Arbitration - lenzstaehelin.com · Alexey Anischenko and Kirill Laptev SORAINEN Belgium 89 ... on the Recognition and Enforcement of ... Domestic arbitration is governed by Part 3

ArbitrationIn 60 jurisdictions worldwide

Contributing editorsGerhard Wegen and Stephan Wilske

2015

Arbitration 2015Contributing editors

Gerhard Wegen and Stephan WilskeGleiss Lutz

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Published by Law Business Research Ltd87 Lancaster Road London, W11 1QQ, UKTel: +44 20 3708 4199Fax: +44 20 7229 6910

© Law Business Research Ltd 2015No photocopying: copyright licences do not apply.First published 2006Tenth editionISSN 1750-9947

The information provided in this publication is general and may not apply in a specific situation. Legal advice should always be sought before taking any legal action based on the information provided. This information is not intended to create, nor does receipt of it constitute, a lawyer–client relationship. The publishers and authors accept no responsibility for any acts or omissions contained herein. Although the information provided is accurate as of January 2015, be advised that this is a developing area.

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CONTENTS

2 Getting the Deal Through – Arbitration 2015

Introduction 7Gerhard Wegen and Stephan WilskeGleiss Lutz

CEA 14Pablo Poza and Ana BlancoSpanish Court of Arbitration

CEAC 17Eckart Brödermann and Christine Heeg Chinese European Arbitration CentreThomas Weimann Chinese European Legal Association

CIETAC 22Shengchang Wang, Ning Fei and Fang ZhaoHui Zhong Law Firm

The DIFC-LCIA Arbitration Centre 25Gordon Blanke and Soraya Corm-BakhosBaker & McKenzie Habib Al Mulla

DIS 28Renate Dendorfer-DitgesHeussen Rechtsanwaltsgesellschaft mbH

HKIAC 32Paulo FohlinOdebjer Fohlin

ICC 35José Rosell and María Beatriz BurghettoHughes Hubbard & Reed LLP

The Polish Chamber of Commerce 40Justyna Szpara and Maciej ŁaszczukŁaszczuk & Partners

SCC 43Dan Engström and Cornel MarianStockholm Arbitration & Litigation Center (SALC) Advokatbyrå KB

The Swiss Chambers’ Arbitration Institution 46Philippe Bärtsch and Christopher BoogSchellenberg Wittmer Ltd

Angola 50Agostinho Pereira de Miranda, Cláudia Leonardo and Jayr FernandesMiranda Correia Amendoeira & Associados

Argentina 56Luis Alberto Erize, Hernán Martín Oriolo and Mariano Hernán BeicaAbeledo Gottheil Abogados SRL

Australia 63Tony Johnson and Henry WinterJohnson Winter & Slattery

Austria 70Klaus OblinOblin Melichar

Bahrain 76Adam VauseNorton Rose Fulbright (Middle East) LLP

Belarus 83Alexey Anischenko and Kirill LaptevSORAINEN

Belgium 89Johan Billiet Billiet & Co Cecile Oosterveen Association for International Arbitration

Brazil 98Hermes Marcelo Huck, Rogério Carmona Bianco and Fábio Peixinho Gomes CorrêaLilla, Huck, Otranto, Camargo Advogados

Chile 104Cristián Gandarillas and Gabriel del RíoAninat Schwencke y Cía

China 110Shengchang Wang, Ning Fei and Fang ZhaoHui Zhong Law Firm

Colombia 120Alberto Zuleta-Londoño, Juan Camilo Fandiño-Bravo and Juan Camilo Jiménez-ValenciaCárdenas & Cárdenas Abogados

Croatia 126Zoran Vukić, Iva Sunko and Ana PeharVukić & Partners, Ltd

Cyprus 133Andreas Erotocritou and Alexis Erotocritou AG Erotocritou LLC

Denmark 137Peter Lind Nielsen and Morten GrundahlBird & Bird Advokatpartnerselskab

Dominican Republic 145Fabiola Medina GarnesMedina Garrigó Attorneys at Law

Ecuador 152Rodrigo Jijón Letort, Juan Manuel Marchán and Juan Francisco GonzálezPérez Bustamante & Ponce

Egypt 159Tarek F RiadKosheri, Rashed & Riad Law Firm

England & Wales 164Adrian Jones, Gordon McAllister and Edward NormanCrowell & Moring LLP

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Equatorial Guinea 174Agostinho Pereira de Miranda and Cláudia LeonardoMiranda Correia Amendoeira & Associados

Estonia 179Carri Ginter and Maria PihlakSORAINEN

Finland 186Tom Vapaavuori and Juha OjalaBird & Bird Attorneys Ltd

France 193Thomas Bevilacqua and Ivan UrzhumovFoley Hoag LLP

Germany 202Stephan Wilske and Claudia KrapflGleiss Lutz

Ghana 209Kimathi Kuenyehia and Sarpong OdameKimathi & Partners, Corporate Attorneys

Greece 216Antonios D Tsavdaridis IK Rokas & Partners Law Firm

Hungary 222Chrysta BánBán, S Szabó & Partners

India 231Shreyas Jayasimha, Mysore Prasanna, Rajashree Rastogi and Spandana Ashwath Aarna Law

Indonesia 242Anangga W RoosdionoRoosdiono & Partners

Israel 248Eric S Sherby and Tali RosenSherby & Co, Advs

Italy 256Cecilia CarraraLegance – Avvocati Associati

Japan 261Shinji KusakabeAnderson Mori & Tomotsune

Korea 270BC Yoon, Richard Menard and Liz Kyo-Hwa ChungKim & Chang

Lithuania 278Ramunas Audzevicius and Rimantas DaujotasMotieka & Audzevicius

Malaysia 285Foo Joon LiangGan Partnership

Mexico 294Sergio Rodríguez Labastida and Mariana BeltránRodríguez Labastida Abogados

Morocco 301Azzedine Kettani Kettani Law Firm

Mozambique 309Agostinho Pereira de Miranda, Filipa Russo de Sá and Catarina Carvalho CunhaMiranda Correia Amendoeira & Associados

Netherlands 315Daniella StrikLinklaters LLP

Nigeria 321Dorothy Udeme UfotDorothy Ufot & Co

Pakistan 329Sajid Zahid and Mustafa AhmedOrr, Dignam & Co

Poland 335Justyna Szpara and Andrzej MaciejewskiŁaszczuk & Partners

Portugal 342Agostinho Pereira de Miranda and Sofia MartinsMiranda Correia Amendoeira & Associados

Qatar 349Jalal El Ahdab and Myriam EidGinestié Magellan Paley-Vincent in association with Ahdab Law Firm

Romania 356Cristiana-Irinel Stoica, Andrea Micu and Daniel Aragea Stoica & Asociaţii

Russia 364Ilya Nikiforov, Alexey Karchiomov and Svetlana PopovaEgorov, Puginsky, Afanasiev and Partners

Saudi Arabia 373Jalal El Ahdab and Myriam EidGinestié Magellan Paley-Vincent in association with Ahdab Law Firm

Scotland 382Brandon MaloneBrandon Malone & Company

Singapore 391Edmund Jerome Kronenburg and Tan Kok PengBraddell Brothers LLP

Slovakia 401Roman Prekop, Monika Simorova and Peter PethoBarger Prekop sro

Spain 409Alberto EcharriEcharri & Brindle, Abogados

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Sweden 417Simon ArvmyrenSandart & Partners

Switzerland 423Xavier Favre-Bulle, Harold Frey and Daniel DuranteLenz & Staehelin

Tanzania 430Wilbert Kapinga, Ofotsu A Tetteh-Kujorjie and Kamanga KapingaMkono & Co Advocates

Thailand 436Kornkieat Chunhakasikarn and John KingTilleke & Gibbins

Turkey 443Ismail G Esin and Dogan GultutanEsin Attorney Partnership

Ukraine 450Oleg Alyoshin and Yuriy DoboshVasil Kisil & Partners

United Arab Emirates 459Gordon Blanke and Soraya Corm-BakhosBaker & McKenzie Habib Al Mulla

United States 468Jack Thomas, Arlen Pyenson and Amal BouhabibCrowell & Moring LLP

Venezuela 475Fernando Peláez-Pier and José Gregorio Torrealba Hoet Pelaez Castillo & Duque

Vietnam 482Nguyen Manh Dzung, Le Quang Hung and Nguyen Ngoc MinhDzungsrt & Associates LLC

Lenz & Staehelin SWITZERLAND


SwitzerlandXavier Favre-Bulle, Harold Frey and Daniel DuranteLenz & Staehelin

Laws and institutions

1 Multilateral conventions relating to arbitration

Is your country a contracting state to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards? Since when has the Convention been in force? Were any declarations or notifications made under articles I, X and XI of the Convention? What other multilateral conventions relating to international commercial and investment arbitration is your country a party to?

Switzerland has been a party to the New York Convention since 1965 and withdrew its reciprocity reservation in 1993.

Switzerland is also a party to the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States of 1965, as well as the Geneva Protocol on Arbitration Clauses of 1923 and the Geneva Convention on the Execution of Foreign Arbitral Awards of 1927.

2 Bilateral investment treaties

Do bilateral investment treaties exist with other countries?

Switzerland has signed bilateral investment treaties with 119 countries.

3 Domestic arbitration law

What are the primary domestic sources of law relating to domestic and foreign arbitral proceedings, and recognition and enforcement of awards?

International arbitration is governed by Chapter 12 of the Federal Private International Law Act of 18 December 1987 (PILA; an unofficial English version is available on www.swissarbitration.ch/rules.php). Chapter 12 applies to any arbitration if the seat of the arbitral tribunal is in Switzerland and if at least one of the parties to the arbitration had neither its domicile nor its habitual residence in Switzerland when the arbitration agreement was entered into.

Domestic arbitration is governed by Part 3 of the Federal Code of Civil Procedure (CCP). The CCP entered into force on 1 January 2011. Since then, domestic arbitration proceedings are no longer governed by the Inter-Cantonal Concordat on Arbitration of 27 March 1969.

4 Domestic arbitration and UNCITRAL

Is your domestic arbitration law based on the UNCITRAL Model Law? What are the major differences between your domestic arbitration law and the UNCITRAL Model Law?

The Swiss law of international arbitration is not based on the UNCITRAL Model Law, mainly for historical reasons. There are no fundamental differ-ences between Chapter 12 PILA and the Model Law, although Chapter 12 is much shorter. Chapter 12 gives paramount importance to party autonomy for most issues and, in the absence of an agreement between the parties, it allows for wide discretion of the arbitral tribunal.

The rules on domestic arbitration are more elaborated than those in Chapter 12 PILA, but they are not based on the UNCITRAL Model Law either.

5 Mandatory provisions

What are the mandatory domestic arbitration law provisions on procedure from which parties may not deviate?

As regards international arbitration, the PILA sets out two mandatory requirements of procedure: the arbitral tribunal shall ensure equal treat-ment of the parties and their right to be heard (due process) (article 182(3) PILA). Similar mandatory requirements also apply in domestic arbitration (article 373(4) CCP).

6 Substantive law

Is there any rule in your domestic arbitration law that provides the arbitral tribunal with guidance as to which substantive law to apply to the merits of the dispute?

In international arbitration, the arbitral tribunal shall decide the dispute according to the rules of law chosen by the parties or, in the absence of such a choice, according to the rules of law with which the case has the closest connection. The parties may also authorise the arbitral tribunal to decide ex aequo et bono (article 187 PILA).

In domestic arbitration, the CCP provides that the arbitral tribunal shall decide according to the rules of law chosen by the parties or ex aequo et bono if so authorised by the parties (article 381(1)). Absent an agreement on the applicable law or an authorisation to decide the dispute ex aequo et bono, the arbitral tribunal must decide in accordance with the law that an ordinary court would apply (article 381(2)). Disputes without an inter-national element will in principle be decided according to Swiss law. For international disputes, the arbitral tribunal will have to resort to the con-flict of laws rules in the PILA.

7 Arbitral institutions

What are the most prominent arbitral institutions situated in your country?

Switzerland is a preferred venue for ICC arbitrations and some other kinds of institutional arbitrations administered by institutions based abroad.

A prominent Swiss arbitration institution (Swiss Chambers’ Arbitration Institution) has been formed by seven major Chambers of Commerce (Geneva, Zurich, Basel, Bern, Ticino, Vaud and Neuchâtel). The Swiss Chambers’ Arbitration Institution administers arbitrations under the Swiss Rules of International Arbitration (the Swiss Rules, adopted in 2004). A revised version came into force on 1 June 2012. Arbitration pro-ceedings under the Swiss Rules may be introduced before the Secretariat at the addresses of any of the Swiss Chambers and are supervised by an Arbitration Court. Detailed information is available at www.swissarbitra-tion.ch.

The Swiss Rules are a modernised version of the UNCITRAL Arbitration Rules (1976). The most important changes relate to the con-solidation of arbitration proceedings (article 4), the procedural timetable (article 15(3)), jurisdiction over set-off defences (article 21(5)), the expe-dited procedure (article 42) and the emergency relief (article 43). The parties are free to choose their arbitrators and to determine a seat outside Switzerland. Fees are calculated on the basis of an ad valorem scale, but also taking into account the complexity of the matter, the time spent by the arbitrators and other relevant circumstances (article 39).

© Law Business Research Ltd 2015

SWITZERLAND Lenz & Staehelin


Another prominent Swiss-based arbitration institution is the Court of Arbitration for Sport (the CAS), based in Lausanne. The CAS provides ser-vices in order to facilitate the settlement of sports-related disputes through arbitration or mediation. CAS arbitrations are governed by the Code of Sports-related Arbitration and Mediation Rules (the CAS Code). Detailed information is available at www.tas-cas.org.

The Arbitration and Mediation Center of the World Intellectual Property Organization (WIPO), based in Geneva, offers dispute resolution services with a particular focus on disputes involving intellectual property and internet domain name disputes. It administers commercial arbitra-tions under the WIPO Arbitration Rules.

Arbitration agreement

8 Arbitrability

Are there any types of disputes that are not arbitrable?

In international arbitration, any dispute concerning an economic interest may be the subject matter of an arbitration (article 177(1) PILA), which is a very wide definition of arbitrability (disputes, inter alia, in intellectual property, competition law, securities transactions, inter-company disputes are therefore arbitrable). Debt enforcement and bankruptcy cannot be ordered by arbitral tribunals, but the underlying claims remain arbitrable.

In domestic arbitration, arbitrability is limited to rights of which the parties may freely dispose (article 354 CCP), which may limit the arbitrabil-ity of employment disputes.

9 Requirements

What formal and other requirements exist for an arbitration agreement?

In international arbitration, an arbitration agreement is valid as regards its form if made in writing, by telegram, telex, telecopier or any other means of communication permitting it to be evidenced by a text (article 178(1) PILA). The rule for domestic arbitrations is similar: the arbitration agree-ment must be made in writing or any other means allowing it to be evi-denced by a text (article 358 CCP). In both instances, a written document signed by all parties concerned is not required.

Arbitration agreements may be contained in the by-laws of a company or in general terms and conditions. There are no particular formal require-ments in order for state entities to enter into arbitration agreements.

Where a party does not object to the jurisdiction of the arbitral tribunal in a timely manner, it will be barred from raising such objections at a later stage, including objections based on the formal invalidity of the arbitration agreement.

10 Enforceability

In what circumstances is an arbitration agreement no longer enforceable?

An arbitration agreement is valid and enforceable if it conforms either to the law chosen by the parties, or to the law governing the subject matter of the dispute, in particular the law governing the main contract, or if it conforms to Swiss law (article 178(2) PILA).

The doctrine of severability applies in Swiss law: the validity of the arbitration agreement cannot be objected to on the ground that the main agreement is invalid (article 178(3) PILA; article 357(2) CCP). The avoid-ance, rescission, termination etc, of a contract will, in principle, not result in the arbitration clause contained in that contract becoming invalid. However, there may be instances in which both the main contract and the arbitration agreement are subject to the same grounds of invalidity.

Legal incapacity of a party is, in principle, determined by the law of the domicile or registered office of that party and may be a ground of invalidity of the arbitration agreement. If a party to the arbitration agreement is a state or state-owned entity, it cannot rely on its own domestic law in order to deny its capacity to enter into the arbitration agreement (article 177(2) PILA). The death of a party will usually not cause the arbitration agree-ment to become invalid or inoperative.

After insolvency proceedings have been commenced, the debtor can-not validly enter into an arbitration agreement in respect of claims falling in the estate.

11 Third parties – bound by arbitration agreement

In which instances can third parties or non-signatories be bound by an arbitration agreement?

Third parties or non-signatories may be bound by an arbitration agreement under general principles of contract law. A principal will be bound by the arbitration agreement entered into by his or her agent on his or her behalf. Arbitration agreements will generally be transferred to legal successors such as heirs, merged companies, assignees and transferees. Third-party beneficiaries enforcing their claims will be bound by arbitration agree-ments entered into between the parties. Finally, trustees in bankruptcy or the executors of a will are bound by arbitration agreements concluded by the debtor or deceased respectively.

Guarantors and sureties are not bound by the terms of the main con-tract and therefore not bound by any arbitration agreement contained in that contract if the agreements concerned are sufficiently independent.

The Swiss Federal Supreme Court further held that interference in the performance of a contract by a third party may cause such third party to be bound by the arbitration agreement. The piercing of the corporate veil doctrine would also in principle apply if the requirements are met.

12 Third parties – participation

Does your domestic arbitration law make any provisions with respect to third-party participation in arbitration, such as joinder or third-party notice?

Neither Chapter 12 of the PILA (international arbitration) nor Part 3 of the CCP (domestic arbitration) contain any provisions in respect of third-party participation. Arbitral tribunals sitting in Switzerland would first have to determine whether the third party is bound by a compatible arbitration agreement. In the absence of a compatible arbitration agreement (or an agreement between all the parties involved), the interest of the third party in the outcome of the dispute would not per se be a ground for joinder.

The Swiss Rules contain a dedicated provision as regards joinder and third-party notice (article 4(2)).

13 Groups of companies

Do courts and arbitral tribunals in your jurisdiction extend an arbitration agreement to non-signatory parent or subsidiary companies of a signatory company, provided that the non-signatory was somehow involved in the conclusion, performance or termination of the contract in dispute, under the ‘group of companies’ doctrine?

Swiss courts have not endorsed the ‘group of companies’ doctrine to date. Swiss law is based on the concept that different legal entities are independ-ent legal subjects. There is no automatic extension of the arbitration agree-ment to other entities for the mere reason that they are part of the same group of companies. In 1996, the Swiss Federal Supreme Court rejected the exten-sion of an arbitration agreement to entities of the same group under both the ‘piercing of the corporate veil’ and the ‘group of companies’ concepts.

14 Multiparty arbitration agreements

What are the requirements for a valid multiparty arbitration agreement?

There are no specific requirements for multiparty arbitration agreements and no case law comparable to the French Dutco decision. Modern arbitra-tion rules such as the ICC Rules of Arbitration (2012) or the revised Swiss Rules (2012) contain specific provisions dealing with multiparty situations, in particular the situation where the co-respondents (or co-claimants) cannot agree on the same party-appointed arbitrator.

Constitution of arbitral tribunal

15 Eligibility of arbitrators

Are there any restrictions as to who may act as an arbitrator? Would any contractually stipulated requirement for arbitrators based on nationality, religion or gender be recognised by the courts in your jurisdiction?

Swiss law of arbitration provides no restrictions as to who may act as an arbitrator, and arbitrators need not be selected from any list. Judges are, in




principle, allowed to act as arbitrators. One exception exists for domestic arbitration proceedings with regard to disputes involving tenancy and lease of residential property: only the conciliation authority may be appointed as arbitral tribunal (article 361(4) CCP). The conciliation authority is an official body set up by the CCP.

Party autonomy is the overarching principle for arbitrations having their seat in Switzerland. Contractually stipulated requirements for arbitra-tors should therefore be complied with. The parties are not under a duty to provide reasons for any such requirements. Requirements of nationality are certainly not regarded as problematic. Even though Swiss courts have not yet been called upon to decide a challenge based on non-discrimination regulations, requirements based on gender or religion (which are fairly rare in practice) are likely to be declared unobjectionable.

If the dispute is referred to the Court of Arbitration for Sport (CAS), the arbitrators must mandatorily be selected from a closed list of some 300 arbitrators.

16 Default appointment of arbitrators

Failing prior agreement of the parties, what is the default mechanism for the appointment of arbitrators?

In international arbitration, failing provisions in the arbitration agreement or in the rules of arbitration referred to by the parties, the court at the place of arbitration has jurisdiction to appoint the arbitrators and shall do so by applying by analogy the provisions in point of the CCP (article 179(2) PILA). Under article 360(1) CCP, failing an agreement by the parties on the number of arbitrators, the number shall be three.

In the absence of an appointing authority or where such authority fails to make an appointment within a reasonable time, the court at the place of arbitration will appoint an arbitrator in the following instances: • the parties cannot agree on a chairperson or on the sole arbitrator; • a party fails to nominate an arbitrator within 30 days as of the day on

which such party has been put on notice; and • the appointed arbitrators fail to agree on the chairperson within 30

days following their nomination (article 362 CCP).

Under the Swiss Rules, if the parties did not agree on the number of arbitra-tors, the decision will be taken by the court (article 6(1)). As a rule, the mat-ter will be referred to a sole arbitrator, unless the circumstances warrant a three-member arbitral tribunal (article 6(2)). If the parties fail to nominate an arbitrator, if they cannot agree on a sole arbitrator or on the presiding arbitrator, such appointments will be made by the court (articles 7(3), 8(2)). In multiparty proceedings, where a group of claimants or a group of respondents fails to designate an arbitrator, the court may appoint all three arbitrators and shall specify the presiding arbitrator (article 8(5)).

The CAS Code contains similar provisions. In essence, failure by a party to nominate an arbitrator will cause the president of the relevant CAS division to make such appointment (articles R40.2, R53 and R54).

17 Challenge and replacement of arbitrators

On what grounds and how can an arbitrator be challenged and replaced? Please discuss in particular the grounds for challenge and replacement, and the procedure, including challenge in court. Is there a tendency to apply or seek guidance from the IBA Guidelines on Conflicts of Interest in International Arbitration?

In international arbitration, an arbitrator may be challenged only:• if or she he does not meet the requirements agreed by the parties;• if the rules of arbitration agreed by the parties provide for a ground for

challenge; or• if circumstances exist which give rise to justifiable doubts as to his or

her independence or impartiality (article 180(1) PILA).

The same grounds are set out in article 367(1) CCP for domestic arbitration.The arbitrators are under an obligation to disclose any circumstances

giving rise to doubts as to their impartiality or independence. Any ground for challenge must be notified to the arbitral tribunal and the other party without delay (failure to do so would amount to a waiver of the right to challenge the arbitrator). In the event of a dispute and to the extent that the parties have not determined the procedure for the challenge, the court having jurisdiction at the seat of the arbitration shall make the final deci-sion (article 180(3) PILA).

Swiss courts tend to apply a strict standard when called upon to decide whether an arbitrator is biased.

The arbitrators shall be removed or replaced (eg, in cases of illness or death) in accordance with the agreement of the parties. In the absence of such an agreement, the matter may be referred to the court where the arbi-tral tribunal has its seat: the court shall apply by analogy the provisions in point of the CCP (see below) concerning the removal or replacement of arbitrators (article 179(1) and (2) PILA).

In domestic arbitration, the provisions on the challenge, removal or replacement of arbitrators are more detailed (articles 367 to 371 CCP, which apply by analogy to international arbitration). If the parties did not agree on any specific procedure with respect to challenges of an arbitra-tor, a request for challenge must first be made to the challenged arbitrator. If such arbitrator refuses to step down, the party having made the request may file a challenge before the court of competent jurisdiction at the seat of the arbitral tribunal (article 369 CCP). In international arbitration, this court’s decision is final (article 180(3) PILA). In domestic arbitration, the court’s decision on the challenge may be reviewed in setting aside proceed-ings against the award (article 369(5) CCP).

In case an arbitrator is successfully challenged, resigns, or is removed, he will be replaced pursuant to the procedure applied for his appointment.

The Swiss Federal Supreme Court held that the IBA Guidelines on Conflicts of Interest in International Arbitration, although being an impor-tant working tool, do not constitute a binding instrument comparable to legislation.

18 Relationship between parties and arbitrators

What is the relationship between parties and arbitrators? Please elaborate on the contractual relationship between parties and arbitrators, neutrality of party-appointed arbitrators, remuneration and expenses of arbitrators.

Under Swiss law, the parties and arbitrators are bound by an arbitral con-tract whereby the arbitrators shall adjudicate upon the dispute with due care, in person, and impartially; in return, the arbitrators are entitled to remuneration. The Swiss Federal Supreme Court held that all members of the arbitral tribunal are subject to the same degree of independence and impartiality, including the party-appointed arbitrators.

19 Immunity of arbitrators from liability

To what extent are arbitrators immune from liability for their conduct in the course of the arbitration?

The Swiss law of arbitration does not contain any provision regarding the arbitrators’ liability. The majority view of commentators is that arbitrators may be held liable only in case of wilful intent or gross negligence.

When certain arbitration rules apply (eg, the Swiss Rules), arbitra-tors benefit from an express exclusion of liability – they are only liable for damages if they have breached their contractual duties in an intentional or grossly negligent manner (article 45(1) Swiss Rules).

Jurisdiction and competence of arbitral tribunal

20 Court proceedings contrary to arbitration agreements

What is the procedure for disputes over jurisdiction if court proceedings are initiated despite an existing arbitration agreement, and what time limits exist for jurisdictional objections?

If the parties have entered into an arbitration agreement with respect to an arbitrable dispute, any Swiss court before which such dispute is brought shall decline jurisdiction, unless:• the defendant has proceeded on the merits without reservation;• the court finds that the arbitration agreement is null and void, inopera-

tive or incapable of being performed; or• the arbitral tribunal cannot be appointed for reasons which are obvi-

ously attributable to the respondent in the arbitration (article 7 PILA).




21 Jurisdiction of arbitral tribunal

What is the procedure for disputes over jurisdiction of the arbitral tribunal once arbitral proceedings have been initiated and what time limits exist for jurisdictional objections?

The arbitral tribunal shall decide on its own jurisdiction (Kompetenz–Kompetenz principle) in general by a preliminary decision or, in certain circumstances, in the final award. Any plea of lack of jurisdiction must be raised prior to any defence on the merits. According to an amendment to the PILA in force since 1 March 2007, the arbitral tribunal shall make its decision on jurisdiction even if an action on the same matter between the same parties is already pending before a state court or another arbitral tribunal, unless there are serious grounds to stay the proceedings (article 186(1-bis) PILA).

An award on jurisdiction may be sought to be set aside before the Swiss Federal Supreme Court, unless the parties have expressly excluded such ground for challenge (article 190(2)(b) PILA).

Arbitral proceedings

22 Place and language of arbitration

Failing prior agreement of the parties, what is the default mechanism for the place of arbitration and the language of the arbitral proceedings?

If the place of arbitration has not been determined by the parties or by the arbitral institution designated by the parties, it shall be fixed by the arbi-tral tribunal (article 176(3) PILA; article 355(1) CCP). The parties’ failure to determine the place of arbitration may cause difficulties for the constitu-tion of the arbitral tribunal in case the assistance of local courts is needed (see question 23).

The language of the proceedings shall also be determined by the arbi-tral tribunal failing an agreement of the parties.

23 Commencement of arbitration

How are arbitral proceedings initiated?

Swiss law does not impose formal requirements for a notice of arbitration. Legal provisions exist only to determine when the arbitration proceedings are pending (article 181 PILA and article 372(1)(a) CCP). In the absence of an agreement as to how to initiate the proceedings, the claimant would appoint its party-appointed arbitrator and request the respondent to do the same. Assistance from the court of competent jurisdiction may be sought for the purpose of constituting the arbitral tribunal.

Under the Swiss Rules, arbitral proceedings are initiated by submit-ting a notice of arbitration to the Secretariat at the address of one of the Swiss Chambers. The notice of arbitration shall be submitted in as many copies as there are other parties, together with an additional copy for each arbitrator and one copy for the Secretariat. The minimum content of such notice is described in article 3(3) Swiss Rules. Signature is not required but standard in practice.

24 Hearing

Is a hearing required and what rules apply?

Hearings are usually held in practice, but there is no such requirement either under the Swiss law of arbitration (both international and domestic) or under the Swiss Rules.

25 Evidence

By what rules is the arbitral tribunal bound in establishing the facts of the case? What types of evidence are admitted and how is the taking of evidence conducted?

The arbitral tribunal has to follow the procedural rules agreed upon by the parties, directly or by reference to arbitration rules. Where the parties have not determined the procedure, the arbitral tribunal shall determine it to the extent necessary. In general, there are no restrictions as to admissible types of evidence in international arbitration (eg, documents, witnesses, experts whether called by a party or appointed by the arbitral tribunal, inspection, etc; the arbitral tribunal also has wide discretion as to the admissibility and weight of witness evidence by party-representatives).

Although article 184 PILA provides that the evidence shall be taken by the arbitral tribunal, it very much depends on the arbitrators how the taking

of evidence is conducted. No stringent requirements are fixed in Swiss law and wide discretion is left to tailor the procedure according to the specific needs of the parties (standard practice in international arbitration usually includes written witness statements, examination of witnesses by counsel and questions by the arbitral tribunal). It is not infrequent that arbitrators sitting in Switzerland seek guidance from (or even directly apply) the IBA Rules on the Taking of Evidence in International Commercial Arbitration.

26 Court involvement

In what instances can the arbitral tribunal request assistance from a court and in what instances may courts intervene?

If the party concerned does not voluntarily comply with provisional or con-servatory measures ordered by the arbitral tribunal, the arbitral tribunal may request the assistance of the court of competent jurisdiction (article 183(2) PILA; article 374(2) CCP).

The arbitral tribunal or a party with the consent of the arbitral tribunal may request the assistance of the court at the place of arbitration for the taking of evidence (article 184(2) PILA; article 375(2) CCP). The court at the place of arbitration also has jurisdiction for any further judicial assistance (article 185 PILA).

Interventions of the Swiss courts are very limited in international arbitration. This is one of the main features of Chapter 12 of the PILA, which favours party autonomy and grants wide powers to the arbitra-tors. Procedural orders made by an arbitral tribunal cannot be challenged before a Swiss court.

27 Confidentiality

Is confidentiality ensured?

The Swiss law of arbitration (both international and domestic) is silent on confidentiality and the extent to which arbitration proceedings are per se confidential remains unsettled. The arbitration agreement or any other agreement between the parties, as well as the arbitration rules chosen by the parties, may contain provisions on confidentiality.

Under the Swiss Rules (subject to a few exceptions and unless the par-ties expressly agree otherwise in writing), the parties, arbitrators, tribunal-appointed experts, the secretary of the arbitral tribunal, the members of the board of directors of the Swiss Chambers’ Arbitration Institution, the members of the Court and the Secretariat, and the staff of the individual Chambers undertake to keep confidential all awards and orders as well as all materials submitted by a party in the framework of the arbitration proceedings.

Interim measures and sanctioning powers

28 Interim measures by the courts

What interim measures may be ordered by courts before and after arbitration proceedings have been initiated?

In both international and domestic arbitration, courts have non-exclusive jurisdiction to order any provisional or conservatory measures before and after arbitration proceedings have been initiated.

29 Interim measures by an emergency arbitrator

Does your domestic arbitration law or do the rules of the domestic arbitration institutions mentioned above provide for an emergency arbitrator prior to the constitution of the arbitral tribunal?

The Swiss law of arbitration is silent on the issue of emergency arbitration proceedings. Under the revised Swiss Rules (2012), the parties may seek interim relief before an emergency arbitrator (article 43 Swiss Rules).

30 Interim measures by the arbitral tribunal

What interim measures may the arbitral tribunal order after it is constituted? In which instances can security for costs be ordered by an arbitral tribunal?

In both international and domestic arbitration, unless the parties have agreed otherwise, the arbitral tribunal may order provisional or con-servatory measures at the request of a party (article 183(1) PILA; article 374(1) CCP). Types of interim relief are not limited by law, although the




admissibility of some measures is debated (eg attachment of assets, so-called astreintes or penal sanctions in case of non-compliance with the order of the arbitral tribunal, etc). Requirements for court assistance are described in question 26. The arbitral tribunal or the court may make the granting of interim relief subject to the provision of appropriate security (article 183(3) PILA; article 374(3) CCP).

Chapter 12 of the PILA (international arbitration) is silent on security for costs. According to some precedents and academic writings, arbitrators sitting in Switzerland have the power to grant security for costs, but only in very limited circumstances (in practice, security for costs is rarely granted). Article 379 CCP (domestic arbitration) provides that if the claimant appears to be insolvent, the arbitral tribunal may order security for costs.

31 Sanctioning powers of the arbitral tribunal

Pursuant to your domestic arbitration law or the rules of the domestic arbitration institutions mentioned above, is the arbitral tribunal competent to order sanctions against parties or their counsel who use ‘guerrilla tactics’ in arbitration?

Neither the Swiss law of arbitration nor the Swiss Rules contain any provi-sion with the purpose of sanctioning a party or its counsel in case of ‘guer-rilla tactics’. However, an arbitral tribunal may take into consideration the conduct of the parties in the proceedings (including counsel) when decid-ing on the allocation of the costs of the arbitration.

The arbitral tribunal’s jurisdiction to sanction counsel directly appears doubtful.

Awards

32 Decisions by the arbitral tribunal

Failing party agreement, is it sufficient if decisions by the arbitral tribunal are made by a majority of all its members or is a unanimous vote required? What are the consequences for the award if an arbitrator dissents?

In international arbitration, the arbitral award shall be made in conformity with the procedure and form agreed by the parties. In the absence of such an agreement, the award shall be made by a majority decision or, in the absence of a majority, by the presiding arbitrator alone. The signature of the presiding arbitrator is sufficient (article 189 PILA).

The rules in domestic arbitration are similar. The award is made by a majority decision unless the parties agreed otherwise (article 382(3) CCP). In the absence of a majority decision, the award is made by the chairperson (article 382(4) CCP). The signature of the presiding arbitrator is sufficient (article 384(2) CCP).

33 Dissenting opinions

How does your domestic arbitration law deal with dissenting opinions?

The issue of dissenting opinions is not addressed in the Swiss law of arbitration.

34 Form and content requirements

What form and content requirements exist for an award?

In international arbitration, the award shall be made in writing, reasoned, dated and signed (at least by the presiding arbitrator) (article 189(2) PILA; more detailed requirements apply in domestic arbitration – see article 384(1) CCP).

35 Time limit for award

Does the award have to be rendered within a certain time limit under your domestic arbitration law or under the rules of the domestic arbitration institutions mentioned above?

Swiss law of arbitration does not require the award to be rendered within a certain time limit. The Swiss Rules are also silent on the matter.

The operative part of CAS awards in appeal proceedings shall be noti-fied to the parties three months after the transfer of the file to the panel; this time limit may be extended by the President of the Appeals Division (article R59(5) CAS Code).

36 Date of award

For what time limits is the date of the award decisive and for what time limits is the date of delivery of the award decisive?

The date of the award is not decisive for any time limits. The award becomes final when it is notified to the parties (article 190(1) PILA; arti-cle 387 CCP). The 30-day time limit to challenge the award starts running from that notification.

37 Types of awards

What types of awards are possible and what types of relief may the arbitral tribunal grant?

Unless the parties have agreed otherwise, the arbitral tribunal may make interim, partial and final awards (articles 188 to 189 PILA; article 383 CCP), including an award by consent if so requested (article 385 CCP).

The possible types of relief are not limited by Swiss law. They mainly depend on the law applicable to the merits of the case.

38 Termination of proceedings

By what other means than an award can proceedings be terminated?

In case of settlement or other circumstances giving rise to the withdrawal of the claims submitted to arbitration, the arbitral tribunal may make a ter-mination order to declare that the arbitration proceedings are discontin-ued. Terminating the proceedings without an award requires, in principle, that the parties are consulted on such process. Rules of arbitration may pro-vide for how proceedings can be terminated by other means than an award.

39 Cost allocation and recovery

How are the costs of the arbitral proceedings allocated in awards? What costs are recoverable?

Swiss law is silent on the assessment and allocation of costs in arbitration. The parties may make an agreement on that point, either in the arbitration agreement or by reference to arbitration rules. Failing such an agreement, the arbitral tribunal has wide discretion as to costs. As a rule, arbitrators tend to follow the maxim ‘costs follow the event’ and consider that reason-able legal costs are recoverable, at least in part.

40 Interest

May interest be awarded for principal claims and for costs and at what rate?

Interest may be awarded in accordance with the law applicable to the mer-its of the case and other rules and principles which the arbitral tribunal may deem appropriate. In Swiss law, the legal interest rate is 5 per cent per year.

Proceedings subsequent to issuance of award

41 Interpretation and correction of awards

Does the arbitral tribunal have the power to correct or interpret an award on its own or at the parties’ initiative? What time limits apply?

Although Chapter 12 of the PILA is silent on interpretation and correction of awards, this gap has been filled by the Swiss Federal Supreme Court. The arbitral tribunal has the power to correct clerical errors of its own motion and may correct or interpret an award upon request of a party. No specific time limits apply in Swiss law (such time limits may nevertheless be pro-vided for in arbitration rules, such as the Swiss Rules). Undue delays in requests for correction or interpretation may be taken into account by the arbitral tribunal.

Domestic arbitration provisions are more detailed. A request for inter-pretation and correction must be made before the arbitral tribunal within 30 days following the discovery of the mistake or the passages to be inter-preted, but at the latest within one year following the notification of the award (article 388 CCP).




42 Challenge of awards

How and on what grounds can awards be challenged and set aside?

Setting aside proceedings in international arbitration may only be brought before the Swiss Federal Supreme Court (article 191 PILA in its version in force since 1 January 2007) for the following exhaustive grounds (article 190(2) PILA):• the arbitral tribunal has been incorrectly constituted (or the sole

arbitrator improperly appointed);• the arbitral tribunal has wrongly assumed or denied jurisdiction;• the arbitral tribunal has decided beyond the claims submitted to it or

failed to decide one of the claims;• the principle of equal treatment of the parties or their right to be heard

(due process) has been breached; or• the award is incompatible with public policy.

In international arbitration, the parties may exclude all setting aside proceedings (or limit such proceedings to one or several of the grounds set out in article 190(2) PILA) by an express statement in the arbitration agreement or by a subsequent agreement in writing, provided that none of the parties has its domicile, habitual residence or place of business in Switzerland (article 192(1) PILA).

In domestic arbitration, setting aside proceedings must also be brought before the Swiss Federal Supreme Court, unless the parties agree to have setting aside proceedings before the court of competent jurisdiction at the place of arbitration (articles 389 and 390 CCP). The grounds to set aside an award are wider than for international awards (see article 393 CCP).

43 Levels of appeal

How many levels of appeal are there? How long does it generally take until a challenge is decided at each level? Approximately what costs are incurred at each level? How are costs apportioned among the parties?

Unless otherwise agreed between the parties, there is only one level of appeal, ie, setting aside proceedings before the Swiss Federal Supreme Court (see question 42). Statistics show that the Federal Supreme Court would normally render its decision within four to six months, which is a relatively short period.

The petitioner in setting aside proceedings will be required to pay an advance on costs based on an ad valorem scale depending on the amount in dispute. The general rule before the Swiss Federal Supreme Court is ‘costs follow the event’. In addition to the Court’s fees, the successful party will in principle be awarded legal costs which are also determined pursuant to an ad valorem scale depending on the amount in dispute.

44 Recognition and enforcement

What requirements exist for recognition and enforcement of domestic and foreign awards, what grounds exist for refusing recognition and enforcement, and what is the procedure?

Domestic awards are enforced in all Swiss cantons in the same way as a judgment made by a Swiss court. Enforcement of foreign arbitral awards in Switzerland is governed by the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention; arti-cle 194 PILA) (also if the arbitral tribunal had its seat in a non-member state).

When the prevailing party has been awarded a sum of money, the award is to be enforced within the framework of debt collection proceed-ings in accordance with the Federal Debt Collection and Bankruptcy Act and the applicable rules of the CCP. The Swiss court of competent jurisdic-tion would examine the requirements of the New York Convention in such proceedings if the award to be enforced is a foreign award.

Switzerland has a long tradition of arbitration-friendly courts. This is also reflected in the manner in which such courts look upon enforcing awards.

45 Enforcement of foreign awards

What is the attitude of domestic courts to the enforcement of foreign awards set aside by the courts at the place of arbitration?

Recognition and enforcement of foreign arbitral awards is exclusively governed by the New York Convention (article 194 PILA). If a court of competent jurisdiction at the place of arbitration set aside an award, Swiss courts may refuse recognition and enforcement under article V(1)(e) of the Convention.

46 Cost of enforcement

What costs are incurred in enforcing awards?

Costs depend on the canton where enforcement is sought and the specific defences raised against enforcement. Whereas the rules of civil procedure have been unified in one code (ie, the CCP), each canton fixes the costs for the proceedings.

Update and trends

In September 2012, the Swiss federal government was requested to submit a bill with a view to revising Chapter 12 of the PILA on international arbitration. The revision is expected to be light, but one that will further strengthen Switzerland’s position as a preferred place of arbitration. A draft bill is expected shortly.

Xavier Favre-Bulle [email protected] Harold Frey [email protected] Daniel Durante [email protected]

Route de Chêne 30 CH-1211 Geneva 17SwitzerlandTel: +41 58 450 70 00Fax: +41 58 450 70 01www.lenzstaehelin.com

Bleicherweg 58CH-8027 ZurichSwitzerlandTel: +41 58 450 80 00Fax: +41 58 450 80 01




Other

47 Judicial system influence

What dominant features of your judicial system might exert an influence on an arbitrator from your country?

Swiss procedural rules clearly distinguish between the stage where the facts are presented to the court and the subsequent taking of evidence (at hearings). The admissibility of evidence aimed at proving facts which have not been alleged in the briefs could be put into question.

In court litigation, production of documents is possible only within narrow boundaries. Discovery does not exist in court litigation and, even in international arbitration, most Swiss arbitrators have no tendency towards US-style discovery. Written witness statements are common practice in international arbitration. Party officers cannot testify as witnesses proper in court litigation, but arbitrators may allow for more flexibility in interna-tional arbitration (see question 25).

A Swiss arbitrator would also be ready and willing to act as a settle-ment facilitator if the parties so wish.

48 Professional or ethical rules applicable to counsel

Are specific professional or ethical rules applicable to counsel in international arbitration in your country? Does best practice in your country reflect (or contradict) the IBA Guidelines on Party Representation in International Arbitration?

Foreign counsel appearing in arbitrations in Switzerland are not bound by the local professional and ethical rules. Swiss-qualified lawyers are in principle bound by the Swiss Code of Conduct, but there are rules which do not apply to counsel acting in arbitration.

The IBA Guidelines on Party Representation in International Arbitration are extremely detailed if compared to the Swiss Code of Conduct or best practices in Switzerland. Whereas a number of provisions in the Guidelines are generally accepted rules of conduct in Switzerland, the Swiss arbitration community expressed general concerns about the need of such Guidelines and more detailed concerns over some provisions.

49 Regulation of activities

What particularities exist in your jurisdiction that a foreign practitioner should be aware of?

Switzerland is a well-known pro-arbitration jurisdiction, which is charac-terised by the efficiency of its arbitration laws and practice. There are no adverse particularities of which a foreign practitioner should be aware.

Neither a foreign arbitrator nor the foreign counsel of a party in arbi-tration proceedings taking place in Switzerland need to be a lawyer or national or resident of Switzerland. The foreign arbitrators or counsel do not have to pay Swiss taxes on their fees. Local ethical rules do not, in prin-ciple, apply in international arbitration.


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