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Enhancing Efficiency and Legitimacy: Expert Panel Recommends Arbitration Division in High Courts
Enhancing Efficiency and Legitimacy: Expert Panel Recommends Arbitration Division in High Courts
Introduction:
In a significant move towards expediting the resolution of corporate disputes, the expert panel formed by the Centre to suggest reforms in the Arbitration and Conciliation Act, 1996, has recommended the establishment of a dedicated Arbitration Division in every High Court. The panel, led by Dr TK Viswanathan, emphasizes the need for a streamlined process to ensure the legitimacy and integrity of the arbitral process.
Arbitration Division: A Catalyst for Swift Resolutions:
The expert panel suggests that the establishment of an Arbitration Division in every High Court could catalyze fast-tracking the resolution of corporate disputes. By creating a specialized division with regular proceedings and expedited decision-making processes, the panel aims to ensure efficient dispute resolution. This move is poised to reduce the burden on regular court proceedings and enhance the overall efficiency of arbitration.
Limited Oversight, Timely Disposal: Key Recommendations:
The panel underscores the importance of limited court oversight, particularly during the post-award stage. While acknowledging the necessity of court supervision for the legitimacy of the arbitral process, the panel advocates for a second look only at crucial junctures. Furthermore, it suggests that enforcing courts should dispose of petitions within nine months unless there is a stay on enforcement. The call for sparingly granted adjournments only for exceptional reasons aims to prevent unnecessary delays in the resolution process.
Reforming Arbitrators' Fees and Appointment Procedures:
Addressing long-standing concerns, the committee recommends a revision of arbitrators' fees, which have remained unchanged since 2015. Proposing different fee structures for small and medium value claims, the panel suggests periodic rate revisions to align with the evolving landscape. The urgent need for institutionalizing the arbitrator appointment process to minimize court intervention is also emphasized. Courts are urged to promptly handle applications for arbitrator appointments, contributing to a smoother commencement of arbitral proceedings.
Challenging Arbitral Awards: Realism and Finality:
The expert panel calls for a pragmatic approach to challenging arbitral awards. It suggests that decisions to challenge an award must be based on an honest assessment of success prospects weighed against litigation costs. Emphasizing finality, the report proposes that bona-fide administrative suggestions not to challenge an award should be conclusive. Legal personnel involved in the arbitral process are urged to identify challenge grounds and make realistic assessments under the supervision of senior law officers. Additionally, the report suggests a standing committee for immediate examination of awards post-delivery to decide on challenges or settlements, coupled with fortnightly reviews to prevent the expiration of challenge timelines.
Separate Domestic Law for Enhanced Specificity:
In a forward-looking recommendation, the panel suggests the need for a separate domestic law to address India-specific concerns in arbitration. While acknowledging the influence of the UNCITRAL Model Law, the panel proposes consultations with the Bar Council, Advocates’ Associations, and trade associations for the formulation of a comprehensive domestic law tailored to India's unique needs.
Conclusion:
The recommendations put forth by the expert panel signal a progressive shift in India's arbitration landscape. The establishment of dedicated Arbitration Divisions, coupled with pragmatic reforms in arbitrators' fees, appointment procedures, and challenging arbitral awards, reflects a commitment to efficiency and transparency. If implemented, these changes could significantly enhance the dispute resolution process, fostering a business-friendly environment and reinforcing India's position as a hub for fair and expeditious arbitration. The proposed separate domestic law underscores a proactive approach to address the nation's distinctive concerns in the realm of arbitration, marking a crucial step towards comprehensive legal reforms.
- Expert panel formed by the Centre to suggest reforms in the Arbitration and Conciliation Act, 1996, has recommended the establishment of a dedicated Arbitration Division in every High Court.
- While acknowledging the necessity of court supervision for the legitimacy of the arbitral process, the panel advocates for a second-look only at crucial junctures.
- The urgent need for institutionalizing the arbitrator appointment process to minimize court intervention is also emphasized.
