Arbitration agreement 2019

ARBITRATION AGREEMENT MULTI-TIERED DISPUTE RESOLUTION CLAUSES AND THEIR PROBLEMS Hochiminh, 23rd July 2019 DZUNG MANH NGUYEN • MEMBER | ICC INTERNATIONAL COURT OF ARBITRATION • ARBITRATOR| VIAC & KCAB INTERNATIONAL • DIRECTOR| ADR VIETNAM CHAMBERS LLC CONTENTS I Multi-tiered dispute resolution clauses II Problems III Recommendations FIDIC 2017 CONDITIONS OF CONTRACT FOR EPC/TURNKEY PROJECTS Unless settled amicably, and subject to Sub-Clause 3.5.5 [Dissatisfaction with Employer’s Representative’s determination], Sub-Clause 21.4.4 [Dissatisfaction with DAAB’s decision], Sub-Clause 21.7 [Failure to Comply with DAAB’s Decision] and Sub-Clause 21.8 [No DAAB In Place], any Dispute in respect of which the DAAB’s decision (if any) has not become final and binding shall be finally settled by international arbitration Unless otherwise agreed by both Parties: (a) the Dispute shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce; (b) the Dispute shall be settled by one or three arbitrators appointed in accordance with these Rules; and (c) the arbitration shall be conducted in the ruling language defined in Sub-Clause 1.4 [Law and Language] FIDIC 2017 CONDITIONS OF CONTRACT FOR EPC/TURNKEY PROJECTS The arbitrator(s) shall have full power to open up, review and revise any certificate, determination (other than a final and binding determination), instruction, opinion or valuation of the Employer and/or of the Employer’s Representative, and any decision of the DAAB (other than a final and binding decision) relevant to the Dispute Nothing shall disqualify the natural person(s) who has/have acted on behalf of the Employer under the Contract from being called as witness(es) and giving evidence before the arbitrator(s) on any matter whatsoever relevant to the Dispute In any award dealing with costs of the arbitration, the arbitrator(s) may take account of the extent (if any) to which a Party failed to cooperate with the other Party in constituting a DAAB under Sub-Clause 21.1 [Constitution of the DAAB] and/or Sub-Clause 21.2 [Failure to Appoint DAAB Member(s)] FIDIC 2017 CONDITIONS OF CONTRACT FOR EPC/TURNKEY PROJECTS Neither Party shall be limited in the proceedings before the arbitrator(s) to the evidence or arguments previously put before the DAAB to obtain its decision, or to the reasons for dissatisfaction given in the Party’s NOD under Sub-Clause 21.4 [Obtaining DAAB’s Decision] Any decision of the DAAB shall be admissible in evidence in the arbitration Arbitration may be commenced before or after completion of the Works The obligations of the Parties and the DAAB shall not be altered by reason of any arbitration being conducted during the progress of the Works If an award requires a payment of an amount by one Party to the other Party, this amount shall be immediately due and payable without any Statement or Notice ICC CLAUSE D: OBLIGATION TO REFER DISPUTE TO THE ICC MEDIATION RULES, FOLLOWED BY ARBITRATION IF REQUIRED: In the event of any dispute arising out of or in connection with the present contract, the parties shall first refer the dispute to proceedings under the ICC Mediation Rules If the dispute has not been settled pursuant to the said Rules within [45] days following the filing of a Request for Mediation or within such other period as the parties may agree in writing, such dispute shall thereafter be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with the said Rules of Arbitration SIAC-SIMC ARB-MED-ARB MODEL CLAUSE (“ARB-MED-ARB CLAUSE”) i Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration administered by the Singapore International Arbitration Centre (“SIAC”) in accordance with the Arbitration Rules of the Singapore International Arbitration Centre (“SIAC Rules”) for the time being in force, which rules are deemed to be incorporated by reference in this clause.  The The seat Tribunal of the shall arbitration consist of The language of the arbitration shall be shall be _** [Singapore].*  arbitrator(s).  SIAC-SIMC ARB-MED-ARB MODEL CLAUSE (“ARB-MED-ARB CLAUSE”) The parties further agree that following the commencement of arbitration, they will attempt in good faith to resolve the Dispute through mediation at the Singapore International Mediation Centre (“SIMC”), in accordance with the SIACSIMC Arb-Med-Arb Protocol for the time being in force Any settlement reached in the course of the mediation shall be referred to the arbitral tribunal appointed by SIAC and may be made a consent award on agreed terms VIAC ARB-MED-ARB CLAUSE “… Các bên thỏa thuận thêm rằng, sau bắt đ ầu tố t ụng tr ọng tài, bên nỗ lực cách thiện chí giải tranh chấp thơng qua hịa gi ải t ại Trung tâm Hòa giải Việt nam theo chế liên thơng Trọng tài-Hịa gi ải-Tr ọng tài c VIAC VMC có hiệu lực thời điểm Bất c ứ giải pháp hịa gi ải đ ạt đ ược thủ tục hòa giải chuyển tới hội đồng trọng tài có thẩm quy ền VIAC ghi nhận định trọng tài c s đ ồng thuận (consent award)” PROBLEMS Ineffective and Unenforceable Pre-condition or Requisite for Arbitration Arbitration and Court Time Bar Interim Relief Contractual breach DRAFTING A MULTI TIER DISPUTE RESOLUTION CLAUSE Option 1: Using the best advantage of Seat, Rule and Institution is feasible? Any dispute arising out of or in relation with this contract shall be resolved by the Vietnam International Arbitration Centre (VIAC) in accordance with its ICC Rules of Arbitration The Seat of Arbitration is in Singapore Question: VIAC arbitral award will be seen as Singaporean award or Vietnamese award under respective laws of Singapore and Vietnam and New York Convention 1958? DRAFTING A MULTI TIER DISPUTE RESOLUTION CLAUSE Option 2: Using the best advantage of Institution, Rules and Seat of arbitration is workable? Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration administered by the Singapore International Arbitration Centre (“SIAC”) in Ho Chi Minh city, Vietnam in accordance with the Arbitration Rules of the International Chamber of Commerce (ICC) for the time being in force, which rules are deemed to be incorporated by reference in this clause.  Question: which national court shall have a power to set aside SIAC arbitral award under respective laws of Vietnam and Singapore? DECISION ON THE SETTING ASIDE OF ARBITRAL AWARD NO.: 10/2014/QD – PQTT ISSUED BY HANOI COURT ON 28/10/2014: VIETMINDO COMPANY V HOANG LONG COMPANY • Step 1: Both parties shall negotiate with goodwill and cooperation to come up with the most favorable solutions for both parties • Step 2: After negotiation, if both parties cannot agree on the most favorable solutions for both parties, the parties agree to bring the dispute to Vietnam International Arbitration Centre (VIAC) Rulings According to clause article Law on Commercial Arbitration, one of the fundamental principles for dispute resolution by arbitration is: “Arbitrators must respect the parties’ agreement if such agreement neither breaches prohibitions nor contravenes social ethics.” The Trial panel considers that The Arbitral Tribunal processed the case when the pre-conditions for proceedings, and conditions for processing were insufficient, thus it failed to comply with the law of Vietnam Hoang Long Company had good grounds when citing this violation (sub-clause b clause Article 68) RECOMMENDATIONS Seat is an important factor for negotiation and drafting of an arbitration agreement Consider using commercial mediation in a multi-tier dispute resolution clause Finding a legal ground is not enough, more importantly is its enforceability! REFERENCE • Julian D M Lew, Loukas A Mistelis and Stefan Kröll, Comparative Interna-tional Commercial Arbitration, Kluwer Law International 2003 (8-62 to 8.73) • Alan Redfern & Martin Hunter with Nigel Blackaby and Constantine Partasides, Law and Practice of International Commercial Arbitration (Sweet & Maxwell 4th edition) 2004 (Chapter 3) TÀI LIỆU THAM KHẢO TRONG NƯỚC • • • • • 50 phán trọng tài quốc tế chọn lọc xuất năm 2002 Các định trọng tài quốc tế chọn lọc năm 2007 Các phán trọng tài quốc tế chọn loc năm 2010 Trọng tài phương pháp giải quy ết tranh chấp lựa chọn Alan Redfern, Martin Hunter, Nigel Blackaby, Constaintine Partasides, Pháp lu ật th ực ti ễn tr ọng tài thương mại quốc tế • • Tư pháp quốc tế Việt nam – TS Đỗ Văn Đ ại – PGS.TS Mai H ồng Quỳ NXB Chính tr ị qu ốc gia năm 2010 Tuyển tập Bản án, Quyết định Tòa án Việt nam v ề Tr ọng tài th ương m ại – TS Đ ỗ Văn Đ ại & TS Trần Hồng Hải NXB Lao Động T3/2010 • Pháp luật trọng tài thương mại Việt nam: Bản án bình luận án (2 t ập) – PGS.TS Đ ỗ Văn Đ ại – Nhà xuất Hồng Đức 2018 TÀI LIỆU THAM KHẢO MẠNG • • IBA:https://www.ibanet.org/LPD/Dispute_Resolution_Section/Arbitration/Default.aspx UNCITRAL:http ://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/2012Recommendations.html • • • CIArb:http://www.ciarb.org/guidelines-and-ethics/guidelines/arbitration-guidelines ICCA: http://www.arbitration-icca.org/publications.html ICC: https://iccwbo.org/dispute-resolution-services/arbitration/practice-notes-forms-checkl ists/ THANK YOU FOR YOUR ATTENTION! Q & A ADR Vietnam Chambers LLC Add: Level 46, Bitexco Financial Tower, No.2 Hai Trieu Street, Ben Nghe Ward, District 1, Ho Chi Minh City, Viet Nam Tel +(84) 903 807 376 Email: dzung.nguyen@adr.com.vn Web: www.adr.com.vn ... finally resolved by arbitration administered by the Singapore International Arbitration Centre (“SIAC”) in accordance with the Arbitration Rules of the Singapore International Arbitration Centre... evidence in the arbitration Arbitration may be commenced before or after completion of the Works The obligations of the Parties and the DAAB shall not be altered by reason of any arbitration being... contract shall be resolved by the Vietnam International Arbitration Centre (VIAC) in accordance with its ICC Rules of Arbitration The Seat of Arbitration is in Singapore Question: VIAC arbitral award