International commercial arbitrations often involve cases where the law that governs the contract is defined by the parties, but the law that governs the arbitration and its conduct is left open. How are such international arbitrations dealt with and under which law are they conducted?
Recently, these questions arose before the Supreme Court in Citation Infowares Limited v Equinox Corporation. This case dealt with the jurisdiction of the Indian courts to entertain applications for the appointment of an arbitrator under the Arbitration and Conciliation Act, 1996, where the arbitration agreement did not provide for a venue or the law applicable to such arbitration although the contract was to be governed by foreign laws.
The factual background
Citation Infowares, a company registered in India, and Equinox Corporation, registered in the US, entered into an outsourcing agreement wherein the former was engaged as a service provider. Subsequently, the two companies signed two more agreements, the second of which included the following clause:
Clause 10.1 Governing Law: This agreement shall be governed by and interpreted in accordance with the laws of California, USA and matters of dispute if any relating to this agreement or its subject matter shall be referred for arbitration to a mutually agreed arbitrator.
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Vikas Goel is a partner and Neha Goyal is an associate at Singhania & Partners, which is a full-service national law practice. The firm has offices in New Delhi, Noida, Bangalore, Hyderabad and Mumbai.
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