The Arbitration and Conciliation (Amendment) Bill, 2015 is one of the bills listed for introduction during the current Parliamentary Budget Session between 23 February and 8 May 2015. The bill is expected to contain proposals for reform which are in line with those contained in the report submitted by the Law Commission of India in August 2014, for example:

  • Restrictions to the scope of the term "public policy", in order to reduce challenges to arbitral awards on the ground that they are in conflict with the public policy of India.
  • Clarification that patent illegality on the face of an award should be a ground for setting it aside; awards should not be set aside only on the grounds of erroneous application of the law or re-appreciation of the evidence.
  • Courts to dispose of applications made under Section 34 (Application for setting aside arbitral award) and 48 (Conditions for enforcement of foreign awards) within one year of the application being filed.
  • In situations where parties are unable to decide upon an arbitrator, parties to approach the High Court or the Supreme Court under Section 11 of the Act (and not the Chief Justice, which is currently the case) to appoint an arbitrator on their behalf. Courts to dispose of such applications within 60 days.
  • Court's powers under Section 11 (Appointment of arbitrators) to be limited to examining the existence of an arbitration agreement and not considering the merits of the dispute.

The proposals are also expected to address difficulties created by the Indian Supreme Court judgment in the Bharat Aluminium case (see our previous newsletter on this case), by allowing parties to expressly agree that a party to a foreign seated arbitration may apply to an Indian court for interim measures of protection (like obtaining security or an injunction or for assistance in taking evidence) under Section 9 of the Act, even though this section is no longer applicable to foreign seated arbitrations.

Originally published in March 2015 Newsletter.

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