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Starting an arbitration proceeding
What is needed to commence arbitration?
Under the International Commercial Arbitration Law, arbitral proceedings commence on the date on which the request for referral of the dispute to arbitration is communicated to the respondent, unless the parties have agreed otherwise (Article 21).
The Arbitration Law provides that an arbitration will be deemed to be commenced when one party to the arbitration agreement serves on the other party a notice requiring the other party to appoint an arbitrator or, where the arbitrator is designated in the arbitration agreement, to submit the dispute to the designated arbitrator (Article 24(3)).
Are there any limitation periods for the commencement of arbitration?
The laws on limitation of actions apply to arbitrations under both the Arbitration Law (Article 24) and the International Commercial Arbitration Law (Article 21), as they apply to proceedings in the courts. For contractual claims, the limitation period is six years.
Are there any procedural rules that arbitrators must follow?
Article 19 of the International Commercial Arbitration Law provides that the parties are free to agree on the procedure to be followed by the arbitral tribunal. In the absence of such an agreement, the tribunal may conduct the arbitration in such manner as it considers appropriate.
The Arbitration Law provides that in the absence of an express intention to the contrary in the arbitration agreement, a number of implied terms set out in the first schedule of the law are deemed to be part of the arbitration agreement. These include a provision that the parties, subject to any legal objection, submit themselves to examination by the arbitrators and present before the arbitrators all books, contracts, accounts and documents in their possession or under their control, which may be requested during the proceedings.
Are dissenting opinions permitted under the law of your jurisdiction?
Dissenting opinions are permitted. Article 29 of the International Commercial Arbitration Law provides that in arbitral proceedings with more than one arbitrator, any decision of the tribunal must be made by a majority of its members, unless otherwise agreed by the parties.
Can local courts intervene in proceedings?
Provisions about the extent to which local courts may intervene in arbitral proceedings are included in both the International Commercial Arbitration Law and the Arbitration Law.
The International Commercial Arbitration Law provides that the court may:
- refer a dispute to arbitration where an action is brought in a matter which is the subject of an arbitration agreement (Article 8);
- grant interim conservative measures before or during the arbitration proceedings (Article 9); and
- review a ruling by the tribunal on its jurisdiction (Article 16) or a ruling rejecting a challenge to an arbitrator (Article 13).
Under the Arbitration Law, the court may order a stay of proceedings commenced in respect of any matter agreed to be referred to arbitration (Article 8). Further, under Article 26 of the Arbitration Law, the court has the power to issue orders in respect of any of the matters set out in the second schedule of the law, including:
- security for costs;
- discovery of documents and interrogatories;
- examination on oath of any witness before an officer of the court;
- interim injunctions; and
- the appointment of a receiver.
Can the local courts assist in choosing arbitrators?
The International Commercial Arbitration Law contains provisions for the appointment of an arbitrator by the court where a party fails to appoint an arbitrator or where the two arbitrators fail to agree on the third arbitrator. In an arbitration by a sole arbitrator, if the parties are unable to agree on the arbitrator, one will be appointed by the court on request of a party. Similarly, the court may appoint the third arbitrator where the parties or the two party-appointed arbitrators have failed to agree on the appointment of the third arbitrator (Article 11). Similar provisions are included in the Arbitration Law (Article 10).
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?
A respondent cannot be compelled to arbitrate in the absence of an arbitration agreement or if it has not consented to arbitration. Where there is an arbitration agreement, the International Commercial Arbitration Law provides that the tribunal may continue with the arbitration proceedings if the respondent fails to participate. Under Article 25 of the International Commercial Arbitration Law, the tribunal will continue the proceedings if the respondent fails to submit its statement of defence, without treating such failure in itself as an admission of the claimant’s allegations. The tribunal has similar powers if any party fails to appear at the hearing or produce documentary evidence.
Article 27 of the International Commercial Arbitration Law provides that the tribunal or a party with the approval of the tribunal may request assistance from the court in taking evidence and the court may execute the request within its competence and according to its rules on taking evidence.
Under the Arbitration Law, any party to the arbitration agreement may apply to the court for the issue of a summons requiring any person to attend for examination or to produce any document, but no person can be compelled to produce any such document if he or she could not be compelled to do so at the trial of an action by the court (Article 17).
In what instances can third parties be bound by an arbitration agreement or award?
A third party cannot be bound by an arbitration agreement if it is not a party to the agreement or has not consented to arbitration. However, under Article 8 of the Arbitration Law, the court may stay legal proceedings where any person claiming through or under a party to an arbitration agreement commences legal proceedings in respect of any matter agreed to be referred to arbitration.
Awards are not binding on third parties. However, depending on the circumstances of a case, arbitral awards may have an effect on third parties.
Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?
Under the International Commercial Arbitration Law, the arbitral tribunal will determine the language of the proceedings (Article 22) and the place of arbitration (Article 20), in the absence of any agreement by the parties.
How is evidence obtained by the tribunal?
Article 19 of the International Commercial Arbitration Law provides that in the absence of any agreement by the parties, the arbitral tribunal may conduct the arbitration – including any matter related to the evidence admitted before it – in such manner as it considers appropriate.
What kinds of evidence are acceptable?
Under the International Commercial Arbitration Law, a tribunal is free to determine the admissibility, relevance, materiality and weight of any evidence (Article 19). Documentary and witness evidence is usually presented, as well as expert evidence where necessary.
Is confidentiality ensured?
Neither the International Commercial Arbitration Law nor the Arbitration Law contains any express provisions ensuring confidentiality of arbitral proceedings. Despite the absence of such provisions, the parties may agree that the arbitration proceedings will remain private and confidential, which is normally the case. However, the ability to keep arbitration proceedings private and confidential is limited by the fact that court proceedings relating to the arbitration may take place (eg, applications for interim injunctions or proceedings to set aside the award), in which case information about the arbitration may become a matter of public record (eg, through published court decisions or court hearings open to the public).
Can information in arbitral proceedings be disclosed in subsequent proceedings?
There are no explicit legislative provisions governing this issue. Confidentiality may be lost in court proceedings relating to the arbitration (eg, applications for interim injunctions or proceedings to set aside the award).
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?
Advocates in Cyprus are bound by the Advocates Law (Cap 2) and the Code of Conduct of the Cyprus Bar Association. These provisions apply to the members of the Cyprus Bar Association and European lawyers practising in Cyprus under the relevant EU directives, but do not apply to other professionals involved in any arbitration proceedings in Cyprus.
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