Australian International Arbitration Amendment Bill

The Rudd Government tabled on 25 November 2009 the International Arbitration Amendment Bill 2009 (the Bill) in an attempt to update and transform Australia’s arbitration law into a more modern form. 

Australia’s International Arbitration Act 1974 (the Act) is not as dated as its vintage would suggest and is based – as is the New Zealand Arbitration Act 1996 – upon the UNCITRAL Model Law on International Commercial Arbitration (Model Law).  It also includes as schedules the two major arbitration treaties, known as the New York Convention 1958 (relating to the recognition and enforcement of arbitration awards) and the Washington Convention 1966 (relating to the administration and enforcement of certain disputes between private investors and States).  

The Act could certainly do with some sprucing up, however.  It had sought to achieve a different balance between domestic and international arbitration procedure than is now best practice.  A key example of this is s 21, which provides that parties may opt out of the Model Law by any written document.  This has led to uncertainty and confusion as to when parties have excluded this instrument and, if so, to what extent.  The nadir of such confusion was the Queensland Court of Appeal decision of Eisenwerk v Australian Granites Ltd [2001] Qd R 461, which held that an agreement to arbitrate using the International Chamber of Commerce Rules was an implicit decision not to arbitrate under the Model Law.  That decision was plainly wrong as the Model Law is designed to be used together with arbitration rules chosen by the parties.  Section 21 is now to be repealed.

The other major changes proposed by the Bill are to:

  • implement the 2006 amendments to the Model Law

  • ensure that the Act, and not State or Territory legislation, applies to all international arbitration issues

  • streamline recognition and enforcement procedures for arbitration awards, and 

  • include express powers for Australian court assistance to arbitrations, such as subpoena powers for live evidence or non-party document disclosure.

The express purpose behind the Bill is to raise Australia’s profile on the international arbitration stage, where it is recognised as lagging behind other regional centres such as Singapore and Hong Kong.  Singapore’s amendments to its international arbitration laws, covered in a previous edition of Connected Asia Pacific, have now been passed and shall come into force on 1 January 2010.

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Related topics: International trade & investment; Arbitration; Connected Asia Pacific; International trade agreements

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