Arbitration Agreement Example South Africa

Of all the components of an arbitration clause, the seat is the only aspect that always causes the most confusion. Simply put, the seat of an arbitration procedure is the “legal place” of arbitration. It is important because it determines that an arbitration agreement may be in the form of a compromise clause in a contract or in the form of a separate agreement. “The parties agree to resolve disputes or disputes arising from this Treaty and conciliation, as provided by the UNCLOSE Arbitration Regulations, for which the Southern Africa Arbitration Foundation will act.” The starting point of Indian law is that there must be reciprocity in an arbitration agreement. The Delhi Supreme Court has held that an asymmetric compromise clause is not valid (or even an arbitration agreement) until the party exercises its ability to settle – before that, there is a lack of reciprocity (Union of India vs Bharat Engineering Corporation ILR 1977 Delhi 57). However, the Calcutta Supreme Court subsequently upheld the validity of an asymmetric arbitration clause (New India Assurance Co Ltd/Central Bank of India – Ors AIR 1985 Cal 76). The Calcutta Supreme Court expressly refused to accept the argument of the Delhi Supreme Court and found that an asymmetric arbitration clause constitutes a valid arbitration agreement from the outset, even if it is enforceable only by the party with the possibility of conciliation. It is also likely that Indian courts will take into account the balance of comfort, the interests of justice and other similar considerations when deciding whether Indian courts have jurisdiction under a contractual choice of jurisdiction or a judicial clause. Indeed, such considerations may be “essential, in the interest of international trade and trade, to improving relations between countries and the inhabitants of the world” (see The Black Sea Ship U.L. Lastochkina ODESSA USSR/Union of India AIR 1976 ANDH PRA 103). This situation is reinforced in two recent cases in asymmetric jurisdiction clauses. In The case of Barclays Bank plc/Ente Nazionale di Previdenza Ed Assistenza dei Medici e Degli Odontoiatri [2015] EWHC 2857 (Comm), the High Court upheld a clause authorizing one party to sue only in English courts, while leaving the other party free choice, stating that there were “good practical reasons” for the clause. Similarly, the Commerzbank AG Tribunal ruled against Pauline Shipping Limited Liquimar Tankers Management Inc [2017] EWHC 161 (Comm) (still under appeal) that asymmetric jurisdiction clauses are exclusive jurisdiction clauses within the meaning of Article 31, paragraph 2, of the Brussels Regulation.

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