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Arbitration Procedure
Arbitration Procedure CIETAC arbitrations are generally conducted under its current Arbitration Rules, i.e. the Arbitration Rules effective as from May 1, 2012. Where the parties have agreed on the application of other arbitration rules, or any modification of these Rules, the parties’ agreement shall prevail except where such agreement is inoperative or in conflict with a mandatory provision of the law of the place of arbitration.
Application for Arbitration When applying for arbitration, the Claimant shall submit to the Arbitration Court of the CIETAC headquarters or the Sub-Commissions, or CIETAC Hong Kong Arbitration Center an arbitration agreement, a Request for Arbitration in writing, and the facts and evidence on which its claim is based. In addition, the arbitration fee shall be paid by the Claimant in advance to the CIETAC according to the CIETAC Arbitration Fee Schedule.
The arbitral proceedings shall commence on the date on which the CIETAC or one of its Sub-Commissions receives a Request for Arbitration.
The Request for Arbitration shall specify the following: l the names and addresses of the Claimant and the Respondent, including the zip code, telephone, telex, fax and telegraph numbers, email addresses or any other means of electronic telecommunications; l a reference to the arbitration agreement invoked;
l a statement of the facts of the case and the main issues in dispute; l the claim of the Claimant; and l the facts and grounds on which the claim is based.
The Request for Arbitration shall be signed and/or stamped by the Claimant and/or the attorney authorized by the Claimant.
After applying for arbitration, the Claimant may request to amend its arbitration claim. The arbitral tribunal may refuse such a request for amendment, however, if it considers that it is too late to raise the request and the amendment may delay the arbitration proceedings.
Defense and Counterclaim The Arbitration Court of CIETAC shall send to the Respondent the Notice of Arbitration, a copy of the Claimant’s Request for Arbitration along with its attachments, the Arbitration Rules, and the Panel of Arbitrators.
The Respondent shall, within 45 days (in foreign-related arbitration) or 20 days (in domestic arbitration or arbitration where the summary procedure applies) from the date of receipt of the Notice of Arbitration, produce its written defense and relevant documentary evidence to the Court of CIETAC. The arbitral tribunal may extend that time period if it deems that there are justified reasons.
The Respondent may lodge its counterclaim during the arbitration procedure, which shall meet the following three requirements:
l the counterclaim arises from the same contractual relations or legal relations as that of the claims raised by the Claimant;
l the counterclaim is directed against the Claimant; and
l the disputes involved in the counterclaim shall not be the same as in the claim.
When lodging its counterclaim, the Respondent shall pay a deposit of the arbitration fee in advance according to the CIETAC Arbitration Fee Schedule.
Jurisdictional Objections The CIETAC has the power to decide on the existence and validity of an arbitration agreement and its jurisdiction over an arbitration case. The CIETAC may, if necessary, delegate such power to the arbitral tribunal.
A party may challenge the CIETAC jurisdiction if it has justified reasons. A challenge to an arbitration agreement and/or to the CIETAC jurisdiction over an arbitration case shall be raised prior to the first hearing. Where the case is examined on the basis of documents only, the jurisdictional challenge should be raised in writing before submission of the first substantive defense. The challenges to and/or decisions made by the CIETAC on jurisdiction shall include objections to and/or decisions on a party’s standing to participate in the arbitration.
Waiver of Right to Object A party shall be deemed to have waived its right to object where it knows or should have known that any provision of, or requirement under the Arbitration Rules has not been complied with and yet participates in or proceeds with the arbitration proceedings without promptly and explicitly submitting its objection in writing to such non-compliance.
Arbitral Tribunal According to the CIETAC Arbitration Rules, the arbitral tribunal may be composed of either a sole arbitrator or three arbitrators. A case where the summary procedure applies shall be examined and heard by a sole arbitrator, while cases where the general procedure applies shall be examined and heard by three arbitrators, unless the parties agreed otherwise. The parties may also agree on how the tribunal is formed.
Panel of Arbitrators Generally, the parties shall appoint arbitrators from the Panel of Arbitrators provided by the CIETAC. Parties can also appoint arbitrators that are not from the Panel of Arbitrators provided by the CIETAC.
Where the parties have agreed to appoint arbitrators from outside of the CIETAC’s Panel of Arbitrators, the arbitrators so appointed by the parties or nominated according to the agreement of the parties may act as co-arbitrator, presiding arbitrator or sole arbitrator, subject to confirmation by the Chairman of the CIETAC in accordance with the law.
Sole arbitrator If the case is to be heard by a sole arbitrator, both parties may jointly appoint or jointly entrust the Chairman of the CIETAC to appoint a sole arbitrator from among the Panel of Arbitrators to form the tribunal for the case. On the other hand, the parties may each recommend one to three arbitrators as candidates for the sole arbitrator.
Three arbitrators If the case is to be heard by three arbitrators, the Claimant and the Respondent shall each appoint one arbitrator or entrust the Chairman of the CIETAC to make such appointment within 15 days from the date of receipt of the Notice of Arbitration. Where a party fails to appoint or to entrust the Chairman of the CIETAC to appoint an arbitrator within the specified time period, the arbitrator shall be appointed by the Chairman of the CIETAC.
Within 15 days from the date of the Respondent’s receipt of the Notice of Arbitration, the presiding arbitrator shall be jointly appointed by the parties or appointed by the Chairman of the CIETAC upon the parties’ joint authorization.
Where the parties have failed to jointly appoint the presiding arbitrator according to the above methods, the presiding arbitrator shall be appointed by the Chairman of the CIETAC.
The presiding arbitrator and the other two arbitrators shall jointly form an arbitral tribunal to examine and hear the case.
Multi-Party Appointment Where there are two or more Claimants and/or Respondents in an arbitration case, the Claimant side and/or the Respondent side each shall, through consultation, jointly appoint or jointly entrust the Chairman of the CIETAC to appoint one arbitrator from the CIETAC Panel of Arbitrators.
Where either the Claimant side or the Respondent side fails to jointly nominate or jointly entrust the Chairman of CIETAC with appointing one arbitrator within fifteen (15) days from the date of receipt of the Notice of Arbitration, the Chairman of CIETAC shall appoint all three members of the arbitral tribunal and designate one of them to act as the presiding arbitrator.
Challenge and Replacement of Arbitrators and Majority to Continue Arbitration Any arbitrator who has interests in a case or is related in a way that might affect the impartial examination and hearing of the case shall make a disclosure of such interests to the CIETAC, and request on his own motion for a withdrawal. The parties may also make a request for the withdrawal of an arbitrator from an arbitration case.
In the event that an arbitrator is prevented de jure or de facto from fulfilling his/her functions, or he/she fails to fulfill his/her functions in accordance with the requirements of the CIETAC Rules or within the time period specified in the CIETAC Rules, the Chairman of the CIETAC shall have the power to decide whether the arbitrator shall be replaced. The arbitrator may also withdraw from his/her office on his/her own initiative.
In the event that, after the conclusion of the last oral hearing, an arbitrator on a three-member arbitral tribunal is unable to participate in the deliberation and/or render the award owing to his/her demise or removal from CIETAC Panel of Arbitrators, the other two arbitrators may request the Chairman of the CIETAC to replace the arbitrator pursuant to the Arbitration Rules. Or, after consulting with the parties and upon the approval of the Chairman of the CIETAC, the other two arbitrators may proceed with the arbitration and make decisions, rulings or the award.
All arbitrators shall be independent and impartial and shall not represent either party. The CIETAC has made a set of Ethical Rules of Arbitrators to regulate the arbitrators’ behavior in the conduct of arbitration cases.
Hearing The arbitral tribunal shall examine the case in the way that it deems appropriate unless otherwise agreed by the parties. Under any circumstance, the arbitral tribunal shall act impartially and fairly and shall offer reasonable opportunities to all parties for presentations and debates.
The arbitral tribunal shall hold oral hearings when examining the case. However, oral hearings may be omitted and the case shall be examined on the basis of documents only if the parties so request or agree and the arbitral tribunal also deems that oral hearings are unnecessary. Unless otherwise agreed by the parties, the arbitral tribunal may adopt an inquisitorial or adversarial approach when examining the case, having regard to the circumstances of the case. The arbitral tribunal may hold deliberation at any place or in any manner that it considers appropriate.
The arbitral tribunal may, if it considers it necessary, issue procedural directions and lists of questions, hold pre-hearing meetings and preliminary hearings, and produce terms of reference, etc., unless otherwise agreed by the parties.
The parties shall send their representative(s) or authorized agent(s) to attend the hearing. If the Respondent fails to appear at an oral hearing without showing sufficient cause for such failure, the arbitral tribunal may proceed with the arbitration and make a default award. If the Claimant fails to appear at an oral hearing without showing sufficient cause for such failure, the Claimant may be deemed to have withdrawn its Request for Arbitration.
Place of Arbitration and Oral Hearing Where the parties have agreed on the place of arbitration in writing, the Parties’agreement shall prevail. Where the parties have not agreed on the place of arbitration, the place of arbitration shall be the domicile of the CIETAC or its Sub-Commission. The arbitral award shall be deemed as being made at the place of arbitration.
Where the parties have agreed on the place of oral hearings, the case shall be heard at that agreed place except for circumstances stipulated in the Arbitration Rules. Unless the parties agree otherwise, a case accepted by the CIETAC shall be heard in Beijing, or if the arbitral tribunal considers it necessary, at other places with the approval of the Secretary-General of the CIETAC. A case accepted by a Sub-Commission of the CIETAC shall be heard at the place where the Sub-Commission is located, or if the arbitral tribunal considers it necessary, at other places with the approval of the Secretary-General of the Sub-Commission.
Evidence The Claimant and the Respondent shall assume the burden of proving the facts on which their claim, defense or counterclaim is based. The arbitral tribunal may undertake investigation and collect evidence on its own initiative where it deems necessary. If the arbitral tribunal investigates and collects evidence on its own initiative, it shall duly inform the parties to be present at the investigation where it deems necessary. Should one party or both parties fail to be present, the investigation and collection of evidence shall by no means be affected.
The arbitral tribunal may consult an expert or appoint an appraiser for the clarification of special issues relating to a case. In this situation, the parties are obliged to submit or produce to the expert or appraiser any materials, documents, properties or goods related to the case for check-up, inspection or appraisal. The parties may engage their own experts to testify at the hearing.
The expert’s report and the appraiser’s report shall be copied to the parties so that the parties may have the opportunity to make comments thereon. At the request of any party to the case and with the approval of the arbitral tribunal, the expert and appraiser may be present at the hearing and give explanations of their reports when the arbitral tribunal deems it necessary and appropriate.
The admission of any evidence, including the evidence submitted by the parities, the expert’s report, and the appraiser’s report, shall be decided upon by the arbitral tribunal after examination thereof. The arbitral tribunal has the right to determine the relevance, weight and validity of the evidence.
Interim Measures of Protection To ensure the smooth administration of the arbitration proceedings and the enforcement of the awards, the parties may apply for interim measures of protection in relation to property and evidence. A party should apply in writing to the CIETAC for the preservation of property and/or the protection of evidence. The CIETAC shall forward the party’s application to the competent people’s court in the place where the domicile of the party against whom the interim measures are sought is located, or in the place where the property and/or the evidence is located. The CIETAC is only responsible for forwarding the application. The people’s court shall decide whether or not the interim measures can be taken.
At the request of a party, the arbitral tribunal may order any interim measure it deems necessary or proper in accordance with the applicable law, and may require the requesting party to provide appropriate security in connection with the measure. The order of an interim measure by the arbitral tribunal may take the form of a procedural order or an interlocutory award.
Award In a general procedure case, the arbitral tribunal shall render an arbitral award within 6 months (in foreign-related cases) or 4 months (in domestic cases) from the date on which the arbitral tribunal is formed. In a summary procedure case, the arbitral tribunal shall make an award within 3 months from the date on which the arbitral tribunal is formed. At the request of the arbitral tribunal and with the approval of the Secretary-General of the CIETAC, the time period of rendering an arbitral award may be extended.
According to the CIETAC Arbitration Rules, the arbitral tribunal shall submit its draft arbitral award to the CIETAC for scrutiny before signing it and the CIETAC may remind the tribunal of issues in the award on the condition that the tribunal’s independence in rendering the award is not affected. The scrutiny of arbitral awards may assist in ensuring high quality of CIETAC arbitration and the enforceability of its arbitral awards.
The date on which the arbitral award is made is the date on which the arbitral award comes into effect.
The arbitral award is final and binding upon both parties. Neither party may bring a lawsuit before a court of law on the same dispute resolved by the previous arbitration or make a request to any other organization for revising the arbitral award.
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