurisdiction as the arbitration agreement referred disputes to the Old Sub-commission, now renamed as SHIAC. For this argument Hindustan relied on article 1 of the SPC Interpretation.

2) That CIETAC breached principles of natural justice when it appointed a substitute arbitrator to replace the original chair within 2 days.

All the arguments were rejected by Judge Navin Chawla.

Comments

In my view, Judge Navin Chawla made a judicious judgment.

It is important to note the distinction between providing for arbitration before CIETAC Shanghai Sub-commission on the one hand, and arbitration before “CIETAC in Shanghai” as is in the present case, on the other. The former provision refers to a specific institution by the name of CIETAC Shanghai Sub-commission whereas the latter commonly interpreted as “CIETAC” being the name of the institution whereas “Shanghai” the place of arbitration.

According to the 2005 edition of CIETAC Arbitration Rules, the claimant could choose either CIETAC the head office or CIETAC Shanghai Sub-commission to administer its arbitration if there is no such selection in the arbitration clause. Although in practice cases with a contractual provision for arbitration before CIETAC in Shanghai were usually handled by the Old Sub-commission, CIETAC reserved the right to decide otherwise. So provision for arbitration before CIETAC in Shanghai is not 100% equivalent of arbitration before CIETAC Shanghai Sub-commission.

Art. 1 of the SPC Interpretation obviously refers to an express reference to CIETAC Shanghai Sub-commission by name rather than Shanghai by place because the very object of the circular was to eradicate ambiguity and uncertainty.

Alternatively even if the reference to arbitration before CIETAC in Shanghai could be treated as 100% equivalent of CIETAC Shanghai Sub-commission, article 3 of the SPC Interpretation would have deprived Hindustan of any right to challenge the award on the ground of no competence in China. Since China is the place of arbitration, it’s only normal for the Indian court to give overriding weight to the positions of PRC laws and courts, particularly the SPC.

Chawla J’s rejection of the natural justice point was predicated on the fact that Hindustan had made no effort to achieve agreement with LDK on the choice of presiding arbitrator when it had the opportunity to do so at the start of the case. It’s true that as per the 2005 CIETAC Arbitration Rules, the same procedure should have been followed to appoint a replacement arbitrator as that for the one being replaced. In other words, to replace the presiding arbitrator, the parties should have been given 15 days to agree on a candidate. However, when a party had not exercised that right when it had an opportunity to do so in the first place, it’s hardly arguable that its legitimate interests would be compromised in any consequential way if it was not given a second opportunity. Therefore, Chawla J was only right in commenting that Hindustan was “merely trying to take advantage of an inconsequential issue to challenge the arbitral award”, and that “there is no such thing as mere technical infringement of natural justice.”

Had the presiding arbitrator been appointed without giving the parties an opportunity to agree on a candidate in the first place, would the judge have viewed it as inconsequential and rejected Hindustan’s invocation of natural justice? I think it would probably not be so. Hence the crux of the judgment is that Hindustan had waived or been slack in exercising its right to propose a presiding arbitrator candidate in the first place.

The decision of the Delhi court to enforce the award is a welcome pro-arbitration gesture of Indian courts that they would not refuse enforcement of arbitral awards merely based on some non-material technical irregularities.

 

References   [ + ]

1. ↑ See e.g. Justin D’ Agostino, Kluwer Arbitration Blog, 2 May 2014, The Aftermath of the CIETAC Split: Two years on, lower courts take clashing views on arbitration agreements and awards– but higher courts strive for consistency. 2. ↑ https://globalarbitrationreview.com/article/1171818/chinese-company-enforces-award-in-delhi-despite-arguments-based-on-cietac-split 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: Arbitration in Belgium: A Practitioner’s Guide
by Edited by Niuscha Bassiri, Maarten Draye
€ 185


The post Delhi High Court Rejects Arguments against Enforcement Based on CIETAC Split appeared first on Kluwer Arbitration Blog.

Does Anger Pay Off?

ADR Prof Blog - Tue, 2018-10-02 17:46
Building on Andrea’s post on teaching the Kavanaugh hearings, I am thinking about whether and how to teach my negotiation students about strategic uses of anger. Obviously such a discussion raises interesting questions around whether and how certain groups are able to display anger, and to whom. (It’s not true that all men can act … Continue reading Does Anger Pay Off? →
Syndicate content