Continuing its move to introduce legislative amendments by way of ordinance, while the Parliament is not in session, the Central Government has once again amended the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) with the consent of the President. The President of India promulgated the Arbitration and Conciliation (Amendment) Ordinance, 2015 to amend the Arbitration Act, on October 23, 2015 (“Arbitration Ordinance”). The Arbitration Ordinance brings into force the Arbitration and Conciliation (Amendment) Bill, 2015, that had been cleared by the Union Cabinet during August this year, the salient features of which were summarised in our earlier Newsletter of August, 2015.
The Arbitration Ordinance, which comes into force with immediate effect, puts to rest the matter whether interim measures under Section 9 of the Arbitration Act, assistance of court for taking evidence under Section 27 of the Arbitration Act and provision for appeal under Section 37 of the Arbitration Act from interim orders are available for international commercial arbitration where the place of arbitration is outside India. It has been clarified that even though the place of arbitration of international commercial arbitration is outside India, and an arbitral award is a foreign award which is enforceable and recognised under the provisions of Part II of the Arbitration Act, the provisions of the Arbitration Act dealing with interim measures, assistance of court for taking evidence and appeal from interim orders will be applicable.
The Arbitration Ordinance which has introduced effective steps for speedy redressal of arbitrations, will have to be passed by both Houses of Parliament, within 6 (six) weeks of its reassembling or the ordinance will cease to operate. Considering that ordinances have the effect of temporary laws, stakeholders will be wary of implementing the provisions of the Arbitration Ordinance before the Parliament reconvenes next month for its winter session.