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India to revamp its Arbitration Law



India has never been a favoured destination for international arbitration. However, the country is interested in changing this scenario and becoming a hub for the resolution of commercial disputes. The Law Commission of India has recently issued a report proposing a radical overhaul of the Arbitration & Conciliation Act, 1996. Read more here, herehere, here, and here.

One of the measures typically adopted by jurisdictions interested in attracting arbitration proceedings is legal reform. The quality and predictability of the legal environment is essential for a country to catch the attention of users of arbitration services. As a result, jurisdictions use their legal regimes to compete for international arbitration proceedings. Governments strive to adjust and improve their legal frameworks aiming for simplicity, flexibility, and pragmatism. The adoption of a new arbitration law is seen as a ‘marketing strategy’ intended to send a signalling effect to the international arbitration community of the user-friendliness of a certain legal system.

The number of arbitration proceedings held in a jurisdiction generally rises subsequent to the enactment of a new arbitration law. However, no one should expect astounding results in the short run.  Setting up an ‘arbitration hub’ requires long-term strategic planning, patience, and constant monitoring. It is necessary to promote an open discussion between arbitral institutions, public officials, and commercial entrepreneurs. This dialogue must focus on developing commercial arbitration mechanisms that assures consistency across proceedings and among arbitrators aimed at the goal of making the arbitration of commercial disputes a ‘business as usual’ proposition, as opposed to the major event that is the typical law suit.

Image: Wikimedia Commons


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