Binding Non Signatories To Arbitration Agreement

However, the Court avoided addressing the issues of law at issue and the role of the principle of consent in defining the scope of arbitration agreements. These issues have yet to be addressed by the preliminary bodies. The provisions of the New York Convention on Arbitration Agreements are set out in Article II. Paragraph 1 requires states to “recognize in writing an agreement” under which the parties agree to submit certain disputes to arbitration. Paragraph 2 provides that a written agreement includes a compromise clause “signed by the parties.” Finally, paragraph 3 provides that a national court, at the request of one of the parties, refers the parties to arbitration “when an appeal is before us with exceptions in a case for which the parties have reached an agreement within the meaning of this article.” a) Sukanya Holdings- The Supreme Court considers that only signatories are bound by an arbitration agreement. Finally, the Court considered “the post-ratified understanding by the signatory states” and the 2006 CNCI recommendation (which had supported an indeterminate interpretation of Article II`s request for a “memorandum of understanding”. The Court found that “the weight of the authority of the contracting states,” as expressed in judicial decisions and national arbitration regulations, based its interpretation of the Convention. In the United States, arbitration is governed by the Federal Arbitration Act (“FAA”), chapter 1 of which governs national arbitration, while Chapter 2 implements the New York Convention and applies to international arbitrations. An important provision in Chapter 2 states that Chapter 1 also applies to international arbitration agreements, but only to the extent that it is not inconsistent with the New York Convention. 3. Notwithstanding the granting of an application under subsection 1 and the consideration of the matter before the judicial authority, arbitration proceedings may be initiated or prosecuted and an arbitration award may be rendered.” One of the first known assumptions and preachings of the “Group of Companies” doctrine can be attributed to the CCI Arbitration Award to Dow Chemical v. Isover-Saint-Gobain1.

In this case, the litigation adle adhies adhies between several contracts executed by various subsidiaries of Dow Chemical Company (but not of Dow Chemical Company itself) and Isover. Dow Chemical Company has commenced arbitration proceedings with its subsidiaries. Isover challenged the jurisdiction of the rights invoked by Dow Chemical Company on the grounds that it was not a party to the contract. The court upheld his jurisdiction. In its distinction, the ICC Court of Arbitration stated that mere business relationships between different companies were not sufficient to bind them to a single arbitration and that non-signatory firms must have played a key role in the “conclusion, execution or termination” of contracts.

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