Is the principle of competence-competence recognised in your country?
International Arbitration (4th edition)
Yes. Art. 1654 of the NCCC provides that, unless stated otherwise, the arbitration agreement confers on the arbitrators the power to decide on their own competence (kompetenz-kompetenz principle). This includes the competence to decide on any objections related to the existence or the validity of the arbitration agreement or on any other objections whose appraisal impedes the arbitrators from entering into the merits of the dispute.
Art. 35 of the LICA provides that the arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.
Austrian arbitration law recognises the principle of “competence-competence”. Thus, the arbitral tribunal may rule on a party’s challenge to the arbitral tribunal’s own jurisdiction. Lack of jurisdiction of the arbitral tribunal may be raised as a ground to set aside an arbitral award. If set-aside proceedings are initiated, the question of jurisdiction will be reviewed by the Austrian Supreme Court.
Yes. The arbitral tribunal is permitted to rule on its own jurisdiction as a preliminary question with a separate ruling or to decide on it with its final award on the merits. Unlike the Model Law (which provides the arbitration ruling upon the request of a party to be reconsidered by a court of law), ICAA provides that in any case the decision of the arbitral tribunal on its jurisdiction is final and not subject to appeal.
The FAA is silent on the principle of competence-competence. However, U.S. courts have recognized the authority of an arbitral tribunal to rule on its own jurisdiction, so long as the parties have clearly delegated the question of arbitrability to the arbitrator, either expressly or by incorporating the rules that recognize the principle of competence-competence. See, e.g., Henry Schein, 139 S. Ct. at 531; First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943 (1995); Belnap v. Iasis Healthcare, 844 F.3d 1272, 1290–92 (10th Cir. 2017); Terminex Intern. Co. v. Palmer Ranch Ltd., 432 F.3d 1327, 1332–1333 (11th Cir. 2005).
Yes. The doctrine of competence-competence was approved by the Supreme Court of Cyprus in the case of Open Joint Stock Company v Base Metal el al (2003) 1C C.L.R. 1856, whereby according to Section 16 of Law 101/1987, an arbitral tribunal may rule on its own jurisdiction, including ruling on objections to the existence or validity of the arbitration agreement.
Yes, the arbitrators are entitled to consider and decide disputes that fall within their own jurisdiction. The parties may also contest the jurisdiction of the arbitrators, which may be performed no later than in the first action of arbitration proceedings.
UAE- Federal Jurisdiction
Article 19 of the UAE Arbitration Law provides for the principle of ‘Kompetenz-Kompetenz’ by providing that the Arbitral Tribunal may rule on any plea as to its jurisdiction.
The Arbitral Tribunal’s ruling may form part of the answer of a ‘preliminary question’ or as part of the final arbitral award.
Should the Arbitral Tribunal decide the issue of jurisdiction as a ‘preliminary question’, this decision may be appealed within 15 days of notice of that decision. The appropriate court will then issue its decision within 30 days. The decision of the court is not subject to appeal.
DIAC Rules (Article 6) also expressly confer power on an Arbitral Tribunal to determine its own jurisdiction.
UAE – Common Law Jurisdictions
The DIFC Arbitration Law
An Arbitral Tribunal may rule on its own jurisdiction (Article 23).
Should the Arbitral Tribunal rule in favour of its own jurisdiction as part of a preliminary question, this decision (‘subject to any process agreed between the parties’) can be appealed by any party to the DIFC Court of First Instance.
This appeal must be made within 30 days of receipt of the decision of the Arbitral Tribunal, and the arbitral process shall not be stayed pending the outcome of the appeal.
The decision of the DIFC Court of First Instance on the jurisdiction of the Arbitral Tribunal is not subject to appeal.
Article 23 of the DIFC-LCIA Arbitration Rules also provides the Arbitral Tribunal with authority to rule on its own jurisdiction and authority.
The Arbitral Tribunal may decide upon any challenge to its jurisdiction through either an arbitral award as to its jurisdiction or later within the arbitral award as to the merits of the dispute.
An arbitration pursuant to the DIFC-LCIA Arbitration Rules (Article 23.5) shall treat the parties as having agreed not to apply for relief from a state court or other legal authority regarding the jurisdiction or authority of the Arbitral Tribunal.
The parties relinquish such rights after the constitution of the Arbitral Tribunal, except:
by ‘prior agreement in writing of all parties to the arbitration’; or
with ‘prior authorisation of the Arbitral Tribunal, or
following the’ Arbitral Tribunal’s ‘award on the objection to its jurisdiction or authority’.
Unless the parties have agreed otherwise, an Arbitral Tribunal may rule on its own ‘substantive jurisdiction’ pursuant to the ADGM Regulations (Regulation 24).
The Arbitral Tribunal’s determination may be challenged through the processes agreed by the parties or in accordance with the ADGM Regulations.
The Arbitral Tribunal’s response to a challenge may be answered as either a ‘preliminary question’ or as part of its award on the merits, unless the parties have agreed on how the Arbitral Tribunal should decide such a challenge.
The Court may determine the question of the ‘substantive jurisdiction’ of the Arbitral Tribunal, upon the application by a party to the arbitration, on notice to the other party.
A party may, however, ‘lose it right to object’ pursuant to Regulation 10.
The application to the Court to determine the question of the Arbitral Tribunal’s ‘substantive jurisdiction’ will not be considered unless:
‘(a) it is made with the agreement in writing of all the other parties to the proceedings’; or
‘(b) it is made with the permission of the Tribunal’’ (Regulation 26)
The Court must, however, be satisfied that:
its decision will save substantial costs;
there was no delay in making the application; and
there is good reason why the Court should decide this matter.
Should this application be made without the agreement of the parties, the grounds for the Court deciding the matter shall be contained within the application.
The decision of the Court shall not be subject to appeal, and unless agreed otherwise by the parties, proceedings shall not be stayed pending the Court’s decision.
Yes, the 1996 Act recognises the principle of competence-competence (s.30(1)).
Yes. Art. 16(1) of the UNCITRAL Model Law provides that ‘[t]he arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement’.
The principle of competence-competence is adopted in the Arbitration Act (the “Act”). The Act states, “The arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement” (Article 17(1) of the Act). If the arbitral tribunal rules on jurisdiction as a preliminary issue, a party may appeal the ruling to the competent court to review the issue within 30 days of receiving notice of the arbitral tribunal’s decision (Article 17(6) of the Act). The court’s decision on jurisdiction is unappealable (Article 17(8) of the Act). If the arbitral tribunal rules on its own jurisdiction as part of the final award, a party may challenge the award by initiating a set-aside action on jurisdictional grounds (Article 36(2) of the Act).
Yes - section 1040 (1) sentence 1 ZPO empowers the arbitral tribunal to rule on its own jurisdiction as well as on the existence or validity of the arbitration agreement. Should the arbitral tribunal issue an interim decision on an objection regarding its competence, the party may, however, apply for a court decision within one month after having received the interim decision in writing, section 1040 (3) ZPO. Furthermore, any decision of an arbitral tribunal to decide on its own jurisdiction is of course subject to review in potential enforcement or setting-aside proceedings.
The principle of competence-competence is complemented by section 1040 (1) sentence 2 ZPO which stipulates the principle of separability according to which an arbitration clause shall be treated as a separate agreement. Consequently, the arbitral tribunal may examine the validity of the arbitration clause independent of the other terms of the contract. Apparently, both principles (competence-competence and separability) are interdependent and aim at enabling the parties to obtain at least preliminary assurance about the jurisdiction, even though the state court retains the last word, particularly if one of the arbitral parties intends to contest the tribunal's decision on its jurisdiction.
The Arbitration and Conciliation (Amendment) Act, 2019 inserted a new provision Section 42B regarding Protection of action taken in good faith which mandates that “No suit or other legal proceedings shall lie against the arbitrator for anything which is in good faith done or intended to be done under this Act or the rules or regulations made thereunder”.
The Arbitration Law does not contain any provisions explicitly referencing the competence-competence principle. However, the law does compel district courts to refuse jurisdiction where an arbitration agreement already exists between the disputing parties. This should allow the arbitral tribunal to make determinations on any matters relating to the dispute, including its own jurisdiction.
On the other hand, the BANI Rules do recognise the principle of competence-competence, stipulating that an arbitral tribunal has the right to determine questions pertaining to its jurisdiction to examine and resolve the dispute.
Yes. The arbitral tribunal rules on its own jurisdiction, either in the context of the arbitral award on the merits of the dispute or in a separate (interim) arbitral award (see § 609 para. 1 Liechtenstein CCP).
Yes. Section 18(1) of the Arbitration Act provides that the arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.
In France, the principle of competence-competence is recognized and applied both in domestic and international arbitrations (FCCP Articles 1448 and 1465).
The principle implies that:
• The arbitral tribunal has jurisdiction to rule on its own jurisdiction in the first instance (also referred to as the “positive” aspect of competence-competence).
• French courts must decline jurisdiction over a dispute that is subject to an arbitration clause (also referred to as the “negative” aspect of competence-competence).
Nevertheless, before the constitution of the tribunal, a court can accept jurisdiction if the arbitration agreement is manifestly void or manifestly not applicable. However, French courts interpret this prima facie inquiry restrictively, i.e. any ambiguity is resolved in favour of the arbitral tribunal’s power to decide the issue (Alimport v. Ebonu, Court of Cassation, Common Chamber, 21 February 2006, No. 04-11030).
Furthermore, domestic courts can review the arbitral tribunal’s jurisdiction when requested to set aside an award. In such case, the court reviews the issue de novo without being bound by the factual and legal findings of the arbitral tribunal.
The principle of competence-competence is generally recognised in Egypt. The EAL provides that the arbitral tribunal shall decide over any jurisdiction-related claims including the existence, validity and scope of the arbitration agreement. (article 22.1) However, in practice, there exist instances where Egyptian courts, in relation to administrative contracts and beyond, have decided over the existence and validity of an arbitration agreement prior to or while arbitral proceedings were still pending and irrespective of the arbitral tribunal’s jurisdiction.
Yes, as said before the Commerce Code is based on UNCITRAL rules, and as in such rules, in Mexico the principle is recognised. In this sense, article 1432 of the Commerce Code states that arbitral tribunal shall be empowered to decide on its own jurisdiction, including on the exceptions concerning the existence or validity of the arbitration agreement.
By the provisions of section 12(1) of the ACA, an arbitral tribunal is competent to rule on questions pertaining to its own jurisdiction and on any objections with respect to the existence or validity of an arbitration agreement. An objection that the arbitral tribunal lacks jurisdiction must be raised no later than the time of submission of the points of defence, and a party is not precluded from raising such plea by reason that he or she has appointed, or participated in the appointment of, an arbitrator.
Furthermore, an objection that the arbitral tribunal is exceeding the scope of its authority can be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the proceedings. However, an arbitral tribunal shall rule on any such objections either as a preliminary question or in an award on the merits, and such ruling is final and binding. The ACA makes no provision for circumstances in which parties can be precluded from raising jurisdictional objections.
Even though the ACA does not specifically state that a court can determine the issue of an arbitral tribunal’s jurisdiction, it is not precluded from doing so if any of the parties approaches it. This is particularly so where an arbitrator proceeds with arbitration even where circumstances exist that could give rise to justifiable doubts as to his or her impartiality or independence (section 8(3)(a) ACA).
Further, the court can be asked to determine the issue of jurisdiction and competence of an arbitral tribunal after the award has been made and proceedings have been commenced in such instances seeking to set aside or refuse the recognition and enforcement of arbitral awards. Arbitrators exceeding their mandate have been held to constitute misconduct on the part of the tribunal for which an award may be set aside under section 30 of the ACA. See Taylor Woodrow Ltd v GMBH (1991) 2 NWLR (Pt. 175) 604.
Yes, the tribunal decides its own jurisdiction (eg, whether the dispute may be referred to arbitration and objections over the existence or validity of the arbitration agreement).
Provided that the tribunal finds that it has jurisdiction before making its award, the parties may appeal the decision to the ordinary courts within one month. A jurisdiction or competence objection may be raised as grounds for setting aside the award or rejecting the enforceability of the award.
Any objection to jurisdiction must be raised no later than in the party's statement of defence. This implies that the party's participation in the appointment of arbitrators does not prevent it from making a jurisdictional objection. However, if the party's delay is justifiable (eg, the objection was raised immediately after it became aware of the situation), the tribunal may accept the objection even though it is overdue.
Yes. Arbitral Tribunals are recognized to have the competence to rule on its own jurisdiction, including any objection with respect to the existence or validity of the arbitration agreement precedent to the filing of a request for arbitration. (Art. 4.16, IRR)
Yes, the arbitration panel is authorized to decide whether it has jurisdiction to resolve a dispute. Its decision may only be challenged after the issuance of the award and before the competent court.
Yes. Art. 22 of the LAM provides that, in the substantiation hearing, once the arbitral secretary has been appointed, the arbitration agreement must be read it and the tribunal must decide on its own jurisdiction. Although the LAM does not expressly state it, it is understood that this decision must be made ex officio, even if the parties have not challenged the competence of the arbitral tribunal.
Yes. Pursuant to Article 16 of the ICA Act the arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement. A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence. A party is not precluded from raising such a plea by the fact that he has appointed, or participated in the appointment of, an arbitrator. A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings. The arbitral tribunal may, in either case, admit a later plea if it considers the delay justified.
Article 16 of the ICA Act goes on saying that the arbitral tribunal may rule on the plea referred to immediately above either as a preliminary question or in an award on the merits. If the arbitral tribunal rules as a preliminary question that it has jurisdiction, any party may request, within 30 days after having received notice of that ruling, the competent Court of Appeals, which decision shall not be subject to appeal; while such a request is pending, the arbitral tribunal may continue the arbitral proceedings and render an award.
For domestic cases, although there are no provisions on the matter, Article 20 of the CAM Santiago Arbitration Rules set forth -mutatis mutandi- a similar procedure.
Yes, the competence-competence principle has been recognised by the Supreme Court of Canada and it is found in most of the provincial statutes. Canadian courts will intervene in limited circumstances to determine the jurisdiction of an arbitral award. These circumstances are when the jurisdictional challenge is based solely on a question of law or the questions of fact are superficial, the lack of jurisdiction is clear and obvious or the court is satisfied that the challenge is not a delaying tactic. This was stated by the Supreme Court of Canada in Dell Computer Corp. v. Union des consommateurs (2007 SCC 34). Canadian courts will also intervene, on application by a party, in two possible cases when the tribunal rules on its own jurisdiction. First, as a preliminary issue and, second, in a final award. In the first case, the decision is not subject to appeal. The arbitral proceedings can generally continue, according to all the provincial acts, while a party seeks to resolve the issue of jurisdiction before a court.
The principle of competence-competence applies to arbitral tribunals based on art. 178 para 1 PILA.
Swiss court practice has established principles favouring arbitration over state court litigation, at least where the parties have agreed on arbitration seated in Switzerland. When a state court's jurisdiction is contested based on the existence of an arbitration agreement, Swiss court practice directs any state court seized to refer the matter for review to the arbitral tribunal stipulated in the arbitration agreement in question, if the arbitration agreement on its face appears to be valid and capable of being performed by the parties. This is referred to as the negative effect of competence-competence, which applies in Switzerland with regard to arbitral tribunals seated in Switzerland. Thus, if an arbitration agreement provides for arbitration seated in Switzerland, a state court (wrongly) seized by a party must even in case of doubt refrain from reviewing the arbitration agreement (i.e. its validity and scope) and refer the matter to arbitration.
The principle of competence – competence is unanimously accepted in legal literature and case law. It is also the law as regards both domestic as well as international commercial arbitral proceedings. With regard to the former, article 887 para. 2 GrCCP provides that, unless the parties agree otherwise, the arbitrators have jurisdiction to decide on their own jurisdiction. With regard to the latter, article 16 para. 1 L. 2735/1999 pro-vides the same without the reservation of a contrary agreement by the parties.
The principle of competence-competence is recognised in legislation and case law as well.