Developments in
Arbitration in Asia
Pacific – A Regional
Perspective
Nish Shetty
Overview
 Rise of Asia Pacific as an Arbitration Hub
 Regional Round-up
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“Twin Asian Cities of Arbitration” Singapore & Hong Kong
Snapshot of players in the region
 India as a ‘seat’ of international arbitration?
 Future of International Arbitration in Asia
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Rise of Asia Pacific as an Arbitration
Hub
ICC Arbitration & Amicable Dispute Resolution – Focus on India
30 June 2011
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Twin Asian Cities of Arbitration –
Singapore & HK
 Regionalisation of Arbitration.
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Regional institutions: CIETAC, SIAC, JCAA, KLRCA, PDRC, VIAC,
HKIAC …and the list goes on.
Major European International Institutions establishing in the region e.g.
ICC, LCIA etc
 Singapore & HK emerging as the leaders
 NB only Singapore is a‘reciprocating territory’ for the
purposes of NY Convention in India.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Hong Kong
 “Gateway to China”: HK’s greatest appeal and drawback
 New Hong Kong Arbitration Ordinance (Cap. 609) effective
since 1 June 2011.
 Largely modelled on UNCITRAL Model Law:
 Key features:
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Unified system for domestic & international arbitration
Interim measures (ML provisions adopted)
Express Duty of Confidentiality
Med-Arb/Arb-Med
Bespoke enforcement process for awards rendered in Mainland China
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Hong Kong (cont.) - Enforcement
 Different processes under HK Ordinance for enforcement
of:
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Awards rendered in NY Convention States
Other Awards (e.g. awards rendered in Taiwan)
Awards rendered in Mainland China (in application of Arrangement
Concerning Mutual Enforcement of Arbitral Awards Between the
Mainland and the Hong Kong Special Administrative Region, which
became effective from 1 February 2000.
China’s side: In 2010 China Supreme People’s Court issued “Notice
Concerning Questions of Enforcement of Hong Kong Arbitral Awards in
the Mainland” – streamline enforcement for ad hoc/institutional awards
seated in HK
Conclusion – HK is the ‘seat’ of choice for China-related matters.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Hong Kong (cont.) Med/Arb – Arb/Med
 What is it?
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Med/Arb – Arbitrator acts as a mediator at the out-set of matter, then
proceeds as arbitrator if matter does not resolve.
Arb/Med – Arbitrator ‘swaps hats’ to act as mediator
 China influence (CIETAC Arbitration Rules – Article 40)
 Benefits
•
Familiarity with the case and parties
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Med-Arb cont.
 Disadvantages:
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Arbitrator wearing ‘two hats’ may not be able to distinguish between
roles
Disclosure requirement under s34 of Arbitration Ordinance on Arbitrator
if mediation fails to disclose to all other parties any confidential
information obtain during the mediation that is “material to the arbitration
proceedings” …may dissuade parties from frank discussions during
mediation.
Recent example: Impression of bias post mediation → enforcement
refused: Gao Haiyan v Keeneye Holdings Ltd [2011] HKEC 514.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Med-Arb cont.
 Gao Haiyan v Keeneye Holdings Ltd [2011] HKEC 514
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Facts of the case: The tribunal wearing their ‘mediator hats,’ wined and
dined friend of one of the parties and suggested friend “work on” that
party with a proposed settlement figure.
HK court may refuse to enforce if it would be “contrary to public policy”
(s40E(3) of the Arbitration Ordinance (Cap. 341)).
Public policy: incl. “award made in circumstances that would cause a
fair minded observer to apprehend a real possibility of bias on the part of
the arbitral tribunal”
Inherent risk of Med-Arb.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Snapshot #1: Malaysia
 Recent‘upgrade’to the Arbitration Act 2005: Arbitration
(Amendment) Act 2011 (shortly to come into effect).
 Highlights:
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Clear wording to preclude court intervention except in limited
circumstances
Power to grant interim measures for arbitrations with seat outside
Malaysia
Narrowing of ground of appeal on a question of law → must be a
question of law that “substantially affects the rights of one or more of the
parties.”
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Snapshot #2: Thailand
 One step forward – two steps back.
 Pro-arbitration trends up to the early 00s, incl:
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Arbitration Act BE 2545 2002 (Model Law based);
Party to the NY Convention
Arbitration clauses included in government contracts
 Anti-arbitration in recent history
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2004: resolution of Cabinet in 2004 that no arbitration clause in any
administrative contracts between private entity & govt. → (Thai govt.
loses investor-state arbitration)
2009: blanket ban on arbitration clause in all contracts between private
entity & govt. (with some exceptions on a case-by-case basis subject to
approval by cabinet).
Anti-arbitration court decisions and obstructive parties.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Snapshot #3: Indonesia
 State of Play
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Law No. 30 of 1999 on Arbitration and Alternative Dispute Resolution
(no Official English language version).
Indonesian national arbitration institution BANI often required by State
entities: (although BPMIGAS (upstream oil and gas regulator), has been
known to agree to off-shore in recent times).
Bad reputation and a number of traps and tricks to bear in mind
(especially if arbitration is Indonesia-seated), but Indonesian courts
increasingly enforcing foreign awards.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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India as a ‘seat’ for International
Arbitration
 What do arbitration users say makes a good seat?
62%* of in-house counsel say the #1 criteria is Formal Legal Infrastructure,
i.e. 3 key components:
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National Arbitration Law;
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Track Record in Enforcing Agreements to Arbitrate and Arbitral
Awards;
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Neutrality and Impartiality of Legal System.
*Source: White & Case/Queen Mary 2010 International Arbitration Survey: Choices in
International Arbitration”
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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India as a ‘seat’ – Singapore Case
Study
The 3 Key Components – Singapore example
 National Arbitration Law
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Most recent amendments to International Arbitration Act implemented in
2010;
Active legislature – amendments to improve the legislation made in a
matter of months.
 Track Record in Enforcing Agreements to Arbitrate and
Arbitral Awards
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Non-interventionist, pro-arbitration approach of judiciary to arbitrations.
Exemplary record for the enforcement of foreign arbitral awards;
 Neutrality and Impartiality of Legal System
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Singapore listed as first in the world for neutrality under the Corruption
Perceptions Index
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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India as a ‘seat’ – Singapore case
study
 Additional ‘ingredients’ in a good seat:
“…it appears that the promotion of Singapore as an arbitral seat with
conferences and the active involvement of more arbitral institutions
(such as ICC and AAA/ICDR) have paid dividends and Singapore clearly
emerges as the most popular Asian seat ” * Source: White &
Case/Queen Mary 2010 International Arbitration Survey: Choices in
International Arbitration”
 Maxwell Chambers opened. Occupiers include: ICC,SIAC,
ICDR, ICSID, PCA, LCIA, WIPO, SCMA, CIArb, SIArb
*
Source: White & Case/Queen Mary 2010 International Arbitration Survey: Choices in International
Arbitration”
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Future of Arbitration in the Region
 Growth of more be-spoke rules tailored to cultures in the
region (e.g. Med-Arb).
 Institutional rules likely to increasingly tailor to provide for
Expedited Procedures.
 Enforceability remains the key factor.
ICC Arbitration & Amicable Dispute Resolution – Focus on India
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Enforcement of the New York Convention
State
Ratification/Accession
Bangladesh
Brunei
Cambodia
Hong Kong SAR
India
Indonesia
Japan
Laos
Malaysia
Mongolia
Nepal
Pakistan
People's Republic of China
Philippines
Singapore
South Korea
Sri Lanka
Thailand
Vietnam
1992
1996
1960
(1997 via PRC)
1960
1981
1961
1998
1985
1994
1998
2005
1987
1967
1986
1973
1962
1959
1995
Non-members of the New York Convention include: Bhutan, North Korea, Taiwan and Myanmar
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Arbitration-friendly jurisdictions
 Top of the class:
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Hong Kong
Singapore
Japan
 Generally reliable:
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Malaysia
South Korea
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Arbitration-friendly jurisdictions
 Improvement / further improvement required:
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China
Vietnam
Philippines
Thailand
India
Indonesia
ICC Arbitration & Amicable Dispute Resolution – Focus on India
16 July 2011
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Developments in
Arbitration in Asia
Pacific – A Regional
Perspective
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