Tuesday, August 30, 2016

Arbitration in the News – August 2016

  • India launches the Mumbai Centre for International Arbitration (MCIA)

India seeks to be a new arbitration hub with the creation of MCIA. By this point, arbitration proceedings in India were preferably ad hoc and the major cases involving Indian companies were conducted outside its borders (for instance, 30% of arbitration cases in Singapore involved companies from India). With the creation of this institution, India intends to adjust its arbitration system to the standards accepted by international practice in order to become the new hub for arbitration.

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  • Glencore manifest its intention to initiate an arbitration against Bolivia

This is another situation of a government nationalizing the investment of a foreign investor. On August 13, it came to the news Glencore´s statement about initiating arbitration against Bolivia. The Swiss corporation said it was trying to solve the dispute amicably. However, the negotiations had not been successful so far and it looks like an arbitration will be unavoidable at this point. The Government of Bolivia states that the nationalization respected the public interest.

The case relates back to nationalization occurred in 2007 and 2010.

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  • U.S. – Banks use arbitration to bar consumers´ lawsuits

According to a NY Times Blog, researchers found that banks increased the number of arbitration clauses in contracts with their customers. In addition, when researchers asked consumers about this subject, they answered that they would like to have the option to file actions in courts, especially, in class actions cases. Nonetheless, only a small portion of unsatisfied costumers said they would file lawsuits to settle disputes about fees with their banks, even when there is option of going to courts.

This situation is leading to a debate about a new regulation on the matter, by which arbitration clauses would not be allowed to bar class actions on consumer/banks litigation.

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  • India's minister of finance pitches for BRICS arbitration platform

The Minister of finance of India, Mr. Arun Jaitley, spoke at the conference on 'International arbitration in BRICS' encouraging BRIC countries to create their own arbitration mechanisms. He argued that developed nation dominate the field and arbitral awards are usually against the developing world. In addition, Mr. Jaitley reinforced the importance of dispute resolution mechanisms to foster trade between nations. Finally, he suggested the creation of a task force of specialists from the BRICS in order to discuss and design a model for these countries.

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  • Number of arbitration cases continue to increase worldwide


After the arbitral institutions released their caseloads from 2015, Baker and McKenzie platform Globalarbitrationnews released a compilation of the data from 11 of the top institutions. The added number of cases increased from 4130 cases in 2012 to 5207 in 2015.

It is impressive that Asia is the leading force for the growth of arbitration cases. The most impressive number is the Chinese CIETAC, who added more than 900 cases in this period.

Finally, the data also shows an increase of women´s participation as arbitrators. This fact is noteworthy, because men traditionally perform this role. The change in this pattern is still small though.

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