International Commercial Arbitration Nguyen Manh Dzung, MCIArb Managing Partner - Dzungsrt & Associates Vice President - Pacific International Arbitration Center (PIAC) Hà Nội - 03/11/2010 www.piac.com.vn Dispute Resolution Main processes: Negotiation Mediation Arbitration Litigation www.piac.com.vn Dispute Resolution Negotiation Mediation International Commercial Arbitration Litigation www.piac.com.vn Dispute Resolution Arbitration is: 2.1 based in contract 2.2 alternative to litigation 2.3 not (strictly) ADR ADR – ‘alternative dispute resolution’ ‘Alternative’ to ‘Adjudication’ ‘Adjudication’ – third party determination ADR processes – party agreement www.piac.com.vn What is arbitration? • private and non-national system of dispute resolution • the fair resolution of disputes by an impartial tribunal • without unnecessary delay or expense parties are relatively free to agree how their disputes are resolved • there should be minimal court intervention • binding enforceable award www.piac.com.vn What arbitration is not IT IS NOT • • • • a national court procedure Mediation expert determination DO YOU WANT ONE OF THESE PROCEDURES? • Then you will have to make an express agreement to that effect www.piac.com.vn Why arbitration? Advantages • ALTERNATIVE TO NATIONAL COURTS? • Suspicion/mistrust of national courts • No party wish to submit to other party’s court • FINALITY • No appeal • ENFORCEABILITY • FLEXIBILITY Court procedures are rigid/fixed Procedure fixed for each arbitration Evidence/Witnesses/Discovery/production of documents www.piac.com.vn Why arbitration? Advantages • PARTY AUTONOMY • NEUTRALITY  No national character  Truly non-national/international • BALANCING TRIBUNAL  Various expertise • CHOICE OF ARBITRATOR  Selecting arbitrator with geographic and relevant experience to the dispute www.piac.com.vn Other Why arbitration? Alleged Advantages • CONFIDENTIALITY AND PRIVACY  Who says so?  Enforceability? • SPEED  Average duration – 18 months • COST  Not inexpensive but cost can be calculated www.piac.com.vn What is ad hoc arbitration www.piac.com.vn 10 Model Arbitration Clause “Any dispute, controversy or claim arising out of or relating to this contract, or the breach, termination or invalidity thereof, shall be settled by arbitration in accordance with the Uncitral arbitration Rules as at present in force The appointing authority shall be ICC; The number of arbitrators shall be three; The place of arbitration shall be Singapore; The language to be used in the arbitral proceedings shall be English” www.piac.com.vn 11 Ad hoc arbitration A specially designed framework to organise and conduct arbitration - Parties agree to framework, including for selection of arbitrators and procedural rules - Total party control without institutional structures or management - Particularly appropriate for disputes involving governments - Need for authority when difficulty arises • appointing authority • national courts - UNCITRAL Arbitration Rules dedicated to ad hoc arbitration www.piac.com.vn 12 What is institutional arbitration www.piac.com.vn 13 SIAC Model Clause “Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration in Singapore in accordance with the Arbitration Rules of the Singapore International Arbitration Centre ("SIAC Rules") for the time being in force, which rules are deemed to be incorporated by reference in this clause The Tribunal shall consist of three (03) arbitrators to be appointed by the Chairman of the SIAC The language of the arbitration shall be English” www.piac.com.vn 14 Institutional arbitration Administered by an institution set up specifically to provide an arbitration service Service may be specific or general • Specialist arbitration service • Arbitration activity in addition to other activity • Arbitration is in support of particular professional body or industry Infrastructure helps in smooth running of arbitration • Support of administrative staff • Name –”cache” of institution • Cost includes administrative and management charges www.piac.com.vn 15 International Arbitration Institutions • Asia Pacific Regional Arbitration Group ('APRAG') includes over 30 members: http://www.aprag.org./ • Singapore International Arbitration Center (SIAC): http://www.siac.org.sg/ • Hong Kong International Arbitration Center (HKIAC): http://www.hkiac.org/HKIAC/HKIAC_English/main.html • China International Economic and Trade Arbitration Commission (CIETAC): http://cietac.org.cn/english/introduction/intro_3.htm • Japan Commercial Arbitration Association (JCAA): http://www.jcaa.or.jp/e/index-e.html • The ICC International Court of Arbitration: http://www.iccwbo.org/court/arbitration/id4400/index.html • London Court of International Arbitration (LCIA): http://www.lciaarbitration.com/ • American Arbitration Association: http://www.adr.org/ • International Center for Settlement of Investment Disputes (ICSID): http://icsid.worldbank.org/ICSID/Index.jsp www.piac.com.vn 16 Vital Statistics www.piac.com.vn 17 Popular Venues Preferred Arbitration Venues 160 140 137 120 100 Overall Score 74 80 63 57 63 Respondents 58 60 37 40 35 30 30 12 20 England Switzerland France Other www.piac.com.vn USA Japan 18 Các tổ chức trọng tài Việt nam Trung tâm trọng tài quốc tế Việt nam (VIAC) bên cạnh Phòng thương mại cơng nghiệp Việt nam (VCCI) trụ sở Hà nội; Trung tâm trọng tài kinh tế Hà nội Trung tâm trọng tài kinh tế Thăng Long Trung tâm trọng tài kinh tế Bắc Giang Trung tâm trọng tài kinh tế Sài Gòn Trung tâm trọng tài kinh tế Cần Thơ Trung tâm trọng tài quốc tế Thái Bình Dương – PIAC Trung tâm trọng tài kinh tế Viễn Đông? www.piac.com.vn 19 Types of arbitration (Traditional) Commercial arbitration • i.e consensual (and binding) Investment (treaty) arbitration • Arbitration without privity Transnational arbitration • i.e detached from the place where is held Compulsory arbitration • Exceptional Consumer arbitration www.piac.com.vn 20 Meaning of “International” UNCITRAL Model Law – Article 1(3) An arbitration is international if: (a) the parties have their place of business in different States; or (b) one of the following places is situated outside the State in which the parties have their place of business: (i) the place of arbitration if determined in, or pursuant to, the arbitration agreement; (ii) any place where a substantial part of the obligations of the commercial relationship is to be performed or the place with which the subject-matter of the arbitration agreement relates to more than one country NOTE: New York Convention refers to awards made in the territory of a State other than the State where recognition and enforcement are sought Ordinance on Commercial Arbitration of Vietnam in 2003 (Article 2.4) “Disputes involving foreign elements are those arising from commercial activities with one participating party or all participating parties being foreigners, foreign legal persons, or those with the bases for establishing, changing or terminating disputed relationships arising abroad or with involved properties situated abroad” www.piac.com.vn 21 Meaning of “Commercial” UNCITRAL Model Law  The term “commercial” should be given a wide interpretation so as to cover matters arising from all relationships of a commercial nature, whether contractual or not  Relationships of a commercial nature include, but are not limited to, the following transactions  Any trade transaction for the supply or exchange of goods or services; distribution agreement; commercial representation or agency; factoring; leasing; construction of works; consulting; engineering; licensing; investment; financing; banking; insurance; exploitation agreement or concession; joint venture and other forms of industrial or business co-operation; carriage of goods or passengers by air, sea, rail or road Ordinance on Commercial Arbitration of Vietnam in 2003 (Article 2.3) “Commercial activities means the performance of one or many trading acts by business people or organizations, including goods purchase and sale, service provision; distribution; trade representation and agency; consignment; renting and lease; hire purchase; construction; consultancy; technology; licensing; investment; financing; banking; insurance; exploration and exploitation; transport of goods and passengers by air, sea, rail, land, and other commercial acts as prescribed by law” www.piac.com.vn 22 Acknowledgment International & Comparative Commercial Arbitration of School of International Arbitration, Queen Mary University of London International Commercial Arbitration of University of Westminster www.piac.com.vn 23 Thank you for your attention ! Dzungsrt & Associates Suite 901, HAREC building, 4A Lang Hạ str, Ba Đ ình Dist, Ha Noi Tel (4) 3772 6970 / Fax (4) 3772 6971 Email dzung.nguyen@dzungsrt.com Web www.dzungsrt.com Pacific International Arbitration Center – PIAC 11A, Phan Ke Binh Str, Dist 1, Ho Chi Minh City Tel (8) 3911 8048/ Fax (8) 3911 8049 Email dzung.nguyen@piac.com.vn Web www.piac.com.vn – www.piac.vn ... tâm trọng tài kinh tế Bắc Giang Trung tâm trọng tài kinh tế Sài Gòn Trung tâm trọng tài kinh tế Cần Thơ Trung tâm trọng tài quốc tế Thái Bình Dương – PIAC Trung tâm trọng tài kinh tế Viễn Đông?... trọng tài Việt nam Trung tâm trọng tài quốc tế Việt nam (VIAC) bên cạnh Phòng thương mại công nghiệp Việt nam (VCCI) trụ sở Hà nội; Trung tâm trọng tài kinh tế Hà nội Trung tâm trọng tài kinh tế