How Effective is LCIA’s Bite on Arbitration in India?
20/03/2011
1. Arbitration proceedings in India
India’s arbitration dispute-resolution forum is renowned for its sluggish procedure. Many practitioners blame the schedules of counsel and arbitrators because many of India’s commercial arbitrations are conducted by tribunals dominated by members of the judiciary, including High Court judges, counsel and retired judges. Often arbitration hearings, whether interlocutory, preliminary, substantive or otherwise, are arranged to fit around High Court proceedings. These hearings are then often adjourned because over-committed counsel and/or arbitrators become unavailable through unexpected and pressing court demands. These unnecessary delays are further compounded when there is a three-person tribunal.
India’s arbitration proceedings are similar to High Court litigation with its entrenched and inherent delays; they are also often ad hoc and make no reference to institutional rules, with consequent further delay. Thus there are plenty of opportunities for recalcitrant respondents to prolong proceedings. These difficulties emasculate the very principles which a successful arbitral forum requires.
2. LCIA India
Introduction
At the Taj Mahal Palace in Mumbai on April 18, 2010 the London Court of International Arbitration in India (“LCIA India”) based in New Delhi introduced its new set of rules and arbitrator’s notes which interface with India’s Arbitration Act 1996 and High Court judgments. The LCIA India Arbitration Rules (“the Rules”) and Notes for Arbitrators (“the Notes”) comprise respectively 32 articles and 41 notes. The Rules and Notes deal with all the usual
issues of impartiality, independence and fairness, all of which feature in LCIA’s existing rules. However, the new Rules are designed in particular to: (a) expedite proceedings; and
(b) provide sanctions for unnecessary delay. These two rudimentary pillars are the cornerstones of the Rules. India’s arbitration fraternity have welcomed the Rules with the hope that they will have real teeth to coerce parties and tribunal alike to conduct proceedings expeditiously, efficiently and without unnecessary delay.