Canada has long been an arbitration-friendly jurisdiction and was the first state to adopt the 1985 UNCITRAL Model Law on International Commercial Arbitration (“Model Law”).
On March 22, 2017, the Canadian province of Ontario updated its international arbitration regime to adopt the 2006 amendments to the Model Law. The Ontario International Commercial Arbitration Act, 2017, SO 2017, c 2 (the “ICAA”) replaces the former Ontario International Commercial Arbitration Act, RSO 1990, c I.9 (the “Former ICAA”) with immediate effect. The ICAA applies to all international commercial arbitration agreements seated in Ontario, and to awards sought to be recognized or enforced in Ontario, whether made before or after the coming into force of the ICAA.
Ontario is one of seventeen jurisdictions worldwide to have updated their legislationto incorporate the 2006 amendments. The ICAA offers a flexible interpretation of some of the more rigid requirements of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”).
1) Adopts the New York Convention
The ICAA explicitly adopts as Ontario law and appends as a schedule to the ICCA the New York Convention. Although Canada ratified the New York Convention in 1986, Ontario had not adopted it under the Former ICAA. Instead, Ontario courts relied on the enforcement provisions contained in the Model Law. The explicit adoption of the New York Convention will foster certainty for parties seeking to enforce arbitration awards in Ontario. In addition, it will eliminate the risk that foreign states may refuse enforcement of awards made in Ontario, on the basis of non-reciprocity of the New York Convention.
2) Extends Limitations Periods
The ICAA imposes a limitation period of 10 years from the date the award was made, or, where there was a proceeding to set aside an award, 10 years from the date on which the proceedings concluded. Previously, the limitation period for enforcement of an arbitration award was two years.
3) Articulates a Tribunal’s Powers to Grant Interim Measures
By adopting the 2006 amendments to the Model Law, the ICAA also incorporates provisions that clearly outline a tribunal’s powers to grant interim measures. The provisions set out authorized interim measures and the conditions under which such measures may be granted and a regime for the recognition and enforcement of interim measures (but not preliminary orders).
4) Broadens Interpretation of “Arbitration Agreement”
The ICAA broadens the requirements of an “arbitration agreement” by adopting “option one” of Article 7 of the 2006 amendments to the Model Law. Like the Former ICAA, the arbitration agreement must still be in writing to be enforceable, but under the ICAA an agreement to arbitrate is in writing if the content is recorded in written form, including by electronic communication or email. However, an arbitration agreement can be concluded orally, by conduct, or by other means.
The ICAA is a positive development to the arbitration law in Ontario, confirming Ontario’s status as an arbitration-friendly jurisdiction, and may invite increased arbitrations in Toronto and Ottawa, Ontario.