Ireland: Arbitration

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This country-specific Q&A provides an overview of the legal framework and key issues surrounding arbitration law in Ireland.

This Q&A is part of the global guide to Arbitration.

For a full list of jurisdictional Q&As visit http://www.inhouselawyer.co.uk/index.php/practice-areas/arbitration/

  1. What legislation applies to arbitration in your country? Are there any mandatory laws?

    The Arbitration Act 2010 (“the Act”), governs arbitrations commenced in Ireland from 8 June 2010. It applies to all arbitrations held in Ireland after the date of entering into force, both international and domestic.

  2. Is your country a signatory to the New York Convention? Are there any reservations to the general obligations of the Convention?

    Yes, Ireland ratified the New York Convention in 1981 and no reservations to the general obligations were entered.

  3. What other arbitration-related treaties and conventions is your country a party to?

    The Arbitration Act 2010 applies to all arbitrations commenced after 8 June 2010 and it applies the UNCITRAL Model Law.

    Ireland is a party to the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States of 1965, the Geneva Protocol on Arbitration Clauses of 1923, the Geneva Convention on the Execution of Foreign Arbitral Awards of 1927, and the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958.

    As regards investment treaties, Ireland is a signatory to the Energy Charter Treaty.

  4. Is the law governing international arbitration in your country based on the UNCITRAL Model Law? Are there significant differences between the two?

    Yes, the Arbitration Act adopted the provisions of the UNCITRAL Model Law on International Commercial Arbitration (2006) (“the UNCITRAL Model Law”) for arbitral proceedings where Ireland is the place of arbitration. As previously mentioned, the Arbitration Act notably adopts the UNCITRAL Model Law for both international commercial arbitrations and domestic arbitrations.

    The Arbitration Act clarifies and amends the UNCITRAL Model Law in a number of matters, including the commencement of the arbitral proceedings, the provision of security for costs, the deadline for the application to set aside an award, and the default number of arbitrators.

  5. Are there any impending plans to reform the arbitration laws in your country?

    The Arbitration Act repealed previous arbitral legislation and put in place a unitary statute which was introduced to reform the Irish Law in order to come in line with the best international practice and given that it entered into force in 2010, which is relevantly recent, it is unlikely that there will be any new reforms in the near future.

  6. What arbitral institutions (if any) exist in your country?

    There are currently no Irish arbitral institutions but a number of international arbitral institutions have conducted arbitrations in Ireland.

  7. What are the validity requirements for an arbitration agreement under the laws of your country?

    In Ireland, the Arbitration Act has adopted Option 1 under Article 7 of the UNCITRAL Model Law resulting in the requirement that an arbitration agreement must be in writing.

    An arbitration agreement is held to be in writing if its content is recorded in writing, including electronic means, whether or not the arbitration agreement or contract has been concluded orally, by conduct or by other means.

    Furthermore, an arbitration agreement is considered to be in writing if it is contained in an exchange of statements of claim and defence in which the existence of an agreement is alleged by one party and not denied by the other.

    Finally, the reference in a contract to any document containing an arbitration clause constitutes an arbitration agreement in writing, provided that the reference is such as to make that clause part of the contract under the general principles of contract law.

    The parties to the arbitration agreement must also have capacity to enter into the agreement. The normal rules of contract apply to determine whether or not a party has the required capacity to enter into an arbitration agreement.

  8. Are arbitration clauses considered separable from the main contract?

    Yes. Arbitration clauses are treated as independent agreements which are divisible from the other contractual terms. Therefore, if an arbitral tribunal decides that the contract is null and void, the arbitration clause will not be automatically invalidated.

  9. Can claims under more than one contract be brought in the one arbitral proceeding? Can an arbitral tribunal with its seat in your country consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?

    It is permissible under Irish law to consolidate arbitral proceedings. The consolidation of arbitral proceedings may only take place where all the parties to each of the constituent arbitral proceedings agree to consolidate the matters into a single set of arbitral proceedings.

  10. How is the law applicable to the substance determined?

    As a general rule, the law applicable to the substance of the dispute is determined by reference to the choice of law governing the agreement. If there is no express choice of law, the arbitrator may determine the governing law by reference to applicable international standards.

  11. Are any types of dispute considered non-arbitrable? What is the approach used in determining whether or not a dispute is arbitrable?

    The Arbitration Act does not apply to arbitration under an agreement relating to the terms or conditions of employment or the remuneration of any employees and to an arbitration concerning trade disputes under Section 70 of the Industrial Relations Act 1946.

    The Arbitration Act does not apply also to arbitrations conducted by a property arbitrator appointed under Section 2 of the Property Values (Arbitration and Appeals) Act 1960.

    Lastly, the Arbitration Act provides that consumer disputes are only arbitrable at the election of the consumer where the arbitration agreement contains terms that has not been individually negotiated and where the dispute involved a claim for an amount not exceeding €5,000.

  12. Are there any default requirements as to the selection of a tribunal?

    The parties are free to agree on a procedure to appoint an arbitrator or a tribunal of arbitrators. However, if the parties fail to agree, the default position (which is an amendment to Article 10 of the UNCITRAL Model Law) is that the arbitral tribunal shall consist of one arbitrator only.

  13. Can the local courts intervene in the selection of arbitrators? If so, how?

    The High Court can intervene in the selection of arbitrators if the parties fail to agree on the appointment of an arbitrator. When appointing the arbitrator, the High Court must have due regard to any qualifications required of the arbitrator by the agreement of the parties and to such considerations as are likely to secure the appointment of an independent and impartial arbitrator.

  14. Can the appointment of an arbitrator be challenged? Can an arbitrator be disqualified? What is the procedure for such challenge?

    The appointment of an arbitrator can be challenged only if circumstances exist that give rise to justifiable doubts as to his impartiality or independence, or if he does not possess qualifications agreed to by the parties.

    The parties are free to agree on a procedure for challenging an arbitrator. Failing such agreement, a party who intends to challenge an arbitrator shall, within fifteen days after becoming aware of the constitution of the arbitral tribunal or after becoming aware of any of the above-mentioned issues, send a written statement of the reasons for the challenge to the arbitral tribunal. Unless the challenged arbitrator withdraws from his office or the other party agrees to the challenge, the arbitral tribunal will decide on the challenge.

    However, if a challenge is rejected by an arbitral tribunal, the challenging party may apply to the High Court for a final decision on the challenge within 30 days after having received notice of the arbitral tribunal’s decision rejecting the challenge. There is no appeal from a decision of the High Court on a challenge to an arbitrator.

  15. Are arbitrators immune from liability?

    An arbitrator is not liable in any proceedings for anything done or omitted in the discharge or purported discharge of his or her functions. This immunity also extends to persons engaged by the arbitrators and arbitral institutions. The immunity applies even where an arbitrator acts in bad faith.

  16. Is the principle of competence-competence recognised in your country? What is the approach of local courts towards a party commencing arbitration in apparent breach of an arbitration agreement?

    The principle of competence-competence is recognised in Ireland under the UNCITRAL Model Law as adopted by the Arbitration Act. An arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.

    Where an action is brought under a matter that is subject to an arbitration agreement, the courts in Ireland are under an obligation to refer the parties to arbitration regardless of whether the commencing party is in apparent breach of the arbitration agreement or not, provided that the application is brought no later than when submitting the first statement on the substance of the dispute and the written arbitration agreement is not null and void or incapable of being performed.

  17. How are arbitral proceedings commenced in your country? Are there any key provisions under the arbitration laws relating to limitation periods of which the parties should be aware?

    Arbitral proceedings are deemed to have commenced either on the date that the parties to an arbitration agreement agree to its commencement or on the date when a written request to refer the matter to arbitration made by one party, is received by the other party. A written communication is deemed to have been received on the day it was delivered to a respondent.

    Limitation periods for arbitration are governed under Statute of Limitations 1957 (as amended) where a limitation period governing specific arbitral proceedings depends on the substantive nature of the claim. The limitation period is typically six years where the arbitral proceeding concern claims for breach of contract.

  18. What is the applicable law (and prevailing practice) where a respondent fails to participate in the arbitration? Can the local courts compel parties to arbitrate? Can they order third parties to participate in arbitration proceedings?

    If the respondent fails to appear at a hearing or to produce documentary evidence, the arbitral tribunal may continue the proceedings and make the award on the evidence before it. In the event, the respondent fails to communicate his statement of defence, the arbitral tribunal shall continue the proceedings without treating such failure in in itself as an admission of the claimant’s allegations. The Irish Courts cannot order a party to participate in arbitration proceedings.

  19. In what instances can third parties or non-signatories be bound by an arbitration agreement or award (e.g. by joinder)?

    As a general rule, parties to an arbitration agreement should consent to be regarded as a party to an arbitration agreement.

    However, third parties or non-signatories can be bound by an arbitration agreement under the rules of contract law by means of agency, alter ego, implied consent, group of companies doctrine, estoppel, beneficiary law, guarantee, subrogation, succession, ratification and assumption.

  20. What interim measures are available? Will local courts issue interim measures pending the constitution of the tribunal?

    An arbitral tribunal has the power to grant interim measures in respect of arbitral proceedings unless it was agreed otherwise by the parties. The interim measures that may be granted are: (a) measures to maintain or restore the status quo pending determination of the dispute; (b) measures to prevent current or imminent harm or prejudice to the arbitral process itself; (c) measures to preserve assets out of which a subsequent award may be satisfied; or (d) measures to preserve evidence that may be relevant and material to the resolution of the dispute.

    The High Court in Ireland has the power to issue interim measures under Articles 9 and 17J of the UNCITRAL Model Law prior to the commencement of arbitral proceedings in circumstances where the plaintiff is concerned about the possibility of the dissipation of assets or destruction of evidence by the proposed defendant.

  21. Are there particular rules governing evidentiary matters in arbitration? Will the local courts in your jurisdiction play any role in the obtaining of evidence?

    In the absence of agreement between the parties in relation to the provisions of the rules of procedures of the arbitration, the arbitral tribunal should conduct the proceedings in such a manner as it considers appropriate. This power includes the power to determine the admissibility, relevance, materiality and weight of any evidence.

    An arbitral tribunal must rely on the coercive power of courts in taking evidence where the arbitral tribunal or a party with the approval of the arbitral tribunal may request assistance in the taking of evidence in arbitral proceedings from the High Court. The High Court may execute the request in accordance with its own rules in obtaining evidence.

  22. What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your country?

    While ethical codes and professional standards exist among the legal professionals and arbitral institutions, there are no other express standards in place for arbitrators in Ireland.

  23. How are the costs of arbitration proceedings estimated and allocated?

    Under the 2010 Act, parties may make such provision for costs as they see fit. If the parties are using an arbitral institution, the parties will be bound by the institutions rules as to costs.

    In situations where the parties have not agreed costs, section 21(3) of the Act provides that the arbitral tribunal will decide the suitable award of costs. This award must state the grounds relied upon, the items of recoverable costs, fees or expenses and by and to whom they shall be paid.

    In arbitrations other than international commercial arbitrations, on request by any of the parties, the arbitrator shall make an order for the taxation of costs in accordance with the taxation procedures in Ireland.

  24. Can interest be included on the principal claim and costs incurred?

    Yes, section 18 of the 2010 Act allows the parties to agree on the powers of an arbitral tribunal in relation to interest. In the absence of any agreement in respect of interest, the arbitral tribunal may grant simple or compound interest which it deems fair and reasonable. This interest can be on any amount awarded by it, for any period up to the date of the award until payment.

  25. Does the law impose limits on the available remedies? Are some remedies not enforceable by the local courts?

    An arbitrator can generally grant any remedy or relief within the scope of the agreement of the parties which is permissible under the substantive law applicable to the dispute.

    The law applicable to the dispute will dictate the remedies that may be sought in arbitration. With this in mind, an arbitrator can order both common law and equitable remedies such as damages and specific performance (except in relation to land or any interest in land).

    If the arbitrator stipulates a remedy which goes beyond what is necessary to adjudicate on the issues referred to arbitration, the award will be deemed unenforceable if the offending part cannot be severed. An award will also be unenforceable if it seeks to regulate the future conduct of the parties in respect of future disputes.

  26. What legal requirements are there in your country for the recognition of an award?

    An award made pursuant to the 2010 Act shall be binding on the parties between whom it is made. Under section 23 of the Act, an award made by an arbitrator or by an arbitral tribunal shall be enforceable and where leave is given by the High Court, judgment may be entered in the terms of the award.

  27. Can arbitration proceedings and awards be appealed or challenged in local courts? What are the grounds and procedure?

    The decision of the arbitral tribunal can be appealed to the High Court within 30 days. The decision of the High Court will be final. The Arbitration Act doesn't provide for an avenue of appeal against an arbitral award.

    Article 34 of the Model Law provides limited grounds to challenge and set aside an award. These grounds include proving that the party to the arbitration was under an incapacity or not given proper notice of the appointment of the arbitrator. If any of the grounds set out under Article 34 are satisfied, the Court may set aside the arbitral award.

  28. Can the parties waive any rights of appeal or challenge to an award by agreement before the dispute arises (such as in the arbitration clause)?

    It does not appear that parties may waive rights before the dispute arises. A party will be deemed to have waived their right to apply to set aside an award under the Model Law where they refused to participate in the arbitral proceedings.

    Under Article 13(2) of the UNCITRAL Model Law, the arbitrator’s appointment may be challenged if an action is brought within 15 days of discovering a ground or grounds for such a challenge, for example, reasonable doubts as to the arbitrator’s independence or impartiality.

  29. To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?

    The Irish Courts have not yet addressed this issue in the context of enforcement of an arbitral award.

  30. Are there rules or restrictions on third-party funders in your country?

    Under Irish law, the common law principles of maintenance and champerty preclude funders without a legitimate interest from proceedings. The Irish High Court in April 2016 confirmed that professional third party litigation funding remains prohibited however this decision is under appeal to the Supreme Court, which appeal is likely to be determined during 2017.

  31. Is there a concept in your country providing for class-action or group arbitration? If so, are there any limitations to the arbitrability of such claims or requirements that must be met before such claims may be arbitrated?

    There is no provision for class-action or group arbitration under the Arbitration Act.

  32. Is diversity in the choice of arbitrators (e.g. gender, age, origin) actively promoted in your country? If so, how?

    Diversity in the choice of arbitrators is not actively promoted in Ireland. An arbitrator is chosen by agreement or appointed by a nominated body so designated in an arbitration agreement. Article 11(1) of the Model Law provides that “no person shall be precluded by reason of his nationality from acting as an arbitrator, unless otherwise agreed by the parties”.

    It has been suggested that the Irish courts may find a provision in an arbitration agreement that prescribes a qualification for appointment as an arbitrator on unlawfully discriminatory grounds to be contrary to public policy, within the meaning of Art 34 of the Model Law and thus void.

  33. Is emergency arbitrator relief available in your country? Is this actively used?

    There are no express provisions of the Arbitration Act dealing with emergency arbitrator relief. However, the parties to an arbitration agreement may have adopted institutional rules that do provide for such relief.

  34. Have measures been taken by arbitral institutions in your country to promote transparency in arbitration?

    Not as yet.

  35. Have steps been taken in your country to publish reasoned decisions on arbitrator challenges and provide more insight into the drivers behind arbitrator selection by institutions?

    Not as yet.

  36. Are there arbitral laws or arbitration institutional rules in your country providing for simplified procedures for claims under a certain value?

    Not as yet other than rules of international arbitral institutions which may be availed of by parties to an arbitration agreement.