The NITI Aayog and the International Chamber of Commerce (ICC)- International Court of Arbitration recently held a training and brainstorming workshop on best practices in international arbitration in New Delhi. As India moves towards the goal of a New India by 2022, legal reform is of great significance. This aligns with the vision of ‘Make in India’ and complements it with ‘Resolve in India’. The aim is to boost alternate dispute resolution mechanisms like arbitration that can encourage the ease of doing business and living in India.
Understanding Arbitration
Arbitration is an agreed-upon procedure wherein a dispute is submitted to one or more arbitrators who make a binding decision. Opting for this private dispute resolution procedure bypasses the need to go to court. It ensures prompt and efficient enforcement of contracts.
Types of Arbitration Procedures
There are mainly two types of arbitration procedures: Ad-Hoc Arbitration and Institutional Arbitration. Ad-Hoc Arbitration involves a tribunal conducting the process as per either the rules agreed by both parties beforehand or those set by the tribunal if no agreement exists between the parties.
In the case of Institutional Arbitration, the disputing parties submit their issue to a nominated institution that oversees the process. This institution then arbitrates the dispute according to its prescribed rules before the parties. A panel chosen by the institute administers the whole process.
Arbitration Practices in India
Currently, ad-hoc arbitration is the prevalent practice in India. The Arbitration and Conciliation Act, 1996 governed arbitration proceedings before 2015. According to the proposed Arbitration and Conciliation (Amendment) Bill, 2018, proceedings after October 23, 2015, will fall under the Arbitration and Conciliation Act, 2015. The Act bases itself on the United Nations Commission on International Trade Law (UNCITRAL) model law.
The Arbitration and Conciliation (Amendment) Bill, 2018
The Amendment Bill seeks to amend the Arbitration and Conciliation Act, 1996. It introduces provisions for domestic and international arbitration and outlines the protocol for conducting conciliation proceedings. The new features of the Bill include the establishment of the Arbitration Council of India (ACI) to promote arbitration and other alternative dispute redressal mechanisms. It also revises the rules for appointing arbitrators and lays down guidelines for completing written submissions, maintaining confidentiality of proceedings, and applying the Arbitration and Conciliation Act, 2015.
Importance of the Workshop on Arbitration
The workshop aims to institutionalize and streamline dispute resolution to make India a business-friendly hub. It covered essential aspects of international arbitration, including best practices for drafting arbitration agreements, selecting arbitrators, enforcing arbitral awards, and the role of courts during the arbitration process.
NITI Aayog’s Role in Supporting Arbitration in India
NITI Aayog has been actively promoting the importance of arbitration in India. In 2016, it organized a conference on international arbitration attended by the President, Prime Minister of India, and Chief Justices of all SAARC countries. The conference explored commercial arbitration, both domestic and international, as a favored means of dispute resolution. NITI Aayog also organized a two-day National Law Day Conference in 2017 in partnership with the Law Commission of India, to discuss a range of legal aspects, including dispute resolution.
The Way Forward
With the government’s focus on ‘Make in India’, it is imperative for both domestic and international investors to trust India’s dispute resolution mechanism. Arbitration use would significantly reduce case pendency and fortify investor faith in India.
About the ICC-International Court of Arbitration
The International Court of Arbitration, part of the International Chamber of Commerce (ICC), deals with the resolution of international commercial disputes. Since 1923, it has been assisting in resolving difficulties in international commercial and business disputes, thereby promoting trade and investment. The court provides a variety of customizable services at every stage of a dispute for individuals, businesses, and governments.