India’s lower house of Parliament approves further amendments to the Indian Arbitration Act

As previously reported here, a draft Bill to amend the Arbitration and Conciliation Act 1996 (the “Act“) was approved by the Indian Cabinet on 7 March 2018 (the “Bill“). The Bill was listed as a part of the agenda for the monsoon session of the Indian Parliament and was passed by the Lower House on 10 August 2018, without any amendments. The text of the Bill can be found here.

The Law Minister has described the Bill as “a momentous and important legislation” aimed at making India “a hub of domestic and international arbitration”. The key features of the Bill are:

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Recent Developments in India-related international arbitration

Herbert Smith Freehills has issued the latest edition of its Indian international arbitration e-bulletin. This issue considers some significant decisions of the Indian courts, including two decisions on the arbitrability of fraud claims and a decision of the Supreme Court concerning the power of Indian courts to intervene in foreign-seated arbitrations.

The e-bulletin also reports on some interesting news stories on India-related arbitration claims, including the ongoing GMR-Maldives dispute and a decision on the termination of an arbitral tribunal’s mandate.

SIAC emergency arbitrator awards – a speedier route to interim relief before the Indian Courts?

The Singapore International Arbitration Centre (the SIAC) introduced emergency arbitrator provisions in its arbitration rules in July 2010 and has had 34 applications filed before it to date where parties have asked for an emergency arbitrator to be appointed. The SIAC further reports that 9 out of the 34 emergency arbitrator applications have involved Indian parties (5 where the Indian party was the respondent and 4 where Indian parties were both the claimant and the respondent).

An emergency arbitrator is typically approached by parties where the Tribunal has not been constituted and a party may require urgent interim relief including, amongst others, orders for preservation of properties, freezing accounts, orders against the dissipation of assets etc. Seeking relief from an emergency arbitrator is increasingly been chosen as an alternative to seeking injunctive relief from the courts (in support of the arbitration). According to statistics released by the SIAC, the average time taken by an emergency arbitrator to pass an award after having heard the parties ranges from 8-10 days, with the shortest period being 2 days to pass an award.

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Supreme Court of India delivers landmark arbitration decision in Bharat Aluminium, overruling Bhatia International

As reported in our blog posting on 6 September 2012, the controversial decision of the Indian Supreme Court in Bhatia International v Bulk Trading SA [1] has been overruled by the Indian Supreme Court in the case of Bharat Aluminium v Kaiser Aluminium, paving the way for an end to intervention by the Indian courts in arbitrations seated outside India. However, for contracts containing arbitration clauses entered into prior to the decision, the previous difficulties will remain, at least for now.

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Indian Government declares China (including the Hong Kong SAR) as a territory to which the New York Convention applies

The Indian Government has declared that China (including the Hong Kong SAR) is a territory to which the New York Convention applies under the Indian Arbitration and Conciliation Act 1996 (the “Act“). We understand that the notification will be published in the official Gazette of India shortly, following an announcement by the Hong Kong Department of Justice last week.

Both India and China are signatories to the New York Convention, which they ratified in 1960 and 1987 respectively. However, Part II of the Act, which governs the enforcement of New York Convention awards in India, only applies to awards rendered in jurisdictions notified by the Indian Government in the official Gazette as jurisdictions in which the New York Convention applies. Whilst most of the major international arbitration centres lie within such jurisdictions, the most notable exception was Hong Kong which, until now, had not been notified. This was a significant omission and had encouraged parties in India-related contracts to choose a seat of arbitration other than Hong Kong. This should no longer be the case.

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