What Is Law Governing Arbitration Agreement

In other words, the English High Court has held that there is a rebuttable presumption that, in the absence of an express choice of law, the choice made for the underlying agreement will apply to the arbitration agreement. The second most common option is the application of arbitration law. However, it can be argued that the implicit choice of this proposal may not work properly. Since the seat is often chosen, inter alia because of its arbitration laws – procedural law – it is difficult to argue that the parties implicitly define when choosing the seat that the substantive law of the seat would regulate matters related to their arbitration agreement, such as validity, constitution, etc. Similarly, the right of seat is not always chosen by the parties – for example, agreements in which the parties do not appoint a seat and the arbitration institution or even the arbitrators must do so. Therefore, it may be unreasonable to assume that the validity of the agreement depends on a retrospective decision by a third party – an institution or tribunal – that essentially chooses a law governing the arbitration agreement without regard to the intention of the parties. On the other hand, the ex post election takes place only because the parties had implicitly delegated that election to the third party, so that it could be argued that the decision of the ex officiable third party reflects the proper will of the contracting parties. Thus, if the law of the underlying contract and the registered office differ, the parties must always explicitly indicate the law that will govern the arbitration agreement. .