1. Deutsches und Internationales Schiedsverfahrensrecht WS 2013/2014
Prof. Dr. Joachim Zekoll, LL.M. (Berkeley)
Prof. Dr. Rolf Trittmann, LL.M. (Berkeley)

2. Interaktives Kolloquium in vier Blöcken und in englischer/deutscher Sprache
Grundlagen der Schiedsgerichtsbarkeit/The Basics of Arbitration
Der Ablauf eines nationalen Schiedsverfahrens/ The Course of a Domestic Arbitration Proceeding in Germany
Der Ablauf eines internationalen Schiedsverfahrens/ The Course of an International Arbitration Proceeding
Schiedsspruch und Vollstreckung/The Arbitral Award and Enforcement

3. Grundlagen der Schiedsgerichtsbarkeit/Basics of Arbitration
Arbitration as a form of Dispute Resolution
Ad hoc and Institutional Arbitration
Sources of Law
Arbitrability
Arbitration Agreement
Confidentiality
Pros and Cons of Arbitration

4. Arbitration as a form of Dispute Resolution Developments in the 20th century
1923 Foundation of the International Court of Arbitration at the International Chamber of Commerce in Paris – ICC Court of Arbitration
Foundation of other arbitration institutions, such as
London Court of International Arbitration - LCIA
Stockholm Chamber of Commerce – SSC
Swiss Arbitration Association - ASA
American Arbitration Association - AAA
Singapore International Arbitration Centre – SIAC
China International Economy and Trade Arbitration Commission - CIETAC
German Institution for Arbitration - DIS

5. Arbitration as a form of Dispute Resolution (2) Developments in the 20th Century
Various multilateral Treaties
1927 Genfer Abkommen zur Vollstreckung ausländischer Schiedssprüche
1958 New York Convention
1965 Übereinkommen zur Beilegung von Investitionsstreitigkeiten zwischen Staaten und Angehörigen anderer Staaten von 1965
1965 Foundation of the International Centre for Settlement of Investment Disputes – ICSID
1981 Iran – United States Claims Tribunal in Den Haag – 4000 cases
1985 UNCITRAL Model Law

6. Arbitration as a form of Dispute Resolution (3) Recent Developments in Germany
1998 Gesetz zur Neuregelung des Schiedsverfahrensrechts - §§1025 ff ZPO based on the UNCITRAL – Model law
DIS-Arbitration Rules published

7. Arbitration as a form of Dispute Resolution (4)
State Courts are maintained by the state to provide a means by which disputes between parties can be decided. They are based on the sovereign power of the state and its responsibility of ensuring a system of independent courts with independent judges and proper rules of procedure
Parties may agree to (to a large extent) remove their dispute from the jurisdiction of the state courts and have third parties deal with it (Alternative Dispute Resolution, „ADR“)
Other Forms of ADR
Mediation
Conciliation
Expert determination

8. Arbitration as form of dispute resolution (5)
An alternative to litigation for protecting contractual rights and enforcing contractual obligations
Results in a final, binding award – like a court judgment, but with no appeals on the merits
Track record of use in disputes under:
international contracts
transactions with developing countries
transactions involving States and governmental entities

9. Arbitration as form of dispute resolution (6)
More than 80 % of all international contracts contain an arbitration clause
As of 2012, 817 pending cases at the International Court of Arbitration in Paris, value in dispute up to 5 bn EUR
As of 2012, 172 pending cases at the German Institution of Arbitration , value in dispute up to 2 bn EUR

10. The Concept of Arbitration
Parties agree to not use state courts to resolve their (arbitrable) dispute but conclude an arbitration agreement by which they consent that a particular legal issue will be finally decided by one or more arbitrators.
The arbitral tribunal consists of one or three arbitrators which must be impartial and independent from the parties. The arbitrators are selected by the parties or an indenpendent third party
The parties choose the seat of the arbitration
The arbitration procedure is regulated by mandatory law but also is determined and controlled by the parties
The arbitral tribunal renders a final and binding as well as enforceable decision

11. Ad hoc and Institutional Arbitration
Institutional arbitration means that an arbitration is administered by an arbitral institution
Where parties have not selected an arbitration institution, the arbitration will be ad hoc, i.e. governed by the mandatory law, the lex arbitri
Advantages/Disadvantages of the two forms of arbitration

12. The Applicable Procedural Law
Sources of Law
The Applicable Procedural Law
Procedural law inlcudes those aspects of a legal system which determines the technical aspects of a (court) procedure
Substantive Law contains those elements of a legal system that creates, defines and regulates the duties, liabilities and rights of legal entitities
The rules applicable to the procedure primarily result from the arbitration agreement between the parties.
Mandatory procedural law in Germany relating to arbitration
Sec 1025 – 1066 ZPO (10th Book)

13. Sources of Law (2) The Applicable Procedural Law
primarily depends on the mandatory provisions at the place of arbitration (lex loci arbitri)
The parties have a free choice of the applicable procedural law as long as it is in compliance with the lex loci arbitri
In absence of parties´agreement the arbitral tribunal may decide at its discretion or refer the applicable rules of procedure at the place of arbitration
Ranking order according to Sec 1042 ZPO:
Mandatory Rules at the place of arbitration (Sub 1)
Determination of the parties (Sub 2)
Procedural Orders by the Tribunal (Sub 3)

14. Sources of Law (3) Limitations to Applicable Procedural Law
Sec 1042 ZPO (Minimum standards)
Fair Trial
Equality of the parties
Possibility of presenting its case
Counsel may not be excluded from acting as representative

15. Sources of Law (4) The Applicable Substantive Law
The law applicable to the merit of the dispute results usually from the underlying agreement between the parties Mandatory regulation on Substantive Law in Germany relating to arbitration : Sec 1051 ZPO
Parties may choose a legal system of a given jurisdiction as a whole or only certain elements
Limitations of the applicable substantive law
An arbitral award can be set aside if it is in conflict with mandatory law (ordre public), Sec 1059 II Nr 2b

16. Sources of Law (5) The UNCITRAL Model Law (1985/2006)
Standard basis for the arbitration law in many jurisdictions
Basis for 10 th Book of the ZPO
Provides for the basic rules for all stages of an arbitration proceeding
Aims at harmonizing and unifying national arbitration laws

17. Sources of Law (6) UNCITRAL Arbitration Rules (2010)
Ad hoc framework of rules which is widely accepted
Regulates all stages of an ad hoc proceeding
No administrative support
Regulations include
Scope of application and model arbitration clause
Composition fo the arbitral tribunal
Arbitral proceedings (place, language et al)
The award (form, effect, applicable law, costs et al)

18. Sources of Law (7) Institutional Arbitration Rules DIS ICC UNCITRAL
LCIA
SCC
CIETAC
Swiss Rules
Vienna Rules
CAS
ICSID
HKIAC

19. Sources of Law (8) „Soft law“/ „best practice“
IBA (International Bar Association) Guidelines for Drafting International Arbitration Clauses
IBA Rules on the Taking of Evidence in International Commercial Arbitration
IBA Guidelines on Conflicts of Interest
Consistent and published case law of arbitral tribunals
Articles by experienced practitioners

20. Case study
Compare the Rules of DIS and ICC-Regeln. What are the prerequisites for filing a request for arbitration, are there differences with respect to mandatory content of the request for arbitration / statement of claim?

21. Case study
A company from Brazil, (S) sells 50 t coffee – beans to a highly reputed family company (B) in Hamburg for EUR Upon receipt, B discovers that roundabout 20% of the coffee-beans are damaged. He wants partial repayment of the purchase price, i.e. EUR ,00. S denies responsibility and refuses payment. B decides to sue.

22. Case study
§ 10 of the Contract reads: "All disputes arising out of or in connection with the present contract shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by three arbitrators appointed in accordance with said rules. The place of Arbitration shall be Hamburg, Germany. The language of the proceedings shall be English. The present contract shall be governed by German Law."

23. Case study Applicable Law
Statutory Rules of §§ 1025 et seq of the German Civil Procedural Code
ICC Rules of Arbitration
Agreement of the parties
Discretion of the arbitral tribunal

24. Case study
Conflict of Law Rules Question 1: Which conflict of law rules are applicable? Question 2: To which substantive law lead the conflict of law rules? Question 3: What is the content of the applicable substantive law?

25. Case study Conflict of Law Rules
Conflict of Law Rule of German Statutory Law (§1051 ZPO)
Conflict of Law Rules of the ICC-Rules (Artikel 17 ICC-SchO)
Conflict of Law Rules of German International Private Law (EGBGB bzw. Rom-I und Rom-II-Conventions?)

26. Case study Objective determination § 1051 (2) ZPO
Where the parties to the dispute failed to determine which statutory
provisions are to be applied, the arbitral tribunal is to apply the laws of
hat state to which the subject matter of the proceedings has the
closest ties.
Artikel 21 S. 2 ICC-SchO
In case the Parties have not agreed on the law applicable, the Arbitral
Tribunal shall apply the rules of law which it determines to be
appropriate.

27. Arbitrability Party capacity („subjektive Schiedsfähigkeit“)
To conclude an arbitration agreement the legal capacity of the contracting person is required.
The legal capacity and capacity to contract of a person are governed by the law of the country of which the person is a national or where a legal entity is registered.
Limitations of party capacity are governed by the respective national law. Under German Law, doubts with respect to party capacity exist in cases where one party is consumer or employee, or where a party is insolvent.

28. Arbitrability (2)
Eligibility for arbitration („objektive Schiedsfähigkeit“),
§ 1030 ZPO
Any claim concerning an economic interest
Private disputes in competition law matters may also be referred to an arbitral tribunal including, for example, disputes arising out of an agreement regarding restrictive trade practices.
The German Federal Supreme Court (BGH) ruled in 2009 that applications to set aside shareholders’ resolutions adopted at a general meeting of a limited liability company, (Gesellschaft mit beschränkter Haftung), may be subject to arbitration if certain formal and procedural requirements are observed

29. Arbitrability (3) Sec 1030 CCP (ZPO)
An arbitration agreement regarding non-pecuniary claims has legal effect insofar as the parties to the dispute are entitled to conclude a settlement regarding the subject matter of the dispute.
An arbitration agreement regarding legal disputes arising in the context of a tenancy relationship for residential space in Germany is invalid.
Arbitration is not possible if statutory law provides that disputes
may not be subjected to arbitration proceedings.

30. Arbitration Agreement
The Arbitration Agreement is the basic element of every arbitration proceeding
Sec 1029 Sub 1 CCP (ZPO)
„Schiedsvereinbarung“ ist eine Vereinbarung der Parteien, alle oder einzelne Streitigkeiten, die zwischen ihnen in Bezug auf ein bestimmtes Rechtsverhältnis vertraglicher oder nichtvertraglicher Art entstanden sind oder künftig entstehen, der Entscheidung durch ein Schiedsgericht zu unterwerfen“
Two alternatives
„separate arbitration agreement“ (Schiedvereinbarung)
„arbitration clause“ (Schiedsklausel)

31. Arbitration Agreement (2)
Example of an institutional arbitration clause :
DIS arbitration clause
„All disputes arising in connection with the contract (description of the contract) or its validity shall be finally settled in accordance with the Arbitration Rules of the German Institution of Arbitration e.V. (DIS) without recourse to the ordinary courts of law.“
It is recommended to add the following provisions:
„The place of arbitration is....“
„The tribunal consist of (number of) arbitrators“
„The language of the arbitration is.....“
„The substantive law of.....is applicable to the dispute.“

32. Arbitration Agreement (3)
Legal qualification depends on applicable law: German law qualifies arbitration agreement as „Procedural Agreement“
Effect of arbitration agreement
Binding on contracting parties
No binding effect on third parties such as guarantors (exceptions 328 BGB, 398 BGB)
Conclusion by offer and acceptance
Necessary: well-defined description of controversies to be resolved by arbitration
Written form required (Sec 1031 ZPO)
Trend to a liberal approach as to written form

33. Arbitration Agreement (4)
What is compliant with the „written form requirement“ ?
Exchange of letters, telefaxes, telegrams, or other means of arbitration which provide a record of the agreement
Contained in a document transmitted from one party to the other or by a third party to both parties, as well as when such document is considered to be part of the contract in accordance with common usage („kaufmännsiches Bestätigungsschreiben“)
A reference in a contract to a document containing an arbitration clause is sufficient if the clause form part of the agreement („AGB“)
Arbitration Agreements to which a consumer is a party must be contained in a separate agreement which has been personally signed by the parties
Any non-compliance is cured by entering into discussions on the merits

34. Question What is the relevance of the „written form requirement“ ?
Should it be handled liberally or rather not ?

35. Arbitration Agreement (5)
Pathological clauses
Example 1:
Each dispute, disagreement or each claim which results out of this agreement or which releates to this agreement, its infringement or ist annulment is to be decided upon by arbitration proceedings according to the UNCITRAL Rules of arbitration in their current version.
Ziff. 2 nach BGH NJW 89, 1477

36. Arbitration Agreement (6)
Pathological clauses
Example 2:
Zur Durchführung von Streitigkeiten wählt die Firma G eine neutrale Person aus der Wirtschaft oder dem Recht als Schiedsrichter. Der Schiedsrichter entscheidet dann den Streitfall definitiv für beide Seiten. Die Entscheidung ist ohne Widerspruch sofort vollstreckbar. Findet das Verfahren vor einem ordentlichen Gericht statt, sind Rechtsanwälte als Parteivertreter zu bestellen.
Ziff. 2 nach BGH NJW 89, 1477

37. Arbitration Agreement (7)
Pathological clauses
Example 3:
"The Parties shall attempt to settle amicably any dispute or difference of opinion that may arise in connection with the Contract. Disputes or disagreements that cannot be solved through negotiations shall be brought before the International Court in Switzerland. This court will proceed in accordance with international law. The award of this court shall be considered final and binding upon the Parties."
Ziff. 2 nach BGH NJW 89, 1477

38. Arbitration Agreement (8)
Pathological clauses
Example 4:
"Arbitration: […] Any dispute not settled amicably […] shall be finally settled by arbitration. […] For contracts with foreign contractors, international arbitration with proceedings administered by the international arbitration institution appointed in the Contract Data, conducted in accordance with the rules of arbitration of the appointed institution, if any, or in accordance with UNCITRAL arbitration rules, at the choice of the appointed institution. The place of arbitration shall be the city where the headquarters of the appointed arbitration institution is located. The arbitration shall be conducted in the language for communications defined in Sub-Clause 1.4 of the Contract Data."
Ziff. 2 nach BGH NJW 89, 1477

39. Arbitration Agreement (9)
What went wrong ?
Keep it simple
Don‘t over-engineer
Stick with Standard clauses of the leading arbitral institutions if you want to avoid problems when starting your arbitration.
Ziff. 2 nach BGH NJW 89, 1477

40. Arbitration Agreement
Standard slide
Arbitration Agreement
Template tip
To start using numbers or bullets, use the INCREASE INDENT button
Choose the Law
Choose the Venue
Choose the Rules
Choose the Number of Arbitrators
If there’s time, add “Bells & Whistles”

41. Case study
Draft an institutional arbitration clause relating to a supply agreement between a German manufacturer and a Chinese distributor.
Draft an ad hoc arbitration agreement for a German and a Spanish party relating to the purchase of a solar-energy system to be supplied to the Spanish customer in Malaga

42. Confidentiality
More private than state court litigation. Oral hearings not open
to the public.
The private nature of arbitration is usually considered as one of the key advantages of arbitral proceedings compared to proceedings in state courts.
Reluctance to publish awards; publications, if any, in a sanitized version
The public is not informed of the conduct and content of the proceedings.
Hinweis auf die jüngsten Änderungen der Schiedsordnungen

43. Confidentiality (2)
BUT: Confidentiality of such proceedings is not as clear as parties assume. German arbitration law does not expressly stipulate a confidentiality obligation on the parties. Regarding any consultation during the decision-making process, the arbitrators are bound by the confidentiality of judicial deliberations.
Hinweis auf die jüngsten Änderungen der Schiedsordnungen

44. Case study
During an arbitration the arbitrators become aware that the parties are in dispute about claims arising out of a (prohibited) cartel the European and national cartel offices are not aware of. Are the arbitrators under an obligation to report the prohibited behaviour to the authorities ?
The arbitrators become aware that they are „used“ by the parties to conduct a sham arbitration with the aim to illegally transfer monies out of Russia. What should they do ?
The arbitrators believe that they have written a faboulous award which the world should be aware of. They want to publish the award. Are they allowed to ?

45. Pros and Cons of arbitration (1) Advantages of arbitration – perception and reality
Enforceability – New York Convention awards are enforceable in more than 149 signatory states – but do your do diligence
Neutrality – “level playing field”´, away from local courts and national administrative bodies
Confidentiality of arbitral proceedings – but do not take it for granted
Procedural flexibility
Expert arbitrators chosen by the parties more or less carefully
Finality – a double edged sword?
Speed and cost?

46. Pros and Cons of arbitration (2) Disadvantages of Arbitration – inherent and other limitations
Limited scope of arbitral jurisdiction – defined by contract
Limited powers of arbitrators, e.g. to order injunctions with effective sanctions/impact on third parties and (in practice) to give summary judgments
Flexibility may lead to unpredictable procedure
The problem of multi-party disputes/lack of consolidation powers
Awards are not precedents, nor binding on third parties – problem of contradicting awards
Speed and cost?

47. Pros and Cons of arbitration (3)
Bottom line: ultimately, perhaps the only realistic option – or the least worst alternative to home field advantage

48. Pros and Cons of institutional/ad hoc arbitration (1) Choosing the rules – tailor made or ready to wear?
Pure ad hoc arbitration: tailor made to the (likely) dispute but heavy administrative/financial burden on parties and risk of delay (or worse) through non-cooperation (e.g. expensive applications to court to appoint arbitrators). Drafting of arbitration clause is crucial!
Ad hoc arbitration with UNCITRAL Rules: preferable to pure ad hoc arbitration; must specify appointing authority and expressly exclude appeals
Institutional arbitration: may seem slower and more expensive, but generally recommended; always adopt model institutional arbitration clause
Choice of institution: choose a major international institution absent a particular reason not to (e.g. ICC, LCIA, SCC); check track record/durability of regional alternatives

49. Pros and Cons of ad hoc/institutional arbitration (2)
Advantages of Institutional Arbitration
Existence of an automatically incorporated set of arbitration rules
Higher degree of forseeability and predictability
Assistance through trained staff
No issues with service of process
Quality assurance (some institutions)
Different types of rules for different situations
Disadvantages of Institutional Arbitration
Higher costs through administrative fees
Potentially slower proceeding
Not all institutions are of same quality

50. Choice of the arbitral institution
Often chosen by default or because institute is well known in a particular region or trade area
Differences
Default regulation on number of arbitrators
Nomination of arbitrators
Calculation of costs
Ability of the institution to consolidate proceedings or join parties
Rules on multi-party proceedings
Ability of the institution to control the proceeding
Scrutiny of the draft award
Level of administrative support
Experience of staff

51. Domestic Arbitration in Germany
The initiation of the arbitration proceeding (ad hoc/DIS)
The selection of the arbitral tribunal (ad hoc/DIS)
The stages of an arbitration
The role of the ordinary courts
Interim relief (ad hoc/DIS)
Expedited Proceeding (DIS)
Rules for arbitrating corporate issues (DIS)

52. The initiation of the arbitration proceeding (ad hoc/DIS)
Initiation of proceeding
Sec 1044/1046 CCP/Sec 6 DIS-Rules
What are the prerequisites for initiating a domestic arbitration ?
Which elements are mandatory ?
What applies as to language ?
When is an arbitration proceeding „pending“ (Sec 204 Sub 1 no 11 Civil Code) ?
Practical issue: full reasoning or notice pleading ?
Cost of initiating an arbitration proceeding
Sec 7 DIS-Rules
Sec 6 Sub 1 and 12 GKG
Consequence of non-payment ?

53. Initiation of proceeding (2)
Service of process (Sec 8 DIS-Rules/Sec 1047 Sub 3 CCP)
Reply (Sec 9 DIS-Rules/Sec 1046 Sub 1; 1040 Sub 2 CCP)
No formal requirements as to contents
Sec 1049 Sub 2 CCP requires Respondent to invoke lack of jurisdiction of the arbitral tribunal in its reply, DIS-Rules ?
Sec 1032 Sub 2 CCP allows until constitution of the tribunal the initiation of court proceeding to request a declaration that an arbitration proceeding is permissible/impermissible
Counterclaim (Sec 10/11 DIS-Rules/Sec 1046 Sub CCP)
Tribunal decides on permissibility (Sec 10 Aub 2 DIS-Rules)
Is the Tribunal competent ? Is there a congruent arbitration agreement ?
Set-off ?

54. The constitution of the arbitral tribunal (ad hoc/DIS)
Key element in every arbitration
Sole arbitrator, three or more arbitrators ? What is preferable in which situation ?
Default provision in Sec 1034 CCP/DIS ?
Who is the „ideal“ arbitrator ?
Qualifications
What are the relevant condiderations ?
Rules on the appointment of arbitrators, Sec 1035 Sub 3 CCP/Sec 12 DIS-Rules
Nationality requirements ? Judges ? Lawyer ?
Special situation
Multi-party proceedings (Sec 13 Sub 3 DIS-Rules)

55. The constitution of the arbitral tribunal (2)
What happens if the Respondent does not nominate an arbitrator ?
Sec 12 Sub 1 DIS-Rules (The „DIS-Appointing Committee“)
Sec 1035 Sub 3 CCP (Appointment by the ordinary courts, cost issues)
Nomination of the Chairman
By the two co-arbitrators within 30 days (Sec 12 Sub 2 DIS-Rules/Sec 1035 Sub 3 CCP)
Default nomination
Sec 12 Sub 2 DIS-Rules, on request by one of the parties after expiration of 3o days period

56. The constitution of the arbitral tribunal (3)
Basic elements: Independence and impartiality
Sec 1036 CCP/Sec 15 ff DIS-Rules
Arbitrators shall disclose possible conflicts before and during an arbitration proceeding
The IBA Guidelines on Conflict of Interest/Sec 41 CCP
What are the crucial elements ?
Independence: personal economic interests, professional relationship with one of the parties, previous actvities
Red/Orange/Green list
Impartiality: Bias
Formal acceptance by an arbitrator
Sec 16 DIS-Rules/Sec 1035 CCP
Formal nomination
Sec 17 DIS-Rules

57. The constitution of the arbitral tribunal (4)
How to find the „right tribunal“ ?
What are the relevant criteria ?
What is the right process ?

58. Competence-Competence
Sec 1040 CCP
The Tribunal has competence to rule on its jurisdiction
Separability of the arbitration agreement (sub 1)
By objection of one party the tribunal it should make a preliminary ruling on its jurisdiction (sub 2)
This ruling then can be challenged before the ordinary courts (sub 3)
During the review by the courts the tribunal may continue the arbitration proceedings

59. The further stages of an arbitration (ad hoc/DIS)
How to structure an arbitration
CCP and DIS-Rules give broad discretion (Sec 1042 CCP/Sec 24 DIS-Rules)
Procedural Order No 1 (PO 1)
„German court proceeding in a hotel“, „Hybrid approach“ or „international best practice in Germany“
Rules on factfinding process are very limited and leave many options
CCP contain in Sec 1042 only provides a procedural framework
DIS-Rules contain more specific but still broad rules in Sec 24, 25, 26, 27. Difference to CCP procedure in Book 1 – 9 since arbitrators in Sec 27 have possibility to independently from evidence provided by the parties may investigate the facts

60. The further stages of an arbitration (2)
Generally, a domestic arbitration includes the following stages
Presentation of facts by the parties including submission of the relevant (e-)documents, possibly written witness statements, expert reports
Normally two rounds of submissions
Evaluation of the relevant facts for the decision of the requests by the arbitral tribunal
Possibly bifurcation of proceeding
Taking of evidence, controlled by the tribunal, some times verbatim protocol
Post-hearing briefs
Drafting to the award

61. The further stages of an arbitration (3)
No or only limited involvement of the DIS in the course of an arbitration, no „scrutiny“ of the arbitration agreement, the arbitration process or the award. In practice the DIS nevertheless gives guidance and follows the arbitration
In ad hoc proceedings there is no institution which follows the proceedings
No Terms of Reference, no time management requirements
Best practice guides (?)

62. The role of the state courts
The intervention of state courts is very limited and an exception (only to the extent permitted by Sec 1026 CCP)
Primary situations where an intervention might take place:
Declaration of admissibility or inadmissibility of arbitration
Interim relief
Assistance in constituting the arbitral tribunal
Assistance in connection with the taking of evidence
Recognition and enforcement of the award

63. The role of the state courts (2)
Recognition of the arbitration agreement
Enforcing the agreement (Sec 1032 CCP), pursuant to Sub 1 an action before a state court is inadmissible
Anti-suit injunctions ? („West Tankers“ : Inadmissible where Brussels I regulation applies)
Declaration of (in)admissibility of an arbitration (Sec 1032 Sub 2 CCP)
Application to OLG, only permissible until tribunal has been constituted, thereafter exclusively to be dealt with by tribunal
Interim Measures (see separate slides)
Support and control during constitution process
Appointment of sole arbitrator or chairman (Sec 1035 Sub 3 CCP)
Replacement of arbitrator, challenge of arbitrators, if tribunal dismissed the challenge (Sec 1037 Sub 3, Sec 1038 Sub 1 CCP)

64. The role of the state courts (3)
Support in connection with the taking of evidence and other measures (Sec 1050 CCP)
To compensate lack of sovereign power of the tribunal
Upon application of one party or the tribunal
Summons and interrogation of witnesses
Excursus: US 28 U.S.C. § 1782a

65. Interim relief Alternative 1 Alternative 2
Request for interim relief to state court
Alternative 2
Request to arbitral tribunal
Which issues exist ? What seems preferable ?
State courts are competent to render interim measures (Sec 1033 CCP, also with regards to arbitrations with seat outside of Germany; Sec 1025 Sub 2 CCP)

66. Interim relief (2) Alternative 2:
An arbitral tribunal is competent to render interim relief pursuant to Sec (1) CCP, which must be declared enforceable, Sec 1041 Sub 2 CCP

67. Expedited proceedings (DIS)
Rationale: Arbitrations must be less time-consuming, i.e. consume less efforts and money; arbitrations must be simpler to organize without endangering the principles laid down in the existing practice
CCP does not provide expedited proceedings
„Supplementary Rules for Expedited Proceedings“
Issued by DIS in 2008, must be agreed on expressly
Maximum Duration of proceeding: 6/9 months(Sec 1) but in full compliance with Sec 24 DIS-Rules
Sole arbitrator as default (Sec 3), shorter periods
Shorter periods for submissions (Sec 4)
Time schedule, two rounds of submissions, guidance by the tribunal (Sec 5)

68. Expedited Proceedings (2)
Time limits may be modified
If parties and arbitrators cannot comply with the time-limits the jurisdiction remains unaffected (Sec 6)
The tribunal may in abstain from stating the facts in the award (Sec 7)
Limited practical success
More success of (mandatory) expedited proceeding pursuant to the Swiss Rules

69. Arbitrating corporate disputes (DIS)
Rationale: Corporate disputes for a long time have been considered non-arbitrable due to its impact on other shareholders
The Federal Supreme Court in its decisions „Schiedsfähigkeit I“ and „Schiedsfähigkeit II“ (BGH NJW 2009, 1962) finally permitted to arbitrate corporate shareholder disputes, provided certain prerequisites are fulfilled
Implemented in „Supplementary Rules for Corporate Law Disputes“ (in force since 2009)

70. The course of an international arbitration proceeding
The ICC rules and its features
What differentiates an international arbitration from a domestic arbitration ?
Some elements of the common law approach to arbitration
The IBA Rules on the Taking of Evidence in International Arbitration
Other elements of „best practice“

71. The ICC Rules and its features
Revised in 2012
The ICC Court of Arbitration and the ICC Secretariat
Contain many quality assurance elements
Art 6 Rejection of obviously impermissible requests by the Court
Art Selection of arbitrators by the Court or NCs
Art 23 Terms of reference
Art 24 Case management conference
Art 33 Scrutiny
Annex IV Management Techniques
The ICC Commission on Techniques for Controlling Time and Costs in international arbitration

72. What differentiates an international arbitration from a domestic arbitration ?
Different legal regimes (lex fori) lead to unexpected standards the participants to an arbitration have to comply with
Example: Settlement discussions
„Best practice“, lex fori and applicable substantive law may lead to discrepancies which have to be bridged
Different legal cultures lead to different expectations
On part of the parties to the arbitration
On part of the arbitrators
Lack of certainty as to the procedure followed may lead to unpredictability

73. Some elements of the common law approach to arbitration
Civil law approach
The „relative truth“
Common law approach
The search for „real truth“ (US) or the „truth“ (UK)
Documents vs oral testimony
Concept of materiality and relevance
Electronically Stored Information (ESI)
Procedure driven by Counsel rather than by the judges
Witness statements; cross-examination; re-cross
Battle of the experts

74. The IBA Rules on the Taking of Evidence in International Arbitration
Revised in 2010
Try to bridge different approaches in civil law and common law
Scope „Guidelines for international arbitration“
Fairness and good faith as implied guideline
Preparation by the tribunal
Document production (Art 3)
E-document production
Witness and expert deposition
Privileges

75. Other elements of „best practice“
Case Management
(E-)Document production
Witness testimony
Use of Experts
Assistance to the tribunal
Deliberations
„Relationstechnik“ ?
Drafting of the award
Dissenting opinions
More „Softlaw“ or is there enough already ?

76. The true „best practice“
No „one size fits all“
Expectation Management
Tailormade arbitration
Lex fori
What do the parties expect ?
In case of discrepancies: Accommodate the needs of the parties
Discussion, Agreement or Order ?

77. The Making of the Award Decision making (Sec 1052 CCP)
Deliberations and voting (Sub 1)
Refusal of an arbitrator to participate (Sub 2)
Formalities (Sec 1054 CCP)
In writing
Signed by the arbitral tribunal (majority)
Specify the place and date of arbitration
Shall state the reasons on which the award is based

78. The making of the award (2)
Contents of the award
Recitals
Procedural history
Facts of the case
Reasons
Dispositive sections
Place and date
Signature of the arbitrators
Dissenting Opinion
Delivery of the award

79. Effect of the award
Same effect between the parties as a final and binding court judgment (Sec 1055 CCP)
Possibility to make certain corrections and interpret the awards pursuant to Sec 1058 CCP
Res iudicata (limited to dispositive section and to the parties)
No agreement to appeal permissible under German law
Exceptions from the binding effect
If the award is set aside (Sec 1059 CCP)
Foreign awards are binding only to the extent they have become final under the lex arbitri

80. Types of awards Final awards Partial awards
Interim/interlocutory awards
Decision on jurisdiction
Award on claim in principle

81. Settlement No need for tribunal to promote settlement discussions
Settlement by means of a consent award (Sec Sub 2 CCP)
Alternative
Termination of proceeding pursuant to Sec 1053 Sub 1 CCP

82. Decision on costs
Tribunal has to mandatorily decide on costs (Sec 1057 CCP)
Except if parties have agreed otherwise
The decision has to state the exact amounts
It is possible to decide costs in a separate cost award
Costs include administrative costs of institute (if applicable), the fees and expenses of the tribunal and the costs of the parties
In case of a separate cost award the decision can be contested separately too

83. Recourse against the award
Application for setting aside (Sec 1059 CCP)
Constitutionally required control of the arbitration process
In line with effect of Sec 1055 CCP
Largely in the disposition of the parties to the arbitration
Limiting function: only by an application for setting aside in accordance with Sub 2 and 3, i.e. no review on the merits
No waiver permissible in advance but after award has been rendered
Object of setting aside proceeding
Only awards
Only domestic awards (i.e. with seat of arbitration in Germany)
To be treated separately from proceeding to declare domestic award enforceable (Sec 1060 CCP)

84. Recourse against the award (2)
Setting aside proceedings have to brought within three months (Sec 1059 Sub 3 CCP)
To appeals court (Sec 1063 CCP) hearing mandatory,
Grounds for setting aside: (Sec 1059 Sub 2 CCP)
Literally taken from Model Law and Art V of New York Convention
Sub 1: grounds to be pleaded by parties
Sub 2: grounds to be taken into account ex officio
Sub 1:
Lack of valid arbitration agreement
Violations of the right to be heard
Excess of authority
Flaws in the composition of the tribunal or the procedure

85. Recourse against the award (3)
Sub 2 (ex officio)
Non-arbitrability
Conflict with public policy (ordre public)
“if the award led to a result that obviously violates basic principles of German law, especially if it is inconsistent with constitutional rights”
Form of decision
Order, appealable to Federal Supreme Court
Consequence of a setting aside
Arbitration agreement becomes operable again (Sec 1059 Sub 3)
Consequence of a rejection to set aside
Determination with res iudicata that alleged defects do not exist (Sec 1060 Sub 2 CCP)

86. Recognition and enforcement of arbitral awards in Germany (Domestic Award)
German approach different from Model Law and NYC 1958 since it differentiates between domestic and foreign awards
Domestic awards (Sec 1060 CCP) are considered final and binding per se (Sec 1055 CCP) unless it is set aside pursuant to Sec 1059 CCP (application only permissible within three months period)
Pursuant to Sec 1060 CCP the award is not per se enforceable but has to be declared enforceable
Declaration will be granted in the absence of a reason to set aside in Sec 1059 Sub 2 CCP
Application required
Procedure regulated in Sec 1063, 1064 CCP
Appealable to Fed Supreme Court

87. Recognition and enforcement of arbitral awards in Germany (Foreign award)
For the recognition and enforcement of foreign arbitral awards Sec 1061 CCP directly refers to the New York Convention of 1958
Recognition occurs automatically provided that no grounds to resist enforcement exist
Request to Appeals Court where debtor or assets are located (Sec 1062, 1063 CCP)
Foreign award is defined pursuant to NYC 1958
Grounds to refuse Enforcement
Lack of a valid arbitration agreement (Art V (1)(a) NYC 1958
Violations of the right to be heard (Art V (1)(b) NYC 1958
Excess of Authority (Art V (1)(c) NYC 1958
Irregularities in the Constitution of the Tribunal (Art V (1)(d)

88. Recognition and Enforcement of arbitral awards in Germany (Foreign awards 2)
Lack of a final and binding award (Art V (1)(e)
Ground that have to be considered “ex officio”
Lack of objective arbitrability (Art V (2)(a)
Violation of public policy (Art V (2) (b)
Annulment of the award in its country of origin constitutes a ground to refuse the declaration of enforceability (Art V (1) (e)