The effectiveness of general arbitration principles in resolving investment disputes The principle of extension of the arbitration agreement to others as a model

Ahmad ICHRAKIEH

private and commercial law - Faculty of Law and political and administrative sciences - Lebanese University

Abstract

Investment contracts are inherently complex, in which many contracts are intertwined horizontally and vertically, so they are interconnected in terms of their parties and their relationship with others, or in terms of their issues and dispute resolution. Arbitration is the best way to resolve overlapping disputes arising from this type of legal process, given the ability to collect them in a single arbitration process that leads to avoiding conflicting and impossible execution of the arbitration awards, and to save money and time. Although this unification is attractive, it can only happen if the parties to the conflict are clearly defined and have accepted it. Arbitration is based mainly on the principle of freedom of contract, and the arbitrator derives his authority to resolve the dispute from the agreement of the parties, and being a contract, the arbitration agreement produces effects only between its parties. The contractual investment environment, which is characterized by the overlap and multiplicity of contracts, as well as the multiplicity of parties independent of each other, makes the process of unification arbitration procedures very difficult. The necessity of resolving overlapping disputes within a unified arbitration process, has pushed jurisprudence and the Doctrine, whether French or international, to adopt a substantive rule that states that participation in arbitration procedures is not limited to the signatory parties who basically accepted the arbitration agreement, but can extend to others (non-signatories). On the other hand, another jurisprudential and doctrinal trend has arisen, which considers that the inclusion of all parties, signed and not signed, in the dispute arising from one economic process in a multiple arbitration process carries an attack on the principle of the arbitration will, arbitration can only arise from the will of the parties, and thus the arbitration clause becomes A mobile element floats in a space that has no borders, and that the unification of conflicts may also lead to a violation of the principle of equality between the parties to the conflict. The legal and economic realism internally and internationally assumes jumping over rigid principles and moving towards a path that is in the interest of the investment process depends on the extension of the arbitration clause to all parties to the conflict who are united by the economic process. Moreover, the unification of the arbitration process within a multilateral body enshrines the effectiveness of the arbitration agreement and arbitration award and provides the desired justice in resolving the dispute in the interest of the investment in general. Recently, many countries such as France, India and Brazil have modernized their laws by dedicating the jurisprudence extending the effect of the arbitration clause to non-signatories, considering that dedicating the effectiveness of arbitration as a means of resolving disputes makes it more attractive to foreign investment. This conflict between legal principles and economic realism leads us to ask about the legal means that the arbitrator can resort to extend the effect of the arbitration agreement to others and to include them selected or against them in the arbitration process, and what are the procedural means that enable the arbitrator to unify the arbitration process without prejudice to the principle Equality between the parties to the conflict.

Keywords

arbitration, arbitration clause, multiparty arbitration, extension to others