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Arbitration agreements

Validity

What are the validity requirements for an arbitration agreement?

The Arbitration Law defines an ‘arbitration agreement’ as a written agreement to submit present or future disputes to arbitration (Article 2).

The International Commercial Arbitration Law provides that an arbitration agreement is valid only if it is in writing, but the writing requirement is broadly defined. An agreement is deemed to be in writing if it is contained in:

  • a document signed by the parties;
  • the exchange of letters or other means of telecommunication which record such agreement; or
  • an exchange of statements of claim and defence in which the existence of an agreement is alleged by one party and not denied by the other. 

Further, reference in a contract to another document containing an arbitration clause constitutes an arbitration agreement if the contract is in writing and the reference is such that the arbitration clause constitutes an integral part of said contract (Article 7).

Enforcement of agreements

How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements?

Cyprus courts are arbitration friendly and will generally enforce arbitration agreements. Under the Arbitration Law, the courts have the power to stay any legal proceedings commenced in respect of any matter agreed to be referred to arbitration, if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the relevant agreement and that the party applying for the stay of the proceedings is ready and willing to do all things necessary for the proper conduct of the arbitration (Article 8).

The International Commercial Arbitration Law provides that where an action is brought in respect of a matter which is the subject of an arbitration agreement, the court will – if one party so requests before filing its first statement on the substance of the dispute – refer the parties to arbitration unless it finds that the agreement is null and void, inoperative or incapable of being performed (Article 8).

Consolidation

Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?

An agreement of the parties to confer such power on the arbitral tribunal is required for the consolidation of separate arbitral proceedings. A provision for consolidation may be included in the arbitration agreement or agreed by the parties ex post facto.

Choice of law

How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

Article 28 of the International Commercial Arbitration Law provides that the tribunal will decide the dispute in accordance with the law chosen by the parties. If the parties have not chosen the substantive law of the dispute, the tribunal will apply the law determined by the conflict-of-laws rules which it considers applicable.

Separability

Are there any provisions on the separability of arbitration agreements?

The principle of separability is included in Article 16(1) of the International Commercial Arbitration Law, which provides that an arbitration clause which forms part of a contract will be treated as an agreement independent of the other terms of the contract. A decision of the tribunal that the contract is null and void will not entail ipso jure the invalidity of the arbitration clause.

Multiparty agreements

Are multiparty agreements recognised?

Multiparty agreements are recognised in Cyprus. However, it is not possible to deal with multiparty disputes without the consent of all parties involved. 

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