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National arbitration laws What legislation applies to arbitration in your jurisdiction? The International Arbitration Act 1974 (Cth) governs international arbitration (eg, where one party is foreign) in Australia. Each state has its own commercial arbitration act which applies to domestic arbitration. Both the International Arbitration Act and the various commercial arbitration acts adopt the UNCITRAL Model Law (except the Commercial Arbitration Act in the Australian Capital Territory).
Mandatory laws Are there any mandatory laws? Some provisions of the UNCITRAL Model Law, as adopted by the International Arbitration Act, may arguably be considered mandatory, including:
- the parties must be treated with equality and each party must be given a full opportunity to present its case (Article 18);
- the claimant must state the facts supporting its claim and the respondent must state its defence (Article 23(1));
- the parties must be given sufficient advanced notice of any hearings or meetings of the arbitral tribunal for the purposes of inspecting goods, other property or documents (Article 24(2));
- all statements, documents or other information supplied to the arbitral tribunal by one party must be communicated to the other party, including any expert report or evidentiary document on which the arbitral tribunal may rely (Article 24(3));
- the arbitral tribunal, or a party with the approval of the arbitral tribunal, may request the competent court’s assistance in taking evidence (Article 27);
- in relation to settlement, an award on agreed terms must be made in accordance with Article 31 and must state that it is an award (Article 30);
- the prescribed form of the award – except for Article 31(2), under which the parties can agree whether reasons are required (Article 31);
- arbitral proceedings are terminated by the final award or by order of the tribunal (Article 32); and
- the arbitral tribunal may correct any administrative errors at the request of a party or of its own accord – except for Article 33(3), which the parties may agree to exclude so that the arbitral tribunal can make an additional award to correct an omission (Article 33).
In addition, there are mandatory laws that apply in certain circumstances, such as the Competition and Consumer Act 2010 (Cth).
New York Convention Is your country a signatory to the New York Convention? If so, what is the date of entry into force? Australia is a signatory to the New York Convention, which entered into force on June 24 1975.
Are there any reservations to the general obligations of the convention? Australia has not included any reservations or made any other declarations or notifications to the New York Convention.
Treaties and conventions What other treaties and conventions in relation to arbitration is your jurisdiction party to? Australia is a party to:
- the Geneva Convention on the Execution of Foreign Arbitral Awards 1927;
- the Convention on the Settlement of Investment Disputes between States and Nationals of Other States 1966;
- around 23 bilateral investment treaties and 10 free trade agreements (including the China-Australia Free Trade Agreement, which entered into force on December 20 2015).
Australia signed the Trans-Pacific Partnership on February 4 2016. Australia is now progressing its internal process to approve the agreement.
UNCITRAL Has your jurisdiction adopted the UNCITRAL Model Law? Yes, the UNCITRAL Model Law is annexed in Schedule 2 to the International Arbitration Act 1974 (Cth).
Reform Are there any impending plans to reform the arbitration laws in your jurisdiction? Amendments to the International Arbitration Act 1974 (Cth) were made in August and October 2015. The amendments included the following:
- The confidentiality provisions in Sections 23C to 23G now apply on an opt-out rather than an opt-in basis.
- Section 8(4), which prevented the enforcement of arbitral awards made in countries that are not party to the New York Convention, has been removed. This means that any arbitral award – regardless of whether the New York Convention applies – may be enforced by the Australian courts.
- Section 21 was amended to clarify that the UNCITRAL Model Law applies to any arbitral proceedings commenced after July 6 2010 (the date on which the International Arbitration Act was amended in order to implement the UNCITRAL Model Law), regardless of when the arbitration agreement was concluded.
Validity What are the validity requirements for an arbitration agreement? Australia has adopted Option 1 of Article 7 of the UNCITRAL Model Law for the definition and form of arbitration agreements. Option 1 requires arbitration agreements to be in writing (Article 7(2)). This requirement is broadly defined to include electronic communications (Article 7(4)) and any record in any form, whether the agreement has been concluded verbally, by conduct or by other means (Article 7(3)).
Enforcement of agreements How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements? Australian courts are arbitration friendly and will enforce arbitration agreements. The courts must stay court proceedings if the parties have agreed to an arbitration agreement and the matter is capable of settlement by arbitration, unless the agreement is null and void, inoperative or incapable of being performed (Section 7 of the International Arbitration Act 1974 (Cth)).
Consolidation Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances? An arbitral tribunal may consolidate separate arbitral proceedings, provided that it has been given the power to do so in the arbitration agreement or arbitral rules. The new Australian Centre for International Commercial Arbitration Rules (which apply as of January 1 2016) include consolidation provisions that may apply in certain circumstances.
If there is no agreement to consolidate in the arbitration agreement and the arbitral rules do not include consolidation, there may be consolidation under Section 24 of the International Arbitration Act, provided that the parties have agreed to apply this provision (ie, it is an opt-in provision) and:
- a common question of law or fact arises in the proceedings;
- the rights to relief claimed in the proceedings are in respect of, or arise out of, the same transaction or series of transactions; or
- for some other reason specified in the application, it is desirable that an order be made.
Choice of law How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be? The substantive law of the dispute is usually chosen by the parties in the underlying contract. If the parties have not chosen the substantive law, Article 28 of the UNCITRAL Model Law (Schedule 2 of the International Arbitration Act 1974 (Cth)) provides that the arbitral tribunal will apply the law which it considers appropriate.
Separability Are there any provisions on the separability of arbitration agreements? The principle of separability is provided for in Article 16 of the UNCITRAL Model Law (Schedule 2 of the International Arbitration Act 1974 (Cth)).
Multiparty agreements Are multiparty agreements recognised? Multiparty agreements are recognised in Australia as long as all of the parties to the arbitration have consented to arbitration pursuant to the relevant arbitration agreement.
Criteria for arbitrators Are there any restrictions? No nationality restrictions apply to the appointment of arbitrators, unless the parties agree otherwise (Article 11(1) of the UNCITRAL Model Law). However, arbitrators must be independent and impartial (Article 12 of the UNCITRAL Model Law).
Contractual stipulations What can be stipulated about the tribunal in the agreement? The parties are free to stipulate specific criteria for the appointment of the tribunal. The parties may also stipulate the procedure for the appointment of the tribunal. The only restriction is that the parties cannot agree that the arbitrators will not be independent and impartial.
Default requirements Are there any default legal requirements as to the selection of a tribunal - for example, concerning the number of arbitrators or their characteristics? Articles 10 to 12 of the UNCITRAL Model Law set out the default rules for the appointment of an arbitral tribunal. If the parties have not agreed on the number of arbitrators, the tribunal will consist of three arbitrators (Article 10(2) of the UNCITRAL Model Law). Article 11 sets out the default process for the appointment of a sole arbitrator and the appointment of a three-person tribunal.
The appointing authority (if required) is the Australian Centre for International Commercial Arbitration. The appointing authority will address any qualifications specified by the parties and any considerations that are likely to ensure the appointment of an independent and impartial arbitrator. Further, the appointing authority may consider the nationality of the parties if it is the sole arbitrator or the third arbitrator.
Challenging the appointment of an arbitrator Can the appointment of an arbitrator be challenged? Can an arbitrator be disqualified? What is the procedure for this? An arbitrator may be challenged if there are circumstances likely to give rise to justifiable doubts as to his or her impartiality or independence (Article 12 of the UNCITRAL Model Law). Unless the parties have agreed otherwise (eg, through the applicable arbitral rules), the procedure for challenging an arbitrator is as follows (Article 13 of the UNCITRAL Model Law):
- Within 15 days of becoming aware of the constitution of the tribunal or the relevant circumstance, the challenging party must send a written statement of the reasons for its challenge to the arbitral tribunal.
- The tribunal must issue a ruling on the challenge, unless the arbitrator withdraws.
- The challenging party has 30 days from the issue of the decision on the challenge to request the relevant court to decide on the challenge (the court’s decision cannot be appealed).
Jurisdictional objections How should an objection to jurisdiction be raised? Arbitral tribunals can rule on their own jurisdiction (Article 16(1) of the UNCITRAL Model Law). A challenge to a tribunal's jurisdiction must be raised no later than the date on which the statement of defence was submitted (Article 16(2) of the UNCITRAL Model Law). Tribunals may decide on jurisdiction as a preliminary question or in an award on the merits (Article 16(3) of the UNCITRAL Model Law). If a tribunal rules on its jurisdiction as a preliminary question, the parties have 30 days from the tribunal’s decision to request the court to determine whether the tribunal has jurisdiction. The court’s decision cannot be appealed.
Replacement of an arbitrator Why and how can an arbitrator be replaced? Arbitrators can be replaced pursuant to the same rules that apply to the initial appointment of arbitral tribunals (Article 15 of the UNCITRAL Model Law).
Powers and obligations What powers and obligations do arbitrators have? Arbitral tribunals have a number of powers and obligations, including:
- the power to rule on their own jurisdiction (Article 16 of the UNCITRAL Model Law);
- the power to rule on the challenge of an arbitrator (Article 13 of the UNCITRAL Model Law);
- the power to order interim measures (Article 17 of the UNCITRAL Model Law);
- the obligation to treat the parties equally and give each party a full opportunity of presenting its case (Article 18 of the UNCITRAL Model Law);
- the power to determine the rules of procedure for the arbitration and the admissibility, relevance, materiality and weight of any evidence (Article 19 of the UNCITRAL Model Law);
- the power to determine the seat of the arbitration if it has not been agreed by the parties (Article 20 of the UNCITRAL Model Law);
- the power to determine the substantive law to apply to the arbitration, unless the parties have agreed otherwise (Article 28(2) of the UNCITRAL Model Law); and
- the power to appoint a tribunal-appointed expert, unless the parties agree otherwise (Article 26 of the UNCITRAL Model Law).
Liability of arbitrators Are arbitrators immune from liability? Section 28 of the International Arbitration Act 1974 (Cth) provides that an arbitrator is not liable for anything done or omitted by the arbitrator in good faith in his or her capacity as arbitrator.
Communicating with the tribunal How do the parties communicate with the tribunal? No specific provisions in the International Arbitration Act 1974 (Cth) relate to communication with arbitral tribunals. The general practice is that the parties communicate with the tribunal via email and conference calls. Each party should copy or include the other party in any communication to the tribunal to ensure the independence and impartiality of the tribunal.
Reaching decisions Is unanimous agreement of the tribunal required? If there is disagreement, does the will of the majority suffice? What are the implications of this? The International Arbitration Act 1974 (Cth) does not require unanimous agreement by the arbitral tribunal.
The International Arbitration Act 1974 (Cth) incorporates Article 29 of the UNCITRAL Model Law, which provides that any arbitral tribunal decision must be made by a majority of its members, unless the parties agree otherwise. A dissenting arbitrator need not provide reasons and the majority is under no obligation to refer to the dissenting arbitrator’s concerns.
Arbitrability Are there any disputes incapable of being referred to arbitration? The International Arbitration Act 1974 (Cth) does not specifically state what disputes are incapable of being resolved by arbitration. The Australian courts have held that “disputes such as those concerning intellectual property, antitrust and competition disputes, securities transactions and insolvency” are the types of dispute that are considered incapable of settlement by arbitration (Comandate Marine Corp v Pan Australia Shipping Pty Ltd (2006) 157 FCR 45 at ).
Can the arbitrability of a dispute be challenged? The arbitrability of a dispute may be challenged in the early stages of the arbitration. A party may challenge the arbitral tribunal's jurisdiction to hear a matter, including on the grounds that the dispute is not capable of settlement by arbitration (Article 16 of the UNCITRAL Model Law).
The arbitrability of a dispute may also be challenged after an award has been issued. An award may be set aside or enforcement may be refused if the subject matter of the dispute cannot be settled by arbitration (see Article 34 of the UNCITRAL Model Law for setting aside an award, Section 8(7) of the International Arbitration Act 1974 (Cth) and Article 36 of the UNCITRAL Model Law for challenging the enforcement of an award).
Jurisdiction and competence-competence Is the principle of competence-competence recognised in your jurisdiction? Can a party to an arbitration ask the courts to determine an issue relating to the tribunal’s jurisdiction and competence? The principle of competence-competence is recognised in Australia. Article 16 of the UNCITRAL Model Law provides that an arbitral tribunal may rule on its own jurisdiction. If the tribunal issues a decision on jurisdiction, a party may request the court to determine whether the tribunal has jurisdiction (Article 16(3)). The court's decision cannot be appealed.
Starting an arbitration proceeding What is needed to commence arbitration? Arbitration is commenced by one party (the claimant) issuing a notice in writing (a notice of arbitration or a request for arbitration) to the other party (the respondent) to begin the arbitral proceedings. The arbitral rules agreed to by the parties (if any) may set out the requirements for the notice of arbitration or request for arbitration. The notice of arbitration or request for arbitration is usually emailed or couriered to the respondent.
Limitation periods Are there any limitation periods for the commencement of arbitration? No specific limitation periods apply to the commencement of arbitration. However, the usual limitation periods that apply to the commencement of claims in the courts also apply to arbitration. The limitation period for contractual claims is six years (12 years if the contract is a deed) from the date on which the breach occurred. The limitation period for tort claims is six years from the date on which the cause of action arose.
Procedural rules Are there any procedural rules that arbitrators must follow? The only procedural rules that must be followed are those set out by the parties in the arbitration agreement. Otherwise, the arbitral tribunal has extensive powers to determine the rules of procedure, provided that the arbitration is conducted in an appropriate manner (Article 19 of the UNCITRAL Model Law). The tribunal has the power to determine the admissibility, relevance, materiality and weight of any evidence.
Dissenting arbitrators Are dissenting opinions permitted under the law of your jurisdiction? An arbitrator may issue a dissenting opinion. Article 31 of the UNCITRAL Model Law provides that an award must be decided by the majority of the tribunal. The dissenting arbitrator may issue a dissenting opinion explaining the reasons for his or her dissent.
Judicial assistance Can local courts intervene in proceedings? The extent to which the local courts may intervene in the arbitral proceedings is limited to the express provisions in the International Arbitration Act 1974 (Cth) and the UNCITRAL Model Law (Article 5 of the UNCITRAL Model Law). The local courts may support and supervise arbitral proceedings by, for example:
- ordering a stay of court proceedings and referring the parties to arbitration (Section 7 of the International Arbitration Act);
- ruling on the arbitral tribunal’s jurisdiction after the tribunal has issued its decision on jurisdiction (Article 16 of the UNCITRAL Model Law);
- ordering interim measures in certain circumstances (Article 9 and 17J of the UNCITRAL Model Law); and
- hearing a challenge to an arbitrator (Article 13 of the UNCITRAL Model Law).
Can the local courts assist in choosing arbitrators? The local courts cannot assist in choosing arbitrators. The appointing authority is the Australian Centre for International Commercial Arbitration, pursuant to the International Arbitration Regulations 2011 (Cth).
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? Arbitral tribunals have the power to continue with arbitration if the respondent fails to participate in the proceedings. Specifically, the tribunal may continue if the respondent fails to communicate its statement of defence (Article 25(b) of the UNCITRAL Model Law). The tribunal may also continue if either party fails to appear at a hearing or produce documentary evidence (Article 25(c) of the UNCITRAL Model Law).
Tribunals cannot compel the parties to arbitrate or issue subpoenas. If a party does not comply with a tribunal order, the tribunal cannot enforce the order, but may draw adverse inferences from that party's conduct. A party may apply to the Australian courts, with the permission or approval of the tribunal (if the arbitration is seated in Australia and the relevant witness or documents are based in Australia) for a subpoena to compel the witness to give evidence or compel the production of documents before the tribunal in certain circumstances (Section 23 of the International Arbitration Act 1974 (Cth) and Article 27 of the UNCITRAL Model Law).
Third parties In what instances can third parties be bound by an arbitration agreement or award? Third parties are not usually bound by arbitration agreements, unless they are party to the agreement or have otherwise consented to arbitration. There are circumstances in which a court may stay court proceedings pending arbitration where the proceedings have been brought by a person or company claiming "through or under a party".
Third parties are not usually bound by arbitral awards. However, awards may have an effect on third parties where, for example, the third party owed money to the award debtor which may be paid to the award creditor on the order of the court (garnishee orders or third-party orders).
Default language and seat Unless agreed by the parties, what is the default language and location for arbitrations? There is no default language or seat of arbitration under the International Arbitration Act. However, the applicable arbitral rules may provide for the default language or seat of the arbitration. For example, the new Australian Centre for International Commercial Arbitration Rules provide that the default seat is Sydney (Article 23.1).
The arbitral tribunal has the power to determine the language of the arbitration (Article 22 of the UNCITRAL Model Law) and the seat of the arbitration (Article 20 of the UNCITRAL Model Law) if this has not been agreed by the parties.
Gathering evidence How is evidence obtained by the tribunal? The arbitral tribunal has discretion to determine the rules of procedure for the arbitration (subject to the arbitral rules agreed by the parties and the principle of equal treatment of the parties). The tribunal and the parties may agree to apply the International Bar Association Rules of Evidence.
Usually, the parties and tribunal will agree to the procedural timetable for the proceedings, which set outs the submissions and evidence to be provided by the parties. This process includes:
- documentary evidence relied on by each party;
- witness evidence; and
- expert evidence (if any) that is provided in writing.
Oral evidence is then provided during the hearing, including the cross-examination and re-examination of witnesses and experts.
What kinds of evidence are acceptable? Arbitral tribunals have broad discretion to determine the admissibility, relevance, materiality and weight of any evidence (Article 19 of the UNCITRAL Model Law). Usually, the tribunal will consider and accept documentary evidence, witness evidence and expert evidence. The parties do not usually object to the admissibility and relevance of evidence, although some specific points may be raised if they are particularly significant. Rather, the tribunal will consider and determine the evidence that is relevant and material to the outcome of the dispute.
Evidence that may be excluded includes evidence where legal professional privilege is claimed or where the documents are commercially confidential.
Confidentiality Is confidentiality ensured? One of the amendments made to the International Arbitration Act 1974 (Cth) in October 2015 changed the provisions on confidentiality from opt-in to opt-out (Sections 23C, 23D, 23E, 23F and 23G). This means that the legislation now provides that arbitral proceedings are confidential unless the parties have agreed otherwise. The new Australian Centre for International Commercial Arbitration Rules also state that all arbitrations are confidential unless the parties have agreed otherwise (Article 22).
Can information in arbitral proceedings be disclosed in subsequent proceedings? As all information provided to or produced during the arbitral proceedings is confidential, this information cannot be disclosed in subsequent proceedings, except in certain circumstances. Section 23D sets out circumstances in which confidential information may be disclosed. For example, information may be disclosed where it is required by a court order, law or a regulatory body. Confidential information may be disclosed in subsequent arbitral proceedings where it is necessary to:
- ensure that a party has a full opportunity to present its case;
- protect legal rights in relation to a third party and the disclosure is no more than reasonable for that purpose; or
- enforce an arbitral award.
Ethical codes What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction? Solicitors admitted in Australia and registered foreign lawyers are bound by the rules that apply to the state in which they are admitted. There is now a Legal Profession Uniform Application Act in New South Wales and Victoria with uniform rules. The other states have not yet adopted the Uniform Law or rules.
Barristers in Australia are subject to the relevant rules and codes for the state in which they practice. For example, in New South Wales barristers are subject to the rules and guidelines of the New South Wales Bar Association.
These rules and guidelines do not apply to foreign lawyers who are not registered as such in Australia.
Estimation & allocation How are the costs of arbitration proceedings estimated and allocated? Arbitral tribunals have the power to award costs in the arbitration. The new Australian Centre for International Commercial Arbitration Rules provide that tribunals must fix costs in awards (Article 44). The International Arbitration Act 1974 (Cth) also gives tribunals the power to order costs in awards (Section 27 of the International Arbitration Act). Tribunals have discretion to award costs in whole or in part. Costs may include:
- the tribunal’s fees and expenses;
- the arbitration institution’s fees and expenses; and
- the parties’ legal costs and expenses, which may include the costs of experts, witnesses and potentially in-house counsel.
Security for costs Can the national court or tribunal order security for costs under the law in your jurisdiction? An arbitral tribunal seated in Australia has the power to order security for costs (Section 23K of the International Arbitration Act 1974 (Cth) and Article 17 of the UNCITRAL Model Law). The new Australian Centre for International Commercial Arbitration (ACICA) Rules provide that the tribunal may order security for legal or other costs of any party (Article 33.2(e) of the ACICA Rules).
Australian courts can order security for costs in support of an arbitration seated in Australia (Articles 9 and 17J of the UNCITRAL Model Law).
Requirements What legal requirements are there for recognition of an award? Must reasons be given for the award? Does the award need to be reviewed by any other body? The requirements for the recognition of an award are as follows (Article 31 of the UNCITRAL Model Law):
- The award must be made in writing.
- The award must be signed by each member of the tribunal, whether it be a sole arbitrator or three arbitrators (or at least by the majority if it is a majority decision).
- The award must state the reasons on which it is based, unless the parties have agreed that no reasons need to be given.
- The award must state the date and place of arbitration (the award will be deemed to be made in the place of arbitration).
- A copy of the award must be provided to each party.
The award will not be reviewed by any other body unless it is an International Chamber of Commerce or Singapore International Arbitration Centre arbitration.
Timeframe for delivery Are there any time limits on delivery of the award? No time limits apply to the delivery of the award under the International Arbitration Act 1974 (Cth) (including the UNCITRAL Model Law) or the new Australian Centre for International Commercial Arbitration (ACICA) Rules.
There are time limits for issuing an award in an arbitration under the ACICA Expedited Arbitration Rules. Those rules provide that arbitral tribunals must issue awards within four months of their appointment or five months if there is a counterclaim (Article 27 of the ACICA Expedited Arbitration Rules).
Remedies Does the law impose limits on the available remedies? Are some remedies not enforceable by the court? There are no limits on the remedies that may be ordered by an arbitral tribunal.
What interim measures are available? Will local courts issue interim measures pending constitution of the tribunal? Arbitral tribunals have the power to order interim measures to (Article 17 of the UNCITRAL Model Law):
- maintain or restore the status quo pending the determination of the dispute;
- take action that would prevent, or refrain from taking action that is likely to cause, current or imminent harm or prejudice to the arbitral process;
- provide a means of preserving assets out of which a subsequent award may be satisfied; or
- preserve evidence that may be relevant and material to the resolution of the dispute.
There are conditions that must be satisfied before a tribunal will issue an interim measure (Article 17A of the UNCITRAL Model Law).
The new Australian Centre for International Commercial Arbitration Rules also provide that tribunals have the power to award interim measures (Article 33).
The Australian courts have the power to order interim measures in support of an arbitration seated in or outside Australia (Article 9 and 17J of the UNCITRAL Model Law).
Interest Can interest be awarded? Arbitral tribunals have the power to order pre-award interest and post-award interest, unless the parties have agreed otherwise (Sections 25 and 26 of the International Arbitration Act, respectively). Section 25 does not specify whether simple or compound interest may be awarded for pre-award interest. Section 26 expressly states that tribunals may order simple or compound interest for post-award interest.
At what rate? Section 25 (pre-award interest) and Section 26 (post-award interest) of the International Arbitration Act 1974 (Cth) provide that arbitral tribunals may order interest at a "reasonable rate".
Finality Is the award final and binding? Yes.
What if there are any mistakes? The arbitral tribunal may correct or provide an interpretation of an award in limited circumstances (Article 33 of the UNCITRAL Model Law). For example, the tribunal may correct clerical or typographical errors. It may also give an interpretation of a specific point or part of the award. Any requests for corrections or interpretations must be made within 30 days of receipt of the award.
Can the parties exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide? The International Arbitration Act 1974 (Cth) does not provide for a right of appeal. The only recourse available is an application to set aside or annual the award.
Appeal What is the procedure for challenging awards? Awards can be challenged by submitting an application to the relevant court within three months of the date that the award was received by the parties (Article 34(3) of the UNCITRAL Model Law).
On what grounds can parties appeal an award? Parties cannot appeal an award issued in an international arbitration. However, the parties may apply to the relevant Australian court (the Federal Court or the Supreme Court in the state of the seat of the arbitration) for the award to be set aside or annulled (Article 34 of the UNCITRAL Model Law). An arbitral award may be set aside on limited procedural grounds or if it conflicts with public policy. In domestic arbitration, the parties may agree that the award can be appealed on a point of law. The court must grant leave for the appeal. Specifically, an award may be set aside if:
- a party to the arbitration agreement was under some incapacity or the agreement was invalid under the applicable law;
- the party making the application was not given proper notice of the appointment of an arbitrator or the arbitral proceedings or otherwise unable to present its case;
- it deals with a dispute not submitted to arbitration or matters beyond the arbitration;
- the composition of the tribunal or the procedure was not in accordance with the agreement of the parties;
- the subject matter of the dispute was not arbitrable; or
- it conflicts with Australian public policy.
Enforcement What steps can be taken to enforce the award if there is a failure to comply? The successful party may apply to the court for an order in the same terms as the award (Section 8 of the International Arbitration Act 1974 (Cth) and Article 35 of the UNCITRAL Model Law). This order is enforceable as a court judgment using the ordinary measures available under Australian laws.
Can awards be enforced in local courts? Yes, pursuant to Section 8 of the International Arbitration Act.
How enforceable is the award internationally? Arbitral awards made in Australia are enforceable:
- under the New York Convention where it is in force;
- under the Geneva Convention where countries are party to the Geneva Convention and not the New York Convention;
- under the International Convention for the Settlement of Investment Disputes; and
- under a country’s domestic law, if available, where that country is not a party to the New York Convention or Geneva Convention.
To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage? Foreign states and their agencies are generally entitled to immunity from the jurisdiction of the courts of other countries. Foreign states are granted immunity from jurisdiction in Australian courts under the Foreign States Immunities Act 1985 (Cth). Exceptions to this immunity include cases involving commercial transactions, contracts of employment, personal injury and possession and use of property.
Foreign states and their agencies may be considered to have waived immunity from jurisdiction by agreeing to arbitration. However, it may still be possible to raise immunity on enforcement. Again, there are exceptions for immunity on enforcement for commercial assets. This means that an award may be enforced against commercial assets.
Are there any other bases on which an award may be challenged, and if so, by what? Section 8(5) of the International Arbitration Act 1974 (Cth) sets out the circumstances in which the court may refuse to enforce an arbitral award. The circumstances generally reflect those set out in Article 36 of the UNCITRAL Model Law and Article V of the New York Convention. These circumstances include where:
- a party to the arbitration agreement was under some incapacity at the time the agreement was made;
- the arbitration agreement is invalid;
- a party was not given proper notice of the arbitration or was otherwise unable to present its case;
- the award deals with matters outside the scope of the arbitration agreement;
- the composition of the arbitral tribunal was not in accordance with the agreement; and
- the award is not yet binding on the parties.
How enforceable are foreign arbitral awards in your jurisdiction? The successful party may apply to the court for an order in the same terms as the award (Section 8 of the International Arbitration Act 1974 (Cth) and Article 35 of the UNCITRAL Model Law). This order is enforceable as a court judgment using the ordinary measures available under Australian laws.
Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction? Under Section 8(5)(f) of the International Arbitration Act, a court may refuse to enforce an arbitral award that has been set aside by the competent authority of another county.
Rules and restrictions Are there rules or restrictions on third-party funders? In Australia, third-party litigation funders may contract to fund litigation or arbitration. No licencing regime regulates third-party funders.
Class-action or group arbitration
Concept Is there a concept in your jurisdiction providing for class-action arbitration 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 concept of class-action arbitration in Australia. However, if all members of the class agreed to arbitration it may be possible.
Emerging trends Are there any hot topics or trends emerging in arbitration in your jurisdiction? Investor-state dispute settlement is a hot topic in Australia – particularly as a result of the plain packaging case brought by Philip Morris against Australia. In addition, Australia has been negotiating and concluding a number of free trade agreements during the past couple of years, including with Japan, Korea and China and the Trans-Pacific Partnership. Some of these free trade agreements provide for investor-state dispute settlement.