For many years Bahrain has promoted itself as a centre of dispute resolution in the GCC. In 1988 Bahrain became the second GCC state to ratify the New York Convention; the head office of the GCC’s Commercial Arbitration Centre has been located in Bahrain since its inception in 1995; and in 2009 the Bahrain Chamber for Dispute Resolution (the “BCDR”) was formed as an arbitration, mediation and litigation centre for the resolution of disputes involving international elements.
The recent Bahrain Arbitration Law (Legislative Decree No. 9/2015) consolidates this position by standardising the procedural law governing domestic and international arbitrations which have their seat in Bahrain, or are otherwise governed by Bahraini law.
The Arbitration Law incorporates the UNCITRAL Model Law in its entirety, thereby according with internationally accepted best practice in the field of arbitration, enshrining the principles of fairness and impartiality, ensuring limited court intervention, and providing a standardised procedural framework for the constitution of the arbitral tribunal, provisional measures, and awards, challenges and enforcement.
One notable provision is Article 6 of the new Arbitration Law, which permits non-Bahraini lawyers to represent parties in international commercial arbitrations: a position which was previously reserved for cases brought under Chapter 2, Section 2 of the BCDR Law (Legislative Decree No. 30/2009).
Effectively, Article 6 clears up a perceived inconsistency between arbitral proceedings under the BCDR’s Arbitration Rules and those held under other arbitral rules, giving parties to non-BCDR arbitral disputes in Bahrain a much wider scope in the choice of their representation.
For example, international entities can now be represented by their own in-house legal teams, or their preferred international lawyers, without the added cost of “front-of-house” representation by Bahraini local counsel.
This will be of particular relevance to parties seeking to resolve disputes in Bahrain relating to complex, highly specialised and/or technical fields, as it significantly increases their ability to instruct those with expertise in what may be a niche area currently underrepresented in Bahrain.
The recent Arbitration Law is a significant step towards the harmonisation of arbitration internationally, and is but one example of the innovative reforms undertaken by Bahrain (and other GCC states).
There is little doubt that Bahrain’s promotion of arbitration as a leading method of resolving domestic and international disputes will continue to have a positive impact on trade and investment in Bahrain, and increase recognition of Bahrain as a centre for business in the region and globally.