The UNCITRAL

Model Law

Submitted to: Atty. Ever Rose Higuit

Submitted: Jan Kyle C. Corpuz

Objective:

The purpose of this research is to determine the history of the UN UNCITRAL model law and
why the UN came up with a guiding law that may be adopted by the UNCITRAL member states. This
is to understand the benefit of the model law to our current arbitration processes.

Background:

The UNCITRAL Model Law on International Commercial Arbitration was prepared

by UNCITRAL, and adopted by the United Nations Commission on International Trade Law on 21
June 1985. In 2006 the model law was amended, it now includes more detailed provisions on interim
measures.

The Model Law is designed to assist States in reforming and modernizing their laws on
arbitral procedure so as to take into account the particular features and needs of international
commercial arbitration. It covers all stages of the arbitral process from the arbitration agreement, the
composition and jurisdiction of the arbitral tribunal and the extent of court intervention through to the
recognition and enforcement of the arbitral award. It reflects worldwide consensus on key aspects of
international arbitration practice having been accepted by States of all regions and the different legal
or economic systems of the world.

Amendments to articles 1 (2), 7, and 35 (2), a new chapter IV A to replace article 17 and a
new article 2 A were adopted by UNCITRAL on 7 July 2006. The revised version of article 7 is
intended to modernize the form requirement of an arbitration agreement to better conform to
international contract practices. The newly introduced chapter IV A establishes a more comprehensive
legal regime dealing with interim measures in support of arbitration. As of 2006, the standard version
of the Model Law is the amended version. The original 1985 text is also reproduced in view of the
many national enactments based on this original version.

History:

When world trade began to expand dramatically in the 1960s, national governments began to
realize the need for a global set of standards and rules to harmonize national and regional regulations,
which until then governed international trade.

The United Nations Commission on International Trade Law (UNCITRAL) was established
by the General Assembly in 1966 ( Resolution 2205(XXI) of 17 December 1966). In establishing the
Commission, the General Assembly recognized that disparities in national laws governing
international trade created obstacles to the flow of trade, and it regarded the Commission as the
vehicle by which the United Nations could play a more active role in reducing or removing these
obstacles.

The General Assembly gave the Commission the general mandate to further the progressive
harmonization and unification of the law of international trade. The Commission has since come to be
the core legal body of the United Nations system in the field of international trade law.
Philippine adaptation of UNCITRAL Model Law:

The growing need for a law regulating arbitration in general was acknowledged when R.A.
No. 876 was passed. Said Act was adopted to supplement and not to supplant the New Civil Code
provisions on arbitration. With its enactment, the Philippine Supreme Court stated in a case that
Congress had officially adopted the modern view that arbitration as an inexpensive, speedy and
amicable method of settling disputes and as a means of avoiding litigation should receive every
encouragement from the courts.

On the other hand, the UN General Assembly recommended that all states give due
consideration to the Model Law in view of the desirability of uniformity of the law of arbitral
procedures and the specific needs of international commercial arbitration practice. The twin objectives
of the law are the harmonization of national arbitration laws for international arbitration and the
setting up of rules which will meet the present requirements of international arbitration.

With respect to the scope of application, the Philippine Arbitration Law differs from the
UNCITRAL Model Law in that the former applies to any controversy existing between the parties
involved. The submission or contract may include questions arising out of valuations, appraisals or
other controversies which may be collateral, incidental, precedent or subsequent to any issue between
the parties. The Model Law, on the other hand, applies only to international arbitration.

Republic Act 876: The Arbitration Law

The government of the Philippines has to authorize the making of arbitration and submission
agreements, to provide for the appointment of arbitrators and the procedure for arbitration in civil
controversies, and for other purposes to cater the harmonization of the UNCITRAL model law and
our domestic law when it comes to the arbitration processes. Hence, they enacted RA 876 otherwise
known as “The Arbitration Law”.

Two or more persons or parties may submit to the arbitration of one or more arbitrators any
controversy existing between them at the time of the submission and which may be the subject of an
action, or the parties to any contract may in such contract agree to settle by arbitration a controversy
thereafter arising between them. Such submission or contract shall be valid, enforceable and
irrevocable, save upon such grounds as exist at law for the revocation of any contract.

Such submission or contract may include question arising out of valuations, appraisals or
other controversies which may be collateral, incidental, precedent or subsequent to any issue between
the parties.

A controversy cannot be arbitrated where one of the parties to the controversy is an infant, or
a person judicially declared to be incompetent, unless the appropriate court having jurisdiction
approve a petition for permission to submit such controversy to arbitration made by the general
guardian or guardian ad litem of the infant or of the incompetent.

But where a person capable of entering into a submission or contract has knowingly entered
into the same with a person incapable of so doing, the objection on the ground of incapacity can be
taken only in behalf of the person so incapacitated.
Republic Act 9285: Alternative Dispute Resolution Act of 2004

Philippines enacted a law that will institutionalize the use of an alternative dispute resolution
system in the Philippines and to establish the office for alternative dispute resolution. It is essentially
needed since the Arbitration Law did not specify the modes that can be use in alternative dispute
resolution. The declaration of policy of the law clearly gives the idea and the objective of the law. As
specified in Section 2 of the Alternative Dispute Resolution Act of 2004:

SEC. 2. Declaration of Policy. - it is hereby declared the policy of the State to actively
promote party autonomy in the resolution of disputes or the freedom of the party to make their own
arrangements to resolve their disputes. Towards this end, the State shall encourage and actively
promote the use of Alternative Dispute Resolution (ADR) as an important means to achieve speedy
and impartial justice and declog court dockets. As such, the State shall provide means for the use of
ADR as an efficient tool and an alternative procedure for the resolution of appropriate cases.
Likewise, the State shall enlist active private sector participation in the settlement of disputes through
ADR. This Act shall be without prejudice to the adoption by the Supreme Court of any ADR system,
such as mediation, conciliation, arbitration, or any combination thereof as a means of achieving
speedy and efficient means of resolving cases pending before all courts in the Philippines which shall
be governed by such rules as the Supreme Court may approve from time to time.

RA 9285 clearly enunciates the encouragement of the Government to settle disputes with the
use of Alternative Dispute Resolutions as an effective means to resolve and have a quicker settlement
of the disputes. It also helps the court by decloging its dockets. A way more effective and faster than
court procedures which takes time due to the influx of cases involving civil up to the criminal aspects
of cases.

Overview:

Since post balangay government system times, Philippine Laws has already evolved into a
more effective guiding system in resolving disputes from ancient methods of settling disputes to a
modernized form of system. It clearly gives us an impression that in order to be a successful state we
have to start from fixing disputes to have a better economic progress. The UNCITRAL Model law,
RA 876, and RA 9285 gives us the benefit of becoming an effective country and increase the influx of
investments to better stabilize our economy.
Resources:

https://en.wikipedia.org/wiki/UNCITRAL_Model_Law_on_International_Commercial_Arbitra
tion

http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/1985Model_arbitration.html

https://en.wikipedia.org/wiki/United_Nations_Commission_on_International_Trade_Law

http://www.uncitral.org/uncitral/en/about/origin.html

https://www.hg.org/article.asp?id=5124

http://www.lawphil.net/statutes/repacts/ra2004/ra_9285_2004.html

http://www.lawphil.net/statutes/repacts/ra1953/ra_876_1953.html