Starting an arbitration proceeding
What is needed to commence arbitration?
Unless otherwise agreed by the parties, arbitral proceedings start on the date on which the application for arbitration was communicated in accordance with Article 1678(1) (Article 1702).
Are there any limitation periods for the commencement of arbitration?
From a Belgian perspective, prescription is a matter of substantive law. The Judicial Code does not as such provide for limitation periods for the commencement of arbitration proceedings. Claims filed in the context of arbitral proceedings will be time barred by virtue of the applicable substantive law.
The standard limitation periods under civil law are:
- 30 years for rights in rem;
- 10 years for personal and contractual claims; and
- five years for claims based on tort.
Are there any procedural rules that arbitrators must follow?
Arbitrators must comply with the procedural rules agreed by the parties. In the absence of such agreed rules, the arbitrators must determine the procedural rules.
In any event, the arbitrators must ensure that both the principle of adversarial proceedings and the principle of fairness of the debates are respected. Regardless of any agreement to the contrary, the parties must be treated equally and each party must be given a full opportunity to present its case, pleas and arguments (Article 1699).
Unless the parties agree that no hearings need to be held, the arbitrators must hold such hearings at an appropriate stage of the proceedings, if so requested by a party (Article 1705(1)).
Are dissenting opinions permitted under the law of your jurisdiction?
There is no unanimity on whether dissenting opinions are permitted under Belgian law. On the one hand, the secrecy of deliberations prevents an arbitrator from formulating a dissenting opinion. On the other, Article 1711(1) of the Judicial Code provides that an arbitral tribunal consisting of more than one arbitrator must decide by majority, unless the parties have agreed otherwise. However, Article 1711(3) adds that the parties can agree that if no majority can be obtained, the president has the decisive vote. Further, an arbitrator can refuse to join the deliberation or the decision-making process, in which case the other arbitrators can deliberate or decide without the dissenting arbitrator, provided that they give the parties advance notice of their intention to do so (Article 1711(4)). This article does not prevent an arbitrator from stating the reasons why they refused to join the deliberation or decision. Hence, although Article 1711 does not expressly permit dissenting opinions, it does not prohibit them either.
Can local courts intervene in proceedings?
The local courts can intervene and assist at several stages of the arbitral proceedings in order to:
- appoint arbitrators (Articles 1685(3) and 1685(4));
- rule on the withdrawal of an arbitrator (Article 1685(7)), on the challenge of an arbitrator (Article 1687(2)) and on an arbitrator’s failure or impossibility to act (Article 1688(2));
- set a time limit for an arbitrator to give their award (Article 1713(2)); and
- take all necessary measures to obtain evidence (Article 1708).
Can the local courts assist in choosing arbitrators?
On a party’s application, the president of the court of first instance can appoint an arbitrator where:
- a party fails to act as required under the appointment procedure;
- the parties or two arbitrators are unable to reach an agreement under the appointment procedure; or
- a third party (including an institution) fails to perform any function entrusted to it under the appointment procedure (Article 1685(4)).
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?
The local courts can refer parties to arbitration but cannot compel them to participate in arbitration proceedings.
In the event of a non-cooperating respondent, the local courts or the relevant arbitral institution will appoint an arbitrator and the proceedings will be conducted in that party’s absence. If the respondent fails to communicate its statement of defence, the arbitral tribunal will continue the proceedings without treating such failure in itself as an admission of the claimant’s allegations (Article 1706(b)).
If the claimant fails to communicate its statement of claim, the arbitral tribunal will terminate the proceedings, without prejudice to handling any other party’s claims (Article 1706(a)).
If any party fails to appear at an oral hearing or produce documentary evidence, the arbitral tribunal may continue the proceedings and make the award on the existing evidence (Article 1706(c)).
The courts can direct orders to third parties in the context of taking evidence (Article 1708).
In what instances can third parties be bound by an arbitration agreement or award?
A third party can be bound by an arbitral agreement to the extent that the agreement contains a provision for the benefit of that third party. If the third party accepts this provision, it becomes a party to the agreement that was made in its favour. Other situations can result in a third party being assimilated with a signatory party and thus being bound by the arbitration agreement – for example:
- an insolvency administrator could be bound by an arbitration agreement made by the insolvent company; or
- the party to which an agreement containing an arbitration clause was assigned could be bound by the arbitration clause.
For a third party to be bound by an arbitral award, there should be an express or implicit contractual undertaking between the third party and a party to the arbitration proceedings which states that the third party will be bound by the arbitral award. For example, an insurer can be bound by an arbitral award between the insured and the other party ordering the insured person to pay to the other party.
Although an arbitral award has no authority of res judicata for third parties, it can be used against third parties. This function entails that an arbitral award has evidential value in relation to third parties regarding the factual and legal matters decided in the award (as it creates a refutable presumption of truth regarding the factual and legal matters set out in the award) and is something that they should respect.
Until recently, third parties aggrieved by an arbitral award could not oppose this award. With its 16 February 2017 judgment, the Constitutional Court decided that the fact that Article 1122 of the Judicial Code (which provides that third parties negatively affected by a judicial decision can initiate third-party opposition proceedings against it) does not allow a third party that is negatively affected by an arbitral award to initiate opposition proceedings against that award, constitutes an unjustified discrimination. However, in the same judgment, the court held that it is not an unjustified discrimination that a third party aggrieved by an arbitral award can initiate a claim only to annul such decision in the event of fraud.
Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?
In the absence of an agreement on the language of the proceedings, the arbitral tribunal will determine the language or languages to be used in the proceedings (Article 1703(1)).
Failing an agreement on the place of arbitration, the place will be determined by the arbitrators with regard to the circumstances of the case, including the parties’ convenience (Article 1701(1)). If the parties or the arbitral tribunal have not determined the place of arbitration, the place where the award is to be given will be deemed as the place of arbitration (Article 1701(2)).
How is evidence obtained by the tribunal?
The law provides that the arbitral tribunal will set the necessary investigative measures. The parties can entrust that responsibility to one of the arbitrators (Article 1700(4)). The law does not provide for an exhaustive list of measures to be granted to the arbitrators, but does set out certain rules regarding the power to:
- hear persons;
- order a party to disclose evidence (Article 1700(4)); and
- appoint and hear experts (Article 1707).
Although other measures such as site visits and inspections are not mentioned in the law, they are not excluded as investigative measures in the context of arbitration proceedings.
What kinds of evidence are acceptable?
The arbitrators must freely assess the admissibility and weight of the evidence presented to them, unless the parties have agreed otherwise (Article 1700(3)). The discretionary power of the arbitral tribunal is limited by the principle of adversarial proceedings and the principle of fairness of the debates (Article 1699). Documentary evidence, written and oral testimony and expert reports are most commonly used.
Is confidentiality ensured?
The law contains no provisions on confidentiality. The parties are free to agree on confidentiality and should do so or be subject to institutional rules providing for confidentiality if they wish to ensure confidentiality.
Can information in arbitral proceedings be disclosed in subsequent proceedings?
Belgian law does not prevent information in arbitral proceedings from being disclosed in subsequent proceedings. The parties are free to make agreements on this issue.
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?
The arbitration law does not refer to ethical codes or professional standards. Legal counsel are bound by the rules of conduct of their bar association. The Belgian Centre for Arbitration and Mediation has issued Rules of Good Conduct for arbitrations. Moreover, reference is often made to international guidelines, such as the International Bar Association Guidelines on Conflicts of Interest in International Arbitration.
Estimation & allocation
How are the costs of arbitration proceedings estimated and allocated?
The law provides that in the final award, the arbitrators must fix the costs of the arbitration and decide which of the parties will bear these costs or in what proportion they will be borne by the parties. Unless otherwise agreed by the parties, these costs must include:
- the fees and expenses of the arbitrators;
- the fees and expenses of the parties’ counsel and representatives;
- the costs of services given by those in charge of the administration of the arbitration; and
- all other expenses arising from the arbitral proceedings (eg, costs for experts and court reporters) (Article 1713(6)).
In the context of institutional arbitration, the arbitrators’ fees are mostly set by the institution. In ad hocarbitration, arbitrators are free to set their fees (unless otherwise agreed).
The other costs are generally demonstrated on the basis of invoices.
Security for costs
Can the national court or tribunal order security for costs under the law in your jurisdiction?
Contrary to Article 851 of the Judicial Code, Belgian arbitration law contains no general provision on security for costs. However, Article 1694 provides that the arbitral tribunal may order any interim measure that it deems necessary. Moreover, Article 1693 holds that the arbitral tribunal can impose a guarantee on the party requesting conservatory or interim measures. Finally, Article 1696(3) adds that the local court before which the exequatur of the conservatory or interim measures is being requested can impose a guarantee on the requesting party in the event that the arbitral tribunal has not yet decided on a guarantee and to the extent that it is necessary for the protection of the other party’s rights.