Arbitration Act 2010 - The End Of Arbitration As We Know It?

The Arbitration Act 2010 ("the 2010 Act") was signed into law by the President of Ireland on 8 March 2010 and came into operation on 8 June 2010. It repeals all previous arbitration legislation in Ireland (including the Arbitration Act 1954, the Arbitration Act 1980 and the Arbitration (International Commercial) Act 1998). The 2010 Act applies to all arbitrations commenced in Ireland after 8 June 2010, thereby being retrospectively applicable to arbitration agreements in existence prior to this date but pursuant to which an arbitration may not have commenced.

So what are the changes made by the 2010 Act to Irish Arbitration Law?

UNCITRAL Model Law

The United Nations Convention on International Trade Law Model Law on International Commercial Arbitration ("the Model Law") is incorporated into the 2010 Act and now applies to all arbitrations held in Ireland. There is no longer a distinction between domestic and international arbitrations under the 2010 Act. The most significant changes introduced by the Model Law relate to an increased jurisdiction afforded to arbitrators, including the power to review challenges to their appointment and determine their own jurisdiction. The Model Law also confers increased procedural powers on arbitrators including the power to terminate proceedings for want of prosecution and order injunctive relief. A further significant departure from previous legislation is the new requirement for arbitrators to provide reasoned awards unless the parties have agreed otherwise, which will impose an additional burden on the arbitrator.

Case Stated Procedure

The case stated procedure, which allowed an arbitrator to refer a question of law to the High Court for determination during the course of an arbitration (which often occurred at the request of the parties), has been abolished by the 2010 Act. The rationale for the removal of this procedure is to strengthen the integrity of the arbitration process and deter delays. There was a perception, not entirely reflected in reality, that the case stated procedure was being used by parties to slow down the arbitration process. It is a significant amendment in the new legislation and the opportunities for parties to seek judicial intervention in arbitration proceedings will now be severely curtailed. This will lead to parties placing a greater focus on the choice of arbitrators and their appointment mechanisms together with a greater focus on the specific rules to be applied to the...