India: Highlights: The Arbitration & Conciliation (Amendment) Bill, 2018

Last Updated: 21 February 2019


The journey towards India becoming a desirable hub for International commercial arbitration has been and continues to be a long and arduous done. Arbitration in India has been riddled with issues including excessive cost, protracted proceedings leading to extensive delays. In order to remedy such issues and create greater confidence in parties to choose India as a seat for arbitration, the Arbitration & Conciliation (Amendment) Act, 2015 (hereinafter to be referred to as "Amendment Act, 2015") was introduced, bringing into the realm several significant changes in the Arbitration & Conciliation Act, 1996 (the Act). A noteworthy motive for bringing about the Amendment Act, 2015 was to make arbitration a more preferred mode of settlement of disputes by making it cost effective and providing a fixed time period for disposal of disputes. The Amendment Act, 2015, however, failed to address certain issues including importance of institutional arbitrations at a time when internationally, institutions such as ICC, LIAC, SIAC, HKIAC are playing key role in resolution of disputes through arbitration.

Another drawback of the Amendment Act, 2015, which was creating legal hurdles, was the question posed on its applicability to court proceedings, initiated pursuant to arbitrations invoked prior to 23.10.2015. Hence, a further amendment was absolutely imperative to clear the obscurities created by the amendments introduced in 2015. In order to address above difficulties and issues, the cabinet has introduced, "The Arbitration & Conciliation (Amendment) Bill, 2018" and has approved the same. The bill will now be placed before the Parliament of India. It is laudable that the flaws of the Amendment Act, 2015 have been noticed early on and are now being proposed to be rectified.

PROPOSED AMENDMENTS (as highlighted by the PBI release)

At the very outset, the proposed Bill clarifies that the objective of the amendments is to promote institutional arbitration by creating an independent, statutory body to govern the entire process of Arbitration in India right from the stage of appointment of arbitrator. It further proposes to create a robust eco system for commercial arbitration to flourish and thrive in India. Primarily, following are the amendments proposed by the aforesaid Bill:

  1. Establishment of a statutory body called Arbitration Council of India "ACI", for promoting institutional arbitrations;
  2. Amendment in Section 29A of the Act;
  3. Introduction of Section 42A & 42B;
  4. Introduction of Section 87

The above amendments are quite significant as the same cater to the practical difficulties being faced by the parties as well as the arbitrators. For instance, the Amendment Act, 2015 introduces a time limit of 12 months for conclusion of arbitral proceedings including making the award, from the date when an arbitrator enters into reference. The aforesaid period is found to be too less as subsequent to an arbitrator entering into reference, completion of pleadings consumes substantial period. This makes it practically impossible for an arbitrator to record evidence, wherever necessary, hear arguments and make the award within 12 months only. In majority of the cases especially those involving complex issues and where number of claims are high, parties are required to approach the Court for extending the time for making the award. To overcome this obstacle, the Amendment Bill, 2018, introduces an amendment in Section 29A, thereby suggesting that 12 month period shall begin to run from the date when pleadings are complete. The Bill further suggests to exclude International Arbitration from the restricted timeline of making the arbitral award.

Most significantly, the Bill suggests the creation of a separate, independent, statutory body called the Arbitration Council of India ("ACI") to be presided over by a Judge of the Supreme Court or Chief Justice or Judge of any High Court or any other eminent person, which would include an eminent academician etc. and other government nominees as well. The ACI's role includes grading arbitral institution and accrediting arbitrators by laying down certain rules and norms and to promote and encourage arbitration and other ADR Mechanisms. For the aforesaid purpose, ACI is to formulate appropriate policy and guidelines for the establishment, operation and maintenance of uniform professional standards in respect of all matters relating to arbitration and ADR mechanism. In this regard, the ACI's role may further expand to facilitate the speedy appointment of arbitrators through designated arbitral institutions by the Supreme Court or the High Court.

Importantly, the Act did not contain any express provision regarding confidentiality of the proceedings and the Amendment Act, 2015 was also silent on the issue. However, the Amendment Bill, 2018 proposes to insert a new Section 42A which aims to provide for confidentiality of arbitral proceedings except for the award.

The Amendment Bill, 2018 also provides for a new Section 42B which aims to protect the Arbitrator or arbitral tribunal from being dragged into unnecessary legal proceedings by the parties for any action or omission done in good faith. This will afford comfort to the arbitrators.

One of the major legal hurdles faced while implementing the Amendment Act, 2015 was regarding the applicability of the same to court proceedings arising out of arbitrations, invoked prior to the amended Act coming into force. This practical issue arose and there were a host of conflicting judgments on the issue, emerging across the spectrum of the High Courts in the country. In order to address this issue, a new Section 87 has been proposed in the Amendment Bill, 2018 to clarify that unless parties agree otherwise the Amendment Act, 2015 shall not apply to the following:

  1. arbitral proceedings that have commenced prior to the Amendment Act, 2015 coming into force i.e. prior to 23.10.2015.
  2. court proceedings arising out of or in relation to such arbitral proceedings irrespective of whether such court proceedings are commenced prior to or after the commencement of the Amendment Act, 2015


While the proposed bill appears to fill in some lacunae created by the recent amendment, the extent of it successfully plugging all the loopholes is still debatable. It is germane to point out the practical difficulties and challenges that are faced by parties and lawyers with regard to the law governing arbitration in India. Some of these seem to be overlooked by lawmakers and require consideration by them, which more often than not, is a protracted process. The following are some of the loopholes, still left for debate in Courts:

  1. With respect to the introduction of the ACI, it would be crucial for the Amendment to clearly define the scope of the ACI's role and its powers.
  2. Pertinently, the question arises whether in view of establishment of an institution like ACI, for securing speedy appointment of the arbitrators, Section 11 of the Act becomes redundant. Further, where a party is objecting to the validity of the arbitration agreement itself, what is the course of action to be adopted in such circumstances.
  3. Further, the Amendment Bill, 2018 could have provided clarification on the issue, whether two Indian parties can agree for a foreign seated arbitration, despite being bound by the Indian Law.
  4. Similarly, with regards to the section containing confidentiality, it is not clear whether the confidentiality remains even when the proceedings have progressed to the Court under Section 34 of the Act and the Court requisitions the arbitral record.

Thus, while the Amendment Bill, 2018 proposes many welcome changes, there are still certain grey areas, which are required to be addressed by the legislature before the Act can be said to be complete and all-encompassing legislation. It is quite possible that some of the issues highlighted by us have been addressed in the text of the Bill, which is presently not available.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

This document is not intended to create an attorney-client relationship. You should not act or rely on any information in this document without first seeking legal advice. This material is intended for general information purposes only and does not constitute legal advice. If you have any specific questions on any legal matter, you should consult a professional legal services provider.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Contact the Author?
Click here to email the Author
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Other India Advice Centres
Insolvency and Restructuring
More Advice Centers
Useful Resources
Legal updates from Singhania & Partners
Based in New Delhi, the main objective of ICA is to promote amicable, quick and inexpensive settlement of commercial disputes by means of arbitration, conciliation, regardless of location.
The Chartered Institute of Arbitrators (CIArb) is a leading professional membership organisation representing the interests of alternative dispute practitioners worldwide.
Upcoming Events
The firm regularly participates in or hosts a number of legal events.
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions