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DRAFTING DISPUTE RESOLUTION

CLAUSES IN INTERNATIONAL SALES
AGREEMENTS
James M. Klotz, Toronto, Canada(1)

{Reprinted from New Jersey Lawyer Magazine, August 2006/ No. 241, pp. 16-22}

I.

INTRODUCTION

International sales agreements have many complexities that the parties need to address,
particularly the intricacies of such fundamental terms as price, payment and delivery. As a result,
short shrift is given to the drafting of outwardly mundane clauses such as those that deal with the
resolution of disputes. Unfortunately, it is usually only long after the contract has been signed and
subsequently disputed that these clauses reveal their lack of due consideration, and then only to
litigators who, by their calling, seldom draft commercial agreements.

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Dispute Resolution Clauses in International Sales Agreements

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-2When given the opportunity to include a dispute resolution term in an agreement, many
drafters feel comfortable with their own standard term, placing the dispute in their own courts, or
if more modern, inserting a reference to ICC arbitration. This is typically done without the parties
appreciating the extent of the costs, the most convenient location for the action or arbitration to
take place or what language the hearing should be held in? What risk does the client want to limit
most? Is it the credit risk the risk of non-payment by the buyer? In this case proceedings in the
buyer
s local Court where the assets are located may be most appropriate. Alternatively, is
it the risk in relation to the liability for failure of a product; for example, an engine for a ship
manufactured in Europe but supplied to a US fishing fleet? In this case, arbitration may be more
appropriate.
What follows is a discussion of some of the issues to consider in drafting the dispute
resolution provisions in international sales agreements.
II.

JURISDICTION, VENUE AND ATTORNMENT CLAUSES

A
jurisdictionor
venueclause provides that any dispute under the agreement must be
resolved in the courts of a specified jurisdiction. In an attornment clause, the parties agree to be
bound by the decisions of the court in a specified jurisdiction (from the rule that jurisdiction over
persons may be conferred by consent). The parties can confer exclusive jurisdiction upon the
courts of one province, state or country in case of a dispute under the agreement, subject to
public policy and statutory matters. This helps ensure that any litigation must be brought in that
place. This may be an important issue of convenience to the parties. In addition, there are
legitimate reasons for avoiding some jurisdictions because of the difficulty in obtaining justice
there. It is a knee-jerk reaction to insert the drafter
s local jurisdiction as the exclusive place for
litigation. In some cases, this may be a good defensive move in order to avoid a foreign litigant,
for example, bringing its judgment to Canada or the US for enforcement. However, in some
export sales, it may ultimately be more advantageous for the Canadian or American seller to sue
the buyer in its home jurisdiction, particularly if the buyer has no assets in Canada or the US. If
so, then inserting a US or Canadian venue provision may actually be more limiting to the seller,
and thus may not be appropriate in all circumstances. In such circumstances, a non-exclusive
clause may be more useful than an exclusive clause. A non-exclusive clause also avoids a problem
intrinsic to an exclusive clause the ability to initiate an action in a forum other than the specified
forum, without being in violation of the clause.
Unlike arbitration, there is no international agreement on the enforcement of foreign court
awards. This can make a venue clause an expensive delaying exercise in litigation time (which can
be good or bad), as the moving party may, in essence, have to litigate the matter twice to get the
claim enforced.
A choice of forum clause in an international contract is presumed valid in Canada and the
US.(2) In fact, the need for predictability and a mutually satisfactory jurisdiction actually lowers
the threshold for such validity (in a domestic transaction, the chosen forum will generally need
some reasonable relationship to the transaction to be followed). Factors to be considered by the
court include whether the contract was bargained for, whether the choice of jurisdiction is
reasonable (for example, a choice by a Canadian or US party doing business in North America to
litigate in Japan, thereby discouraging litigation due to cost, distance and language barriers, would
probably not be enforced), whether the chosen forum will apply any mandatory Canadian or US
law to the dispute, and the impartiality of the forum. Thus Canadian and US courts will generally
enforce a clause that gives a foreign court exclusive jurisdiction. It will be necessary, however, to

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-3raise with lawyers in the foreign jurisdiction as to whether the foreign court will be so respectful
of a like provision giving Canadian or US courts exclusive jurisdiction.
The danger of not having a venue and attornment clause is simply that any court may take
jurisdiction over the matter. Note that when the agreement has an all-encompassing arbitration
clause, a venue and attornment clause conferring exclusive jurisdiction to a specific court is
inconsistent and therefore inappropriate. Real problems arise when an umbrella supply agreement,
for example, contains an arbitration clause, but where the individual shipment order is subject to
terms and conditions with, say, an English jurisdiction clause.
The awarding of legal fees is not necessarily guaranteed in many jurisdictions. In Canada
and England, unlike in the US, legal costs (or attorneysfees) follow the event, so that the winner
in a piece of litigation generally recovers legal costs. When agreeing to a specified venue,
consideration should therefore be given to adding a provision permitting the awarding of legal
fees, and awarding the legal fees and expenses incurred to enforce a judgment.
III.

MEDIATION

Although arbitration may be preferable to litigation through the Courts, arbitration of a

complex international sale agreement is costly, often involving teams of experts and lawyers and
the charges of the arbitrators. While mediation can be agreed to by the parties at any time, drafters
may wish to include a mediation clause in the agreement as a precondition to arbitration (or even
litigation).
Parties in some Middle Eastern and Asian jurisdictions may specify that non-binding
mediation/conciliation take place as a prerequisite to arbitration. If so, care should be taken to
ensure that such a requirement is not a condition precedent to arbitration, as this can affect the
seller
s ability to act swiftly to deal with a difficult customer. Many arbitral organizations have
basic rules for mediations. When not referring to such rules, a mediation clause should have a
specific period of time in which the mediation is to be held (and the rules for so doing), so that the
parties can get on with litigation or arbitration if the mediation process is clearly unable to resolve
the dispute.
IV.

ARBITRATION

Because there are at least two jurisdictions involved in most international agreements, the
parties often agree upon resolving disputes by arbitration. The appeal of arbitration is primarily
due to the existence of the Convention on the Recognition and Enforcement of Foreign Arbitral
Awards, known as the
1958 New York Convention
.(3) This makes it much easier to enforce an
award in a country which is signatory. However, arbitration is not always more appropriate than a
court, and in some jurisdictions, should be avoided altogether.
An arbitration clause can take one of two forms: an institutional provision or an ad hoc
provision. For international sales agreements, it is more common to select an international arbitral
organization administering its own or other institutional rules.
Canadian, US and European sellers usually have several good choices of arbitral
organisations and rules to choose from. For Canadian sellers, the first choice is arbitration in
Canada under provincial rules, such as the International Commercial Arbitrations Act (Ontario).
For US sellers, the first choice is arbitration in the US under the International Arbitration Rules of

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-4the American Arbitration Association (AAA). The other primary choices for Canadian, US, and
European sellers are the International Chamber of Commerce, the Rules of the London Court of
International Arbitration and the UNCITRAL Rules (even though there is no organization).
Occasionally, due to the nature of the other party, somewhat less well-known rules will be chosen,
such as those of the Beijing arbitration institution (CIETAC), or those of the Euro-Arab
Chambers of Commerce.
The appropriate arbitration clause depends upon the circumstances and the negotiating
strengths of the parties. The Rules of the International Chamber of Commerce (ICC) are the
oldest and best known, and are usually acceptable to most parties. However, each set of rules
must be examined to determine which is most appropriate to the issues that may likely arise. The
various arbitral rules are generally similar but not identical. Compared with the AAA rules, for
example, the ICC rules are less specific. The AAA has two sets of general rules, international and
domestic. These provide that during the initial stages the parties must file statements in support of
their claims, whereas the ICC rules provide for the preparation and agreement of the parties on
the terms of reference.
Most of the arbitral institutions provide a short model clause for commencing arbitration.
These clauses do not cover many of the issues that may arise to entangle and retard an arbitration
proceeding (and subsequent enforcement of the award). With thoughtful drafting, these issues can
be reduced or eliminated. In addition to choosing the rules of arbitration, other salient issues
include the number of arbitrators, special qualifications required of the arbitrators, time limits, the
language of arbitration, the place of arbitration, the disputes to be covered by arbitration, and the
substantive law to govern the dispute. The resulting clause, however, is much longer than the
model clause of each arbitral body.
A.

Drafting the Arbitration Clause

Specific care must be exercised in determining the types of disputes that are arbitrable.
Departing from the specific wording of the standard institutional clauses may be dangerous if
done without consideration. For example, the specific wording is slightly different in each model
clause, such as
all disputes arising in connection withcompared with
any and all disputes,
claims or controversy
. Courts in the US have found the former clauses to be non-inclusive and
they can give rise to circumstances whereby an arbitration panel can be denied jurisdiction. The
word
controversyis generally accepted as having the broadest meaning.
Two examples of popular model clauses are below:
ICC Model Arbitration Clause
All disputes arising out of or in connection with the present contract shall be
submitted to the International Court of Arbitration of the International Chamber
of Commerce and shall be settled under the Rules of Arbitration of the
International Chamber of Commerce by one or more arbitrators appointed in
accordance with the said Rules.
AAA Model Arbitration International Clause
Any controversy or claim arising out of or relating to this contract, or the breach
thereof, shall be determined by arbitration administered by the International

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-5Centre for Dispute Resolution in accordance with its International Arbitration

Rules.(4)
Parties wishing to avoid arbitration despite the existence of an arbitration clause in a
contract, will look for any opportunity to bring the matter before a court. By embellishing the
above clauses with:
Any dispute arising out of or in connection with this contract, its negotiation,
performance, breach, existence or validity;
the arbitrators are empowered with jurisdiction over the validity of the contract itself, and even
over tortious acts which surround the contract such as fraud and misrepresentation.(5)
Alternatively, the parties may not be willing to permit all matters to be arbitrated, for
example, in cases where the terms of an express warranty have been breached by the seller. If so,
the clause may be written to cover only specified disputes. Drafting the clause in such a limited
manner does leave room for the other party to possibly manoeuvre the dispute into court. A
further option is to draft the arbitration clause so that it covers all disputes with the exception of
certain specific issues. For example, where a seller may not wish to have the validity of its US
patent determined in an arbitration proceeding, it can exclude that issue from the clause. Likewise,
disputes over payment by a buyer are matters that a seller may not wish to permit to proceed to
arbitration.
In addition to considering exclusionary matters, the seller may wish to consider those
matters for which recourse to the courts is the sole practical temporary remedy, for example,
where injunctive relief is required immediately, or where relief against third parties is necessary,
particularly if the arbitral tribunal has not yet been formed.
B.

Ad Hoc Arbitration

In an ad hoc arbitration clause, the parties provide for arbitration without reference to any
particular institutional arbitral organization. They are free to select the rules to be applied in the
arbitration. The most important issue in an ad hoc arbitration lies in determining how to solve any
dispute relating to the appointment of arbitrators. For example, in an agreement covered by
Ontario law, this problem will be gap-filled by the International Commercial Arbitration Act
(Ontario). Alternatively, the appointing authority can be the ICC (6), the president of a court, or
any other appropriate neutral authority which inspires confidence in the parties. The most popular
rules used as a basis for proceeding to ad hoc arbitration are the Arbitration Rules of UNCITRAL
(which are not truly ad hoc since the rules pre-exist despite the fact that there is no governing
body).(7)
C.

Place of Arbitration

Choosing the proper place to arbitrate is important because this will determine the
enforceability of the award and the procedural law to be followed. As important as this is, many
arbitration clauses do not specify the place of arbitration, and few specify the procedural rules
(which can be critical to the rights of the parties and to the subsequent enforcement of the award).
By choosing a site for arbitration, and by choosing the procedural rules, the parties are able to
save on costs of the arbitral panel as it otherwise must attempt to resolve these issues.(8)

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-6In choosing a site for arbitration, the basic considerations are limited to the general legal
climate and neutrality of the site and the likelihood of enforcement of the award in the host
country and in the countries of the parties. Signatories to the 1958 New York Convention have
bound themselves by treaty to enforce foreign arbitral awards. There are 136 countries, including
Canada, the US and England, that are signatories to the 1958 New York Convention which is the
primary treaty governing the enforcement of non-domestic arbitral awards.(9)
However, even among signatory countries to the 1958 New York Convention, some
jurisdictions are known for their willingness to uphold arbitral awards, such as Switzerland,
France, Sweden and Canada. Others are apparently more receptive to challenges against an
award, such as England and Australia (although the general move is moving towards enforcement
of arbitral awards). The modern trend in the US is toward greater recognition of arbitral awards,
both foreign and domestic. Accordingly, where the foreign country is a 1958 New York
Convention signatory and has a record of enforcing arbitral awards, that country may be an
acceptable place to hold the arbitration. Nonetheless, it may still be considered tactically useful to
choose a neutral third country that is also a signatory.
The danger of arbitrating a matter in a country which does not observe the rule of law, but
which is a 1958 New York Convention signatory, should be noted. While an extraordinary court
judgment from such a country may be difficult to enforce in the US or Canada, the same may not
be the case for an extraordinary arbitral award.
It is important to note that the 1958 New York Convention is an enforcement mechanism
for
foreignawards only. If the arbitration is held in a particular country, the courts in that
country will be asked to enforce a domestic arbitration award, rather than enforcing the award
based upon the 1958 New York Convention. The issue will be whether the country enforces its
own domestic arbitrations. Thus, another consideration in choosing the place of arbitration must
be whether the other party
s home nation or other country where it has assets, would be more
likely to enforce a domestic or foreign arbitral award (or neither).
The following clause determines the place of the arbitration and the law applicable.
Place of Arbitration
The place of arbitration shall be [country] and the law applicable to the
arbitration procedure shall be determined by referring to the law of the place of
arbitration.
Note that the clause above relates only to the procedural (gap-filling) law of the arbitration (which
is most often, the law of the site of the arbitration). It is better to be clear in the choice of law
with respect to both substantive and procedural law as the general choice of law provision may
cover only the substantive law issues. Foreign counsel will be required, however, to advise on
local procedural or substantive law (or both).
D.

Discovery and Procedure

One of the perceived advantages of arbitration is the lack of far-reaching discovery, as is

often encountered in US proceedings. Most arbitration rules leave the issue of discovery to the
discretion of the arbitrators, who, depending on their legal grounding, may be unfamiliar with
discovery issues. As a result, it has increasingly become the practice in international commercial

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-7arbitration to include a discovery provision in the arbitration clause or in the terms of reference,
and once proceedings are underway, incorporating the IBA Rules on the Taking of Evidence in
International Commercial Arbitration. These rules, published in 1999, provide mechanisms for the
presentation of documents, witnesses of fact, expert witnesses and inspections, as well as for the
conduct of evidentiary hearings.
E.

Number and Qualities of Arbitrators

Standard model clauses do not generally specify how many arbitrators there will be.
Specific arbitral rules often provide for one arbitrator if the parties agree, and three if they cannot
agree. However, the parties may specify their choice in the arbitration clause if they know in
advance that they desire a sole arbitrator or a three-arbitrator panel. Few arbitration rules have
provision for any other combinations. A single arbitrator is usually recommended as it is less
expensive that having more arbitrators.
Many arbitration clauses require a highly structured process to choose arbitrators.
Although it is difficult to predict the kind of arbitrator that may be required for an arbitration in
the future, the parties may wish to specify the qualifications or experience required by the
arbitrator. Another option is to agree upon the required qualifications or experience once the
dispute has arisen. The ICC, for instance, will endeavour to appoint an arbitrator with the
requested qualifications agreed by the parties. For example, in a dispute over complex warranty
claims, the seller may wish the arbitrator to have some engineering experience or degrees of
higher learning.
Some international sales agreements often have more than two parties. This raises further
considerations when drafting an arbitration clause. As arbitrations under most rules permit only
one or three arbitrators, consideration should be given to the inclusion of language that ensures
that one party is not disadvantaged in not being able to choose an arbitrator. Note, however, that
in attempting to draft such a provision, the complexities may be overly difficult. Most arbitration
rules fail to address the consolidation of claims where common questions of fact or law affect
multiple parties, but arise under separate agreements in some types of international sales
transactions.This is a matter the parties may wish to address in the arbitration clause or leave to
the time of arbitration. Multi-party arbitrations are becoming frequent occurrences. Arbitral
institutions have an increasing number of cases involving multi-party claimants and/or defendants
(10).
The 1998 ICC Rules of Arbitration (Rules) now deal with the joinder or consolidation of
arbitral proceedings. Article 4(6) of the Rules proposes a mid way solution allowing the parties to
agree to join or consolidate arbitrations independently from the ICC framework. When a party
submits a Request in connection with a legal relationship in respect of which arbitration
proceedings between the same parties are already pending, the Court, at the request of a party,
may decide to include the claims contained in the Request in the pending proceedings provided
that the Terms of Reference have not yet been signed or approved by the Court. The consent of
all parties is not required as a condition for any such joinder. Alternatively, a party may request
the joinder of a third party. The Rules do not have a provision dealing with this issue. However, it
is possible in practice to join a third party subject to specific conditions being met.

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-8G.

Language of Arbitration

The arbitration clause should provide which language the arbitration will be conducted in.
Until recently, for example, arbitrations in China were required to be conducted in the Chinese
language only. If parties can agree on a single language, they will benefit from the cost savings of
such a measure, particularly where the arbitrators may otherwise speak different languages. Note
that in the Language clause in the agreement, the drafter may wish to ensure that all
correspondence, discussions and settlement negotiations prior to and in connection with any
arbitration proceedings also be in the specified language, as considerable savings of time and
expense can be achieved (as well as the avoidance of ambiguity). This will also assist in speeding
up the selection of suitable arbitrators.
H.

Finality of Award

In some countries, such as China, arbitral awards are not open to review by courts,
whereas in other countries, courts will readily review an award for errors in law. Where the
parties do not wish to permit court interference, the clause should be drafted clearly to that effect.
Doing so will reduce the likelihood of a party attempting to re-litigate matters already dealt with
in the arbitration. If the clause below is used, it will often prevent the retrying of any issue which
has been
presented or pledin the arbitration, regardless of whether it is dealt with in the award.
Note however that courts in Canada and the US will overturn an award for a manifest disregard
of the law and in England, it is not possible to exclude a party
s right to appeal to the Court on
the basis of a substantial irregularity in the proceedings.
Arbitration Award Sole Remedy
The parties agree that the award of the arbitrators shall be the sole and exclusive
remedy between them regarding any claims, counterclaims, issues or accountings
presented or pled to the arbitrators. The decision of the arbitrator(s) shall be
final and binding and not subject to review by any court.
In terms of enforcement, the ICC, though expensive, is often a good choice for
institutional arbitration. Its prominence in the international community may make it easier to
enforce arbitral awards in other countries than lesser known rules (including Canadian, US, and
English rules). ICC awards also benefit from their review prior to release by the ICC Court of
Arbitration, which has the authority to revise the form of the award and point out to the arbitrator
areas which may have been inadequately addressed. This results in a certain level of consistency in
the award.
I.

Currency of Award

The drafter can require that any arbitration award be issued in a specific currency. This
provision makes the award easier to enforce, particularly where restricted currencies may be
involved. This request usually comes from US parties who prefer to have all matters settled in US
dollars (in fact, many of the arbitral institutions, including the ICC, charge their fees in US
dollars). As the award is intended to be a global settlement of all disputes, the clause should
provide that the award is free from offset or other claims.

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-9J.

Costs

Most arbitral rules provide that awarding the costs of the arbitration proceeding is in the
discretion of the arbitrators. Since the enforcement of arbitral awards can be a costly exercise, the
clause should specifically permit the enforcing party to recovery its costs against the resisting
party. The definition of
costsshould be as broad as possible, and written to include any court
costs, judgment registration fees, or taxes.
K.

Interest

Interest on an award can often be a substantial part of the award in itself, particularly if

pre-judgmentinterest is awarded. However, unless the arbitration clause provides otherwise,

arbitrators are generally under no obligation to award interest, or if interest is granted, to specify a
commercial rate. However, failure to include an interest provision is not it itself a bar to claiming
interest. In those circumstances where the inclusion of a pre-judgment interest clause makes the
arbitration clause too unwieldy to negotiate, the drafter may choose to accept an interest
provision for post-judgment interest only.
L.

Sovereign Immunity

When entering into sales transactions with sovereign parties (such as foreign governments
or state agencies), caution must be exercised when agreeing to arbitration as a method of
resolving disputes. In many countries, the fact that a sovereign party entered into a sales
agreement containing an arbitration clause does not mean that it has given a waiver of sovereign
immunity from execution and related proceedings. In these situations, the drafter should insert an
explicit waiver of immunity from jurisdiction and a waiver of immunity as to the execution of the
award. This clause in itself will not ensure enforcement of an award, but may assist in succinctly
responding to one of the defences raised when attempting to enforce the award.
M.

Specific Performance During Arbitration

If the United Nations Convention on Contracts for the International Sale of Goods (the

CISG
) applies, Articles 46 and Article 62 provide that the buyer or seller may require the other
party to continue to perform the agreement, notwithstanding that it has commenced arbitration
(or other) proceedings. There are two approaches to this problem. The first is to require both
parties to continue, where possible, all obligations under the agreement notwithstanding an
arbitration, including the making of payments due by the buyer. This clause is particularly
dangerous for a buyer. In certain circumstances, the buyer could learn of facts which lead to
conclusively believe that the goods supplied by the seller will ultimately fail in their use. With such
a clause, the buyer would be forced to pay the seller during the arbitration proceeding, and hope
that the seller still has the funds available when the award goes to the buyer. Alternatively, the
parties can opt out of Articles 46 and 62 of the CISG, and avoid the application of specific
performance to the contract. Again, in some situations, for example, where the buyer is relying on
key equipment and wishes to have it delivered notwithstanding that it may be defective, this clause
would not be appropriate.
In some countries, arbitration tribunals are unable to order non-monetary relief. Under
some arbitral rules, unless awards of specific performance are expressly permitted by the
agreement to arbitrate, they will not be permitted. Thus, the parties may wish to consider a

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- 10 provision permitting the arbitral tribunal to award both provisional and final specific performance
or just final specific performance.
N.

Timing of Arbitration; Delivery of Award

Most arbitral rules determine how quickly arbitrations must commence. The procedural
rules, however, can delay the commencement of an arbitration for quite a long time. Some rules
mandate how long an arbitration takes. For example, the ICC requires the award to be issued six
months from the date of the signing of the terms of reference for the arbitration or the approval of
the Terms of Reference by the Court. The parties may wish to insert some modest language to
indicate that the proceedings should be held promptly, and permit the arbitrators to set the pace or
set out the timelines for each phase of the arbitration in detail, including when the award is to be
rendered.
Once the arbitration has ended, the arbitrators must render an award. Not all arbitral rules
require arbitrators to deliver reasons for their decision. The drafter should read the arbitral rules,
and if necessary, insert a requirement for detailed written reasons.
O.

Confidentiality

One of the reasons for choosing arbitration as a method of resolving disputes is the fact
that the dispute is not heard in an open forum. However, parties may often assume that because
the forum is closed, the information gleaned is confidential. This supposition is nave. While many
(but not all) arbitration rules contain provisions imposing confidentiality upon the arbitrators and
administrators, there are no rules imposing confidentiality upon the participants. Thus, in addition
to the confidentiality provisions which may (or may not) be found elsewhere in the agreement, the
drafter may wish to insert a specific confidentiality provision relating to the arbitration
proceeding.
P.

Costs

In recommending the use of an arbitration clause, it is useful to advise the client of the
minimum cost of the procedure. Some arbitral associations require a substantial deposit to be
paid.

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James M. Klotz

Dispute Resolution Clauses in International Sales Agreements

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- 11 -

Endnotes
1.

This paper began as a lengthy chapter in the author

s text, International Sales Agreements: An Annotated
Drafting and Negotiating Guide published by Canada Law Book, in 1997. Thereafter, it was updated by
Jonathan Wood of Clyde & Co, Guilford, in 2003 and again in 2005, for which the author is extremely
grateful, in particular with respect to the EU and the ICC. Since then, it was further updated by the
author, and presented at the International Bar Association 2005 Annual Meeting in Prague, Czech
Republic at a program entitled
Dispute Resolution Clauses - A Practical Approach(a joint session
between the International Sales Committee and the Dispute Resolution/Arbitration Committee). It has
since been modified and significantly abridged by the author for this publication.

2.

M/S Bremen v. Zapata Off-Shore Co. (1972), 407 U.S. 1, 92 S.Ct. 1907, 32 L.Ed.2d 513.

3.

330 U.N.T.S. 38 (June 10, 1958). Discussed in further detail under the heading Place of Arbitration, infra.

4.

The International Centre for Dispute Resolution is the international division of the AAA which
administers international commercial cases. See AAA website http://www.adr.org

5.

Referred to as Kompetenz-Kompetenz in Civil Law jurisdictions.

6.

See ICC website http://www.iccwbo.org/court/english/appointing_authority

7.

G.A. Res. 31/98, 31 U.N. GAOR Supp. (No. 39) U.N. Doc. A/31/39 (1976).

8.

Most arbitral rules contain a mechanism for determining where the arbitration will take place, although it
may take months for such a determination to occur. For example, the International Rules of the AAA
provide that where the parties disagree, the place of arbitration
may initially be determined by the
administrator, subject to the power of the tribunal to determine finally the place of arbitration within 60
days after its constitution. In the ICC Rules of Arbitration, the place of arbitration will be fixed by the
International Court of Arbitration of the ICC unless agreed upon by the parties (Article 14).

9.

The current list of countries which have acceded to the 1958 New York Convention (as at May 14, 2006)
is as follows: Afghanistan, Albania, Algeria, Antigua and Barbuda, Argentina, Armenia, Australia,
Austria, Azerbaijan, Bahrain, Bangladesh, Barbados, Belarus, Belgium, Benin, Bolivia, Bosnia and
Herzegovina, Botswana, Brazil, Brunei Darussalam, Bulgaria, Burkina Faso, Cambodia, Cameroon,
Canada, Central African Republic, Chile, China, Colombia, Costa Rica, Cote d
Ivoire, Croatia, Cuba,
Cyprus, Czech Republic, Denmark, Djibouti, Dominica, Dominican Republic, Ecuador, Egypt, El
Salvador, Estonia, Finland, France, Georgia, Germany, Ghana, Greece, Guatemala, Guinea, Haiti, Holy
See, Honduras, Hungary, Iceland, India, Indonesia, Iran (Republic Islamist of), Ireland, Israel, Italy,
Jamaica, Japan, Jordan, Kazakhstan, Kenya, Kyrgyzstan, Kuwait, Lao People
s Democratic Republic,
Latvia, Lebanon, Lesotho, Liberia, Lithuania, Luxembourg, Madagascar, Malaysia, Mali, Malta,
Mauritania, Mauritius, Mexico, Monaco, Mongolia, Morocco, Mozambique, Nepal, Netherlands,
Nicaragua, New Zealand, Niger, Nigeria, Norway, Pakistan, Panama, Paraguay, Peru, Philippines,
Poland, Portugal, Qatar, Republic of Korea, Republic of Moldova, Romania, Russian Federation, Saint
Vincent and the Grenadines, San Marino, Saudi Arabia, Senegal, Serbia and Montenegro, Singapore,
Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Syrian Arab Republic,
Thailand, The former Yugoslav Republic of Macedonia, Trinidad and Tobago, Tunisia, Turkey, Uganda,
Ukraine, United Kingdom, United Republic of Tanzania, United States of America, Uruguay, Uzbekistan,
Vietnam, Venezuela, Zambia, Zimbabwe. Note that many of the signatory countries have made
reservations under the Convention. UNCITRAL Status of Conventions see UNCITRAL website:
http://www.uncitral.org./uncitral/en/uncitral_texts/arbitration/NYConvention_status.html.

10.

See ICC International Court of Arbitration Bulletin Vol. 16/No.1

James M. Klotz

Dispute Resolution Clauses in International Sales Agreements

September, 2005