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International Negotiation On Water
International Negotiation On Water
INTRODUCTION
Water is an essential element needed to sustain human civilization, the plant and
animal life that share the earth with man, and a healthy environment. Initially,
the amount of water that could be found within a short distance and could be
brought to the consumers by traditional means was sufficient to meet the needs.
But even then, water was a limiting factor in arid and semi-arid regions, due to
its scarcity and the inherent hydrological variability. With time, the pressures of
civilization on water resources increased, in two ways. With the rise in
population and living standards, the amounts withdrawn from rivers, lakes and
groundwater increased at an exponential rate, and, on the other, the expanding
agricultural, urban and industrial activities cause pollution of the sources,
thereby reducing the amounts of water that can be used without substantial
treatment. These pressures on water resources cause competition between
nations. These present a need for negotiation as the most viable tool which
sufficiently caters to interests of both nations and aims towards amicable
settlement of disputes.
Fundamentally, negotiation is a method of problem solving and conflict
settlement. The purpose of this interactive process is to find a formula for the
distribution of a contested value between the negotiating parties. A s such, a
negotiation is a joint decision-making process through which parties
accommodate their conflicting interests into a mutually acceptable settlement.
The process is circumscribed by applicable laws, the readiness of law
enforcement agencies to enforce them, and the respective goals and priorities of
each of the negotiating parties. In international disputes over the management of
water resources, even when an applicable treaty exists, each country can choose
to ignore it or interpret its terms as it pleases, in ways that other stakeholders
might regard as a violation. Distinguished international experts have adopted
guidelines on how to manage transboundary water resources: the Helsinki
Declaration and the Seoul Rules. However, they include some mutually
exclusive general principles.
In general, decision-makers and those who may negotiate on their behalf have a
choice of six universal negotiations strategies:
Negative non-zero sum games (or Lose-Lose solutions)
Unilateral creation of new facts Zero-sum games (or Win-Lose
negotiations)
Positive non-zero sum games (or Win-Win negotiations)
Conflict and threats of violence
No action, causing opportunity costs
Among the strategies given above, the 'win-win' solution is obviously the most
attractive one, because it provides for both partners in dispute an improvement
in their position. The Mutual Gains Approach to negotiation is a process model,
based on experimental findings and hundreds of real-world cases, that lays out
various steps for negotiating better outcomes, often including equitable sharing
of benefits, while protecting relationships and reputation. This could be either
achieved due to different preferences and/or due to extending the scope on
project outputs, such that additional benefits might accrue which were neglected
so far.
APPROACHES TO NEGOTIATION
The first approach is Positional and lacks coordinated and impartial
administrative, technical, legal and mediation support. In contrast, the second
approach is Interest-based, and has coordinated and impartial administrative,
technical, legal and mediation support. The Positional approach suffers from all
of the inefficiencies associated with applying positional negotiations in a
context where it is relatively easy to miss opportunities for mutual gain because
the underlying interests and their synergies are not well understood. The parties
are focused on maintaining positions rather than exploring alternatives that may
integrate their respective interests. If administrative support is viewed as biased,
the negotiation platform itself can become tangled up in the negotiation, as
parties bring process issues to the negotiating table while substantive issues are
being addressed. If technical and legal advice are not provided through an
impartial mechanism that ensures transparent understanding of conflicting
perspectives, then the negotiation can be diverted into a dialogue or conflict
between experts as opposed to focusing on how well national interests are being
addressed. Finally, if mediation and facilitation support is either separated from
these other functions, or nonexistent, then the opportunities for these resources
to maximize the potential for productive outcomes are hard to deliver. An
Interest-based approach is significantly different. Administrative, technical,
legal, and mediation support is coordinated, and process design issues are
worked through and agreed upon separately from substantive matters. The
process is designed to maximize opportunities for safe and constructive
discussion of alternatives that may deliver valuable outcomes for all riparian
parties. Technical and legal advice is provided in response to issues raised
through investigation of alternative solutions. They are not driving the
discussion; they are supporting it. Mediation support provides the capacity to
both manage the process for success for all parties, and to investigate
alternatives where direct discussions may be difficult or impossible. In
summary, if the process is interest based and well supported, then time is spent
on constructive problem solving and relationship building, rather than on
unproductive exchanges of positions and negotiation tactics that have little or no
relationship to the mutually beneficial opportunities that may well exist. In
practice, there are a growing number of Open type international agreements,
which provide for the return, either in kind or in cash, of an equitable share of
the benefits resulting from cooperation. Some examples are described below.
(1) The Treaty of Versailles, 1919; Article 358 of the Treaty of Versailles,
1919, gave France the exclusive right to use the waters of the Rhine for power
production, subject to France paying Germany one-half the value of the energy
produced .
(2) The Barcelona Convention, 1921; The Barcelona Convention, 1921,
Article X, contains the idea of sharing downstream and even upstream benefits,
providing that where a state is obliged under the Convention to take steps to
improve the river or is put to expense to maintain it for navigation, it is entitled
to demand a reasonable contribution to the costs involved
LIFE CYCLE MODEL OF NEGOTIATION
The role of negotiations is highlighted for the initiation, adoption, and
implementation phases of a life-cycle model of negotiating processes taking
place in the context of international water-related agreements and conventions.
An international agreement is not a static instrument or monument but a
dynamic process of negotiation and implementation with its own life cycle. An
‘agreement’ is the direct tangible product of negotiation that captures joint
decisions and intentions. There are many types of water agreements: policies,
laws, charters, codes of conduct, contracts or other agreements to manage and
allocate water. Agreements can be formal or informal, legally binding or
voluntary, verbal or written Agreements make public and explicit the goodwill
of the parties involved in a negotiation to reach fairer and more effective use of
water and care for water-related resources. A water agreement secures
commitments from the parties, be they governments, corporations, civil society
organizations (CSOs) or individuals. Each agreement must pass through a
number of phases, each of which comprises some negotiation activities. In a
life-cycle model of an agreement, one may distinguish, in analogy with the life
cycle of a living organism, the following phases:
● Preparatory phase: orientation/initiation/triggering of the negotiation process
(“courtship/gestation” period).
● Main negotiation phase: addressing and defining the contents, and
adoption/signature of the agreement (“engagement and wedding”).
● Ratification phase and preparation of the work program by the signatories
(“infancy”).
● Coming into force and early implementation (“adolescence”).
● Full implementation, and negotiation of amendments and protocols to the
agreement (“maturity and procreation”).
● Major re-negotiation of the agreement because many parts may have become
obsolete and other important elements are missing (“end of the life cycle”).
INTRODUCTION
Section 11(1) provides that unless otherwise agreed to by the parties, an
arbitrator may be of any nationality.
Section 11(2) empowers the parties to agree on a procedure for appointing
arbitrators.
Section 11(3) provides that failing any agreement on appointment procedure, in
arbitration with three arbitrators, each party shall appoint one arbitrator, and the
two appointed arbitrators shall appoint the third arbitrator, who shall act as the
presiding arbitrator.
The provisions of section 11(4) to 11(14) deal with situations when the parties
are unable to appoint arbitrators as per their agreement, or there is no agreement
on procedure of appointment of arbitrator/s. In these cases arbitrator/s is/are
required to be appointed.
CASE LAWS
Citation Infowares Limited v. Equinox Corporation 2009(6)
SCALE 430
M/s Citation Infowares (Indian company) (CI) entered into an agreement in
India with the Equinox Corporation (US company). The final dispute resolution
clause in the agreement provided as follows:
Issues:
Held: Part I of the Arbitration and Conciliation Act does apply in the present
case. The Court further held that, even in respect of agreements governed by the
laws of another country where the seat is not specified in the agreement itself,
the provisions of Part I, including Section 11, will be available to the parties.
Relying on precedents, it was held that the scope of presumption arising from
the selection of a foreign proper law of contract is limited. Such a selection does
not automatically result in exclusion of Part I of the 1996 Act. The presumption
of implicit exclusion of Part I would arise only where the arbitration is agreed to
be held outside India. In such a case the law of the seat would apply as the law
of the arbitration agreement.
In the light of the relevant facts that one of the contracting parties was
incorporated in India; the obligations were to also to be completed in India and
the nature of the contract, it can be said that there was no implied exclusion of
Part I of the 1996 Act. Therefore, it was held that notwithstanding the language
of Section 2(2) of the 1996 Act indicating that Part I would apply where the
place of arbitration is in India, the parties would be entitled to invoke the
provisions of Part I, even in respect of international commercial agreements
which are to be governed by the laws of another country. Consequently, the
application made under Section 11 in Part I was found to be maintainable and
the default in appointment was rectified by appointing a sole arbitrator.
In this case, the Court held that where the intervention of the Court is sought for
appointment of an arbitrator, the court should identify and segregate the
preliminary issues that may arise for consideration in an application under
Section 11 of the Act into 3 categories, that is:
1. Issues which the Chief Justice or his designate are bound to decide
2. Issues which he can also decide i.e. may choose to decide and
3. Issues which should be left to the Arbitral Tribunal to decide are :
- Whether the party making the application has approached the appropriate
High Court?
- Whether there is an arbitration agreement and whether the party who has
applied under section 11 of the act, is a party to such an agreement?
The issues (second category) which the Chief Justice/ his designate may
choose to decide (or leave them to the decision of the arbitral tribunal) are:
(a) Whether the claim is a dead (long barred claim) or a live claim?
(b) Whether parties have concluded the contract/transaction by recording
satisfaction of their mutual rights and obligations or by receiving the
final payment without objection?
The issues (third category) which the Chief Justice/ his designated should
leave exclusively to the arbitral tribunal are:
1. Whether a claim made falls within the arbitration clause (as for
example, a matter which is reserved for a final decision of the
departmental authority and accepted or excluded from arbitration).
2. Merits or any claim involved in the arbitration.
It is clear from the scheme of the Act that in regard to issues falling
under the second category, if raised in any application under section 11
of the Act, the Chief Justice/ his designate may decide them, if necessary
by taking evidence. Alternatively, he may leave those issues open with a
direction to the Arbitral Tribunal to decide the same. If the Chief
Justice / his designate chooses to decide the issue, the arbitral Tribunal
cannot re- examine it. The Chief Justice/ his designate will, in choosing
whether he will decide such issue or leave it, be guided by the object of
the Act, that is expediting the Arbitration process with minimum judicial
intervention.
Issue: Whether the appointment of the third arbitrator should necessarilybe done
by the two appointment arbitrators by sitting together and in writing?Are they
required to consult the parties too, while doing so, or at least, toput the parties on
previous notice?
The provisions of the Act also do not provide that the appointment of third
arbitrator cannot be agreed upon orally or through mutual discussion. It is also
not necessary that the two arbitrators appointed by each of the parties must sit at
one place, deliberate jointly and take a decision in the presence of each other
regarding the appointment of third arbitrator. All that needs to be done is that
they have to actually consult with each other and both or one of them has
inform the parties that the presiding or third arbitrator has been appointed by
them after joint deliberation. In other words, all that the two arbitrators need to
do to satisfy provision of the statute is to:
Supreme Court held that since Chief Justice is not a Court, a decision under
section 11 is not a decision of the Court and hence, will have no precedential
value.
The 2015 Amendment Act has now finally laid this issue to rest by replacing
“Chief Justice” with Supreme Court or High Court and provides that the
Supreme Court or High Court shall limit its examination only to the existence of
the Arbitration Agreement, and not on issues such as live claim, qualification,
conditions for existence of power etc.