Introduction
The Arbitration Act (42/2009) and the Arbitration (Foreign Arbitral Awards) Act (43/2009) came into force on May 20 2010. Both acts are the result of The Bahamas' commitment to adhere to the recommendations of the United Nations Commission on International Trade Law (UNCITRAL) in order to develop uniformity and harmonization in the law relating to arbitral procedures on a domestic level, as well as the specific needs of international commercial arbitration practice.
The Arbitration Act (42/2009) and the Arbitration (Foreign Arbitral Awards) Act (43/2009) came into force on May 20 2010. Both acts are the result of The Bahamas' commitment to adhere to the recommendations of the United Nations Commission on International Trade Law (UNCITRAL) in order to develop uniformity and harmonization in the law relating to arbitral procedures on a domestic level, as well as the specific needs of international commercial arbitration practice.
Once
a party has established the existence of an 'arbitration agreement' -
defined in both acts as "a separate agreement or an arbitration
clause contained in an agreement"- the provisions of the acts
can be relied on to address all disputes or certain specified
disputes set out in an arbitration agreement.
Arbitration
Act 2009
The
Arbitration Act 2009 is based on the UNCITRAL Model Law on
International Commercial Arbitration 1985 and its amendments, which
were adopted in 2006.
The
act provides a framework for:
- Domestic arbitration proceedings;
- The make-up of the tribunal to hear disputes; and
- The application of laws or rules that will determine the arbitration dispute.
The
act also allows parties in certain instances to apply to the Bahamian
court to:
- Assist in proceedings;
- Police proceedings; and
- Decide on the legitimacy of arbitration agreements and the subsequent proceedings.
The
act also gives the court the power to stay proceedings brought in the
Bahamian court to an arbitration agreement pursuant to which the
parties had already expressly agreed would be decided.
Role
of Bahamian court in arbitral disputes
Pursuant
to the provisions of the Arbitration Act, on application to the
Bahamian court, parties may seek to:
- Appoint an arbitrator when the agreed method of appointment has failed;
- Obtain evidence from witnesses;
- Apply interim measures arising out of an arbitration tribunal's ruling.
The
act also provides, upon application by a party to arbitral
proceedings, methods of policing arbitral proceedings:
- In instances where there is a need for the termination of an arbitrator;
- In instances where a party questions the substantive jurisdiction of the arbitration tribunal to sit on the proceedings or make an award;
- In order to challenge an award as result of a serious irregularity having taken place; and
- In order to enforce arbitral awards in the same manner as a Bahamian Supreme Court award.
Arbitration
(Foreign Arbitral Awards) Act 2009
On
becoming a contracting state to the New York Convention on the
Recognition and Enforcement of Foreign Arbitral Awards, The Bahamas
was required to create legislation to enact the convention and its
provisions regarding the recognition and enforcement of so-called
'convention awards' which are made in the territory of another
contracting state, and to enforce them in accordance with the rules
of procedure of the territory where the award is relied upon.
The
Arbitration (Foreign Arbitral Awards) Act 2009 and the New York
Convention define a 'convention award' as "an award made
pursuant to an arbitration agreement in a state other than the
Bahamas that is a party to the New York Convention".
The
act provides that, upon production of the authenticated original
award and original arbitration agreement, convention awards may be
enforced in The Bahamas in the same manner as judgments or orders of
the Bahamian court. Upon obtaining the leave from the Bahamian court,
all relief and remedies available pursuant to Bahamian law may be
utilized to enforce a convention award against a party's assets that
are in the jurisdiction.
Discretion
of court
As
with all contracting states, the recognition and enforcement of a
convention award by the Bahamian courts can be refused only in the
specific instances set out in the convention, which are incorporated
into Bahamian law by the act. Recognition and enforcement may be
refused if:
- The arbitration agreement was invalid under the law to which the parties subjected it;
- A party was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings; or
- The award deals with subject matter not contemplated by or not falling within the terms of the submission to arbitration.
Furthermore,
recognition and enforcement can be refused for public policy reasons
in the contracting state.
Comment
The enactment of both arbitration acts confirms The Bahamas' commitment to modernizing its legal regime related to international trade by developing and improving its legal framework. By enacting this legislation, The Bahamas has reinforced its reputation as a jurisdiction in which international commercial trade agreements can be relied upon and enforced.
If you require advice or representation, you can contact a Bahamian arbitration attorney by clicking here.
The enactment of both arbitration acts confirms The Bahamas' commitment to modernizing its legal regime related to international trade by developing and improving its legal framework. By enacting this legislation, The Bahamas has reinforced its reputation as a jurisdiction in which international commercial trade agreements can be relied upon and enforced.
If you require advice or representation, you can contact a Bahamian arbitration attorney by clicking here.
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