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Mr. Akash Gupta is working as an Assistant Lecturer at Jindal Global Law School. He teaches Arbitration course, serves as the Faculty Coordinator of the Moot Court Society and Faculty Board Member of the ADR Society. He propagates the use of ADR and mooting advocacy through his Workshop in different law schools across India. Also, he judges the ADR competition and moot competition frequently including Jessup, Vis, Stetson, FDI.
In this interview with the IJLPP he discusses arbitration amidst COVID-19, challenges to virtual arbitrations and future of institutional arbitration in India.
Today, the entire world including the legal field is fighting with the COVID-19 and is limited by its associated precautions. Lockdown in the country has affected all the socio-economic activities. With litigation and court functioning being strongly impacted, what all positive and negative impacts has this unprecedented situation brought for an evolving sector like Arbitration in India?
Mr. Akash: Let’s start with the positive things, online arbitration has been the new normal in India now. Also, the subsidiary expenses associated with the arbitration proceeding has gone down substantially. For example, arbitrator’s/counsel’s/party’s travel expenses and venue booking expenses. Before the pandemic, the use of online platforms for ADR has been seen as “not a viable option”. However, now the world has moved to digital platforms as “physical hearings are not a viable option now”.
Moving to the negative points, not all the stakeholders of arbitration are ready for moving to the e-arbitration. Some of the stakeholders prefer physical hearing over virtual hearings because they are not well equipped to migrate on the virtual hearing platform.
Considering the recent developments like not interfering with a foreign award (BALCO Case), time-limit inclusion concerning the stages of arbitration within the Act, confidentiality provision, creation of Arbitration Council of India, arbitration industry in India has moved a step towards achieving their dream of becoming a hub for arbitration.
After the national lockdown, there were concerns about limitation period under the Arbitration Act (being time bound) but there has been some relief since the Hon’ble Supreme Court directives on extension of the concerned time. Is this the right time to adopt better practices within the arbitration process to enable virtual methods? Do we have sufficient legal apparatus?
Mr. Akash: Yes, the relief by the Delhi High Court on the issue of limitation period relating to arbitration procedure was the need of the hour. I think yes, not only because it’s a better practice but also because there was no chance for a physical hearing. Also, this practice of virtual hearing is a stepping stone in reducing the overall cost and making arbitration more accessible to the public. Just to give an analogy, like digital payments are used during the pandemic will affect the usage of cash, the same way virtual hearing is going to affect the physical hearings.
Sufficient legal apparatus remains a big question. I think, there exists a high likelihood that the majority of the stakeholders have the pre-requisite or they have the tendency to learn the new techniques.
There has been a continued criticism on the choice of arbitrators available in India. The process lacks opportunity to the experts of arbitration and that continued dominance of same judges as arbitrators after their retirement does not change their perspective from regular legal process. How far do you agree with it and your reason(s) for the same.?
Mr. Akash: About repeated appointments, I agree to the point that this distributes the caseload among few arbitrators and should be of high concern to the parties, the arbitrators and the authorities. The increased caseload will hamper the competency of the arbitrator and will result in a lack of commitment towards individual cases.
Regarding the appointment of retired judges as arbitrators, it is indeed true that both the mechanisms are different and requires different approach and acumen. It is the vision the arbitrators embrace, overtly or implicitly, determines their conduct and has a major impact on the outcome of arbitration proceedings. In case if a retired judge is appointed as an arbitrator, there exists some probability (which again differs from case to case basis depending upon the vision of the retired judge) that the arbitration proceeding may be affected by the regular court procedure, this has been a concern among arbitration fraternity and a debated topic among scholars.
So, in my opinion, the pool of arbitrators must be large enough to give a justified option to the parties to choose their arbitrator by their autonomy – “Party Autonomy”. On the other hand, the limited option to choose may force them to compromise and indirectly shackles their autonomy. For instance, in recent amendments, the arbitrators are required to have more than 10 years of experience, which limits the pool of arbitrators. People with less than 10 years of experience may be qualified and suitable to an arbitrator in a given case, considering their expertise in the field, but this requirement of 10 years of experience keeps them away limiting the size of the pool. However, in arbitration-friendly jurisdictions like Sweden, Any person who possesses full legal capacity in regard to his or her actions and property may act as an arbitrator. There is no requirement as to minimum years of experience to become an arbitrator. This restricts the young experts to participate in the arbitration proceedings as an arbitrator.
Has the Indian arbitration sector now matured enough to allow foreign law firms to engage directly in arbitration at the same level as it happens in Singapore or UK? Or the current practice of allowing foreign lawyers only in International Commercial Arbitration as subject of India law shall be carried?
Mr. Akash: Like Singapore and the United Kingdom, foreign lawyers in India can freely participate in an arbitration as the Supreme Court of India has allowed ‘fly-in-fly-out’ of foreign lawyers. However, foreign lawyers cannot practice in India.
Parties are free to choose the lawyers from their home countries, however, if the dispute revolves around the local law, parties may wish to engage local law firm or lawyers.
Opening the door of the Indian legal industry to the foreign lawyers will increase competition and help in increasing the pool of arbitrators. But engaging the foreign lawyers directly in arbitration will be somewhat expensive as compared to the Indian lawyers.
As there has been an increase in Foreign Direct Investment in India during the pandemic, there exist high likelihood that entry of foreign lawyers in India will be one of the advantages for the investors.
Therefore, the entry of foreign lawyers shall be considered by the policymakers in a phased manner as it will portray India as a more investor-friendly jurisdiction.
Do you believe that the vision of the current government to institutionalize arbitration and make India the Hub of Arbitration like Singapore, Stockholm, Geneva is a far-fetched dream or a near possibility? What do you think should be the approach of the policy makers and the legal fraternity to this vision?
Mr. Akash: The government has taken substantial steps to institutionalize arbitration towards making India a hub for arbitration. Recent amendments including the 2015 and 2019 have been overall good like the creation of Arbitration Council of India, and insertion of time-limits for a different stage of arbitration proceedings, exhaustive list for conflict check of arbitrators, however, they have certain problems not addressed like emergency arbitration, removing stringent qualifications for becoming an arbitrator, good infrastructure and awareness among people as to the benefits of institutional arbitration.
Yes, I believe that the dream of becoming a hub of arbitration is a near possibility with certain modification to existing regime and infrastructure. The policymakers shall keep in mind that the Indian law on arbitration shall be so advanced and party-friendly that New Delhi becomes the first choice for the Seat. For commercial parties, the foremost thing is the settlement of disputes quickly and efficiently. The courts shall not interfere with the arbitration unless it is warranted by the law and in a mechanical manner as codified in the law.
Overall, the government has taken a step in the right direction, but it needs to be more advanced and futuristic and not only dealing with the present scenario. Like Singaporean Parliament has passed the Singapore Convention on Mediation Bill even before the Convention came into force.
[This questionnaire was drafted by Ms. Rishika Jain, Consulting Editor, IJLPP and Mr. Pranav Tanwar, Consulting Editor, IJLPP]