Law Applicable to Setting Aside Arbitral Awards: An Analysis

Abstract

Choice of law in international commercial arbitration is a topic that has garnered the attention of Indian courts and the academia in the recent past. Despite the manifold case law on the subject, certain courts still get their choice of law analyses wrong. The complex theoretical underpinnings of this important topic and the possibility of different laws operating in international commercial arbitration only complicate the subject. For instance, it is possible that four different laws could apply to an international arbitration: the governing law of arbitration, the substantive law of contract, the law of the arbitration agreement, and the law governing recognition and enforcement of the arbitral award. The complexities are amplified by the lack of clarity on the domain of these laws, the substance-procedure distinction, and various other aspects. One important debate under this intricate subject is the law applicable to setting aside arbitral awards. The issue is whether the law applicable to setting aside the arbitral awards is the law of the arbitration agreement or the law of the seat, where both these laws are different. This paper attempts to provide answers to the issue.

Keywords: Lex Arbitri, Law of the Arbitration Agreement, Law of the Contract, Seat Theory, International Commercial Arbitration, Arbitration and Conciliation Act 1996

JEL Classification: K10, K12, K40