Senator Proposes Extension of Application Period for Arbitration Awards

Photo: Rudranath Fraser Opposition Senator, K.D. Knight, highlights a point while making his contribution to the debate on the Arbitration Act, 2017 in the Upper House today (March 17). The Bill seeks to repeal the Arbitration Act 1900, and replace it with a more modern legislation that is intended to provide an effective non-judicial mechanism for settling disputes between contracting parties.

Opposition Senator, K.D. Knight, has suggested that the proposed application period for the setting aside of awards as a means of recourse in arbitral proceedings, should be extended to six months.

A period of three months is set out in the Arbitration Act, 2017, which is currently being reviewed by the Upper House. The legislation seeks to facilitate domestic and international trade and commerce by encouraging the use of arbitration as a method of resolving disputes.

Clause 37 (3) of the Bill states that an application for setting aside (an award) may not be made after three months have elapsed from the date on which the party making the application had received the award.

Making his contribution to the debate on the Bill in the Senate on Friday (March 17), Senator Knight argued that three months “is a very short time in which to have a review” of the arbitral award, especially in complicated matters.

“This (Act) governs domestic and international (arbitration). Once the arbitration is conducted in Jamaica, if we are realistic, (those matters) which are international in nature, and are done in Jamaica, are likely to be very complex. In our jurisdiction, we are going to have very complex ones too.”

“So whilst the desire certainly is, and correctly so, to have these matters conducted in the shortest possible time, I believe that an extension to six months would still keep it within that concept,” he posited.

Piloting the Bill, acting Leader of Government Business in the Senate, Pearnel Charles Jr., noted that arbitration can be a game changer in the settlement of commercial domestic disputes and serve a major source of foreign exchange earnings from the settlement of international trade matters.

He pointed out that the legislation is important in bolstering the Government’s commitment to sustainable economic development in the country, where investors can feel assured that they are conducting business in an economically stable environment.

“The legal risks inherent in transactional business ventures (particularly cross-border commercial arrangements) demand a settlement dispute mechanism that is expedient, cognisant of emerging trends and that operates at a highly modernised level,” he added.

The Arbitration Act, 2017, seeks to repeal the 1900 legislation and replace it with a more modern law that is intended to provide an effective non-judicial mechanism for settling disputes between contracting parties.

The legislation is based on the provisions of the Model Law published by the United Nations Commission on International Trade Law (UNCITRAL) and will operate in conjunction with the provisions of The Arbitration (Recognition and Enforcement of Foreign Awards) Act as well as the Investment Disputes Awards (Enforcement) Act.

Senator Charles Jr. said with the passage of the Bill, Jamaica will join the large number of countries that have adopted the Model Law and, as such, will benefit from the internationally agreed best practices that are disseminated and promoted by UNCITRAL on an ongoing basis.

He lamented that Jamaica has been “plodding along” with an outdated arbitration regime in which investors have found no confidence.

“We must move towards adoption of the UNCITRAL Model Law which has been accepted in over 70 countries worldwide and over 100 jurisdictions,” he said.

Senator Charles Jr. noted that the Model Law will be complemented by the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention) which Jamaica adopted and ratified in July 2002.

He explained that international arbitration is chosen as the preferred dispute-resolution process for cross-border disputes, because arbitration awards are enforceable under the New York Convention in more than 148 countries around the world.

Highlighting some of the benefits of the arbitration process, Senator Charles Jr. pointed out that the dispute will be resolved quickly, as a date for the arbitration can usually be obtained a lot faster than a court date. This, he said, would also contribute to a reduction of matters that go through the courts.

Further, under arbitration, the parties to the dispute usually agree on the arbitrator(s) whom they will trust to operate in a fair and impartial manner.

Also contributing to the debate were: Government Senators Don. Wehby, and Kavan Gayle; and Opposition Senators Sophia Fraser Binns and Mark Golding.

Debate on the Bill has been suspended until further notice. It was passed in the Lower House on January 24, 2017.

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