Arbitration Council of India

Arbitration Council of India

The Arbitration and Conciliation (Amendment) Act, 2019 as enacted on 9th August,2019 finally established an Arbitration Council of India(ACI).

This amendment also created for the first time a provision for an arbitral institution.This was introduced through a newly added definition under Section 2(ca) of the Arbitration and Conciliation Act,1996, which defined it as under;

“arbitral institution’’ means an arbitral institution designated by the Supreme Court or a High Court under this Act.

Designation of Arbitral Institution

The newly added sub-Section 3A under Section 11 of the Act provides that the Supreme Court and the High Court shall have the power to designate, arbitral institutions, from time to time, which have been graded by the Council under section 43-I, for the purposes of this Act.

Exception 

In a particular High Court jurisdiction, where no graded arbitral institution are available, then, the Chief Justice of the concerned High Court may maintain a panel of arbitrators for discharging the functions and duties of arbitral institution.

In such a case, any reference to the arbitrator shall be deemed to be an arbitral institution for the purposes of this section.The fees payable to such arbitrator  shall be  as specified in the Fourth Schedule of the Act.

The Chief Justice of the concerned High Court may, from time to time, review the panel of arbitrators.

Appointment of Arbitrators

The substituted expression in sub-Section 4 of Section 11 of the Act provides for appointment of an arbitrator in the following manner:

International Commercial arbitration– the appointment shall be made, on an application of the party, by the arbitral institution designated by the Supreme Court, and

Domestic commercial arbitration-the appointment shall be made, on an application of the party, by the arbitral institution designated by the High Court.

Appointments under various situations

There may be different situations where request has been received for an appointment of an arbitrator as below:

First received request to appoint -Where more than one request has been made under sub-section (4) or sub-section (5) or sub-section (6) to different arbitral institutions, the arbitral institution to which the request has been first made under the relevant sub-section shall be competent to appoint. 

Where the matter referred to in sub-sections (4), (5), (6) and (8) arise in an international commercial arbitration or any other arbitration, the reference to the arbitral institution in those sub-sections shall be construed as a reference to the arbitral institution designated under sub-section (3A).

Thirty Days –  An application made under this section for appointment of an arbitrator or arbitrators shall be disposed of by the arbitral institution within a period of thirty days from the date of service of notice on the opposite party.

Fees –  The arbitral institution shall determine the fees of the arbitral tribunal and the manner of its payment to the arbitral tribunal subject to the rates specified in the Fourth Schedule.

Explanation.—For the removal of doubts, it is hereby clarified that this sub-section shall not apply to international commercial arbitration and in arbitrations (other than international commercial arbitration) where parties have agreed for determination of fees as per the rules of an arbitral institution.”.

Establishment of Arbitration Council of India

In terms of Section 43B, the Central Government shall, by notification in the Official Gazette, establish, for the purposes of this Act, a Council to be known as the Arbitration Council of India to perform the duties and discharge the functions under this Act.

The Council shall be a body corporate by the name aforesaid, having perpetual succession and a common seal, with power, subject to the provisions of this Act, to acquire, hold and dispose of property, both movable and immovable, and to enter into contract, and shall, by the said name, sue or be sued.

Head office

The head office of the Council shall be at Delhi.

Other Offices

The Council may, with the prior approval of the Central Government, establish offices at other places in India.

Members of Council 

As per Section 43C of the Act,the Council shall consist of the following Members, namely:–

(a) a person, who has been, a Judge of the Supreme Court or, Chief Justice of a High Court or, a Judge of a High Court or an eminent person, having special knowledge and experience in the conduct or administration of arbitration, to be appointed by the Central Government in consultation with the Chief Justice of India–Chairperson;

(b) an eminent arbitration practitioner having substantial knowledge and experience in institutional arbitration, both domestic and international, to be nominated by the Central Government–Member;

(c) an eminent academician having experience in research and teaching in the field of arbitration and alternative dispute resolution laws, to be appointed by the Central Government in consultation with the Chairperson–Member;

(d) Secretary to the Government of India in the Department of Legal Affairs, Ministry of Law and Justice or his representative not below the rank of Joint Secretary–Member, ex officio;

Duties & Function of Arbitration Council of India

The duties and functions of the Council shall be as under:

(a) frame policies governing the grading of arbitral institutions;

(b) recognise professional institutes providing accreditation of arbitrators;

(c) review the grading of arbitral institutions and arbitrators;

(d) hold training, workshops and courses in the area of arbitration in collaboration of law firms, law universities and arbitral institutes;

(e) frame, review and update norms to ensure satisfactory level of arbitration and conciliation;

(f) act as a forum for exchange of views and techniques to be adopted for creating a platform to make India a robust centre for domestic and international arbitration and conciliation;

(g) make recommendations to the Central Government on various measures to be adopted to make provision for easy resolution of commercial disputes;

(h) promote institutional arbitration by strengthening arbitral institutions;

(i) conduct examination and training on various subjects relating to arbitration and conciliation and award certificates thereof;

(j) establish and maintain depository of arbitral awards made in India;

(k) make recommendations regarding personnel, training and infrastructure of arbitral institutions; and

(l) such other functions as may be decided by the Central Government.

We at AMLEGALS emphasise that the set up of Arbitral Institutions/panel of arbitrators in High Court Jurisdictions and an Arbitration Council of India will ease the burden of various High Courts of India as well as Supreme Court of India in as much as on daily basis hundreds of applications are filed for appointment of an arbitrators and whereas Court are also burdened with litigation over such appointment of arbitrations, extension or substitution of arbitrators due to various reasons.

This Council will save precious hours of the Court as well as also result into an early appointment of arbitrators as in 30 days , an application will be attended and thereby appointments will be made.

It will be an interesting era in arbitration of India with the set up of Arbitration Council of India. To know more about and/or for any assistance in Arbitral Institutions/panel or arbitrator in High Courts or  Arbitration Council of India, feel free to connect with arbitration expert lawyers of AMLEGALS in Mumbai or Ahmedabad on mumbai@amlegals.com or info@amlegals.com.