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Starting an arbitration proceeding
What is needed to commence arbitration?
In most cases, the proceedings start with one party sending a request for arbitration to the other parties and (if applicable) to an institution for notification to the other parties. The next step is the filing of an answer, the constitution of the tribunal and agreement of the timetable and specific procedural rules.
Under Article 1456(1) of the Code of Civil Procedure, the proceedings are deemed to be commenced as of the appointment of the members of the tribunal. However, the parties can agree to a different starting point.
Are there any limitation periods for the commencement of arbitration?
A claim would be admissible only provided that all relevant statutes of limitation are complied with. That aside, there is no specific limitation period regarding the commencement of arbitration proceedings. However, the parties can provide for a specific limitation period in their arbitration agreement.
In addition, submitting a claim to arbitration interrupts any limitation period, as it would in litigation.
Are there any procedural rules that arbitrators must follow?
Parties are free to choose the procedural rules in the arbitration agreement or at any time during the proceedings. Without such agreement, the tribunal may conduct proceedings as it sees fit without having to comply with the specific civil procedure provisions (Article 1509 of the Code of Civil Procedure). The tribunal must always ensure that the parties are treated equally and must uphold the principle of due process (Articles 1464(2) and 1510). In addition, both the parties and the tribunal must act diligently and in good faith in the conduct of the proceedings (Article 1464(3)).
Are dissenting opinions permitted under the law of your jurisdiction?
Dissenting opinions are permitted (Article 1513 of the Code of Civil Procedure; Paris Court of Appeals, October 9 2008).
Can local courts intervene in proceedings?
Before the tribunal is constituted, any party can apply to the local courts for interim or conservatory measures or measures relating to the taking of evidence (Article 1449 of the Code of Civil Procedure).
In the absence of an arbitral institution, the parties can refer a dispute relating to the constitution of the tribunal to the judge acting in support of the arbitration (Article 1454).
If a third party holds a document relevant for the purposes of the proceedings, the tribunal may allow a party to seek an order for disclosure from the judge having jurisdiction over the third party (Article 1469).
Can the local courts assist in choosing arbitrators?
Where the parties have not referred their dispute to an arbitral institution, the judge acting in support of the arbitration will decide on any dispute relating to the constitution of the tribunal (Article 1454 of the Code of Civil Procedure).
The judge acting in support of the arbitration may eventually choose arbitrators when:
- the parties cannot agree on the sole arbitrator (Article 1452(1));
- the party-appointed arbitrators fail to choose the third arbitrator (Article 1452(2)); or
- parties to multi-party arbitration proceedings cannot reach an agreement on the appointment of arbitrators (Article 1453).
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?
There are no specific provisions with regard to default arbitration proceedings.
French case law considers awards rendered by default to be valid. The defendant party must have been informed of the existence of the arbitral proceedings. However, the award may be set aside if the defendant proves that it was materially impossible for it to appear before the tribunal. In addition, the absent party must have had the possibility to intervene at any stage of the proceedings and present its arguments, which means that it must be kept informed of the subsequent development of the proceedings. Moreover, the absent party cannot be deemed to acquiesce to the claims presented by the other party.
Since arbitration is purely contractual in nature, a tribunal cannot order a third party to appear before it.
In what instances can third parties be bound by an arbitration agreement or award?
The French courts’ have an extensive approach to the effects of arbitration agreements on third parties.
In particular, a party taking part in the negotiation, performance or termination of the underlying contract (which contains the arbitration agreement) – or assuming the rights and obligations of an initial party – can be bound by its arbitration clause (Cass 1st Civ, March 27 2007).
Arbitral awards have no res judicata effect on third parties. However, the parties can rely on the award in its relation to third parties in order to ascertain the new legal obligations between the parties to the award.
Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?
The parties are free to choose the language of the proceedings, as French arbitration law sets no default rules. Most institutional arbitration rules provide that when the parties do not agree on the language of the proceedings, the tribunal can determine the language of the arbitration (eg, Article 20 of the 2012 International Chamber of Commerce Rules of Arbitration).
Regarding the seat of arbitration, the parties can choose this in the arbitration clause or in a subsequent agreement. If there is no agreement, in ad hoc arbitration the seat will be decided by the arbitrators. For institutional arbitrations, arbitration rules generally provide that it will be for the institution to determine the place of arbitration.
How is evidence obtained by the tribunal?
Unless the parties agree otherwise (Article 1056(3) of the Code of Civil Procedure), the tribunal can order a party to produce documents and even impose penalties on recalcitrant parties (Article 1467).
If a third party holds a document relevant for the purposes of the proceedings, the tribunal may allow a party to seek an order for disclosure from the judge having jurisdiction over such third party (Article 1469).
What kinds of evidence are acceptable?
The parties usually decide on the rules applicable to the taking of evidence. They either do so directly or through a reference to institutional rules of procedure. Among other things, the parties can decide to allow or refuse discovery. Arbitrators generally enjoy broad discretion to determine the admissibility or relevance of any evidence and may take guidance from the International Bar Association (IBA) Rules on the Taking of Evidence in International Commercial Arbitration (without necessarily being bound by them).
Is confidentiality ensured?
French arbitration law provides for the confidentiality of domestic arbitration only.
Can information in arbitral proceedings be disclosed in subsequent proceedings?
In enforcement proceedings before French courts, the arbitral award and the arbitration clause are not part of the public record. However, the parties’ written pleadings filed to set aside an international award rendered in France, or an appeal against the ex parte decision granting recognition of the award, are part of the public record, and French courts do not have to protect the confidentiality of these pleadings.
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?
No professional standard exists in and of itself. However, a consistent body of ethical rules has flourished. It concerns primarily arbitrators’ independence and impartiality. The IBA Guidelines on Conflicts of Interest in International Arbitration plays a key role in this regard. Other ethical standards have been adopted by arbitral institutions as well.
Ethical rules for counsel in arbitration is a delicate issue, with several sets of rules potentially applicable (ie, those of the lawyer’s jurisdiction and the seat of arbitration, or any set of generally accepted principles, such as the IBA Principles of Conduct for the Legal Profession).
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