Unilateral option clauses—review of selected jurisdictions
Produced in partnership with Latham & Watkins

The following Arbitration practice note produced in partnership with Latham & Watkins provides comprehensive and up to date legal information covering:

  • Unilateral option clauses—review of selected jurisdictions

Unilateral option clauses—review of selected jurisdictions

This Practice Note provides a survey of the treatment of unilateral option clauses in the following jurisdictions: China, England and Wales, France, Germany, Hong Kong, Italy, Japan, Russia, Singapore, Spain, and the United States of America. It should be read in conjunction with Practice Notes: Unilateral option clauses—an introduction and Types of dispute resolution clauses—litigation, mediation, multi-tier, hybrid and carve-out clauses.

Note: all international judgments are not reported by LexisNexis® UK.

ChinaIt is unclear how unilateral option clauses would be treated under Chinese law. Article 16 of the Arbitration Law of the People’s Republic of China of 1994 requires that an arbitration agreement, among other things, contains an expression of intention to apply for arbitration. There is concern that Chinese courts might not recognise the validity of unilateral option clauses on the basis that they lack the requisite agreed intention to resolve disputes by arbitration. There is very little case law on this point, although in 1999 the Beijing Higher People’s Court opined that a unilateral option clause was invalid, deeming such clauses 'unconscionable' or 'unfair'. Note that, in China, cases do not have any precedential value, so the same court or lower court might reach a different decision.
EnglandAs noted in the Practice Note: Unilateral option clauses—an introduction, unilateral option clauses have been upheld

Popular documents