In context

Belgium strengthens position on international arbitration stage

January 13, 2014
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In context

Belgium makes headway in its plans to become an attractive forum for domestic and international arbitration. The new Belgian Arbitration Act, based on the UNCITRAL Model Law, has entered into force and CEPANI, the Belgian arbitration institute, has issued new arbitration rules.

With the new Belgian Arbitration Act‘s entry into force, Belgium joins 66 other countries that have arbitration legislation based on the UNCITRAL Model Law on International Commercial Arbitration. By modernising and aligning its Arbitration Act with international arbitration practice, Belgium hopes to establish itself as an attractive forum for international arbitration.

 

The most important reforms under this new Arbitration Act are:

  • no distinction made between domestic and international arbitration
  • the arbitration agreement does not have to be in writing, the burden of establishing an arbitration agreement lies with the party alleging that an arbitration agreement exists
  • the parties may agree on the procedure for challenging an arbitrator, notably by referring specifically to the arbitration rules of a specific arbitral institution
  • detailed rules governing interlocutory or conservatory measures ordered by the arbitral tribunal have been introduced, including the recognition and enforcement of these measures by national courts
  • explicit confirmation is included that the principles of equal treatment of all parties and fairness are to be applied throughout the arbitral proceedings
  • new rules pertaining to the assistance of the national courts in obtaining evidence
  • the rules regarding setting aside arbitral awards are made significantly stricter

 

Five specific courts have jurisdiction

Five specific courts have jurisdiction to hear all ancillary matters relating to arbitral proceedings, including applications for the enforcement or setting aside of an arbitral award. These are the five courts of first instance that have the same seat as the courts of appeal (Antwerp, Brussels, Ghent, Liège and Mons). All arbitration-related proceedings will be centralised in these five courts, allowing them to become specialised in arbitration matters. As a result, parties should be able to obtain the requisite measures in support of arbitral proceedings from specialised courts as expeditiously and efficiently as possible.

 

Direct appeal to the Supreme Court  

To enhance the effectiveness of arbitration, appealing against a decision of the court of first instance will no longer be possible in relation to an arbitration-related matter. The decision can only be challenged before the Supreme Court based on a number of limited grounds (e.g., violation of law, no review of findings of fact). The streamlining of appeal proceedings with respect to arbitration-related court decisions is a significant and welcome improvement, removing as it does a main cause for possible delays in arbitration-related court proceedings.

 

Remittance of an award to the tribunal

When considering an application to set aside an arbitral award, the court can remit the award to the arbitral tribunal to allow it to revise the award and eliminate the grounds for a potential setting aside. 

 

New CEPANI Rules

CEPANI, the Belgian Centre for Mediation and Arbitration, issued new CEPANI Arbitration Rules, which were inspired by the ICC Rules of Arbitration. The new CEPANI Arbitration Rules apply to all arbitration proceedings commenced on or after 1 January 2013, unless otherwise agreed by the parties. They are to be read in conjunction with the new Belgian Arbitration Act.

 

Multi-party and multiple contracts arbitration

The new CEPANI Arbitration Rules give parties involved in multi-party or multi-contract disputes the opportunity to settle their disputes in a single arbitration. All parties must have agreed to CEPANI arbitration and to have their claims decided within a single arbitration.

 

Intervention and joinder of a third party

A third party may request to intervene in pending arbitral proceedings and any party to a pending arbitration may seek to have a third party joined. The intervention may be allowed when the third party and the parties to the dispute have agreed to submit their disputes to arbitration under the CEPANI Arbitration Rules.

 

Fast-track procedure for interim and conservatory measures

The new CEPANI Arbitration Rules provide for requesting interim and protective measures before the arbitral tribunal is constituted. CEPANI will appoint an emergency arbitrator within 48 hours after receiving a request, and the emergency arbitrator will render an award within 15 working days. The emergency arbitrator cannot subsequently be appointed as the arbitrator in the main proceedings on the merits and the arbitral tribunal deciding on the merits is not bound by the emergency arbitrator’s decision on interim and conservatory measures.

 

Electronic communication

A further innovation of the new CEPANI Rules is that the request for arbitration, the answer to the request for arbitration, the memorials and written submissions and the nomination of the arbitrators can now be sent electronically.

 

Confidentiality

Arbitral proceedings under the new CEPANI Arbitration Rules are confidential, unless the parties agree otherwise and are under a legal obligation to disclose certain information relating to the arbitration.

 

Limitation of arbitrators’ liability

A new provision limiting arbitrators’ liability when carrying out their functions of ruling on a dispute has been added to the CEPANI Arbitration Rules. The arbitrators, CEPANI and its members and personnel will not incur any liability except in the case of fraud or gross negligence.

 

Attractive seat of arbitration

By adopting its modernised Arbitration Act, Belgium has caught up with developments elsewhere and can be considered an attractive and safe seat of arbitration. The updated CEPANI Arbitration Rules are in line with the rules of other major arbitration institutions, such as the ICC.

 

Undoubtedly, the new Belgian Arbitration Act and the new CEPANI Arbitration Rules will significantly influence the expected new Dutch Arbitration Act and the forthcoming overhaul of the NAI Arbitration Rules, which are designed to align Dutch arbitration law with modern international arbitration practice.

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