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Arbitral proceedings

Starting an arbitration proceeding
What is needed to commence arbitration?

In the case of ad hoc arbitration, unless the parties have agreed otherwise, the arbitration proceedings will commence on the date on which the respondent receives the petition to bring the dispute before a tribunal. The petition must designate the parties as well as the subject matter of the arbitration, and indicate that an arbitration agreement was concluded (Section 1044 of the Code of Civil Procedure). It is advisable to include a nomination of one arbitrator (Section 1035 of the code).

In the case of institutional arbitration, the relevant institution must typically be addressed first. Arbitration at the German Institution of Arbitration (DIS) commences when the claimant files the statement of claim with the DIS Secretariat (Section 6 of the DIS Rules). The content of the filing is described in detail in Section 6 of the DIS Rules. Other German institutional arbitration rules contain similar rules (eg, Article 3 of the Chinese European Arbitration Centre Rules).

Limitation periods
Are there any limitation periods for the commencement of arbitration?

If the party does not nominate its arbitrator within one month of receiving a request from the other party, on the request of the other party, the ordinary court is competent to nominate the arbitrator (Section 1035(3) of the Code of Civil Procedure).

The claimant must present its claim and the facts on which this is based within a period determined by the parties or the tribunal (eg, Section 6.4 of the German Institution of Arbitration Rules and Article 20(1) of the Chinese European Arbitration Centre Rules). The defendant must state its position in this regard (Section 1046(1) of the code).  

Procedural rules
Are there any procedural rules that arbitrators must follow?

The parties are to be treated equally. Each party is to be given an effective and fair legal hearing. Attorneys may not be prohibited from acting as attorneys in fact (Section 1042 of the Code of Civil Procedure; Sections 15 and 26 of the German Institution of Arbitration Rules). 

Dissenting arbitrators
Are dissenting opinions permitted under the law of your jurisdiction?

Dissenting opinions are not forbidden, but likewise there are no provisions that expressly allow them. In practice, dissenting opinions are accepted. However, any arbitrator issuing an dissenting opinion should be aware of the confidentiality of the internal deliberations of the tribunal (Section 43 of the German Institution of Arbitration Rules) in order to avoid a petition for reversal of an arbitral award under Section 1059(2)(1)(d) of the Code of Civil Procedure.

Judicial assistance
Can local courts intervene in proceedings?

Yes, in connection with:

  • the appointment of arbitrators (Sections 1034 and 1035 of the Code of Civil Procedure);
  • the challenge of an arbitrator’s appointment (Section 1037 of the code);
  • an interim ruling of the tribunal with respect to its own competence (Section 1040 of the code);
  • interim relief (Section 1041 of code); and
  • the taking of evidence (Section 1050 of the code). 

Can the local courts assist in choosing arbitrators?

Yes, in ad hoc arbitrations, where an arbitrator refuses the appointment or the parties cannot agree on the appointment of a sole arbitrator (Section 1035(4) of the Code of Civil Procedure). However, if the parties have agreed on the rules of an arbitration institution, these might provide differently.

What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration? Can the courts compel parties to arbitrate? Can they issue subpoenas to third parties?

The applicable law where a party fails to participate is the Code of Civil Procedure.  

The courts cannot compel parties to arbitrate.

The courts cannot issue subpoenas to third parties.

Third parties
In what instances can third parties be bound by an arbitration agreement or award?

An arbitration agreement or award binds only the parties to the arbitration agreement. However, a third party may join the arbitration proceedings if the parties so consent. Therefore, a third party may voluntarily join the arbitration proceedings upon a third-party notice, but cannot be forced to join the arbitration proceedings or enforce its joinder. 

Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?

The tribunal shall determine the language of the proceedings if this has not been agreed between the parties (Section 1045(1) of the Code of Civil Procedure; Section 21 of the German Institution of Arbitration (DIS) Rules and Article 19 of the Chinese European Arbitration Centre Rules).

Unless otherwise agreed between the parties, the tribunal shall determine the seat according to the circumstances of the individual case (Section 1043(1) of the Code of Civil Procedure; Section 21 of the DIS Rules and Article 18(1) of the Chinese European Arbitration Centre Rules, which lists Hamburg as the seat of arbitration). However, the tribunal is free to hold oral hearings at any other place where appropriate. 

Gathering evidence
How is evidence obtained by the tribunal?

According to Section 1042(4) of the Code of Civil Procedure, the tribunal is competent to:

  • decide on the admissibility of evidence;
  • take such evidence; and
  • assess the results at its sole discretion. 

What kinds of evidence are acceptable?

Typically, witnesses, experts, documents and inspections are admissible (Section 27 of the German Institution of Arbitration Rules).  The tribunal is free to consider the International Bar Association Rules on the Taking of Evidence.

Confidentiality
Is confidentiality ensured?

German law does not provide for an explicit confidentiality obligation. However, the nature of arbitration requires arbitrators to keep matters confidential as an implicit requirement of their contract with the parties. 

Section 43 of the German Institution of Arbitration (DIS) Rules contains a comprehensive confidentiality obligation, obliging the parties, the arbitrators and the DIS Secretariat not to disclose information regarding the proceedings (Article 34(5) and Paragraphs (e) and (f) of the Annex to the Chinese European Arbitration Centre Rules contain a similar confidentiality obligation).  

Can information in arbitral proceedings be disclosed in subsequent proceedings?

In case of a subsequent court case (eg, for enforcement of a foreign arbitral award), matters which were initially confidential may be discussed in a public hearing of a court case.

Ethical codes
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?

Arbitrators are not per se subject to any ethical or professional code. However, lawyers are subject to their professional code, which includes rules on ethical behaviour. These statutory provisions apply to all dealings of the lawyer, whether giving legal advice as counsel or acting as a representative in a court case or as an arbitrator in arbitration proceedings. 

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