Are arbitration clauses considered separable from the main contract?

International Arbitration (3rd edition)

Egypt Small Flag Egypt

Yes, the autonomy of the agreement to arbitrate is recognized as established through court precedents.

France Small Flag France

French law recognizes the principle of the autonomy or separability of arbitration agreements (Article 1447, CCP).

The nullity of the main contract thus does not affect the validity of the arbitration agreement, and an arbitral tribunal has jurisdiction to rule on allegations made by a party as to the nullity of the main contract, if that contract contains a valid, or at least not manifestly void, arbitration clause.

In order to assess the validity of an international arbitration agreement, the French courts do not refer to the law applicable to the main contract (or to any national law). Instead the courts have established a “substantive” rule of international arbitration (règle matérielle) and look only to the parties’ consent to arbitrate their disputes as a factual matter (see Court of Cassation, First Civil Chamber, 20 December 1993, No. 91-16.828, Dalico). There is a presumption of validity, and a party challenging an arbitration agreement bears the burden of proving its nullity (see Court of Cassation, First Civil Chamber, 5 January 1999, No. 96-21.430, Zanzi).

Cyprus Small Flag Cyprus

Pursuant to section 16(1) of Law no 101/1987:

“the arbitral tribunal has jurisdiction to decide on its jurisdiction and to examine questions relating to the existence or the validity of the arbitration agreement. For the purposes of this paragraph [on the jurisdiction of the arbitral tribunal] the arbitration clause which constitutes an integral part of a contract is considered as distinct from the other conditions of the contract. A decision of the arbitral tribunal which declares the contract void does not make the arbitration clause automatically invalid.”

In view of this provision, while an arbitration clause may constitute an integral/non-severable part of the contract per se, for the purposes of the arbitral proceedings and the jurisdiction of the tribunal, the tribunal may consider it as a separate agreement and decide on its applicability separately.

According to Cap 4 an arbitration clause is not considered as a separate part to the main contract and any decision of an Arbitral Tribunal that the contract containing the arbitration clause is void, does not affect the validity of the arbitration agreement.

Must be noted however that Cap 4 empowers the domestic courts with the discretion to order the termination of the main contract in cases where one of the parties acted in a fraudulent manner.

Czech Republic Small Flag Czech Republic

Yes, arbitration clauses are considered separable; this was as well confirmed by various rulings of the Supreme Court of the Czech Republic.

Romania Small Flag Romania

Under Romanian law, arbitration clauses are deemed separable from the underlying contract i.e. if the agreement is invalid or otherwise unenforceable, the arbitration clause does not automatically become void or unenforceable. The parties may also enter into an arbitration clause subsequent to emergence of the dispute, by means of a separate agreement referred to as a compromise.

Serbia Small Flag Serbia

Yes, Act on Arbitration specifically prescribes that an arbitration clause shall be considered independent of the main contract when deciding on the existence and validity of the said clause.

In addition, the decision of the tribunal that the contract containing an arbitration clause is null and void does not entail the invalidity of that clause.

China Small Flag China

Yes. The principle of independence and separability is embodied in Article 19 of the Arbitration Law, under which an arbitration clause or agreement is independent from the underlying contract, and thus are not affected by the amendment, rescission, termination or invalidity of the underlying contract.

Denmark Small Flag Denmark

a. Yes

Poland Small Flag Poland

Under Polish arbitration law, arbitration clauses are considered separable from the main contract. The doctrine of separability is recognized in Article 1180 §1 CPC, which provides that invalidity or expiration of the underlying agreement does not per se result in invalidity or expiration of the arbitration agreement.

Switzerland Small Flag Switzerland

The concept of severability of the arbitration clause is explicitly stipulated in art. 178 para 3 PILA and art. 357 para 2 CPC. Both provisions provide for the arbitration agreement not to be contested on the grounds that the main contract is not valid or that the arbitration agreement concerns a dispute which had not yet arisen.

UAE Small Flag UAE

Article 6 of the UAE Arbitration Law confirms the UAE’s acceptance of the principle that arbitral agreements are distinct from the underlying contract.

An arbitration agreement is, therefore, unaffected by the ‘nullity, rescission or termination of the contract’ in which it resides, unless the capacity of the parties is affected.

The DIFC Arbitration Law (Article 23), ADGM Regulations (Regulation 14), DIFC-LCIA Arbitration Rules (Article 23) and the DIAC Rules (Article 6) recognises the principle of separating the arbitration agreement/clause from the underlying contract.

United Kingdom Small Flag United Kingdom

Unless otherwise agreed by the parties, an arbitration agreement is separable from the main contract (s.7 of the 1996 Act, and Fiona Trust & Holding Corporation v. Privalov [2007] UKHL 40).

Saudi Arabia Small Flag Saudi Arabia

Article 21 of the Law of Arbitration provides that the arbitration clause shall be treated as an agreement independent of the other terms of the contract. The nullification, revocation or termination of the contract which includes the arbitration clause shall not entail the nullification of the arbitration clause therein, if such clause is valid.

United States Small Flag United States

Yes. Although the FAA does not explicitly address separability of arbitration clauses, case law has established that arbitration clauses are considered separable from the main contract and can be enforced even if the underlying agreement is found to be void or otherwise unenforceable. See Prima Paint Corp v Flood & Conklin Mfg Co, 388 US 395, 403 (1967).

Austria Small Flag Austria

Although legislation governing arbitration in Austria is based on the UNCITRAL Model Law on International Commercial Arbitration, the specific wording of Article 16 (1) of the Model Law regarding separability was not adopted. The doctrine of separability is, however, recognised by the courts, which evaluate the question of the validity of an arbitration clause and the main contract in which the arbitration clause was inserted contained in an invalid contract on a case-by-case basis by interpreting the intention of the parties. In practice, this may lead to the result that the parties’ intent was that the arbitration agreement remains valid where the contract is null and void or was terminated. In cases of consensual termination of the main contract, courts have held that the arbitration clause contained in the contract may also be considered terminated if the parties’ intention was to terminate the entire contractual relationship.

Nigeria Small Flag Nigeria

In Nigeria, arbitration agreements are considered separate from the main contract. In other words, arbitration clauses are generally treated as agreements independent of the other terms of the contract in which they are contained. Both the ACA and the Lagos Law recognize an arbitration agreement as an independent and separate agreement. Section 12(2), ACA and section 19(2), Lagos Law. The fact that the main contract which contains an arbitration clause is not valid does not render the arbitration clause invalid.

Portugal Small Flag Portugal

The arbitration clause is deemed to be an autonomous agreement entered into between the parties and therefore separate from the remaining of the contract. Thus, any issues concerning the non-existence, nullity, revocability, voidability or unenforceability of the main contract remaining clauses do not endanger the validity and efficacy of the arbitration clause.

Russia Small Flag Russia

The principle of separability of arbitration clauses is expressly recognised in both the ICA and DAA.

Ireland Small Flag Ireland

Yes. In accordance with Article 16 of the Model Law, an arbitral tribunal may rule on its own jurisdiction and an arbitration clause is treated as an agreement independent of the other terms of a contract.

Norway Small Flag Norway

The Arbitration Act is based on the principle of separability. An arbitration clause or agreement which is included in and forms part of a contract, is treated as an agreement independent of the other terms of the main contract (Arbitration Act section 18). Thus, a decision by the arbitral tribunal that the contract is invalid does not in itself entail that the arbitration agreement is invalid.

Germany Small Flag Germany

Yes. Section 1040 (1) ZPO provides for the separability or independence of the arbitration agreement from the other terms of a contract. The invalidity of the main contract does not automatically affect the validity of the arbitration agreement. The law, however, does not categorically rule out that severe defects causing the nullity of the main contract may also affect the validity of the arbitration agreement.

Croatia Small Flag Croatia

The Croatian Arbitration Act provides for separability of the arbitration clause from the main contract. An arbitration clause forming part of a contract shall be treated as an agreement independent of the other terms of the contract. A decision of the arbitral tribunal that the contract is null and void does not automatically invalidate the arbitration clause.

Updated: November 14, 2018