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Domestic Arbitration in India

Proceedings relating to Arbitration in India are governed by the Arbitration and Conciliation Act, 1996. The Indian Arbitration Act is based on the UNCITRAL Model Law on International Commercial Arbitration 1985 and the UNCITRAL Arbitration Rules 1976 which was adopted in the year 1985 with the objective to assist States in reforming and modernizing their laws on arbitral procedure so as to take into account the particular features and needs of international commercial arbitration.

In the year 2006, the UNCITRAL Model Law was amended with the object to modernise the form requirement of an arbitration agreement to conform with international contract practices and establish a more comprehensive legal regime dealing with interim measures in support of arbitration. Accordingly, the General Assembly of the United Nations recommended that all countries give due consideration to the said Model Law, in view of the desirability of uniformity of the law of arbitral procedures and the specific needs of international Commercial arbitration practice. In view of the recommendation, the Indian Legislature enacted the Arbitration and Conciliation Act in 1996 with the object to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards so as to define the law relating to conciliation and for matters connected therewith or incidental thereto.

Amendments to the Arbitration and Conciliation Act, 1996

The Arbitration and Conciliation Act, 1996 underwent through major changes vide the Amendment Act of 2015 and the recently introduced Amendment Act of 2019.

The Arbitration and Conciliation Act, 2015- Some of the breakthrough changes brought about in Arbitration Law by this amendment were as under:

  • If an interim order has been passed by the Court arbitration proceedings shall be commenced within 90 days from the date when interim order was passed
  • The Amendment also provides that the arbitral tribunal shall pass an arbitral award within 12 months, which may be extended by a 6-month period.
  • The amendment also provides for a fast track procedure for arbitration

Arbitration and Conciliation Act, 2019- Some of the key features of the Amendment Act of 2019 are as under:

  • Establishment of Arbitration Council of India – In order to promote institutional arbitration, the bill seeks to sanction the establishment of an independent statutory authority for the promotion of arbitration, mediation and conciliation and other forms of Alternate Dispute Resolution mechanisms.
  • Arbitral Institutions for Appointment of Arbitrators – The bill has brought a subsequent amendment to Section 11 and envisages that the parties would have to approach arbitral institutions as designated by the Courts for the purposes of appointment of arbitrator.
  • Confidentiality of Proceedings– the parties in an arbitration are obligated to maintain confidentiality of proceedings as per the newly inserted Section 42 A

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