In brief: arbitration agreements in Spain

Arbitration agreement

Are there any types of disputes that are not arbitrable?

The SAA favours arbitrability. In fact, it provides that any matters that can be freely and legally disposed of by the parties can be submitted to arbitration (article 2). This is a clear demonstration in favour of arbitration, following the premises of the Model Law and taking non-arbitrability as an exception.

In addition, the possibility to submit intra-company disputes to arbitration is expressly recognised in article 11-bis. Moreover, securities transactions are considered as arbitrable, and Spanish case law has recognised the arbitrability of subjective rights related to competition law (judgment of the Madrid Appeal Court, 25 September 2015).

Notwithstanding, some matters remain non-arbitrable, such as family law issues, the civil status and capacity of individuals, criminal liability, insolvency procedure and, in general, matters related to public policy. Further, there is still a reluctance to admit the arbitrability of tax disputes, and the SAA excludes labour disputes from its scope (article 1).

What formal and other requirements exist for an arbitration agreement?

The SAA sets forth the requirements of arbitration agreements (without determining any particularities for public entities).

According to article 9, an arbitration agreement shall be in writing, in a document signed by the parties or an exchange of letters, telegrams, telexes, faxes or other telecommunication methods (including electronic) that ensure a record of the agreement is kept. Additionally, where an arbitration agreement is accessible for subsequent reference on electronic, optical or other media, it will be regarded as compliant with this requisite.

When construing these requirements, the Spanish Supreme Court has concluded that conclusive facts can evidence the consent to submit a dispute to arbitration even if the agreement is only signed by one party (judgment 24 November 1998), and that apart from formal requirements attention shall be paid to the willingness of the parties (judgment 9 May 2003).

In this vein, for instance, as stated in article 9, tacit consent is accepted when there is an exchange of statements of claim and defence and the existence of the arbitration agreement is alleged by one party and not denied by the other.

Lastly, pursuant to article 9.2, arbitration agreements can be contained in adhesion contracts. Their validity and interpretation will be governed by the rules applicable to such contracts. In particular, arbitration agreements signed by consumers, under certain circumstances, are not binding for them as it is set forth under the Consumer’s Act of 16 November 2007.

In any case, it is strongly recommended to use standard clauses provided by the various arbitration courts (for instance, CIMA or CAM), to avoid any doubt about the willingness of the parties to submit all disputes to arbitration or any omission in the arbitration clause.

In what circumstances is an arbitration agreement no longer enforceable?

If the parties expressly submit the dispute to a particular individual who subsequently dies or is declared unable to perform his or her duties, the validity of the arbitration agreement could be jeopardised (judgment of the Superior Court of Justice of Castilla y La Mancha, 25 September 2013).

Additionally, although according to the Spanish Insolvency Act, the mere declaration of insolvency does not affect the validity of arbitration agreements, if the court considers that they could affect the course of insolvency proceedings, then it can stay their effects (article 52.1 of the SAA).

The parties may of course agree on the termination of the arbitration agreement or they can just enter into a new agreement that overrides (tacitly or expressly) the previous one.

Moreover, please note that an arbitration clause may be considered not valid (and therefore, non-enforceable) if the willingness of the parties to submit to arbitration is not clear enough (judgment of the Constitutional Court, 2 December 2010, and of the Supreme Court, 27 June 2017).

Are there any provisions on the separability of arbitration agreements from the main agreement?

The SAA provides that the arbitration agreements must be considered a separate and independent agreement from the underlying contract. Therefore, they are not affected by the fate of the latter.

In which instances can third parties or non-signatories be bound by an arbitration agreement?

Under the SAA, signature is not essential to confirm the consent to submit a dispute to arbitration.

Having said that, the SAA in article 11-bis allows the inclusion of an arbitration agreement in the articles of association for inter-company disputes if a qualified majority of two-thirds of the shareholders votes in favour. If so, those shareholders who have not voted in favour would nonetheless be bound by the arbitration agreement.

Additionally, in certain limited circumstances, Spanish case law has extended its effects to non-signatory parties. For instance:

• in case of assignment of a contract that contains an arbitration agreement, it is generally accepted that the latter is transmitted to the assignee (judgment of the Madrid Appeal Court, 18 February 2002);
• the same outcome is achieved in cases of succession, including mergers and acquisitions, and contractual subrogation (judgment of the Madrid Appeal Court, 26 October 2010); and
• with regard to mandate contracts, representation is recognised, and, therefore, an agent can bind the principal if he or she has enough power to do it (judgment of the Madrid Appeal Court, 16 January 2006).

Does your domestic arbitration law make any provisions with respect to third-party participation in arbitration, such as joinder or third-party notice?

The SAA does not contain any special rule on joinder or notice to third parties. Thus, third-party participation will depend upon the arbitration rules chosen by the parties. The interest of the joinder of third parties for the parties initially involved in the arbitration will have to be assessed on a case-by-case basis.

Do courts and arbitral tribunals in your jurisdiction extend an arbitration agreement to non-signatory parent or subsidiary companies of a signatory company, provided that the non-signatory was somehow involved in the conclusion, performance or termination of the contract in dispute, under the ‘group of companies’ doctrine?

Spanish case law extends the effects of an arbitration agreement to non-signatory parent or subsidiary companies of a signatory company, provided that certain requirements are met. The Superior Court of

Justice of Valencia has set forth, in its judgments dated 19 November 2014 and 5 May 2015, that the essential elements to be considered are as follows:

• the existence of a group of companies: paying attention to European legislation;
• effective participation of the non-signatory: in relation to the dispute and regardless of the stage in which participation took place; and
• application to the facts of a legal doctrine: among others, the estoppel or the piercing of the corporate veil.

What are the requirements for a valid multiparty arbitration agreement?

The SAA does not have any special provision on the validity of multiparty arbitration agreements. It merely provides an arbitrator’s appointment procedure in case of several parties.

Can an arbitral tribunal in your jurisdiction consolidate separate arbitral proceedings? In which circumstances?

The SAA does not have any special provision on consolidation of separate arbitral proceedings. Thus, the consolidation of separate arbitral proceedings will depend upon the arbitration rules chosen by the parties.

Law stated date

Give the date on which the information above is accurate.

2 February 2021