Abstract:
Interim relief is critical in any form of dispute resolution. Parties must have the option to seek interim measures, like preliminary injunctions and attachments, where their adversaries threaten to take action which cannot be undone by after-the-fact damages. Parties in international arbitrations are no exception. But while international arbitration has many advantages that make it a consensus favorite over litigation in national courts, interim relief has been rightfully called its “Achilles’ heel.” Acknowledging this crippling shortcoming, arbitration institutions have sought to address the problem by revising their international arbitration rules to provide a variety of options for parties to seek interim relief. Drawing on prior research, case studies, and statistics, we provide an updated comparative analysis of interim measures under twelve sets of commonly used international arbitration rules and guidelines. Unlike prior studies, however, we test these procedures in action by comparing them in four hypothetical scenarios, consider expedited proceedings as an alternative to interim relief, and compare a much broader group of rules. We conclude that, while no single set of rules provides the full range of possible options that a party might want, those institutions that have sought to address the problem have come up with several viable procedures (particularly pre-tribunal referee procedures) that other arbitral institutions should consider adopting.
Interim relief is critical in any form of dispute resolution. Parties must have the option to seek interim measures, like preliminary injunctions and attachments, where their adversaries threaten to take action which cannot be undone by after-the-fact damages. Parties in international arbitrations are no exception. But while international arbitration has many advantages that make it a consensus favorite over litigation in national courts, interim relief has been rightfully called its “Achilles’ heel.” Acknowledging this crippling shortcoming, arbitration institutions have sought to address the problem by revising their international arbitration rules to provide a variety of options for parties to seek interim relief. Drawing on prior research, case studies, and statistics, we provide an updated comparative analysis of interim measures under twelve sets of commonly used international arbitration rules and guidelines. Unlike prior studies, however, we test these procedures in action by comparing them in four hypothetical scenarios, consider expedited proceedings as an alternative to interim relief, and compare a much broader group of rules. We conclude that, while no single set of rules provides the full range of possible options that a party might want, those institutions that have sought to address the problem have come up with several viable procedures (particularly pre-tribunal referee procedures) that other arbitral institutions should consider adopting.
[This Article is a must-read. A rare analysis of institutional arbitration rules, albeit on the specific issue of interim measures]
Abstract:
Depoliticisation of investment dispute settlement is considered to be one of the principal reasons and advantages of investor-State arbitrations. This paper considers the added value that the depoliticisation vocabulary brings to the resolution of modern challenges.
First of all, equating investor-State arbitration with depoliticisation of investment disputes suggests a particular perception of legal and political. For the drafters of the ICSID Convention, ratione personae identity of the claimant was the benchmark of politicisation. The logical solution was to replace the home State with the investment, leaving the dispute otherwise unchanged. Secondly, one critique of investment arbitration questions its adequacy for resolving public disputes. In terms of depoliticisation, despite the ratione personae changes the ratione materiae nature of the dispute retains the same degree of political sensitivity. While this position is open the classic Lauterpacht’s critique of substantive definitions of political, it also shows the danger of promising depoliticisation by legal means. Thirdly, another challenge to depoliticisation is the involvement of the home State, eg by ownership or control of the investor. While the de facto involvement of the home State blurs the distinction from the classic regime, restrictions could lead to direct challenges of depoliticisation by invocation of the State-State dispute settlement.
Overall, as per Lauterpacht, it has to be taken as a given that every international law dispute is political. Whatever usefulness depoliticisation may have had as a rhetorical tool in contrasting ‘retrogressive State-centred political’ law with ‘progressive investor-centred legal’ law, its contribution to conceptualising and resolving modern challenges is not entirely obvious.
Depoliticisation of investment dispute settlement is considered to be one of the principal reasons and advantages of investor-State arbitrations. This paper considers the added value that the depoliticisation vocabulary brings to the resolution of modern challenges.
First of all, equating investor-State arbitration with depoliticisation of investment disputes suggests a particular perception of legal and political. For the drafters of the ICSID Convention, ratione personae identity of the claimant was the benchmark of politicisation. The logical solution was to replace the home State with the investment, leaving the dispute otherwise unchanged. Secondly, one critique of investment arbitration questions its adequacy for resolving public disputes. In terms of depoliticisation, despite the ratione personae changes the ratione materiae nature of the dispute retains the same degree of political sensitivity. While this position is open the classic Lauterpacht’s critique of substantive definitions of political, it also shows the danger of promising depoliticisation by legal means. Thirdly, another challenge to depoliticisation is the involvement of the home State, eg by ownership or control of the investor. While the de facto involvement of the home State blurs the distinction from the classic regime, restrictions could lead to direct challenges of depoliticisation by invocation of the State-State dispute settlement.
Overall, as per Lauterpacht, it has to be taken as a given that every international law dispute is political. Whatever usefulness depoliticisation may have had as a rhetorical tool in contrasting ‘retrogressive State-centred political’ law with ‘progressive investor-centred legal’ law, its contribution to conceptualising and resolving modern challenges is not entirely obvious.
Enforcing International Insurers’ Expectations: Can States Unilaterally Quash Commercial Arbitration Agreements Under the McCarran-Ferguson Act?
Mary Pennisi
Mary Pennisi
Abstract:
Commercial parties worldwide rely on arbitration clauses to mitigate the high risks inherent in international business transactions. A split in federal circuit courts has emerged and left the validity of arbitration agreements in global insurance contracts under the United Nations Convention on the Recognition and the Enforcement of Arbitral Agreements (the "New York Convention") in a state of uncertainty in the United States. Safety Nat’l Casualty Corp. v. Certain Underwriters at Lloyd’s, London created a split in federal circuit courts over whether the McCarran-Ferguson Act reverse preempts the New York Convention and allows states to circumvent the United States’ national policy favoring arbitration and invalidate global insurers’ arbitration agreements. This Note examines the split in federal circuit courts created by Safety Nat’l Casualty Corp. Part I examines the legal framework governing arbitration in the United States, including New York Convention and Federal Arbitration Act. It also explores the current state of insurance arbitration and the McCarran-Ferguson Act.
Part I briefly reviews the doctrine of preemption and foreign relations law concerning the status of treaties in United States law. Part II discusses the split in federal authority, particularly both sides’ interpretations of foreign relations law and the McCarran-Ferguson Act. Part III proposes two possible resolutions to the conflict in authority, both legislative and judicial. Part III.A suggests that Congress should amend the McCarran-Ferguson Act to exempt the New York Convention in light of the national policy favoring arbitration and the importance of arbitration in promoting international business in which parties rely on arbitration to diminish risks and efficiently resolve their conflicts. Part III.B offers a judicial solution. It contends that the Supreme Court should accept certification in Safety National and hold that the McCarran-Ferguson Act does not enable state law to reverse-preempt the New York Convention or enable states to thwart arbitration of disputes concerning insurance contracts. It argues that the Fifth Circuit appropriately found that the plain meaning of “Act of Congress” when Congress enacted the MFA did not include treaties but instead only contemplated legislation. It further maintains that the MFA’s legislative history reflects that "Act of Congress" does not contemplate treaties. The current status of the Convention as executing and non-self-executing remains unknown, but it is irrelevant for this analysis. Furthermore, it posits that the Supreme Court should recognize that the MFA does not cover the Convention as an "Act of Congress" because the MFA only applies to interstate commerce and does not apply to international arbitration agreements under the Convention. Finally, it contends that Congress did not intend the MFA preemption exemption to apply to arbitration or dispute resolution because in enacting the MFA. This Note concludes that Congress and the Supreme Court should ensure that states do not have unlimited power to preclude international business parties from enforcing mutually agreed-upon arbitration clauses in insurance contracts.
Commercial parties worldwide rely on arbitration clauses to mitigate the high risks inherent in international business transactions. A split in federal circuit courts has emerged and left the validity of arbitration agreements in global insurance contracts under the United Nations Convention on the Recognition and the Enforcement of Arbitral Agreements (the "New York Convention") in a state of uncertainty in the United States. Safety Nat’l Casualty Corp. v. Certain Underwriters at Lloyd’s, London created a split in federal circuit courts over whether the McCarran-Ferguson Act reverse preempts the New York Convention and allows states to circumvent the United States’ national policy favoring arbitration and invalidate global insurers’ arbitration agreements. This Note examines the split in federal circuit courts created by Safety Nat’l Casualty Corp. Part I examines the legal framework governing arbitration in the United States, including New York Convention and Federal Arbitration Act. It also explores the current state of insurance arbitration and the McCarran-Ferguson Act.
Part I briefly reviews the doctrine of preemption and foreign relations law concerning the status of treaties in United States law. Part II discusses the split in federal authority, particularly both sides’ interpretations of foreign relations law and the McCarran-Ferguson Act. Part III proposes two possible resolutions to the conflict in authority, both legislative and judicial. Part III.A suggests that Congress should amend the McCarran-Ferguson Act to exempt the New York Convention in light of the national policy favoring arbitration and the importance of arbitration in promoting international business in which parties rely on arbitration to diminish risks and efficiently resolve their conflicts. Part III.B offers a judicial solution. It contends that the Supreme Court should accept certification in Safety National and hold that the McCarran-Ferguson Act does not enable state law to reverse-preempt the New York Convention or enable states to thwart arbitration of disputes concerning insurance contracts. It argues that the Fifth Circuit appropriately found that the plain meaning of “Act of Congress” when Congress enacted the MFA did not include treaties but instead only contemplated legislation. It further maintains that the MFA’s legislative history reflects that "Act of Congress" does not contemplate treaties. The current status of the Convention as executing and non-self-executing remains unknown, but it is irrelevant for this analysis. Furthermore, it posits that the Supreme Court should recognize that the MFA does not cover the Convention as an "Act of Congress" because the MFA only applies to interstate commerce and does not apply to international arbitration agreements under the Convention. Finally, it contends that Congress did not intend the MFA preemption exemption to apply to arbitration or dispute resolution because in enacting the MFA. This Note concludes that Congress and the Supreme Court should ensure that states do not have unlimited power to preclude international business parties from enforcing mutually agreed-upon arbitration clauses in insurance contracts.
Arbitration: A Possible Solution to the Uncertain Enforcement of Restrictive Covenants Against Third Country Nationals
Obie C. Okuh
Obie C. Okuh
Abstract:
This article argues that drafting employment agreements for third country nationals (TCNs) with an eye toward litigating their restrictive provisions is a poor mechanism for protecting multinational employer (MNC) interests in the contexts of expatriation and cross-border employment. Arbitration, instead, is espoused as a viable alternative to litigation given the special exemptions which various international conventions and protocols accord to the parties’ agreement to arbitrate. This article begins with an overview of the rise of TCN expatriation, including a comparison of TCN use by MNC countries and by region of TCN deployments. Then, the article reviews some of the major problems associated with TCN expatriation such as localization, perceptions of disparate treatment amongst different classes of expatriate and local employees, and the doctrine of at-will employment as well as post employment restrictions.
Citing major cases emanating from European Union countries, this article explains some of the reasons why foreign courts have been less willing to enforce US choice of law and forum clauses in TCN employment contracts – including overriding treaty obligations and domestic public policy. MNC personnel managers and legal counsels should elect arbitration as the default method of resolving TCN employment dispute because of 1) the deferential choice of forum and law exemptions accorded to employment arbitration agreements under the EU and US federal law, which are unavailable to litigants; 2) robust international conventions and agreements favoring the recognition and enforcement of foreign arbitral awards; and 3) the procedural Kompetenz-Kompetenz doctrine, which obviates a majority of pretrial artifice. The article acknowledges and responds to some of the limitations and criticisms of the use of arbitration in resolving cross-border employment issues. Finally, the article proffers some due diligence suggestions that employers should take to improve the validity of their arbitration clauses.
This article argues that drafting employment agreements for third country nationals (TCNs) with an eye toward litigating their restrictive provisions is a poor mechanism for protecting multinational employer (MNC) interests in the contexts of expatriation and cross-border employment. Arbitration, instead, is espoused as a viable alternative to litigation given the special exemptions which various international conventions and protocols accord to the parties’ agreement to arbitrate. This article begins with an overview of the rise of TCN expatriation, including a comparison of TCN use by MNC countries and by region of TCN deployments. Then, the article reviews some of the major problems associated with TCN expatriation such as localization, perceptions of disparate treatment amongst different classes of expatriate and local employees, and the doctrine of at-will employment as well as post employment restrictions.
Citing major cases emanating from European Union countries, this article explains some of the reasons why foreign courts have been less willing to enforce US choice of law and forum clauses in TCN employment contracts – including overriding treaty obligations and domestic public policy. MNC personnel managers and legal counsels should elect arbitration as the default method of resolving TCN employment dispute because of 1) the deferential choice of forum and law exemptions accorded to employment arbitration agreements under the EU and US federal law, which are unavailable to litigants; 2) robust international conventions and agreements favoring the recognition and enforcement of foreign arbitral awards; and 3) the procedural Kompetenz-Kompetenz doctrine, which obviates a majority of pretrial artifice. The article acknowledges and responds to some of the limitations and criticisms of the use of arbitration in resolving cross-border employment issues. Finally, the article proffers some due diligence suggestions that employers should take to improve the validity of their arbitration clauses.
Abstract:
Mediation once offered disputing parties a refuge from the courts. Today it offers them a surrogate for arbitration. As lawyers become increasingly involved representing parties in mediation, the boundaries between mediation and arbitration are blurring. Lawyers generally control the mediation process, considering it the functional equivalent of a private judicial settlement conference. Legal mediation has taken on many of the features traditionally associated with arbitration - adversarial posturing by attorneys in the name of zealous advocacy, adjudication by third party neutrals, and the practice of mediator evaluation. While mediation advances toward an arbitration model, arbitration is becoming the “new litigation.” I argue that mediation’s move to the zone of arbitration practice is problematic because it clashes with mediation’s core values of self-determination and participation. This directional shift limits the spectrum of options available to disputing parties, depriving them of mediation’s benefits-- the opportunity to experience individualized justice as a relief from the rigidity of the formal justice system. Mediation stands at the crossroads and it is worth reflecting on whether the time has come to pull in the reins.
Mediation once offered disputing parties a refuge from the courts. Today it offers them a surrogate for arbitration. As lawyers become increasingly involved representing parties in mediation, the boundaries between mediation and arbitration are blurring. Lawyers generally control the mediation process, considering it the functional equivalent of a private judicial settlement conference. Legal mediation has taken on many of the features traditionally associated with arbitration - adversarial posturing by attorneys in the name of zealous advocacy, adjudication by third party neutrals, and the practice of mediator evaluation. While mediation advances toward an arbitration model, arbitration is becoming the “new litigation.” I argue that mediation’s move to the zone of arbitration practice is problematic because it clashes with mediation’s core values of self-determination and participation. This directional shift limits the spectrum of options available to disputing parties, depriving them of mediation’s benefits-- the opportunity to experience individualized justice as a relief from the rigidity of the formal justice system. Mediation stands at the crossroads and it is worth reflecting on whether the time has come to pull in the reins.
Arbitration, Conciliation and Mediation in Uganda: A Focus on the Practical Aspects
Anthony Conrad Kakooza
Anthony Conrad Kakooza
Abstract:
This article looks outside the box of adversarial litigation of matters through the Courts of law. It explores a new trend in Uganda encompassing different forms of Alternative Dispute Resolution mechanisms. These include Arbitration, Conciliation, mediation and a brief look into Collaborative legal practice. The author explores the advantages and disadvantages of each of these mechanisms as he attempts to provoke the reader into determining whether ADR is a more viable means of administering justice in Uganda.
This article looks outside the box of adversarial litigation of matters through the Courts of law. It explores a new trend in Uganda encompassing different forms of Alternative Dispute Resolution mechanisms. These include Arbitration, Conciliation, mediation and a brief look into Collaborative legal practice. The author explores the advantages and disadvantages of each of these mechanisms as he attempts to provoke the reader into determining whether ADR is a more viable means of administering justice in Uganda.
Mandatory Consumer Law, Ex Officio Application of European Union Law and Res Judicata: From Océano to Asturcom
Martin Ebers
Martin Ebers
Abstract:
In Océano, followed by the rulings in Cofidis, Mostaza Claro, Rampion and Pannon, the ECJ held that national courts must abandon their judicially passive role to ensure ex officio that consumer rights are sufficiently protected. In the Asturcom case, the Court had to decide whether a national court hearing an action for enforcement of a final arbitration award has to determine of its own motion the possible unfairness of an arbitration clause, if the arbitration award became final and acquired the force of res judicata. This article analyses ECJ consumer case law leading up to the decision in Asturcom. It also examines the implications of this ruling on national procedural law in greater detail. It is argued that the ECJ, in developing an autonomous concept of public policy, introduced EU standards with far reaching impacts on the principle of res judicata in consumer arbitration. Given this, the manifold implications of the Asturcom case on consumer arbitration law in particular and civil procedures in general are examined.
In Océano, followed by the rulings in Cofidis, Mostaza Claro, Rampion and Pannon, the ECJ held that national courts must abandon their judicially passive role to ensure ex officio that consumer rights are sufficiently protected. In the Asturcom case, the Court had to decide whether a national court hearing an action for enforcement of a final arbitration award has to determine of its own motion the possible unfairness of an arbitration clause, if the arbitration award became final and acquired the force of res judicata. This article analyses ECJ consumer case law leading up to the decision in Asturcom. It also examines the implications of this ruling on national procedural law in greater detail. It is argued that the ECJ, in developing an autonomous concept of public policy, introduced EU standards with far reaching impacts on the principle of res judicata in consumer arbitration. Given this, the manifold implications of the Asturcom case on consumer arbitration law in particular and civil procedures in general are examined.
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