The Arbitration Act, which follows the UNCITRAL Model Law, was a breakthrough in the regulation of arbitration in Spain when it was first introduced.
However, in order to expedite the enforcement of both national and international awards it required some reform. This new Reform supports Spain’s ambition to attract international arbitration and reinforces the role of arbitral institutions. A brief summary of the main changes is provided below:
- The Reform has reallocated certain judicial functions, for example, those relating to the action for annulment of an award and the exequatur of foreign arbitral awards are now attributed to the Superior Courts of Justice, but keeping the jurisdiction of the Courts of First Instance for the enforcement of national awards.
- The Act recognises arbitration in disputes arising in limited liability companies, ordering a legal majority of the shareholders to introduce a clause providing for arbitration in the company’s constitution/bylaws. It has also been established that a submission to arbitration for the challenge of shareholders’ agreements requires the appointment of an arbitrator(s) by an arbitral institution.
- The Reform also allows the appointment as Arbitrators of persons with legal expertise in arbitration, but not necessarily lawyers. Witnesses and experts, and any third parties involved in the arbitration proceedings, may use their own “mother tongue”, notwithstanding the language agreed by the parties.
- There are also specific references to the formalities required in the Award and a remedy to redress any excess of the Award where the Arbitrators have awarded on matters not submitted to arbitration or for matters which cannot be arbitrated.
- With respect to any action for annulment, the Reform establishes that the Award can be always enforced even when an action for annulment or a revision request has been submitted. It also provides that the annulment proceedings shall be dealt as proceedings for small claims matters ("juicios verbales").
- The Reform also allows for injunctive relief to those who are party to an arbitration agreement even before the arbitration proceedings are initiated.
- Finally, the Reform provides that in certain cases, the parties may initiate arbitration even if one of the parties is declared insolvent.