05/09/2019 - Government Policies | Mainstorming

IAS Parliament 5 years

KEY POINTS

Legal Reforms

· The passing of the Arbitration and Conciliation (Amendment) Bill, 2019, on and that of the New Delhi International Arbitration Centre Bill, 2019 are the first few firm steps in the long walk ahead of us in terms of making India an international arbitration hub.

· Complemented by the NITI Aayog’s ‘National Initiative towards Strengthening Arbitration and Enforcement in India’ and the central government’s ‘Make in India’ initiative, these reforms will help the country reach newer heights not only in terms of arbitration, but also in various allied business fields.

· This newly passed Bill puts India, with the help of the to-be-established Arbitration Council of India (ACI), at a parallel footing with big arbitration hubs such as the London Court of International Arbitration (LCIA), the Singapore International Arbitration Centre (SIAC) and the ICC International Centre for ADR (ICC).

· The Supreme Court, for international commercial arbitrations, and the respective High Courts, for domestic arbitrations, may now designate arbitral institutions for appointment of arbitrators.

Cases

· In the Kandla Export vs Oci Export Corporation case, the Supreme Court took a pro-arbitration stand and refused to intervene by holding that the appeals with respect of arbitration proceedings are exclusively governed by the Arbitration Act and thereby the appeal provision of the Commercial Courts Act, 2015, cannot be used be to circumvent the provisions of the Arbitration Act if no appeal is provided under the provisions of the Arbitration Act.

· In the Ravi Arya vs Palmview Investments Overseas case, the Bombay High Court ruled that when remedies are available to the party seeking an injunction under the Arbitration and Conciliation Act, 1996, an anti-arbitration injunction cannot be obtained to circumvent provisions of the Act.

· These judgments affirm the fact that Indian courts have taken a pro-arbitration stance with a strict adherence to the principle of non-interference with arbitral awards, and have also taken proactive steps to ensure their speedy execution, hence augmenting India’s credentials as an arbitration-friendly regime that includes minimal intervention by national courts and speedy resolution of arbitration proceedings.

The potential for arbitrations in India has also changed with the reform in third-party funding, making the country all set to present itself and compete with other international jurisdictions as an international arbitration hub.