RGNUL FINANCIAL & MERCANTILE LAW REVIEW
VOLUME 3 ISSUE 1
EDITORIAL NOTE I EDITORIAL BOARD
ARBITRABILITY OF FRAUD IN INDIA
Dheeresh Kumar Dwivedi
The author is a fourth-year student of B.A. LL.B. at NLIU, Bhopal.
Arbitration and Conciliation Act 1996 was enacted to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards. The object of the Act was to bring the existing law on arbitration in conformity with UNCITRAL Model Law on Commercial Arbitration, 1985 and thereby fulfilling India’s quest for economic prosperity which was only possible through making the existing legal regime in tune with international law on dispute resolution. Thus, minimum intervention of courts, severability of arbitration agreement form main contract and principle of kompetenz were made the fundamental principles of arbitration jurisprudence in India. The present paper analyses the law relating to arbitrability of fraud in India. The author has critically delved into the theme with the help of the decision of the Supreme Court in N. Radhakrishnan v. M/S Maestro Engineers & Ors and its ramifications on the law in force, the diverging opinions of various High Courts which have been discussed to highlight the ambiguity which persisted during the period of 2009-14 in field of arbitrability of fraud, the single bench decision of the Supreme Court in Swiss Timing Ltd. v. Organizing Committee, CWG Delhi and its contribution to the debate relating to arbitrability of fraud and the rather less discussed area of arbitrability of fraud in foreign seated arbitration. The author concludes by highlighting the difficulty which is being faced by lower courts after two contrasting decisions of the Supreme Court in the area and tries to provide a solution for the same.
THE ORIGINS AND LEGITIMACY OF ATLANTIC SHIPPING CLAUSES
Aniruddha Bhattacharya and Arnab Roy
The authors are fifth-year and second-year students, respectively, at Ram Manohar Lohiya National Law University, Lucknow.
In the modern day where commercial transactions take place every second of everyday, it is quite pertinent that all parties that enter into such commercial transactions devise a speedy dispute resolution mechanism. Litigation is the most obvious choice but it is not the one most suitable for commercial transaction where huge sums of money are at stake. The reason why it is ill suited is pretty obvious as it is very time taking and costly process. The obvious choice for dispute resolution is commercial arbitration as it is one of the most expeditious and fruitful ways to settle a dispute. The reason why commercial arbitration has been so globally successful is because it caters to every need of the parties. Party autonomy is the most enticing feature of commercial arbitration as it allows for the parties to dictate how if in case a dispute arises the matter would be adjudicated upon. Commercial contracts may contain "Atlantic Shipping" clauses, the name which has been popularised by the case Atlantic Shipping and Trading Company Limited v. Louis Dreyfus and Company. The nature of such clauses is to make the reference to arbitration a time bound practice i.e., if one of the parties feels there is a dispute which requires the aid of arbitration then he has to do it within a specific period of time. If the party fails to refer such matter to the arbitrator within the specified period of time then he loses any claim over the same. The purpose of this paper is to trace the origins of these clauses in the common law and then look at the Jurisprudence regarding the same in India and also look at the various corners of the law in India and see whether Atlantic Shipping Clauses pass the test of statutory laws in India. One of the major outlooks of this paper is trying to see whether the law of contracts as it stands today in India should allow for such clauses to exist in contracts because what they are doing in effect is reducing the limitation period from the one that is statutorily recognised under the Limitation Act to a much narrower time frame.
CAN THE ICSID CONVENTION BE A MODEL LAW FOR INVESTMENT DISPUTE SETTLEMENT?: A PERSISTENT SERIES OF QUESTIONS.
The author is a fifth-year student of B.A. LL.B. (Hons.) at National Law University, Jodhpur.
The ICSID Convention, also known as the Washington Convention, was not very central to the investment law universe anyway. The notion of a model law was popularized through the UNCITRAL Model Law on International Commercial Arbitration, adopted in 1985. Surely there existed credible reasons why this particular instrument became accepted as a “model” in the field of commercial arbitration. It would seem that in order to find out whether the ICSID Convention can operate as a “model law” for investment arbitrations, a two-step methodology is adopted. First, the author identified the constituent elements of a “model” law, the UNCITRAL rules being the primary source of reference. And second, these factors must be juxtaposed with the ICSID Convention for comparison to see whether it can, in fact, operate as a “model” law for the world of investment arbitration. Interestingly, since the ICSID Convention from 1966 pre-dates the UNCITRAL rules, the question probably could also be: is the ICSID a model law for investment arbitrations?. Part I introduces the problem at hand. Part II conducts the aforementioned comparison between investment and commercial arbitrations. Finally, Part III discusses the possibility of the ICSID Convention acting as a model law for investment arbitrations. Part IV concludes that the ICSID Convention was found to be largely conducive to the status of a “model law” having fulfilled three out of the four criteria laid out in this work. The desirability of the same, with respect to the dangers of excessive interaction as discussed, however continues to be disputed.
THE ARBITRARY NATURE OF INVESTMENT ARBITRATION: THE EMERGING ISSUES IN BILATERAL INVESTMENT TREATIES
The author is a fourth-year student at School of Law, Christ University, Bangalore
The purpose of investment treaties has been to accord investor protection considering the unabated regulatory powers of the state. The international trade regime of the world has been built upon a multilateral basis, whilst the investment regime has been structured on a bilateral basis. The customary nature of investor rights has evolved out of the law of state responsibility for the injury to alien property. This has led to the creation of the international minimum standards, which reflect the obligatory duties of host states in exercising their regulatory powers. The Vienna Convention on Law of Treaties clearly states that a State cannot invoke its municipal law to avoid international obligations. The Calvo doctrine denies such an international standard on the basis of sovereign equality, where the aliens and nationals are entitled in principle to equal treatment. The debate between the national treatment and minimum standard principles has evolved from theoretical analysis to impacting diplomatic relations. The White Industries Arbitration arising out of the India- Australia Bilateral Investment Treaty (BIT) raises a number of doubts over India’s inherent policy adopted towards BIT’s. The Indian argument of the contract with White industries being a mere contract for supply of goods and services and thus not constituting investment was rejected by the tribunal. The problem lies in the broad definition of investment incorporated in most of India’s bilateral investment agreements. The Bilateral investment treaties with the lacuna in the status quo can be reformed through a progressive approach to delineating the regulatory space for government policy in the public interest. In order to balance this juxtaposition of international arbitration, one requires the reconciliation of divided interests within the legal framework.