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Mandatory Rules of Law in International Commercial Arbitration

2005; University of Melbourne; Volume: 6; Issue: 2 Linguagem: Inglês

1444-8610

Andrew Barraclough, Jeffrey Maurice Waincymer,

Corporate Law and Human Rights

Mandatory rules of law are laws that purport to apply irrespective of the law chosen by the parties to govern their contractual relations. This article examines their role in international commercial arbitration. They pose a complex and continuing problem for arbitrators because they put the interests of states and parties in direct competition. When a law says that arbitrators must apply it, yet the parties' contract excludes it, what should the arbitrators do? Where should their allegiance lie? The answer depends on the underlying nature of arbitration - and since that can be legitimately conceptualised in different ways, a principled approach to mandatory rules is impossible to provide. Nevertheless a practical solution is required. Therefore, recognising the limitations created by arbitration's uncertain nature, this paper identifies the considerations that mitigate for and against the application of mandatory rules and uses these as a basis for examining the merits of different methodological approaches currently in use. In addition, some novel suggestions are offered and analysed. Conclusions are then drawn as to which method best reconciles the interests involved.