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Emergency arbitration has emerged as a significant tool in the realm of international arbitration, particularly appealing to participants in the oil and gas sector, where interim remedies are often crucial. Despite its increasing use, the enforceability of emergency arbitration awards remains a contentious issue. This article delves into the concept of emergency arbitration in the UAE and practical considerations for parties contemplating this route.
What is Emergency Arbitration?
Emergency arbitration involves appointing an arbitrator to address urgent interim relief requests before the formal constitution of the main Tribunal. This mechanism allows parties to seek immediate relief without resorting to national courts or waiting for the full Tribunal’s appointment. Major arbitration rules, such as those of the International Chamber of Commerce (ICC) and the London Court of International Arbitration (LCIA), have incorporated provisions for emergency arbitration.
Key Features of Emergency Arbitration
Urgency: Designed for situations that cannot wait for the main Tribunal’s constitution.
Interim Relief: Can include measures like interim injunctions and asset freezing orders.
Speed: The ICC and LCIA aim to appoint an emergency arbitrator within two and three days, respectively, of the application. The emergency arbitrator must decide the claim within 14-15 days.
Arbitration Framework and Developments
Currently, UAE arbitration institutes lack specific provisions for emergency arbitration. However, the DIFC-LCIA Arbitration Centre plans to update its rules to align with the LCIA’s provisions, which include emergency arbitration. In practice, parties in the UAE’s oil and gas sector often consent to institutional arbitration that allows for emergency arbitrator relief, while agreeing to Dubai or Abu Dhabi as the arbitration seat.
Practical Considerations
Notice to the Other Party
Most institutions require notifying the other party about the emergency arbitrator application, which might undermine the relief sought, particularly in preventing asset dissipation.
Enforceability Issues
The enforceability of emergency arbitration awards in the UAE is uncertain. UAE courts may not recognize these awards as final, thereby complicating enforcement. This issue isn’t unique to the UAE; other jurisdictions also face similar challenges. However, places like Singapore and Hong Kong have amended their laws to clarify the enforceability of such awards.
National Court Interim Relief
UAE courts can order interim relief even if they lack jurisdiction over the main dispute. This includes asset attachment if there is a valid claim and a risk of asset dissipation.
Time Efficiency
UAE courts typically consider asset attachment applications within 24 hours, making them faster than emergency arbitration in some cases.
When to Consider Emergency Arbitration
Given the challenges, parties in the UAE’s oil and gas sector should consider emergency arbitration when:
– National court relief is unavailable, or the relevant court is perceived as partial or inefficient.
– Confidentiality is paramount.
– The opposing party is likely to comply voluntarily with the emergency arbitrator’s award.
Conclusion
While emergency arbitration offers a valuable tool for urgent interim relief, its application in the UAE remains complex due to enforceability issues and the efficiency of national courts. For further guidance on emergency arbitration in the UAE, reach out to Dubai Lawyers ir reputable law firms in Dubai who specialize in Arbitration law.