Cacophony of Delocalization; Emerging Trend in the International Commercial Arbitration

Abstract

Delocalization of international commercial arbitration involve freeing and making an international commercial arbitration from the constraint of the lex loci arbitri that is procedural law of the place of arbitration thereby making it to float and free of national jurisdiction, irrespective of where the arbitration takes place. The delocalization theory is an attractive one from the perspective of both the arbitrators and the parties to arbitration. Mostly the place of arbitration is selected for convenience reasons and neutrality, impartiality, parties are not always willing to submit the arbitration to the procedural norms of that forum especially the rules that permit the intervention of the local court system. The failure to comply with the local procedural law could result in the final award being set aside by a local court which may jeopardize the chances of enforcement of arbitral awards elsewhere.

This article examines the concept of delocalization and its practicability in International commercial arbitration particularly how it tends to liberalize National Arbitration law. The article discusses the jurisdictional trend in United Kingdom, India and France and how it has been able to minimize the reliance on the procedural laws of those jurisdictions.

The article finds that delocalization of international commercial arbitration is yet to spread globally to many jurisdictions. It discovers that delocalization affected many arbitral awards which were subjected to local procedural laws and later led to annulment of the awards.

The article concludes that delocalization of the arbitral process and the final award would mean that parties remain unaffected by unforeseen and undesired local procedural laws. To this effect, the parties will not face the risk that noncompliance with such laws would render their awards unenforceable. Finally, it will take the international commercial arbitration to a greater height from apron strings of national Laws.

Keywords: Delocalization, Arbitral awards, Liberalization, Arbitration