International Arbitration Amendment Act 2010 (Cth)

International Arbitration Amendment Act 2010 No. 97, 2010 An Act to amend the law in relation to international arbitration, and for related purposes Contents 1 Short title 2 Commencement 3 Schedule(s) Schedule 1—Encouraging international arbitration Part 1—Amendments International Arbitration Act 1974 Part 2—Application International Arbitration Amendment Act 2010 No. 97, 2010 An Act to amend the law in relation to international arbitration, and for related purposes [Assented to 6 July 2010] The Parliament of Australia enacts: 1 Short title This Act may be cited as the International Arbitration Amendment Act 2010. 2 Commencement (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. Commencement information Column 1 Column 2 Column 3 Provision(s) Commencement Date/Details 1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table The day this Act receives the Royal Assent. 6 July 2010 2. Schedule 1, items 1 to 5 The day this Act receives the Royal Assent. 6 July 2010 3. Schedule 1, item 6 Immediately after the commencement of Schedule 2 to the Federal Justice System Amendment (Efficiency Measures) Act (No. 1) 2009. 7 December 2009 4. Schedule 1, item 7 The day this Act receives the Royal Assent. 6 July 2010 5. Schedule 1, item 8 The earlier of: 7 December 2009 (a) the commencement of Schedule 2 to the Federal Justice System Amendment (Efficiency Measures) Act (No. 1) 2009; and (paragraph (a) applies) (b) the day this Act receives the Royal Assent. 6. Schedule 1, items 9 to 12 The day this Act receives the Royal Assent. 6 July 2010 7. Schedule 1, item 13 The later of: 6 July 2010 (a) the day after the commencement of Schedule 2 to the Federal Justice System Amendment (Efficiency Measures) Act (No. 1) 2009; and (paragraph (b) applies) (b) the day this Act receives the Royal Assent. 8. Schedule 1, items 14 to 24 The day this Act receives the Royal Assent. 6 July 2010 9. Schedule 1, item 25 Immediately after the commencement of Schedule 2 to the Federal Justice System Amendment (Efficiency Measures) Act (No. 1) 2009. 7 December 2009 10. Schedule 1, items 26 to 35 The day this Act receives the Royal Assent. 6 July 2010 Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent. (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act. 3 Schedule(s) Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms. Schedule 1—Encouraging international arbitration Part 1—Amendments International Arbitration Act 1974 1 At the end of Part I Add: 2D Objects of this Act The objects of this Act are: (a) to facilitate international trade and commerce by encouraging the use of arbitration as a method of resolving disputes; and (b) to facilitate the use of arbitration agreements made in relation to international trade and commerce; and (c) to facilitate the recognition and enforcement of arbitral awards made in relation to international trade and commerce; and (d) to give effect to Australia's obligations under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted in 1958 by the United Nations Conference on International Commercial Arbitration at its twenty‑fourth meeting; and (e) to give effect to the UNCITRAL Model Law on International Commercial Arbitration adopted by the United Nations Commission on International Trade Law on 21 June 1985 and amended by the United Nations Commission on International Trade Law on 7 July 2006; and (f) to give effect to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States signed by Australia on 24 March 1975. 2 Subsection 3(1) Insert: data message means information generated, sent, received or stored by electronic, magnetic, optical or similar means, including, but not limited to, electronic data interchange (EDI), email, telegram, telex or telecopy. 3 Subsection 3(1) Insert: electronic communication means any communication made by means of data messages. 4 At the end of section 3 Add: (4) For the avoidance of doubt and without limiting subsection (1), an agreement is in writing if: (a) its content is recorded in any form whether or not the agreement or the contract to which it relates has been concluded orally, by conduct, or by other means; or (b) it is contained in an electronic communication and the information in that communication is accessible so as to be usable for subsequent reference; or (c) it is contained in an exchange of statements of claim and defence in which the existence of an agreement is alleged by one party and not denied by the other. (5) For the avoidance of doubt and without limiting subsection (1), a reference in a contract to any document containing an arbitration clause is an arbitration agreement, provided that the reference is such as to make the clause part of the contract. 5 Subsection 8(2) Repeal the subsection, substitute: (2) Subject to this Part, a foreign award may be enforced in a court of a State or Territory as if the award were a judgment or order of that court. 6 Subsection 8(3) Repeal the subsection, substitute: (3) Subject to this Part, a foreign award may be enforced in the Federal Court of Australia as if the award were a judgment or order of that court. 7 Before subsection 8(4) Insert: (3A) The court may only refuse to enforce the foreign award in the circumstances mentioned in subsections (5) and (7). 8 Subsection 8(4) Omit "subsections (1) and (2) do", substitute "this section does". 9 After subsection 8(7) Insert: (7A) To avoid doubt and without limiting paragraph (7)(b), the enforcement of a foreign award would be contrary to public policy if: (a) the making of the award was induced or affected by fraud or corruption; or (b) a breach of the rules of natural justice occurred in connection with the making of the award. 10 At the end of section 8 Add: (9) A court may, if satisfied of any of the matters mentioned in subsection (10), make an order for one or more of the following: (a) for proceedings that have been adjourned, or that part of the proceedings that has been adjourned, under subsection (8) to be resumed; (b) for costs against the person who made the application for the setting aside or suspension of the foreign award; (c) for any other order appropriate in the circumstances. (10) The matters are: (a) the application for the setting aside or suspension of the award is not being pursued in good faith; and (b) the application for the setting aside or suspension of the award is not being pursued with reasonable diligence; and (c) the application for the setting aside or suspension of the award has been withdrawn or dismissed; and (d) the continued adjournment of the proceedings is, for any reason, not justified. (11) An order under subsection (9) may only be made on the application of a party to the proceedings that have, or a part of which has, been adjourned. 11 Subsection 15(1) Repeal the subsection, substitute: (1) In this Part: confidential information, in relation to arbitral proceedings, means information that relates to the proceedings or to an award made in the proceedings and includes: (a) the statement of claim, statement of defence, and all other pleadings, submissions, statements, or other information supplied to the arbitral tribunal by a party to the proceedings; and (b) any evidence (whether documentary or other) supplied to the arbitral tribunal; and (c) any notes made by the arbitral tribunal of oral evidence or submissions given before the arbitral tribunal; and (d) any transcript of oral evidence or submissions given before the arbitral tribunal; and (e) any rulings of the arbitral tribunal; and (f) any award of the arbitral tribunal. disclose, in relation to confidential information, includes giving or communicating the confidential information in any way. Model Law means the UNCITRAL Model Law on International Commercial Arbitration adopted by the United Nations Commission on International Trade Law on 21 June 1985 and amended by the United Nations Commission on International Trade Law on 7 July 2006, the English text of which is set out in Schedule 2. 12 Subsection 16(2) Insert: arbitration agreement has the meaning given in Option 1 of Article 7 of the Model Law. 13 Section 18 Repeal the section, substitute: 18 Court or authority taken to have been specified in Article 6 of the Model Law (1) A court or authority prescribed for the purposes of this subsection is taken to have been specified in Article 6 of the Model Law as a court or authority competent to perform the functions referred to in Article 11(3) of the Model Law. (2) A court or authority prescribed for the purposes of this subsection is taken to have been specified in Article 6 of the Model Law as a court or authority competent to perform the functions referred to in Article 11(4) of the Model Law. (3) The following courts are taken to have been specified in Article 6 of the Model Law as courts competent to perform the functions referred to in Articles 13(3), 14, 16(3) and 34(2) of the Model Law: (a) if the place of arbitration is, or is to be, in a State—the Supreme Court of that State; (b) if the place of arbitration is, or is to be, in a Territory: (i) the Supreme Court of that Territory; or (ii) if there is no Supreme Court established in that Territory—the Supreme Court of the State or Territory that has jurisdiction in relation to that Territory; (c) in any case—the Federal Court of Australia. 14 After section 18 Insert: 18A Article 12—justifiable doubts as to the impartiality or independence of an arbitrator (1) For the purposes of Article 12(1) of the Model Law, there are justifiable doubts as to the impartiality or independence of a person approached in connection with a possible appointment as arbitrator only if there is a real danger of bias on the part of that person in conducting the arbitration. (2) For the purposes of Article 12(2) of the Model Law, there are justifiable doubts as to the impartiality or independence of an arbitrator only if there is a real danger of bias on the part of the arbitrator in conducting the arbitration. 18B Article 17B—preliminary orders Despite Article 17B of the Model Law: (a) no party to an arbitration agreement may make an application for a preliminary order directing another party not to frustrate the purpose of an interim measure requested; and (b) no arbitral tribunal may grant such a preliminary order. 18C Article 18—reasonable opportunity to present case For the purposes of Article 18 of the Model Law, a party to arbitral proceedings is taken to have been given a full opportunity to present the party's case if the party is given a reasonable opportunity to present the party's case. 15 Section 19 Repeal the section, substitute: 19 Articles 17I, 34 and 36 of Model Law—public policy Without limiting the generality of Articles 17I(1)(b)(ii), 34(2)(b)(ii) and 36(1)(b)(ii) of the Model Law, it is declared, for the avoidance of any doubt, that, for the purposes of those Articles, an interim measure or award is in conflict with, or is contrary to, the public policy of Australia if: (a) the making of the interim measure or award was induced or affected by fraud or corruption; or (b) a breach of the rules of natural justice occurred in connection with the making of the interim measure or award. 16 Section 21 Repeal the section, substitute: 21 Model Law covers the field If the Model Law applies to an arbitration, the law of a State or Territory relating to arbitration does not apply to that arbitration. 16A Division 3 of Part III (heading) Repeal the heading, substitute: Division 3—Additional provisions 16B Section 22 Repeal the section, substitute: 22 Application of additional provisions Application to arbitration under Model Law (1) This Division applies to any arbitration to which the Model Law applies. Application of sections 23, 23A, 23B, 23J, 23K, 25, 26 and 27 (2) Each of the following sections applies to arbitral proceedings commenced in reliance on an arbitration agreement unless the parties to the agreement agree (whether in the agreement or otherwise in writing) that it will not apply: (a) section 23; (b) section 23A; (c) section 23B; (d) section 23J; (e) section 23K; (f) section 25; (g) section 26; (h) section 27. Application of sections 23C, 23D, 23E, 23F and 23G (3) The following sections apply to arbitral proceedings commenced in reliance on an arbitration agreement if the parties to the agreement agree (whether in the agreement or otherwise in writing) that they will apply: (a) section 23C; (b) section 23D; (c) section 23E; (d) section 23F; (e) section 23G. Application of section 23H (4) Section 23H applies on the death of a party to an arbitration agreement unless the parties to the agreement agree (whether in the agreement or otherwise in writing) that it will not apply. Application of section 24 (5) Section 24 applies to arbitral proceedings commenced in reliance on an arbitration agreement if the parties to the agreement agree (whether in the agreement or otherwise in writing) that it will apply. 17 After section 22 Insert: 22A Interpretation In this Division: court means: (a) in relation to arbitral proceedings that are, or are to be, conducted in a State—the Supreme Court of that State; and (b) in relation to arbitral proceedings that are, or are to be, conducted in a Territory: (i) the Supreme Court of the Territory; or (ii) if there is no Supreme Court established in that Territory—the Supreme Court of the State or Territory that has jurisdiction in relation to that Territory; and (c) in any case—the Federal Court of Australia. 18 Section 23 Repeal the section, substitute: 23 Parties may obtain subpoenas (1) A party to arbitral proceedings commenced in reliance on an arbitration agreement may apply to a court to issue a subpoena under subsection (3). (2) However, this may only be done with the permission of the arbitral tribunal conducting the arbitral proceedings. (3) The court may, for the purposes of the arbitral proceedings, issue a subpoena requiring a person to do either or both of the following: (a) to attend for examination before the arbitral tribunal; (b) to produce to the arbitral tribunal the documents specified in the subpoena. (4) A person must not be compelled under a subpoena issued under subsection (3) to answer any question or produce any document which that person could not be compelled to answer or produce in a proceeding before that court. (5) The court must not issue a subpoena under subsection (3) to a person who is not a party to the arbitral proceedings unless the court is satisfied that it is reasonable in all the circumstances to issue it to the person. (6) Nothing in this section limits Article 27 of the Model Law. 23A Failure to assist arbitral tribunal (1) A party to arbitral proceedings commenced in reliance on an arbitration agreement may apply to a court for an order under subsection (3) if a person: (a) refuses or fails to attend before the arbitral tribunal conducting the arbitral proceedings for examination when required to do so under a subpoena issued under subsection 23(3); or (b) refuses or fails to attend before the arbitral tribunal when required to do so by the arbitral tribunal; or (c) refuses or fails to produce a document that the person is required to produce under a subpoena issued under subsection 23(3); or (d) refuses or fails to produce a document that the person is required to produce by the arbitral tribunal; or (e) appearing as a witness before the arbitral tribunal: (i) refuses or fails to take an oath or to make an affirmation or affidavit when required by the arbitral tribunal to do so; or (ii) refuses or fails to answer a question that the witness is required by the arbitral tribunal to answer; or (f) refuses or fails to do any other thing which the arbitral tribunal may require to assist the arbitral tribunal in the performance of its functions. (2) However, an application may only be made under paragraph (1)(b), (d), (e) or (f) with the permission of the arbitral tribunal. (3) The court may, for the purposes of the arbitral proceedings, order: (a) the person to attend before the court for examination or to produce to the court the relevant document or to do the relevant thing; and (b) the person, or any other person, to transmit to the arbitral tribunal one or more of the following: (i) a record of any evidence given in compliance with the order; (ii) any document produced in compliance with the order, or a copy of the document; (iii) particulars of any other thing done in compliance with the order. (4) A person must not be compelled under an order made under subsection (3) to answer any question or produce any document which that person could not be compelled to answer or produce in a proceeding before that court. (5) The court must not make an order under subsection (3) in relation to a person who is not a party to the arbitral proceedings unless: (a) before the order is made, the person is given an opportunity to make representations to the court; and (b) the court is satisfied that it is reasonable in all the circumstances to make the order in relation to the person. (6) Nothing in this section limits Article 27 of the Model Law. 23B Default by party to an arbitration agreement (1) This section applies if a party to arbitral proceedings commenced in reliance on an arbitration agreement: (a) refuses or fails to attend before an arbitral tribunal for examination when required to do so under a subpoena issued under subsection 23(3) (regardless of whether an application is made for an order under subsection 23A(3)); or (b) refuses or fails to produce a document to an arbitral tribunal when required to do so under a subpoena issued under subsection 23(3) (regardless of whether an application is made for an order under subsection 23A(3)); or (c) refuses or fails to comply with an order made by a court under subsection 23A(3); or (d) fails within the time specified by an arbitral tribunal, or if no time is specified within a reasonable time, to comply with any other requirement made by the arbitral tribunal to assist it in the performance of its functions. (2) The arbitral tribunal may continue with the arbitration proceedings in default of appearance or of the other act and make an award on the evidence before it. (3) Nothing in this provision affects any other power which the arbitral tribunal or a court may have in relation to the refusal or failure. 23C Disclosure of confidential information (1) The parties to arbitral proceedings commenced in reliance on an arbitration agreement must not disclose confidential information in relation to the arbitral proceedings unless: (a) the disclosure is allowed under section 23D; or (b) the disclosure is allowed under an order made under section 23E and no order is in force under section 23F prohibiting that disclosure; or (c) the disclosure is allowed under an order made under section 23G. (2) An arbitral tribunal must not disclose confidential information in relation to arbitral proceedings commenced in reliance on an arbitration agreement unless: (a) the disclosure is allowed under section 23D; or (b) the disclosure is allowed under an order made under section 23E and no order is in force under section 23F prohibiting that disclosure; or (c) the disclosure is allowed under an order made under section 23G. 23D Circumstances in which confidential information may be disclosed (1) This section sets out the circumstances in which confidential information in relation to arbitral proceedings may be disclosed by: (a) a party to the arbitral proceedings; or (b) an arbitral tribunal. (2) The information may be disclosed with the consent of all of the parties to the arbitral proceedings. (3) The information may be disclosed to a professional or other adviser of any of the parties to the arbitral proceedings. (4) The information may be disclosed if it is necessary to ensure that a party to the arbitral proceedings has a full opportunity to present the party's case and the disclosure is no more than reasonable for that purpose. (5) The information may be disclosed if it is necessary for the establishment or protection of the legal rights of a party to the arbitral proceedings in relation to a third party and the disclosure is no more than reasonable for that purpose. (6) The information may be disclosed if it is necessary for the purpose of enforcing an arbitral award and the disclosure is no more than reasonable for that purpose. (7) The information may be disclosed if it is necessary for the purposes of this Act, or the Model Law as in force under subsection 16(1) of this Act, and the disclosure is no more than reasonable for that purpose. (8) The information may be disclosed if the disclosure is in accordance with an order made or a subpoena issued by a court. (9) The information may be disclosed if the disclosure is authorised or required by another relevant law, or required by a competent regulatory body, and the person making the disclosure gives written details of the disclosure including an explanation of reasons for the disclosure to: (a) if the person is a party to the arbitral proceedings—the other parties to the proceedings and the arbitral tribunal; and (b) if the arbitral tribunal is making the disclosure—all the parties to the proceedings. (10) In subsection (9): another relevant law means: (a) a law of the Commonwealth, other than this Act; and (b) a law of a State or Territory; and (c) a law of a foreign country, or of a part of a foreign country: (i) in which a party to the arbitration agreement has its principal place of business; or (ii) in which a substantial part of the obligations of the commercial relationship are to be performed; or (iii) to which the subject matter of the dispute is most commonly connected. 23E Arbitral tribunal may allow disclosure in certain circumstances (1) An arbitral tribunal may make an order allowing a party to arbitral proceedings to disclose confidential information in relation to the proceedings in circumstances other than those mentioned in section 23D. (2) An order under subsection (1) may only be made at the request of one of the parties to the arbitral proceedings and after giving each of the parties to the arbitral proceedings the opportunity to be heard. 23F Court may prohibit disclosure in certain circumstances (1) A court may make an order prohibiting a party to arbitral proceedings from disclosing confidential information in relation to the arbitral proceedings if: (a) the court is satisfied in the circumstances of the particular case that the public interest in preserving the confidentiality of arbitral proceedings is not outweighed by other considerations that render it desirable in the public interest for the information to be disclosed; or (b) the disclosure is more than is reasonable for that purpose. (2) An order under subsection (1) may only be made on the application of a party to the arbitral proceedings and after giving each of the parties to the arbitral proceedings the opportunity to be heard. (3) A party to arbitral proceedings may only apply for an order under subsection (1) if the arbitral tribunal has made an order under subsection 23E(1) allowing the disclosure of the information. (4) The court may order that the confidential information not be disclosed pending the outcome of the application under subsection (2). (5) An order under this section is final. 23G Court may allow disclosure in certain circumstances (1) A court may make an order allowing a party to arbitral proceedings to disclose confidential information in relation to the arbitral proceedings in circumstances other than those mentioned in section 23D if: (a) the court is satisfied, in the circumstances of the particular case, that the public interest in preserving the confidentiality of arbitral proceedings is outweighed by other considerations that render it desirable in the public interest for the information to be disclosed; and (b) the disclosure is not more than is reasonable for that purpose. (2) An order under subsection (1) may only be made on the application of a person who is or was a party to the arbitral proceedings and after giving each person who is or was a party to the arbitral proceedings the opportunity to be heard. (3) A party to arbitral proceedings may only apply for an order under subsection (1) if: (a) the mandate of the arbitral tribunal has been terminated under Article 32 of the Model Law; or (b) a request by the party to the arbitral tribunal to make an order under subsection 23E(1) allowing the disclosure has been refused. (4) An order under this section is final. 23H Death of a party to an arbitration agreement (1) If a party to an arbitration agreement dies: (a) the agreement is not discharged (either in respect of the deceased or any other party); and (b) the authority of an arbitral tribunal is not revoked; and (c) the arbitration agreement is enforceable by or against the personal representative of the deceased. (2) Nothing in subsection (1) is taken to affect the operation of any enactment or rule of law by virtue of which a right of action is extinguished by the death of a person. 23J Evidence (1) An arbitral tribunal may, at any time before the award is issued by which a dispute that is arbitrated by the tribunal is finally decided, make an order: (a) allowing the tribunal or a person specified in the order to inspect, photograph, observe or conduct experiments on evidence that is in the possession of a party to the arbitral proceedings and that may be relevant to those proceedings (the relevant evidence); and (b) allowing a sample of the relevant evidence to be taken by the tribunal or a person specified in the order. (2) The tribunal may only specify a person in the order if the person is: (a) a party to the proceedings; or (b) an expert appointed by the tribunal under Article 26 of the Model Law; or (c) an expert appointed by a party to the proceedings with the permission of the tribunal. (3) The provisions of the Model Law apply in relation to an order under this section in the same way as they would apply to an interim measure under the Model Law. 23K Security for costs (1) An arbitral tribunal may, at any time before the award is issued by which a dispute that is arbitrated by the tribunal is finally decided, order a party to the arbitral proceedings to pay security for costs. (2) However, the tribunal must not make such an order solely on the basis that: (a) the party is not ordinarily resident in Australia; or (b) the party is a corporation incorporated or an association formed under the law of a foreign country; or (c) the party is a corporation or association the central management or control of which is exercised in a foreign country. (3) The provisions of the Model Law apply in relation to an order under this section in the same way as they would apply to an interim measure under the Model Law. 19 Subsection 25(1) Omit "Unless the parties to an arbitration agreement have (whether in the agreement or in any other document in writing) otherwise agreed, where", substitute "Where". 20 Section 26 Repeal the section, substitute: 26 Interest on debt under award (1) This section applies if: (a) an arbitral tribunal makes an award for the payment of an amount of money; and (b) under the award, the amount is to be paid by a particular day (the due date). (2) The arbitral tribunal may direct that interest, including compound interest, is payable if the amount is not paid on or before the due date. (3) The arbitral tribunal may set a reasonable rate of interest. (4) The interest is payable: (a) from the day immediately following the due date; and (b) on so much of the amount as remains unpaid. (5) The direction is taken to form part of the award. 21 Subsection 27(1) Omit "Unless the parties to an arbitration agreement have (whether in the agreement or in any other document in writing) otherwise agreed, the", substitute "The". 22 At the end of subsection 27(2) Add: ; and (d) limit the amount of costs that a party is to pay to a specified amount. 23 After subsection 27(2) Insert: (2A) An arbitral tribunal must, if it intends to make a direction under paragraph (2)(d), give the parties to the arbitration agreement notice of that intention sufficiently in advance of the incurring of costs to which it relates, or the taking of any steps in the arbitral proceedings which may be affected by it, for the limit to be taken into account. 23A Section 28 Repeal the section, substitute: 28 Immunity (1) An arbitrator is not liable for anything done or omitted to be done by the arbitrator in good faith in his or her capacity as arbitrator. (2) An entity that appoints, or fails or refuses to appoint, a person as arbitrator is not liable in relation to the appointment, failure or refusal if it was done in good faith. 23B At the end of Division 4 of Part III Add: 30A Severability Without limiting its effect apart from this section, this Part also has the effect it would have if it were confined, by express provision, to arbitrations involving: (a) places, persons, matters or things external to Australia; or (b) disputes arising in the course of trade or commerce with another country, or between the States; or (c) disputes between parties at least one of which is a corporation to which paragraph 51(xx) of the Constitution applies; or (d) disputes arising in the course of trade or commerce in a Territory. 24 Subsection 35(2) Repeal the subsection, substitute: (2) An award may be enforced in the Supreme Court of a State or Territory with the leave of that court as if the award were a judgment or order of that court. 25 Subsection 35(4) Repeal the sub