Are Australian seats attractive for conducting International Arbitration?

Are Australian seats attractive for conducting International Arbitration?

Peter McQueen discusses Australian court decisions over the last year which have confirmed emphatically that Australia is an arbitration-friendly and pro-enforcement jurisdiction, noting its leading edge legislation, the International Arbitration Act 1974(Cth) as amended in 2010 (IAA), which governs  international commercial arbitration  conducted at Australian seats of arbitration.

The jurisprudence arising from those decisions includes:

  • a confirmation of the constitutional validity of the power of Australian courts to enforce awards, (TCL Air Conditioner (Zhongshan) Co Ltd v The Judges of the Federal Court of Australia [2013] HCA 5);
  • the inappropriateness in general of enforcing courts reaching different conclusions as that reached by supervisory courts in respect the enforcement of foreign awards (Gujurat NRE Coke Limited v Coeclerici Asia (Pte) Ltd [2013] FCAFC 109);
  • the acceptance of foreign arbitration clauses in specific maritime contracts by recognition of the rights of commercial parties to negotiate freely the terms upon which they wish to resolve their disputes(Dampskibsselskabet Norden A/S v Gladstone Civil Pty Ltd [2013] FCAFC 107); and
  • the enforcement in Australia of awards, which result from disputes arising in voyage charterparties, which relate to the carriage of Australian export and import cargoes, and in which the chosen seat of arbitration is outside Australia, (Dampskibsselskabet Norden A/S v Gladstone Civil Pty Ltd [2013] FCAFC 107).

In order for an arbitration seat to be chosen as a place in which to conduct arbitration, it must be attractive to commercial parties, having a combination of features.That combination of features are its arbitration legislation, its courts, its arbitration practitioners and its facilities and its support services:

  • the legal framework in each must be supportive of arbitration and reflect policies of pro-arbitration and of pro-enforcement of arbitration agreements and awards.
  • the commercial courts must be efficient, of the highest integrity and independence and noted for their consistency of their decisions. In addition they must appreciate the independence and significance of arbitral proceedings and rigorous in enforcing wards. Participants can then engage in proceedings before those courts with a high degree of certainty and confident of what to expect.
  • the legal profession, the arbitration practitioners and the arbitration institutions operating in each seat need to have internationally recognised capability in the practice of international arbitration.
  • each seat must possess excellent facilities, infrastructure and logistical support, which include the existence of a dedicated disputes centre.

The writer, while making disclosure of his Australian nationality and his involvement as a Director of the Australian Centre for International Arbitration (ACICA) and as the Chair of the Australian Maritime and Transport Arbitration Commission (AMTAC), argues that Australian seats of arbitration do have a compelling combination of such features and are thereby attractive to commercial parties.

Customers of Lexis®PSL Arbitration can find further details of the legislative regime and the decisions in the LexisNexis Practice Notes International Commercial Arbitration –Australia Part 1 and Part IIClick here for a free trial of Lexis®PSL.

Peter McQueen is an arbitrator, mediator and facilitator

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