The legal landscape of arbitration in the United Arab Emirates (UAE) has transformed with the enactment of Federal Decree-Law No. 15 of 2023. These amendments, effective on September 16, 2023, signify a progressive shift in the UAE’s arbitration framework. Let’s delve into the core modifications:
1. A Closer Look at Article 10
Let’s start by dissecting the amendments to Article 10, a cornerstone of the Federal Arbitration Law No. 6 of 2018. The revisions bring forth a robust set of qualifications for arbitrators, emphasizing the need for independence and impartiality. Notably, arbitrators are now explicitly prohibited from having any direct relationship with the parties involved in arbitration cases. This prohibition serves as a safeguard to ensure the utmost impartiality and integrity in the arbitration process.
However, the term “direct relationship” leaves room for interpretation, and future case law is expected to provide clarity on its nuances. Practitioners are advised to keep an eye on evolving interpretations and potential disputes arising from this provision. While awaiting further judicial guidance, the 2014 IBA Guidelines on Conflicts of Interest in International Arbitration can serve as a valuable soft reference, offering scenarios illustrating both direct and indirect relationships.
The amendment retains the disqualification criteria for arbitrators with felony or misdemeanor convictions involving moral turpitude or dishonesty. This consistency with the previous regime underlines the UAE’s commitment to upholding ethical standards in arbitration proceedings.
2. Article 10bis and Arbitrators from Regulatory Bodies
A groundbreaking addition brought about by Federal Decree-Law No. 15 of 2023 is Article 10bis. This provision introduces a novel dimension to arbitrator appointments by allowing individuals from supervisory or regulatory bodies of arbitration institutions to serve as arbitrators. The conditions for such appointments are comprehensive, covering aspects such as governance regulations, limitations on case numbers, and the requirement for parties’ written acknowledgment without objections.
The potential consequences of non-compliance with Article 10bis are significant. Any violation of the specified conditions results in the annulment of the arbitral award and provides parties with the right to seek civil damages. This legal recourse extends to claims against both the responsible arbitration institution and the arbitrator found to have breached the conditions. The implications underscore the importance of strict adherence to the prescribed requirements by both arbitrators and institutions. While the inclusion of Article 10bis opens new possibilities for arbitrator appointments, the stringent conditions and potential consequences make it a cautiously navigable path. As of now, the likelihood of widespread use of this exception remains uncertain, given the multiple eligibility criteria and the potential for broadened bases for annulment.
3. Virtual Hearings and Confidentiality
Moving into the realm of procedural flexibility and technological adaptation, Articles 23, 28, and 33 present noteworthy changes.
Article 23 emphasizes party autonomy, allowing them to agree on arbitration procedures, and incorporating rules from domestic and foreign arbitration institutions. In the absence of such agreements, arbitral tribunals are granted the discretion to establish procedures in compliance with UAE law.
Article 28 explicitly recognizes and embraces the option of virtual hearings. Parties are now empowered to decide whether arbitration should occur in a physical location or virtually, reflecting a commitment to modern technological advancements. This shift places a significant responsibility on arbitral institutions to furnish the necessary technologies, ensuring alignment with the state’s standards and controls.
Article 33 introduces increased flexibility for arbitral tribunals in managing arbitration proceedings. Notable changes include the discretion to choose between oral hearings or a “documents-only” basis for evidence presentation. The default classification of arbitration proceedings as confidential further enhances security and trust, addressing concerns related to sensitive information disclosure.
In essence, these amendments promote efficiency, transparency, and adaptability in arbitration proceedings, aligning the UAE with global trends and solidifying its stance in the digital age. For those navigating the intricacies of these legal amendments, seeking guidance from legal professionals is a prudent step. Dubai lawyers, legal consultants, and arbitration experts can provide invaluable assistance in understanding the nuances of Federal Decree-Law No. 15 of 2023. Their expertise can streamline the process, ensuring compliance with the amended provisions. Don’t hesitate to reach out to legal professionals to navigate this transformative legal landscape effectively.