SIAC’S 2019 STATISTICS SIAC ARBITRATION TRAINING

VIDEO- 1 INTRO
-Increase in number of cases and women
arbitrator For arbitration to occur:
-Chairman, Davinder Singh Contractual Agreement/Recognition by
Legal System
-CEO, SIAC: Lim Seok Hui
1. Meeting of minds between parties,
-SIAC : third most preferred arbitral
represented by a contractual agreement to
institution.
resort to such a process for resolving their
-80% of cases are international in nature dispute.

-average scrutiny time frame: 12.4 days
-33 members of the SIAC Court of
Arbitration
-Pres: Gary Born; V.Pres: Lucy Reed and
Cavinder Bull
-Young SIAC (composed of young
arbitrators from 14 jurisdictions): 4,300
lawyers from 100+jurisdictions
-Emergency Arbitrator Mechanism
-Exoedited Procedure fast track
-Early Dismissal of claims and defenses
-(SIAC-SIMC); their aim to make Singapore
the leading dispute resolution hub
-SIAC Academy
2. The relevant legal system must recognize
and submit such a process
Why arbitration?
Neutrality, Enforceability, Confidentiality
1. Cost and time efficient
2. More flexible process
3. Option to choose the people who will
decide
Forms of Arbitration:
1. Ad-hoc: pursuant to a procedure agreed by
parties or laid down by the tribunal
2. Institutional: administered by a specialist
arbitral institution, under its own rules of
arbitration
Expedited and emergency
procedure/arbitration: most used
mechanism in SIAC

3- COMMENCING THE
ARBITRATION
1. Notice of Arbitration

Samaniego, H.
-to be submitted to the SIAC via paper/letter
or email
-Applicable rule: SIAC Rule 3.1
2. Emergency Arbitration feature by SIAC
3. Guaranty encashment by Oceania v.
Asianix
4. Indian Arbitration and Conciliation Act
(Sec.9)
-Based on UNCITRAL Model (Art 9)
-not the route they chose because it could be
very problematic
How could you ensure that the arbitration
award will be enforced by the parties, if
the court is seated in SG?
It all depends. But one thing is for sure,
institutional arbitration is much better than
the Ad hoc one. Very good internal rules,
system, etc.
How much is this gonna cost you?
-SIAC will set the maximum and send it to
the parties.
Costs of the arbitration (Rule 31, SIAC
RULES 2013)
1. Tribunal fees and expenses
2. SIAC’s admin fees and expenses
3. Costs of expert advice or other assistance
require (est by adding 20-25% of the tribunal
and admin fees)
st
Three tranches:35-35-30; 1 tranche:
payment is immediate (born equally by the
parties initially but eventually it’s usually
paid by the losing party)
EMERGENCY ARBITRATION
HEARING
-Filed a NOA on December 15, 2013 with
SIAC
- Injunction on the Bank Guaranty
- Emergency Arbitrator
-Complainant: Any implication of the bank
guaranty is premature and is therefore
illegal.; because theres no determination yet
that they are entitled to invoke the bank
guaranty. There is an urgency to this matter.
The company has a prima Facie case against
respondent by virtue of the supplier
agreement and that respondent would not be
prejudiced for not being able to invoke the
bank guaranty at this time.
-Respondent: contract for the supply of
goods. Indian law is relevant for the question
of the bank guaranty. There’s no urgency
simply because theres no harm to the
claimant, whatsoever.
Emergency Arbitrator: asks the claimant’s
counsel if the clamant would be amenable to
cover loss in case ultimately it’s found that
respondent is entitled to the bank guaranty.
-Emergency relief will be submitted by the
Emergency Arbitrator and submits it to
SIAC.
5- RESPONDING TO SIAC AND
APPOINTING THE ARBITRATORS
-Tribunal: 3 (usually)
-each party will make a nomination of their
arbitrator and the arbs that they’ve nominated
will nominate the third arb.
-if they can’t choose which arb to appoint, the
pres of SIAC will choose who to appoint.
Samaniego, H.
- SIAC could still render an award even if
respondent doesn’t want to participate.
- If the tribunal decides against them, it’s not
an option to file an appeal with the regular
courts. Arbitral award is final and binding
between the parties. You could only go to
court if there’s abuse of discretion or unlikely
conduct on the part of the arbitral institution.
-After notice is given, the respondent has
to respond within 14 days to both the SIAC
and claimant.
-CONFLICT OF INTEREST: you cannot
just appoint someone who’s biased in favor
of you, like your in-house counsel;
independent and impartial arbitrator, a
paramount importance to SIAC (strict code of
ethics)
6- CHALLENGE TO THE
ARBITRATOR
-Ground of the complainant: Father in law of
the respondent’s legal counsel’s son.
- SIAC Rule 12. Casts justifiable doubt
against the arbitrator.
Rule 11: Challenge of Arbitrators
11.1 Any arbitrator may be challenged if circumstances exist that give rise to justifiable doubts as to the
arbitrator's impartiality or independence or if the arbitrator does not possess any requisite
qualification on which the parties have agreed.
11.2 A party may challenge the arbitrator nominated by him only for reasons of which he becomes aware
after the appointment has been made.
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Rule 12: Notice of Challenge
12.1Subject to Rule 10.6, a party who intends
to challenge an arbitrator shall send a
notice of challenge within 14 days after
the receipt of the notice of appointment
of the arbitrator who is being challenged
or within 14 days after the circumstances
mentioned in Rule 11.1 or 11.2 became
known to that party.
12.2The notice of challenge shall be filed
with the Registrar and shall be sent
simultaneously to the other party, the
arbitrator who is being challenged and
the other members of the Tribunal. The
notice of challenge shall be in writing
and shall state the reasons for the
challenge. The Registrar may order a
suspension of the arbitration until the
challenge is resolved.
12.3When an arbitrator is challenged by one
party, the other party may agree to the
challenge. The challenged arbitrator may
also withdraw from his office. In neither
case does this imply acceptance of the
validity of the grounds for the challenge.
12.4In instances referred to in Rule 12.3, the
procedure provided in Rules 6, 7, 8 or 9,
as the case may be, shall be used for the
appointment of the substitute arbitrator,
even if during the process of appointing
the challenged arbitrator, a party had
failed to exercise his right to nominate.
The time-limits provided in those Rules
shall commence from the date of receipt
of the agreement of the other party to the
challenge or the challenged arbitrator’s
withdrawal.
7- COURT OF ARBITRATION
DECIDES THE CHALLENGE
Grounds raised by the complainant:
Samaniego, H.
1. The chosen arbitrator by the respondent
received a “reasonable”sum from its previous
appointment as arbitrator for them (Not a
strong ground to remove the arb)
2. their legal counsel’s daughter is married to
the son of the chosen arbitrator
-justify doubts as to the arbitrator’s
impartiality and independence
-Orange list: guideline in the disqualification
of arbitrators
- If further info is needed to decide: SIAC
could reach out to the parties
-Court: Claimant’s challenge is rejected;costs
against the claimant for the challenge
8- THE PROCEEDINGS EARLY
STAGES
Preliminary Conference via live
teleconference
-to decide on the schedule and nuances of the
procedure
-Pres officer: Michael Hwang SC/; takes the
lead of the proceedings but coordinates with
other arbs
-Bifurcation (division into two parts) of the
issues: Jurisdiction and Merits
- Venue; Transciptionist;
-time and cost advantage: why there’s
bifurcation of issues
9- HEARING ON JURISDICTION-
ORAL ARGUMENTS (RESPONDENTS)
-One day hearing for jurisdiction issue
-Maxwell Chambers: arbitration venue with
great coffee hahah!
- Respondent: resolution of corruption
tainted disputes by arbitration furthers this
scheme and violates public policy; claimant
engaged a middleman who bribed the
minister of power of Zurasia.
Respondent:
-Contract between the parties is tainted
with illegality; it was secured through
corrupt payments made by a middleman.
-engaged a middleman and bribed the
power minister to strongly recommend that
electro ace award the powerplant contract
Legal Position: Corruption has long been
applied in securing international contract;
has long been applied in commercial world;
Undue advantages to some, disadvantages
to others; great economic cost to the nation
involved if the contract is of national
importance; a loss of ease in doing business
and a loss of goodwill within the business
world
1st argument: the illegality of bribing
public officials is considered part of
transnational public policy
- This is a well documented rule of
TPP. This has been recognized in a
number of international
conventions including the UN
Convention against Corruption
(Articles 15 to 19), as well as the
OECD Convention on combating
bribery of foreign public officials in
international business transactions
(Article 1).
- A number of court decisions in
arbitral awards support this view as
well such as ICC case 8891 of 1998,
Samaniego, H.
 Hotels in Egypt an exit decision,
and X limited and YBV which are
all contained in our bundle of
authorities.
- The Zurasian law too joins the
world in declaring bribery of public
officials illegal and the punishment
for such conduct in Zurasia is
stringent.
- Thus it is clear, by int’l consensus,
bribery and corruption are to be
condemned as morally unacceptable
and economically disastrous.
2nd argument: arbitration cannot endorse a
violation of transnational public policy.
This tribunal cannot be permitted to decide
the merits of this dispute.
- what may happen when arbitration
enters the picture?
- the use of arbitration agreements to
resolve tainted disputes actually
furthers criminal schemes and
violates public policy over where
such disputes do arise the
arbitration agreement would be
unenforceable
- International arbitration must not be
used as a tool to further unlawful
contracts.
- This principle was most famously
expressed by Judge Lagarith? In
1961 in ICC case 1110. He declined
jurisdiction over an agent’s claim
for commission because he had
been retained to bribe Argentinian
govt officials to secure a govt
contract, and in his words, “parties
who ally themselves in an enterprise
of the present nature must realize
that they have forfeited any right to
ask for assistance of the machinery
of justice, national courts or arbitral
tribunals in settling their disputes.
- In another case, World Duty-Free
Company, Ltd. V. Republic of
Kenya, an exit tribunal dismissed
the claimants claim upon discovery
that the contract under which the
claims were brought was procured
pursuant to a cash bribe to the then
Kenyan Head of State.
- The effect of such illegal acts is
upon arbitration agreement is
actually best summed up by the exit
tribunal’s decision in Chaser and El
Salvador. In this case, the tribunal
decided that it is not possible to
recognize the existence of rights
arising from illegal acts because
because to do so would, as a
principoke of TPP, violate respect
for the law.
- Factual evidence: that claimant
engaged a middleman to bribe the
power minister; such middleman is
notorious for unethical lobbying
and corrupt practices in Zurasia and
and directed him to do “whatever is
required to secure the contract with
the respondent.”
- No doubt therefore that under this
mandate, he proceeded to bribe a
person no less than the incumbent
power minister. And through him,
influenced the respondent’s choice
of the claimant’s services.
- Exhibits presented:
o Letter from the power
minister: directing the
respondent to utilize the
claimant’s services
o Newspaper reports showing
allegations against the
Samaniego, H.
 power minister for receiving
kickbacks
o Investigative reports into the
activities of the middleman
that highlight this financial
transaction as being
suspicious.
- Contract was from its very
inception tainted with corruption
and therefore cannot be form the
basis of a claim to adjudicated by an
arbitral tribunal
- The claimant, through its unjust
acts, has forfeited its right to ask for
assistance of the machinery of
justice to settle its disputes
10- HEARING ON JURISDICTION-
ORAL ARGUMENTS
(COMPLAINANT)
-failed to acknowledge the development of
the subsequent laws on the case cited by the
claimant
-doctrine of separability: treats the
arbitration agreement with the contract
agreement; corruption could not invalidate
the arb agreement unless the agreement was
directly impeached by the corrupt act in
question.
-after both parties’ oral arguments, they now
retire for their deliberations
Claimant:
1st argument: The tribunal has jurisdiction
to examine contracts despite allegations of
bribery.
- After citing the 1963 case, respondent
failed to acknowledge the
development of the subsequent
decisions after the said case. These
decisions have made reference to the
1963 case but they have not followed
it. An example would be West Acre
v. Yugo Import Dispute, where courts
in the UK, Switzerland and Kuwait,
all held the arbitration agreement to
be enforceable despite corruption
surrounding the main contract.
- The basis of these rulings is none
other than the doctrine of
separability: treats the arbitration
agreement separate with the contract
agreement in which it was contained;
and does not allow the invalidity of
the main agreement to extend to the
arbitration agreement.
- To support this, they cited the UK
House of Lords decision on Fionna
Trust v. Frivolov where it was held
that corruption could not invalidate
the arbitration agreement unless the
agreement was directly impeached by
the corrupt act in question.
- The exacting test: unless the
allegation of illegality relates to the
arbitration clause itself, the tribunal
could proceed to decide the dispute
and the dispute on the merits would
include any allegations of bribery.
2nd argument: the facts in the record do
not reveal any clear evidence of the
claimant’s complicity in the alleged
corrupt practices.
- As provided by law, the agent’s
power to affect the legal position of
its principal depends on its actual or
apparent authority
- Actual authority requires
consensual agreement between the
principal and its agent endorsing a
certain act. None of the evidence
adduced by the respondent that the
Samaniego, H.
 claimant requested the middleman No evidence given for the bribery issue
to act in this manner or even
Allegation of Fraud: highest standard of
suggested that such an act was
proof required which was not met
acceptable.
- In fact, claimant was unaware of the Singapore CA: rulings on jurisdiction are not
agent’s actions until after those considered awards but simply decisions of
actions were reported by the media. the tribunal
- As to the implied authority, neither
can it be said that the claimant
provided the middleman implied 12 – DECISION ON JURISDICTION
authority which extends only to acts
Final draft of the tribunal’s decision is sent to
that are ordinarily incidental to the
SIAC where the Secretariat scrutinizes it for
due performance of an express
any technical issues and that it complies with
authority.
SIAC rules; it could make a recommendation
- Bribing a minister can hardly be
which deals only with the form but not with
considered ordinarily incidental to
the substance
the agent’s function, at least not by
the claimant, perhaps the -FD is signed by all arbs sent to SIAC then to
respondent has different views. parties
- The key fact: the claimant is
-Tribunal has jurisdiction. Now off to merits
selected for the powerplant contract
of the case
among several other companies.
The claimant was selected on a
meritorious bases considering its
expertise and its industry-leading 13- THE MERITS PHASE (DECISIONS
track record. ON PROCEDURE)
- The respondent, having known of Written submissions and witness statements
the middleman’s alleged + Hearing
transgression, did not once raise any
objection, any alarm, til the -8 weeks to file; thereafter they could decided
commencement of this arbitration for a responsive pleading for 4 weeks
by the claimant. 14- SUBMISSIONS
-
-Rule 17, SIAC Rules: Guidelines on the
11- HEARING ON JURISDICTION- submissions (Statement of Claim)
DELIBERATIONS OF TRIBUNAL
a. A statement of facts supporting the claim;
Legal Issue: does corruption to secure the
contract invalidates the contractual b. the legal grounds or arguments supporting
agreement the claim; and

Factual Issue: was claimant directly c. the relief claimed together with other
involved in the corruption/bribery issue quantifiable claims

Punitive trust test? Format: Flexible

Samaniego, H.
Respondents: Statement of Defenses + 2. Inherent business risks: assumption of
Counterclaim (same format as that of SOC) risks
Submission: helps to organize proceedings; 3. Precludes liability from political events
make it efficient by determining issues and such as the one in Zurasia 2012/2013
laws in which they are based
4. Exorbitant estimate of loss that it cannot
support
15- HEARING ON THE MERITS 5. Dismiss the claim and award costs against
(OPENING STATEMENTS) the claimants
Hearings/Documents are private/confidential
Claimant: 16- HEARING ON MERITS (CROSS
EXAMINATION)
1. Claims
-Rule 22, SIAC Rules: Tribunal may require
-Electro Ace breached its contractual
parties to:
obligations with Asianix for the supply
($120M) 1. give notice of the identity of the witness
whim they want to produce;
-premature termination maintenance services
of the powerplant ($4M/year) 2. Subject matter of their testimony; and
-a claim for costs 3. Its relevance to the issues.
2. Brief Facts -Written form, sworn affidavits or any other
form of recording
3. Submissions
-Tribunal may put such weight to such
4. Clause 18, contractual agreement
written testimony if the witness fails to attend
5. Legal Basis
the hearing
-art 53 of the convention because respondent
failed to accept delivery of the goods and
payment of the breached 17- HEARING ON MERITS (FINAL
ARGUMENTS) (OPENING
-art79: exclude liability doesn’t apply here
STATEMENTS)
-60M claims; 20M damages for premature
CLAIMANT:
termination
1. Breach of Contract
-UN convention on International Sale of
Respondent:
Goods
Defenses
-sale of components of the powerplant
1. Beyond respondent’s control; exemption
-Part 3 of the Convention: Obligations of the
from liability
Seller and the Buyer

Samaniego, H.
- Art 53 of the convention: Buyer’s obligation
to take delivery of the goods
-Claimant did not receive any payment for
the Phase II components
2. Exemption from Liability
- beyond the respondent’s control: the
impediment must be stressed at the outset; it
must be something that the party could not
reasonably have been expected to take into
account and that it be in no way be avoided
(force majeure);
-Tomato Concentrate case: not given the
benefit of exemption
-Respondent made no effort to overcome the
impediment (Art 79?)
-Failure to give notice disentitles respondent
from claiming protection under art 79
Respondent: Electro Ace Inc
1. On the breach
-time for payment has not arisen;
-Payment: how, what and when
-Question as to when: after completion of its
phase-60M
-Cannot be held liable for the entire price pf
Phase II
2. Entitlement to exemption to liability
(Art 79.(1) convention)
Not “impossibility” but “hardship”
-Butter case cited
-Political theatre in Zurasia cannot be in
respondent’s control
Pointed out: the defective components given
by the supplier
Closure of the proceedings: Rule 28.1 of
the SIAC Rules
18- THE AWARD (DELIBERATIONS
OF THE TRIBUNAL)
-deliberation based on the ISSUES
1. Maintenance services, consequence of the
sale of the goods
2. Article 53: buyer must pay the price and
take delivery of the goods
3. Article 79 (1), on exemption for liability
-what is the standard for the exemption?
- what could have been reasonably expected
of the parties?
- no efforts were made by the respondent to
protect its rights with Gen. Dom
Award is enforceable because of the UN
Convention/New York Convention
-Tribunal decides by majority
19- SCRUTINY OF THE AWARD OF
COSTS OF ARBITRATION
-So that it is complian with New York
Convention
-Registrar’s Scrutiny:
1. Computations
2. All Issues answered
3. Parties are Correctly Identified
Samaniego, H.
4. Facts and Figures
5. Form of the Award
-Scrutinized draft award with SIAC’s
comments
-Registrar to determine total costs of
arbitration
-Tribunal:
1. Scrutinized draft award with SIAC’s
comments
2. Costs of Arbitatrion after registrar
finalized it (Rule 31.1, SR)
3. Legal and other costs (Rule 33.1, SR)
- Award is then Finalized, delivered to the
Registrar then to the Parties
-Successfully Concluded in 13 Months
-Next crucial step is enforcement
20- ENFORCEMENT OF THE AWARD
CLAIMANT WON: 60M + COSTS
AGAINST THE RESPONDENT
Art29.9, SR: comply with the decision
voluntarily
Enforcement of the losing party’s assets in
cooperation of the national courts
-absence of any procedural errors in the
arbitral process
SIAC PROVIDES:
1. Supervision of the contract
2. Appointment of Arbitrators
3. Step-by-step guidance
4. meticulous Scrutiny Process
China and South Korea: NY convention
signatories
China
Recognition and enforcement of the awards
are different but they are integrated.
Intermediate People’s Court in China →
Higher People’s Court → Supreme People’s
Court (Public policy)
Where to file the application? Intermediate
People’s Court in China in the place where
the company is located. Within 2 years from
the award. Losing party will pay the costs for
the enforcement.
Korea
Recognition and enforcement
Refusal? Specific performance was the relief
but the award was not specific enough
Since the current case is a monetary award,
it’s very unlikely that it would be refused.
Subject Matter is not arbitrable in the other
country. (contrary to the public policy)
1. Application of the enforcement
2. Proof of the arbitration agreement and
award
3. Corporate Certification
21- CONCLUDING REMARKS
Lim Seok Hui, CEO SIAC
Autea’s Book Reviewer
THE ARBITRAL AWARD IN
INTERNATIONAL ARBITRATION
For the winning party in an international
arbitration, what is the procedure for the
Samaniego, H.
enforcement of the arbitral award?
File a Petition for Recognition and
Enforcement of Arbitral Award in a Regional
Trial Court at any time from receipt of the
arbitral award. (Special ADR Rules, Rules
12.1 and
12.2)
What is the remedy of the losing party in
an international arbitration?
File a Petition to Set Aside Arbitral Award
within three (3) months from receipt of the
award in a Regional Trial Court on any of the
following six (6) grounds:
(1) A party to the arbitration agreement was
under some incapacity, or the said agreement
is not valid under the law to which the parties
have subjected it or, failing any indication
thereof, under Philippine law;
(2) The party making the application to set
aside or resist enforcement was not given
proper notice of the appointment of an
arbitrator or of the arbitral proceedings or
was otherwise unable to present his case;
(3) The award deals with a dispute not
contemplated by or not falling within the
terms of the submission to arbitration, or
contains decisions on matters beyond the
scope of the submission to arbitration;
provided that, if the decisions on matters
submitted to arbitration can be separated
from those not so submitted, only that part of
the award which contains decisions on
matters not submitted to arbitration may be
set aside or only that part of the award which
contains decisions on matters submitted to
arbitration may be enforced;
(4) The composition of the arbitral tribunal or
the arbitral procedure was not in accordance
with the agreement of the parties, unless such
agreement was in conflict with a provision of
Philippine law from which the parties cannot
derogate, or, failing such agreement, was not
in accordance with Philippine law;
(5) The subject-matter of the dispute is not
capable of settlement by arbitration under the
law of the Philippines; or
(6) The recognition or enforcement of the
award would be contrary to public policy.
In deciding the petition, the Court shall
disregard any other ground to set aside or
enforce the arbitral award other than those
enumerated above.
(Special ADR Rules, Rule 12.4; UNCITRAL
Model Law, Article 34)
FOREIGN ARBITRAL AWARD
What is the procedure for the enforcement
of a foreign arbitral award?
File a Petition for Recognition and
Enforcement of Arbitral Award in a Regional
Trial Court at any time from receipt of the
arbitral award. (Special ADR Rules, Rules
13.1 and 13.2)
A foreign arbitral award, when confirmed by
the Regional Trial Court, shall be enforced
in the same manner as final and executory
decisions of the courts of law of the
Philippines. (RA 9285, Section 44)
What is the remedy of the losing party in
an international arbitration?
Apply in a Regional Trial Court to Refuse
Recognition on any of the following seven (7)
grounds:
(1) A party to the arbitration agreement was
under some incapacity, or the said agreement
Samaniego, H.
is not valid under the law to which the parties
have subjected it or, failing any indication (Special ADR Rules, Rule 13.4; UNCITRAL
thereof, under Philippine law; Model Law, Article 36)

(2) The party making the application to set

aside or resist enforcement was not given
proper notice of the appointment of an
arbitrator or of the arbitral proceedings or
was otherwise unable to present his case;

(3) The award deals with a dispute not

contemplated by or not falling within the
terms of the submission to arbitration, or
contains decisions on matters beyond the
scope of the submission to arbitration;
provided that, if the decisions on matters
submitted to arbitration can be separated
from those not so submitted, only that part of
the award which contains decisions on
matters not submitted to arbitration may be
set aside or only that part of the award which
contains decisions on matters submitted to
arbitration may be enforced;

(4) The composition of the arbitral tribunal or

the arbitral procedure was not in accordance
with the agreement of the parties, unless such
agreement was in conflict with a provision of
Philippine law from which the parties cannot
derogate, or, failing such agreement, was not
in accordance with Philippine law;
(5) The award has not yet become binding on
the parties or has been set aside or suspended
by a court of the country in which that award
was made; or

(6) The subject-matter of the dispute is not

capable of settlement by arbitration under the
law of the Philippines; or

(7) The recognition or enforcement of the

award would be contrary to public policy.
The court shall disregard any ground for
opposing the recognition and enforcement of
a foreign arbitral award other than those
enumerated above.

Samaniego, H.