Just as I was about to depart for the airport I was told "Don't forget about your lead article for the Digest. Can you write it as you travel and fax it back?" -and I'm supposed to be the boss! So, what do I do on a Sunday afternoon in New Delhi? Not sit by the hotel pool as they all think back home, but instead do my duty!

As part of Trett Contract Services increased international involvement, Bill Ryder (a non-executive Director of TCS and old India hand) and I are pursuing possibilities in this rapidly developing country. I am aware that many other companies are also now considering India's potential and so thought it might be of timely relevance to those, and of general interest to others, to look at India's arbitral procedure.

Up until now, arbitration in India has been even more time consuming than the UK with cases taking up to twenty years, ten years being quite usual. There has, therefore, been a degree of disillusionment (happens everywhere doesn't it?) both domestically and intemationally.

In a developing country such uncertainties can hinder the full participation of the international organisations i.e. funders and contractors. The need for infrastructure and industrial development necessitates external finance and know how" and any moves to boost India's credibility will be a step in the right direction.

On 16th January 1996 with the issue of an "Ordinance" by the President, India has adopted revised rules and procedures relating to domestic arbitration, international arbitration and enforcement of arbitral awards.
These revised rules are largely based on the UNCITRAL model law on International Commercial Arbitration (1985).

The Ordinance has repeated the previous Arbitration Acts 1932/1940 and the Foreign Award Act 1961.It is suggested that the new law provides for a "speedy and comparatively less expensive" remedy of resolution.

The new law recognises the autonomy of the parties and at the same time promotes a greater "seen fairness" because it requires the tribunal to give reasons. The parties are free to agree the number of arbitrators provided it is not an even number. In the absence of such determination, the tribunal shall consist of a sole arbitrator -similar to rules with which most of you are familiar.

If a party wishes to challenge the jurisdiction of the Arbitral Tribunal it has to be raised not later than the submission of the statement of defence. If the Tribunal decides to reject the challenge, the proceedings will proceed and an award made. A party aggrieved by such an award can apply to the court to set aside the award.

On the issue of setting aside, the party seeking to set aside the award must apply within 3 months of receipt of the award. The Court may only set aside an award if it is proved that,

1. a party was under some incapacity

2. the arbitration agreement was not valid

3. the applicant was not given proper notice of appointment of arbitrators or of the arbital proceedings, or was otherwise not able to present his case

4. the award deals with disputes not falling within the terms of a submission to arbitration, or it gives decisions on matters beyond its scope

5. that the subject matter of the dispute is not capable of settlement by arbitration as the award is in conflict with the public policy of India
An appeal against the Courts decision to set aside the award can be made to the Appellate Court, but no second appeal lies from an order passed in appeal. This does not however take away the right to appeal to the Supreme Court of India.

If no application for setting aside the award is made within three months of receipt of the award, or if application has been made and rejected, the award will be final and binding on the parties and will be enforced under the Code of Civil procedure as if it were a Decree of the Court.

The Ordinance also provides for the parties to give notice of conciliation, with the conciliation reflecting the ADR route as we know it. If the parties reach an agreement then that becomes final and binding in the same manner as an Arbitration award. There is, of course, then no appeal as the parties will have made the Agreement between themselves.

The positive outcome of the Ordinance is that it will enhance the confidence of those seeking to invest and contract in India.

Hey Bill, how about going to the pool?