THE NEW DELHI INTERNATIONAL ARBITRATION CENTRE BILL, 2019 – AN OVERVIEW

[Mr. M. GOVINDARAJAN]

International Centre for Alternative Dispute Resolution

The International Centre for Alternative Dispute Resolution (‘ICDAR’ for short) was established in the year 1995 by the Central Government with the objective of promoting alternate dispute resolution mechanism and providing facilities for the same.  The ICDAR has not been able to actively engage and embrace developments in the arbitration eco system and to create a reputation par excellence keeping with the dynamic nature of arbitration over more than two decades, as held by the High Level Committee appointed by the Central Government.

Bill 

A bill to set up an independent and autonomous regime for institutionalized domestic and international arbitration was introduced and passed in Lok Sabha, namely ‘The New Delhi International Arbitration Centre Bill, 2019’ (‘Bill’ for short).  This seeks to replace an ordinance issued in March this year by the previous government.   It provides for setting up of an independent and autonomous body for institutional arbitration and to acquire and transfer undertakings of the ICADR to the New Delhi International Arbitration Centre (‘Centre’ for short) with effect from March 2 this year. 

Objective of the Bill

The object of the Bill is to provide for the establishment and incorporation of the Centre for the purpose of creating an independent and autonomous regime for institutionalized arbitration  and for acquisition and transfer of the undertakings of the ICDAR and to vest such undertakings in the Centre for the best management of arbitration so as to make it a hub for institutional arbitration and to declare the Centre to be an institution of national importance and for matters connected therewith or incidental thereto.

Transfer and vesting

On and from the specified date, so much of the undertakings of the ICDAR as form part of, or are relatable to ICDAR and the right, title and interest of ICDAR in relation to such undertakings shall, by virtue of this Act, stand transferred to, and vest in the Central Government.

Objects of the Centre

The following are the objects of the Centre-

• to bring targeted reforms to develop itself as a flagship institution for conducting international and domestic arbitration;
• to promote research and study, providing teaching and training, and organizing conference and seminars in arbitration, conciliation, mediation  and other alternate dispute resolution matters;
• to provide facilities and administrative assistance  for conciliation, mediation and arbitral proceedings;
• to maintain panel of accredited arbitrators, conciliators and mediators both at national and international level or specialists such as surveyors and investigators;
• to collaborate with other national and international institutions and organizations  for ensuring the credibility of the centre as a specialized institution for arbitration and conciliation;
• to set up facilities in India and abroad to promote the activities of the Centre;
• to lay down parameters for different modes of alternate dispute resolution mechanism being adopted  by the Centre; and
• such other objectives as it may deem fit with the approval of the Central Government.

Functions of the Centre

The following are the functions of the Centre-

• to facilitate for conducting international and domestic arbitration and conciliation in the most professional manner;
• to provide cost effective and timely services for the conduct of arbitration and conciliation at national and international level;
• to promote studies in the field of alternative dispute resolution and related matters, and to promote reforms in the system of settlement of disputes;
• to undertake teaching and to provide for diffusion of knowledge of law  and procedure on alternative dispute resolution  and related matters and to award certificates and other academic or professional distinction;
• to impart training in alternative dispute resolution and related matters to those who are handling arbitration, conciliation and mediation;
• to co-operate with other societies, institutions and organizations, national or international for promoting alternative dispute resolution; and
• to perform such other functions as may be entrusted to it by the Central Government for promoting alternative dispute resolution.

Establishment of the Centre

The Bill seeks to establish the Centre by the Central Government by means of notification in the official gazette.  The Centre will be a body corporate having perpetual succession.  The Centre will have power to acquire, hold and dispose of the movable and immovable properties and to enter into contract.  The Centre can sue and can be sued.

The Head office of the Centre will be situated at New Delhi.  The branches of the Centre can be formed in other places of India and abroad with the previous approval of the Central Government.

The Centre shall consist the following members-

• a person, who has been a Judge of the Supreme Court or High Court or eminent person having special knowledge and experience in the conduct or administration of arbitration, law or management – to be appointed by the Central Government – Chairperson;
• two eminent persons – to be appointed by the Central Government as full time or part time members;
• one representative of a recognized body of commerce and industry, chosen on rotational basis – to be appointed by the Central Government – Part time members;
• Secretary, Department of legal affairs, Ministry of Law and Justice or his representative not below the rank of Joint Secretary – ex-officio;
• one Financial Adviser nominated by the Department of Expenditure, Ministry of Finance – Member – ex-officio;
• Chief Executive Officer – ex-officio.

The tenure of the Chairperson and the members are three years and shall be eligible for re-appointment.  The maximum age limit for Chairperson is 75 and for members 67.

The Bill provides provisions for resignation and removal of members from office by the Central Government for the reasons prescribed in the Bill.

The Centre shall meet at least four times a year.  The Chairperson shall ordinarily preside the meeting.   In his absence any member may be selected among the other members present in the meeting.  All questions which come up before any meeting of the Centre shall be dealt with as expeditiously as possible.  The Centre shall dispose the same within 6 months from the date of receipt of the application.  If it could not be disposed within 6 months the reasons for the same shall be recorded.  The Chairperson may invite any expert, not being the member, to attend the meeting but such expert has no power to vote in the meeting.

The Centre shall have a secretariat.

Committee

The Centre is given power to constitute committees to the Centre to administer various aspects of the Centre.  The Central Government may prescribe the composition and functions of such committees.  The Committee shall meet at such times and at such places and to transact the business as per the provisions of the regulations framed for this purpose.

Finance, Accounts and Audit

The Central Government may pay to the Centre in each financial year such sums of money to be utilized by the Centre.  A Fund shall be maintained for this purpose.  In this fund, the sum paid by the Central Government, all fees and other charges received by the Centre, donations, contributions, grants and income from other sources will be credited.  The amount received for the fund shall be deposited in a bank or in such other manner as prescribed by the Central Government.

The Centre shall maintain proper accounts and the same are subjected to audit by the C&AG.  The audited report shall be forwarded annually to the Central Government and the Central Government may cause the same to be placed before Parliament.

Chamber of Arbitration

The Centre shall establish a chamber of arbitration.  The Chamber of Arbitration shall maintain permanent panel of reputed arbitrators of national and international level, having wider experience in the international commercial arbitration and arbitration other than international commercial arbitration.  The Registrar to the Secretariat shall be the Member of the Chamber of Arbitration.

Arbitration Academy

The Centre may establish an Arbitration Academy-

• to train the arbitrators, particularly in the international commercial arbitration to compete on par with the reputed international arbitral institutions;
• to conduct research in the area of alternative dispute resolution and allied areas; and
• to give suggestions for achieving the objectives of the Act.

Powers of Central Government

The Central Government has been power to frame rules and regulations to carry out the purposes of the Act.

Conclusion

The formation of the Centre by replacing ICDAR is to develop the arbitration field in an efficient manner and to bring Indian at par with the international system in commercial arbitration, mediation and conciliation.  We hope for the better function of the Centre in this area and will be helpful for the business entities in resolving their international commercial disputes as well as domestic disputes within a short span of time and with lesser cost and effective decisions for such resolution.