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Results: 4 Answers
International Arbitration
8.
The tribunal
8.1
How is the tribunal appointed?
 
Austria
Section 587 of the ACCP provides for a detailed appointment procedure of arbitrators. However, the parties are free to agree on any other appointment procedure. Section 587(2) of the ACCP gives the parties a four-week period to agree on the appointment of a sole arbitrator. This period starts to run as soon as one party submits a written request for appointment to the other party. If the parties cannot agree on a sole arbitrator, the court, upon the request of a party, will appoint the arbitrator.

Where the tribunal will consist of three arbitrators, Austrian arbitration law provides that each party shall appoint its arbitrator and the two party-appointed arbitrators shall appoint the chairman of the tribunal.

Section 587(3) of the ACCP governs the failure of a party or the parties to comply with an agreed appointment procedure. This also includes the failure of a third party to appoint an arbitrator within three months, if the parties have so agreed. In all these circumstances, an arbitrator must be appointed by the state court.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.2
Are there any requirements as to the number or qualification of arbitrators in your jurisdiction?
 
Austria
Any natural and legally competent person may serve as an arbitrator. The parties can agree that an arbitrator must have specific qualifications in order to be appointed. Such qualifications can include professional competence, language skills or other abilities. Pursuant to Section 587(8) of the ACCP, these qualifications must also be considered by the state court when appointing a replacement arbitrator.

Section 586 of the ACCP governs the composition of the tribunal and is applicable only if the parties have not agreed on a different procedure. Accordingly, the parties are free to determine the number of arbitrators.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.3
Can an arbitrator be challenged in your jurisdiction? If so, on what basis? Are there any restrictions on the challenge of an arbitrator?
 
Austria
Pursuant to Section 588(2) of the ACCP, an arbitrator may be challenged only:

  • due to justifiable doubts as to his or her impartiality or independence; or
  • on the grounds that he or she does not have the qualifications agreed by the parties.

Section 589 of the ACCP provides a procedural framework for the challenge of an arbitrator. A party may challenge an arbitrator within four weeks of the constitution of the tribunal or of the date on which it gains knowledge of the grounds for a challenge. Unless the challenged arbitrator steps down or the other party agrees with the challenge, the tribunal - including the challenged arbitrator - will decide on the challenge.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.4
If a challenge is successful, how is the arbitrator replaced?
 
Austria
In the event of early termination of an arbitrator’s mandate (including a successful challenge of an arbitrator), a replacement arbitrator shall be appointed. The appointment shall be carried out in accordance with the rules that applied to the appointment of the arbitrator who is being replaced. Unless otherwise agreed by the parties, the tribunal may continue the proceedings, making use of the results of the proceedings hitherto obtained - in particular, the existing record of the hearings and all other documents.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.5
What duties are imposed on arbitrators? Are these all imposed by legislation?
 
Austria
The arbitrators’ duties primarily result from the contract between the parties and the arbitrator(s). It can be inferred from Sections 577 to 618 of the ACCP (in particular, Section 588 and Sections 594 and following) that the tribunal must:

  • be independent and unbiased;
  • conduct the proceedings fairly;
  • respect the parties’ right to be heard;
  • take evidence as necessary; and
  • render an award on that basis.

Section 594(4) of the ACCP explicitly provides that an arbitrator may become liable if:

  • he or she entirely omits to fulfil the duties resulting from his or her appointment; or
  • he or she fails to fulfil the duties resulting from his or her appointment in a timely fashion.
For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.6
What powers does an arbitrator have in relation to: (a) procedure, including evidence; (b) interim relief; (c) parties which do not comply with its orders; (d) issuing partial final awards; (e) the remedies it can grant in a final award and (f) interest?
 
Austria
(a) Procedure, including evidence?

Unless the parties have agreed otherwise, the tribunal shall decide whether to hold oral hearings or whether the proceedings shall be conducted in writing. Where the parties have not excluded an oral hearing, the tribunal shall, upon the request of a party, hold an oral hearing at an appropriate stage of the proceedings.

Section 599 of the ACCP, a mandatory rule, empowers the tribunal to rule on the admissibility of evidence, to take evidence and to evaluate the results. While the tribunal has broad discretion, it must adhere to the principles of fair treatment of the parties and the right to be heard. Therefore, the parties must be granted an opportunity to submit evidence, participate in the taking of evidence and comment on the results thereof.

(b) Interim relief?

Section 593 of the ACCP authorises the tribunal to order interim or protective measures, upon the request of a party, if it considers that otherwise the enforcement of the claim would be frustrated or significantly impeded, and also where it considers that a risk of irreparable harm exists.

However, as the tribunal lacks coercive powers, its decisions must be enforced by the state courts. As a result, while the tribunal may order interim measures which are unknown under Austrian law, the enforcement courts in Austria will have to transform them into interim measures which they are authorised to enforce and that most closely resemble the type of interim relief originally granted by the tribunal.

(c) Parties which do not comply with its orders?

The tribunal may draw adverse inferences from a party’s failure to comply with its orders. Likewise, the tribunal may consider non-compliance with its orders in its cost decision. In any case, the tribunal may continue the proceedings and render an award. Specific rules apply to the claimant’s failure to file the statement of claim or the respondent’s failure to respond to the statement of claim in accordance with within the timeframe agreed or set (see question 30).

(d) Issuing partial final awards?

The tribunal has the power to render a partial award.

(e) The remedies it can grant in a final award?

Apart from Austrian public policy, there are no restrictions concerning the type of relief that may be requested and granted. Austrian law regards this issue as a matter of substantive law.

(f) Interest?

Under Austrian law, the issue of interest is a matter of substantive law. Section 1000 of the Austrian Code provides for an interest rate of 4%. If the Austrian Commercial Code is applicable, an increased rate of 9.2% above the base lending rate (provided that the debtor acted culpably) applies. With respect to compound interest, Section 1000(2) of the Austrian Civil Code provides for an interest rate of 4%.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.7
How may a tribunal seated in your jurisdiction proceed if a party does not participate in the arbitration?
 
Austria
Where the claimant fails to file its statement of claim in accordance with Section 597(1) of the ACCP, the tribunal shall terminate the proceedings. Where the respondent fails to respond to a statement of claim within the timeframe agreed or set, the tribunal shall, unless the parties have agreed otherwise, continue the proceedings, without regarding such default in itself as admission of the claimant’s allegations. The same shall apply where a party is in default of another procedural action: the tribunal may continue the proceedings and may render an award on the basis of the evidence already taken. Where, in the opinion of the tribunal, the default is sufficiently justified, the defaulted procedural action may be subsequently taken.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law
8.8
Are arbitrators immune from liability?
 
Austria
Under Austrian arbitration law, arbitrators are not immune from liability. Section 594(4) of the ACCP provides that an arbitrator may become liable if:

  • he or she entirely omits to fulfil the duties resulting from his or her appointment; or
  • he or she fails to fulfil the duties resulting from his or her appointment in a timely fashion.

In any case, in order to be liable towards the parties, the arbitrator must have acted in a culpable manner. It is well-established case law that any liability which goes beyond the scope of Section 594(4) of the ACCP necessarily requires the successful setting aside of the arbitral award. Arbitrators’ agreements and rules of arbitration of arbitral institutions frequently exclude liability to the extent possible under the applicable statutory law.

For more information about this answer please contact: Leon Kopecký from Schoenherr Attorneys at Law