Tribunal Secretaries & the Proposed Amendments to the Indian Arbitration Law

The Arbitration and Conciliation (Amendment) Bill, 2018 has been passed in the Lok Sabha and is likely to be discussed in the Rajya Sabha in the forthcoming Parliamentary session. The amendments seek to establish India as a robust centre for international arbitration. Of the many aspects that the Bill has missed out, one of the crucial aspects of international arbitration that the Bill has failed to address is the issue relating to tribunal secretaries. 

Tribunal secretaries are considered as an integral part of international arbitrations, especially with high stakes and complexities involved.  They have been regarded as the fourth arbitrator and yet the appointment, functioning and other aspects relating to tribunal secretaries are hardly addressed by the amendment. Given that the role and functioning of tribunal secretaries is a grey area, it would do well for India to address this statutorily. Hence, the following amendments are suggested (sincere thanks to Dr Shaswat Bajpai for his comments on the topic)

Inclusion of Fee to Tribunal Secretaries in Costs of Arbitration

The definition of "costs" in Section 31A should include the fees to tribunal secretaries as well. This would mean that the arbitral tribunal will have a lien over the award under Section 39(1) if the fee of the tribunal secretaries remain unpaid. The following amendments are suggested in Section 31A:

Explanation to Section 31A(1) which defines costs should include fees and expenses of tribunal secretaries also.  Accordingly, the phrase "tribunal secretaries" is sought to be added to clause (i) of the explanation as below:

"Explanation: For the purpose of this subsection, "costs" means reasonable costs relating to
i) the fees and expenses of the arbitrators, tribunal secretaries, Courts and witnesses;
(ii) legal fees and expenses;
(iii) any administration fees of the institution supervising the arbitration; and
(iv) any other expenses incurred in connection with the arbitral or Court proceedings and the arbitral award."

Immunity to Arbitrators to Extend to Tribunal Secretaries

The 2018 Amendment Bill proposes to introduce a provision on immunity of the arbitrators in the firm of Section 42B. This immunity should be extended to tribunal secretaries as well. It is suggested that the phrase “or the tribunal secretary” is added after “the arbitrator” in the proposed Section 42B.

An amended Section 42B as per the above suggestion would read as below:

”No suit or other legal proceedings shall lie against the arbitrator or the tribunal secretary for anything which is in good faith done or intended to be done under this Act or the rules or regulations made thereunder."

Arbitration Promotion Council to Take Steps to Recognise Professional Institutes Providing Accreditation of Tribunal Secretaries

Section 43D proposed to be introduced vide the 2018 Amendment Bill lays down the functions of the Arbitration Promotion Council of India. It does not deal with tribunal secretaries. While conducting training programmes for tribunal secretaries could be covered under Section 43D(2)(i), Section 43D is silent on tribunal secretaries. From a perusal of Section 43D, it appears that the Arbitration Promotion Council of India is not tasked with directly accrediting arbitrators. Section 43D(2)(b) provides for recognition of professional institutes which accredit arbitrators. The Council, then, should also recognize professional institutes accrediting tribunal secretaries. To this end, the phrase “and tribunal secretaries” should be added after “arbitrators” in Section 43D(2)(b).

The proposed Section 43D(2)(b) would read as below:

“(2) For the purposes of performing the duties and discharging the functions under this Act, the Council may—

(b) recognise professional institutes providing accreditation of arbitrators “and tribunal secretaries”;

General Norms Applicable to Arbitrators in Eighth Schedule Should Apply Mutatis Mutandis to Tribunal Secretaries

Section 43G of the 2018 Bill provides that the qualifications, experience and norms for accreditation of arbitrators shall be as specified in the Eighth Schedule. Eighth Schedule sought to be introduced by the 2018 Bill lays down the qualifications, experience and norms for accreditation of arbitrators. The norms should apply to tribunal secretaries also.

Although it may be unreasonable to provide for experience requirements for tribunal secretaries, it is imperative that appointment of trained tribunal secretaries is encouraged. To that end, a tribunal secretary to be eligible for appointment must have at least undergone training from recognized institutions.

Following amendments are suggested:

The phrase “and tribunal secretaries” should be added after “of arbitrators” in Section 43G. Section 43G would then read:

“The qualifications, experience and norms for accreditation of arbitrators and tribunal secretaries shall be such as specified in the Eighth Schedule:

Provided that the Central Government may, after consultation with the Council, by notification in the Official Gazette, amend the Eighth Schedule and thereupon, the Eighth Schedule shall be deemed to have been amended accordingly.”

At the end of the Eighth Schedule, the following are to be added:

“Qualifications of Tribunal Secretary

A person shall not be qualified to be a tribunal secretary unless he is trained and certified as such by a professional institute recognised by the Arbitration Promotion Council of India.

General Norms Applicable to Tribunal Secretary

The general norms applicable to arbitrator shall apply mutatis mutandis to tribunal secretary.”

Model Rules Applicable to Appointment and Functioning of Tribunal Secretaries

The current law is silent on the rules regarding the appointment and functioning of tribunal secretaries. Hence, it is proposed that a new Section 15A is added to provide detailed rules that would apply in default for appointment of tribunal secretaries unless parties agree otherwise. Detailed rules in this regard could be contained in a Ninth Schedule. Similar to Section 11A, the Central Government will be empowered with the right to amend the Ninth Schedule.

The provisions proposed will be as below:

“15A. Tribunal Secretaries.-

(1) The parties are free to agree on the number, qualifications, procedure for appointment and functions of tribunal secretaries to the arbitration proceedings.

(2) Failing any agreement referred to in sub-section (1), the Ninth Schedule shall guide the parties and the arbitral tribunal in the appointment and functioning of tribunal secretaries in the arbitration proceedings.

(3) If the Central Government is satisfied that it is necessary or expedient so to do, it may, by notification in the Official Gazette, amend the Ninth Schedule and thereupon the Ninth Schedule shall be deemed to have been amended accordingly.

(4) A copy of every notification proposed to be issued under sub-section (3), shall be laid in draft before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in disapproving the issue of the notification or both Houses agree in making any modification in the notification, the notification shall not be issued or, as the case may be, shall be issued only in such modified form as may be agreed upon by the both Houses of Parliament.”

The Government could come up with draft model rules addressing the topics of appointment, role and functions of tribunal secretaries. If India has to achieve the salutary aim of becoming a robust centre for international arbitration, the arbitration law should reflect the best practices in international arbitration. The need of the day is a comprehensive and enabling system of international arbitration. It would do well for the Government to explore the option of introducing these amendments in the current round of reforms.