In the third of three articles examining the arbitration process as it applies to disputes of an international nature in six Asian jurisdictions, Justyn Jagger, an international arbitration and litigation lawyer of the Singapore office of international law firm Herbert Smith, looks at the arbitration process in Thailand and Japan.

Thailand

International Arbitration Law
Arbitration in Thailand is governed by the Arbitration Act 1987 although that legislation is presently under review. The Arbitration Act does not distinguish between international and domestic arbitration and both ad hoc arbitrations and arbitrations proceeding under the auspices of an arbitration institution are permitted in Thailand.

It is generally accepted that foreign lawyers may represent parties to arbitrations proceeding in Thailand. However, as the position is not entirely clear, it is advisable to instruct law firms entitled to carry on business in Thailand with whom foreign lawyers or lawyers specialising in international arbitration are employed as consultants. In this way any issues arising under the Alien Occupation Act will be avoided.

International Arbitration Institutions
International arbitrations may be conducted in Thailand under the auspices of a foreign arbitration institution such as the International Chamber of Commerce International Court of Arbitration. Alternatively, the arbitration may be conducted through the Thai Arbitration Office that has developed its own arbitration rules. In proceeding through the Arbitration Office the parties may, however, adopt the rules of another arbitration institution with the consent of the Director of the Arbitration Office.

The Role of the Courts in International Arbitration
The Thai Courts will respect a valid arbitration agreement and strike out litigation in favour of Arbitration provided the application to strike out the litigation is filed prior to the taking of evidence or judgement in the litigation proceedings.

Applications may be made to the Court by the arbitral tribunal for assistance in matters beyond the power of the tribunal such as the summoning of witnesses or the production of evidence. Similarly, the tribunal cannot grant interim or conservatory relief and must therefore apply to the Court for provisional measures protecting the interests of the parties to the arbitration.

Enforcement
Domestic and international arbitrations are not subject to appeal. Any objection to the award must therefore be raised upon enforcement.
An application for enforcement of an award made in Thailand must be made by filing a request for a judgement confirming the award within one year of the date when the award was sent to the parties. Upon receipt of the request the Court allows the party against whom enforcement is sought to challenge the request for enforcement. If no challenge is made, the Court will give judgement confirming the award provided that the award is not contrary to the law governing the dispute, is not the result of any unjustified act or procedure or is not outside the scope of the arbitration agreement.

Enforcement of a foreign award made in a country that is a signatory to the United Nations Convention for the Recognition and Enforcement of Foreign Arbitral Awards 1958 (the "New York Convention"), to which Thailand acceded in December 1959, is by application to the local Court. The party against whom the award is to be enforced may resist enforcement on the grounds set out in Article V of the New York Convention . Those grounds relate principally to the failure of due process in the arbitration procedure.

Japan

International Arbitration Law
The law governing arbitration in Japan is contained within Part VIII of the Code of Civil Procedure. New legislation governing the conduct of arbitration is currently under consideration by the Japanese government.

International Arbitration Institutions
Both ad hoc and institutional arbitrations are permitted in Japan. The main commercial international arbitration institutions are the Japan Commercial Arbitration Association (the "JCAA") and the Japan Shipping Exchange Inc (the "JSE"). The JCAA is concerned with general commercial disputes and the JSA with maritime arbitration.

Parties to an international arbitration may be represented by overseas lawyers or registered foreign lawyers ("Gaikokuhu-Jimu-Bengoshi") practising in Japan. However, if the arbitration concerns issues of Japanese law the parties should consider instructing Japanese counsel at least to act jointly with overseas lawyers as it is arguable that it remains illegal for overseas lawyers who are not qualified in Japan to advise on Japanese law.

The Role of the Courts in International Arbitration
In the event of a valid arbitration agreement, the Japanese Court cannot refuse an application to stay proceedings commenced by way of litigation rather than arbitration. The Court does, however, retain the power to appoint an arbitrator if the parties cannot agree and to rule on challenges to the appointment of an arbitrator brought usually on grounds of bias, legal or physical incapacity or undue delay in the performance of his duties. The Court can also rule on the validity of the arbitration agreement and grant interim relief when an application is brought by one of the parties to the arbitration. Arbitrators do not possess the power to grant interim or conservatory relief under Japanese law.

The Courts also hear appeals against arbitration awards. An award may be set aside on five grounds: (1)the arbitration procedure was not permissible; (2) the award requires a party to commit an illegal act; (3) a party was not properly represented or heard during the arbitration proceeding; (4) the award is not substantiated by reasons and (5) other grounds upon which, if the matter were heard by way of civil litigation, would justify a re-trial.

Enforcement
A domestic award is treated in the same way as a judgement of the court and is enforced by means of an application for execution. That application may be challenged on the same grounds as an application seeking to set aside an award.

Japan acceded to the New York Convention in September 1961. A foreign award made in a country that is also a signatory to the New York Convention is enforced by way of an application to the local Court. The Court may only refuse that application if the grounds set out within Article 5 of the New York Convention are made out. Non-convention awards are not recognised by Japanese statute and require a fresh action on the award to be commenced.

Justyn Jagger can be contacted at
Herbert Smith’s Singapore office on
+65 536 7990