International Commercial Arbitration Q2 2023

• Published date: 01 September 2023
• Subject Matter: Corporate/Commercial Law, Litigation, Mediation & Arbitration, Contracts and Commercial Law, Arbitration & Dispute Resolution
• Law Firm: Wiersholm
• Author: Stephan L. Jervell, Thomas G. Naalsund, Christian Hauge, Ignazio Azzari St'en, Bastian Sundling and Anne G'ril Dyrnes Br'rs

This update explores trends and developments in international commercial arbitration seen from a Norwegian perspective.

In the second quarter of 2023, the big trend is still the ongoing discussions on the potential impact of AI and especially generative language models like ChatGPT. The debate on other aspects of the digital development is also ongoing. As professor Richard Susskind writes in his third edition of "Tomorrow's Lawyers - An Introduction to your Future": "[...] I believe we should be increasing our use of virtual hearings, online courts, and online dispute resolution."

Virtual arbitration hearings have already been here for some time, but we believe there is still a way to go before we see "online arbitration". However, we will keep monitoring and share our thoughts on best practice use of AI in the current framework for international commercial arbitration.

In this newsletter we will, against the backdrop of a recent Oslo District Court case, look into the recurring theme of annulment of arbitral awards in Norway. Furthermore, we provide an overview of the latest NOMA News - before we give you an overview of upcoming events in What's On the Agenda.

We hope you will like it!

The setting aside of arbitral awards in Norway

Introduction

Oslo District Court recently considered a challenge against an arbitral award in a dispute between Cesla Armeringsst'l AS and Helgeland Industriutvikling AS regarding the former's pre-emptive right to acquire shares in a company owned by the parties. The underlying dispute was resolved in favour of Cesla Armeringsst'l AS. Subsequently, Helgeland Industriutvikling AS initiated proceedings before Oslo District Court to set aside the arbitral award.

The question before Oslo District Court was whether the arbitral award could be set aside based on either (a) improper composition of the arbitral tribunal due to lack of impartiality and independence, or (b) the arbitral award's lack of sufficient reasoning. The court concluded that the conditions for setting aside the award were not met. The judgment has been appealed. Nonetheless, it presents a valuable opportunity to discuss the issues at hand.

Arbitrators' impartiality and independence

A common basis for challenges against arbitral awards is the arbitral panel's improper composition due to the lack of impartiality and independence of one or more of the members of the arbitral tribunal.

The Norwegian Arbitration Act (the "Arbitration Act"), section 43, first paragraph, states that the courts may set aside an arbitral award if "the composition of the arbitral tribunal was incorrect". This will inter alia be the case when the requirement that the "arbitrators shall be impartial and independent of the parties," set out in the Arbitration Act, section 13, first paragraph, is not satisfied.

These rules are based on the UNCITRAL Model Law (1985), article 34, cf. article 12, and correspond to the requirement of impartiality and independence that applies to judges in the ordinary courts pursuant to the Norwegian Courts of Justice Act, sections 106 and 108. The rules reflect an internationally recognised ideal of independence and impartiality among judges and arbitrators.

Under Norwegian law, as in most other legal systems, it is not necessary to establish actual...