Summary LLM International Dispute Resolution - International Commercial Arbitration I - Module 3 (Arbitration Agreement)
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Course
LLM
Institution
LLM
What are the types of arbitration agreements?
What is the purpose of the arbitration agreement?
What is required for a valid arbitration agreement?
Which law governs the arbitration agreement?
What is kompetenz-kompetenz?
How can tribunal's jurisdiction be challenged?
What is separability?
W...
The first is a submission (compromise/post hoc) agreement where the parties agree to
submit ‘existing’ disputes to arbitration. This was common until the 20 th century when
arbitration clauses were eventually recognised.
The second is an arbitration clause where the parties agree to submit, in contrast, ‘future’
disputes to arbitration. Thus the clause is entered into ‘before’ the dispute comes into
existence. The arbitration rules vary on the requirements for an arbitration agreement. ICC
asserts ‘current’ disputes arising out of the ‘present’ contract 1, UNCITRAL asserts disputes
that current as well as ‘future’ disputes, whether contractual or not, in the form of an
arbitration clause or separate agreement2, UK also recognises future disputes but it does not
distinguish between arbitration clauses and separate agreements 3, yet France recognises all
these requirements and extends to ‘one or more contracts’4.
What is the purpose of arbitration agreements?
The arbitration agreement holds various purposes.
Firstly, it acts as a substantive contract by which the parties consent to withdraw their
disputes from national courts and submit their disputes to tribunals. If both give their consent
by agreeing an arbitration clause, one cannot unilaterally revoke consent. Thus the arbitration
is binding.
Secondly, by excluding the national courts’ jurisdiction, the agreement creates the tribunal’s
jurisdiction to decide the parties’ dispute 5 (to be extended or limited by applicable national
laws). Yet such jurisdiction will depend on whether it falls within the scope of the arbitration
agreement.
Third, the agreement sets out the procedure for arbitration. In other words, its admissibility
determines its special procedural effects, i.e. its arbitrability, whether the subject matter can
be determined in arbitration. This allows parties to choose the procedural rule, such as
conducting ad hoc or institutional arbitration. The procedural effects have led in most
countries to form the requirements and influenced means of enforcing the agreement.
What is the function of arbitration agreements?
The writing requirement of the arbitration agreement has two key functions.
First, it intends to ensure parties have ‘consented’ to the arbitration, thus preventing the
agreement from going unnoticed. It can lead to renunciation by the parties of their
constitutional right to have their disputes decided in court. However, critics have argued
correctly that the strict form requirement can defeat the arbitration agreement, in which the
1
ICC Standard Arbitration Clause.
2
UNCITRAL Model Law, Article 7(1).
3
UK Arbitration Act 1996, Section 6.
4
French Civil Procedure Code, Article 1442.
5
Lew, “The Law Applicable to the Form and Substance of the Arbitration Clause”, ICCA Congress series no 9,
114, 125.
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