Summary
Two competing goals permeate international commercial arbitration – ensuring arbitration is consent-based on the one hand, and an effective alternative to litigation in courts on the other. This article evaluates the extent to which Ethiopian law balances these objectives. To this end, it uses kompetenz-kompetenz, a doctrine deemed to hold the key to unlock the mysteries associated with striking the right balance between the two. Particularly, the basis and scope of this doctrine under Ethiopian law is compared with how the doctrine is understood and applied in selected jurisdictions of significance to international arbitration. Moreover, SALINI Costruttori S.P.A (Italy) v. Addis Ababa Water and Sewerage Authority, an international arbitral case, in which an Ethiopian Court and ICC Tribunal lock horns, is used to analyse the state of Ethiopian law. It finds that Ethiopian law is so lopsided in favour of legitimacy of arbitration that little room is left for the arbitral tribunal to decide on challenges directed at its own jurisdiction. This, it finds, is a major impediment to the success of arbitration as an alternative dispute settlement mechanism in Ethiopia. It then comes up with options to right this imbalance between legitimacy and efficacy of arbitration.
Introduction
Two potentially conflicting goals permeate international commercial arbitration. On the one hand, there is a need to ensure the use of arbitration is based on the consent of the parties. On the other hand, there is a desire to make arbitration an effective and therefore attractive alternative to litigation.1 In other words, since international commercial arbitration is consent-based if a party is compelled to arbitrate in the absence of an agreement to arbitrate the legitimacy of the arbitration and the resultant award is compromised. On the other hand, arbitration becomes costly and non-expeditious mechanism if a party has option to go to court, before arbitration is over, to prevent arbitration from going forward.2 Legal jurisdictions differ in the extent to which they appreciate the challenge of striking the right balance between the competing goals of efficacy and legitimacy of arbitration. They also vary in how they attempt to articulate a workable framework of analysis to address the problem.3 That said, in many jurisdictions, the doctrines of kompetenz-kompetenz and separability are deemed to hold the keys to unlock the mysteries associated with striking the
*The author is immensely grateful to all those who contributed to this article in a variety of ways. Particularly, he would like to thank Professor Matthias Lehmann, from University of Bonn, and Mr. Yazachew Belew for their invaluable support, encouragement and feedback during the process of research that resulted in this article. The author can be reached by email at: dayaseyoum@yahoo.com 1 George A. Bermann, The ‘Gateway’ Problem in International Commercial Arbitration, 37(1) YALE J. INT. LAW 1, 1-2 (2012). 2 Id., at 5 3 Id., at 3
right balance between the two competing goals.4 The two doctrines, which speak to the same question of who determines the jurisdiction of the arbitral tribunal, are thus embodied in the laws of many jurisdictions in some form.5 In this article, we will use the doctrine of kompetenz-kompetenz as the basis for the analysis of Ethiopian law. Our aim will be assessing the extent to which Ethiopian law balances concerns of legitimacy and efficacy of arbitration. To this end, we will attempt to shed light on whether or not arbitral tribunals have the power to decide on their own jurisdiction under Ethiopian law. Particularly, we will discuss the basis and scope of such powers. We will also examine whether or not Ethiopian courts are by law prohibited from entertaining the issue of arbitral jurisdiction till the arbitral tribunal decides on this matter. Furthermore, we will evaluate whether or not Ethiopian law dealing with these issues is compatible with the law and practice of international commercial arbitration. Besides, we will examine Ethiopian law governing this matter in light of public international law and international public policy. Finally, we will recommend steps which we think can help right the imbalance between concerns of legitimacy and efficacy of arbitration in Ethiopia. We start by throwing some light on the doctrine of kompetenz-kompetenz, itself.
Kompetenz-Kompetenz: A Chameleon-like Notion
Kompetenz-kompetenz, which literally means ‘jurisdiction on jurisdiction’, is a much-vexed principle than it appears at first. It has ‘a chameleon-like quality that changes colour according to the national and institutional background of its application.’6 The general understanding is that this doctrine ‘permits an arbitral tribunal to determine its own jurisdiction’ where that is challenged.7 In its most basic form this doctrine is an anti-sabotage mechanism.8 It reduces the possibility of obstruction of arbitration by simple allegation that the arbitration agreement is unenforceable. It does this by empowering the arbitral tribunal to decide on such defences and proceed with the arbitration, where it finds it has jurisdiction.9
This basic rule, however, tells only part of the story.10 First, there are issues, at least in some jurisdictions, as to whether the doctrine covers cases where the very existence, validity and scope of the arbitration clause itself are at issue.11 Second, the basic rule also says nothing about the flip side of this rule which imposes restriction on intervention by courts so the arbitral tribunal has the first opportunity to determine its own jurisdiction.12 It does not specify the exact stage at which courts may or may not intervene.13 Third, the doctrine remains silent about the standard of review the courts should employ where they do have to assess the arbitration agreement and its consequence.14 For instance, in some jurisdictions 4
Id., at 13 5 O Susler, The Jurisdiction of the Arbitral Tribunal: A Transnational Analysis of the Negative Effect of Competence, 6 MACQUAIRE J BUS LAW 119, 119-20 (2009). 6 WILLIAM W. PARK, ARBITRATION OF INTERNATIONAL BUSINESS DISPUTES 232 (Oxford University Press, 2nd ed. 2012) 7 Berman, supra note 1, at 14 8 Park, supra note 6, at 233 9 Id. 10 Id. 11 ZHENG SOPHIA TANG, JURISDICTION AND ARBITRATION AGREEMENTS IN INTERNATIONAL COMMERCIAL LAW, 75 (Routledge Taylor and Francis Group, 2014) 12 O Susler, supra note 5, at 125 13 Id. 14 Id., at, 120
the standard of review employed by courts will be superficial or full depending on whether the review is conducted before or after the arbitral tribunal has been constituted or rendered its award.15 The rules on intervention by courts in this regard may also vary depending on whether the arbitration is domestic or international.16 Fourth, in jurisdictions where parallel proceedings before court and arbitral tribunal are possible, there is issue as to the effect of such proceedings.17 Fifth, where the law provides that the arbitral tribunal has the first word on its own jurisdiction, there are differences as to whether such word is final or subject to review by court.18
Overall, kompetenz-kompetenz, in and of itself, says not much about the course of action a court or an arbitral tribunal confronted with the foregoing types of issues should take. As a result, there is diversity on the timing, extent and impact of intervention by courts in jurisdictional matters in the context of arbitration giving kompetenz-kompetenz different shades of meaning in different jurisdictions.19 In consequence, the doctrine is understood in some jurisdictions in ways that favour efficacy of arbitration over its legitimacy while in some others the reverse is the case.20 Many other jurisdictions provide hybrid solutions lying somewhere in the spectrum between the two extremes.21
A good starting point to evaluate the extent to which Ethiopian law balances concerns of legitimacy and efficacy of arbitration is to look at how the notion of kompetenz-kompetenz is understood and applied in selected jurisdictions of significance to international commercial arbitration. This will help us locate where in the spectrum of the different understandings, the notion as understood in Ethiopia lies. Hence, before delving into Ethiopian law on the subject, we will briefly look at how kompetenz-kompetenz is understood in selected foreign jurisdictions.
Kompetenz-kompetenz in Jurisdictions of Significance: A Snapshot
France
The French arbitration law, which must have informed the arbitration rules of the 1960 Civil Code of Ethiopia,22 was fully overhauled for domestic and international arbitration in 1980 and 1981 respectively.23 These rules have further been amended by the Decree No. 2011-48 of January 13, 2011 which introduces Articles 1442 to 1527 to the Code of the Civil Procedure.24 This new French law aims at consolidating France’s appeal as a venue for
15 Id. 16 Park, supra note 6, at 238. 17 Tang, supra note 11, at 75 18 Id., at 76 19 Park, supra note 6, at 234-7 20 Id. 21 Id., at 248-9 22 René David, A Civil Code for Ethiopia: Considerations on the Codification of the Civil Law in African Countries, 37 TUL. L. REV., 187, 192 (1963). Unfortunately, we do not find documented preparatory works dealing with this part of the Civil Code of Ethiopia. But René David, the drafter of the Code himself tells us that by choosing continental jurists, Ethiopian authorities indirectly choose the Code to be modelled after continental civil codes, when it comes to concepts. From this, and the fact that René David was a French Jurist one may gather that the French arbitration laws of the time informed the drafting of the Ethiopian law on arbitration. 23 Beatrice Castellane, The New French Law on International Arbitration, 28(4) J. INT. ARB., 371, 371(2011) 24 Id.
international arbitration. Hence, it embodies the distinctively pro-efficiency stance taken by the French courts as regards kompetenz-kompetenz. 25
The new law empowers an arbitral tribunal to decide on its own jurisdiction, when that is challenged before the arbitral tribunal.26 This is a feature of many modern arbitration laws as we shall see in due course.27 What distinguishes the French law from other laws is the prohibition it imposes on courts from entertaining challenges to the jurisdiction of arbitral tribunals save in exceptional circumstances. Article 1448 of the new law provides ‘. . . a court shall refuse to hear a dispute which is covered by an arbitration agreement unless an arbitration tribunal has not been seized of the dispute . . . and the arbitration agreement is manifestly void or inapplicable.’28
This provision ties the hands of a judge in two ways. First, it vests in the arbitral tribunal, once it has been constituted, the first opportunity to decide on its own jurisdiction. The French judge has no option but to sit on his hands and wait until the arbitral tribunal decides on its own jurisdiction.29 Second, even where an arbitral tribunal has not yet been constituted, the new law limits the grounds on which the judge may refuse to refer disputes to arbitration to cases where the arbitration agreement is manifestly void or inapplicable. This allows the French judge to conduct only the most superficial review of the arbitration agreement such as whether the agreement is clearly void for lack of any signature.30 He is not allowed to pose more complex questions regarding the validity of the arbitration agreement or examine its scope of coverage at the pre-award stage.31 From this, we note that the obligation imposed by French law on a court to refer disputes to arbitration is broader than that under the New York Convention. 32
In sum, French law not only embodies positive kompetenz-kompetenz but also strictly limits intervention by courts in arbitral proceedings. It is at the pro-efficiency end of the spectrum when it comes to striking balance between efficiency and legitimacy of arbitration. In fact, its emphasis on procedural efficiency is such that it embodies a provision, which is considered a
25 Bermann, supra note 1, at 15-16 26 Castellane, supra note 23, at 373. Article 1465 of the New Decree that embodies this rule is found in the section that deals with domestic arbitration. Yet, it applies to international arbitrations too because Article 1506 indicates it automatically applies to international arbitration unless the parties have reached agreement to the contrary. 27See for instance, The United Nations International Trade Law Commission (UNCITRAL) Model Law on International Commercial Arbitration, as Revised in 2006, Article 16(1), provides ‘[t]he tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.’ So, in countries that follow the UNCITRAL Model Law arbitrators have positive kompetenz-kompetenz. U.N. Comm’n on Int’l Trade Law, Rep. on its 39th Sess., June 19-July 7, 2006, U.N. Doc. A/61/17, (July 14 2006). 28 Castellane, supra note 23, at 372. For this purpose when arbitrators accept their mandate and hence the tribunal is constituted the arbitral tribunal is deemed to have been seized of the dispute pursuant to Article 1456 of the new law. From that date on wards, the courts are prohibited to entertain issues regarding jurisdiction of arbitral tribunal until the tribunal returns its own award. This new rule embodies the 2006 decision of Cour de Cassation in American Bureau of shipping v. Copropriété Jules Verne. 29 Park, supra note 6, at 239 30 Id. 31 Id. 32 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, June 10, 1958), 330 U.N.T.S. 3, 21 U.S.T. 2517, T.I.A.S. 6997. According to Article II(3) the New York Convention, when seized of a matter in respect of which parties have concluded an arbitration agreement a court of Party to the Convention is required to refer the dispute to arbitration, at the request of one of the parties, unless the court ‘finds that the said agreement is null and void, inoperative or incapable of being performed.’
novelty, requiring efficiency from both the arbitral tribunal and the parties to arbitration, though not directly relevant to kompetenz-kompetenz. 33
The UNCITRAL Model Law
The Model Law which was used as the basis for the arbitration laws of over 60 countries in all the six inhabited continents within just 25 years from its adoption in 1985 is a good comparator for assessing Ethiopian law on kompetenz-kompetenz.34 It vests in the arbitral tribunal the power to decide on its own jurisdiction. Particularly, it provides ‘[t]he arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.’35 That means, the tribunal can rule on the ‘foundation, content and extent of its mandate and power.’36
As regards the timing of decision, the Model Law confers on the arbitral tribunal discretion to decide on objection to its jurisdiction either as a preliminary question or together with the award on merits.37 In case the tribunal decides it has jurisdiction as a preliminary matter, recourse to court is possible subject to three procedural safeguards aimed at protecting the efficacy of arbitration.38 First, recourse to court is possible only within thirty days from receipt of notice of the ruling. Second, the decision of the court confirming arbitral jurisdiction is not appealable. Third, the arbitral tribunal is at liberty to continue with the arbitral proceeding while the recourse from its jurisdictional determination is pending before the court.39
Coming to the role of the court, modelled after the New York Convention, the Model Law imposes on the court the obligation to refer to arbitration, any dispute that is subject to arbitration agreement. This obligation does not apply if the court finds the agreement is ‘null and void, inoperative or incapable of being performed.’40 The Working Group on Model Law had considered including the word ‘manifestly’ in Article 8(1) in front of ‘null and void’ to produce similar effect as the French law.41 It, however, dropped the idea in the end.42
Arbitration may be commenced or continued, under the Model Law, despite an ongoing challenge to arbitral jurisdiction before a court of law on any ground.43 As a result, there is a real possibility of simultaneous proceedings on jurisdictional dispute before a court and an arbitral tribunal.44 Such parallel proceedings may cause unnecessary expenses to parties, for instance, when the court finds that the arbitral tribunal lacked jurisdiction after the arbitration
33 Nadia Darwazeh and Baptiste Rigaudeau, Clues to Construing the New French Arbitration Law: An ICC Perspective on Procedural Efficiency, Good Faith, and Independence, 28(4) J. INT. ARB. 381, 382(2011). Article 1464 of the New French law requires both parties and arbitrators to act ‘diligently and in good faith in the conduct of the proceedings.’ 34 Thomas W. Walsh, 2006 UNCITRAL Model Law: Are States Adopting the Law in Letter and Spirit?, 3 ARBITRATION & ADR REVIEW 215, 215 (2010) 35 UNCITRAL Model Law of 2006, supra note 27, Article 16(1). 36 UNCITRAL Model Law, supra note 27, Explanatory notes by UNCITRAL Secretariat at 30. 37 Id., Article 16(3) 38 Id. 39 Id. 40 Id., Article 8(1). 41 O Susler, supra note 5, at 129 42 Id. 43 UNCITRAL Model Law, supra note 27, Article 8(2) provides arbitral proceedings may be commenced or continued, as the case may be, despite an ongoing challenge to arbitral jurisdiction before a court of law. 44 Park, supra note 6, at 252 to 253.
had run its full course. The UN Commission on International Trade Law commented in relation to the 1985 draft that the Model Law provides ways of minimising this happening.45 First, it allows the arbitral tribunal the possibility of deciding on the question of its jurisdiction as a preliminary matter.46 Second, it vests in the arbitral tribunal the discretion of waiting for the decision of the court on jurisdiction when it has serious doubt as regards its own jurisdiction.47
In sum, scrutiny of the Model Law reveals that it takes the middle road when it comes to permitting courts to intervene in the determination of arbitral jurisdiction.48 For instance, it leaves more room for intervention by courts in the determination of arbitral jurisdiction compared to the French and even German law we shall see below.
German Law
The German arbitration law is based on the UNCITRAL Model Law of 1985.49 The arbitral tribunal may, therefore, rule on its own jurisdiction.50 The power of the tribunal in this regard goes to the extent of ruling on whether an arbitration agreement exists and its validity according to the Civil Procedure Code (‘ZPO’) Section 1040(1).51 So, German law clearly posits positive kompetenz-kompetenz, or the power of the arbitral tribunal to decide on its own jurisdiction as does the French law.52 It is also similar to the French law to the extent the German ‘ZPO’ Section 1032(2) provides a court may decide on the jurisdiction of arbitrators only if request is made to the court before an arbitral tribunal is constituted.53 Incidentally, Section 1032(2) of the ‘ZPO’ is a deliberate deviation from the Model Law which does not preclude application to court for determination of arbitral jurisdiction even after arbitral tribunal has been constituted.54 Owing to this deviation one may contend that the German Law emphasises efficacy of arbitration more, as does the French law, compared to the Model Law.
The German law does not, however, go to the extent of the French law in its emphasis on the efficacy of arbitration. Particularly, the German law does not embrace the French approach to negative kompetenz-kompetenz. 55 Though cognizant of the fact that arbitration would proceed more smoothly if courts were denied any room for intervention in matters of arbitral jurisdiction until after arbitral award is given, the German law does not go down that route. It recognizes that following that approach would have inefficiency of its own in a broader sense of the word as awards might have to be vacated for lack of arbitral jurisdiction after full-
45 The United Nations Commission on International Trade Law, YEARBOOK, Vol. XVI: 1985, Report on the work of the Commissions’ eighteenth session (Vienna, 3-21 June 1985) (A/40/17), par. 92. 46 Id. See also UNCITRAL Model Law, supra note 27, Article 16(3). 47 Id. See also UNCITRAL Model Law, supra note 27, Article 8(2). 48 O Susler, supra note 5, 128 49 Park, supra note 6, at 244. 50 Civil Procedure Code of Germany, ZPO, issued in 1998, Article 1040(1), available at: www.disarb.org/en/51/materials/german-arbitration-law-98-id3, accessed on 12 February 2016. 51 Id. According to Section 1040(1) of the ZPO ‘the arbitral tribunal may rule on its own jurisdiction, and in this connection, on the existence or validity of the arbitration agreement.’ 52 Bermann, supra note 1, at 20. 53 John J. Barceló III, Who Decides the Arbitrators’ Jurisdiction? Separability and Competence-Competence in Transnational Perspective 36 VAND. J. TRANSNAT’L L. 115, 1131(2003) 54 Bermann, supra note 1, at 20. See also ZPO, supra note 50, Section 1032(2) that reads, ‘prior to the composition of the arbitral tribunal an application may be made to the court to declare whether or not arbitration is admissible. 55 Bermann, supra note 1, 20.
fledged arbitration with all the attendant costs, including time lost.56 Hence, the ZPO provides for a possibility of lodging an application to a court seeking its determination on whether or not the dispute is subject to arbitration so long as the arbitral tribunal has not been constituted.57 In consequence, the arbitral and judicial proceedings may have to go forward side by side.58
At this juncture, it must be noted that German law, expressly states its preference for arbitrators to decide on their own jurisdiction at the earliest possible time ‘by means of a preliminary ruling.’59 Such award is subject to immediate judicial recourse to set it aside.60 In contrast, under the UNCITRAL Model Law, arbitrators at their own discretion, decide on their own jurisdiction as an interim award or at the very end with the award on the merits of the dispute.61
As regards the standard of review of the arbitration agreement, a German court will not restrict itself to a superficial evaluation unlike a French court.62 Rather it will fully examine the agreement and deny arbitral jurisdiction if it finds the arbitration agreement is ‘null and void, inoperative or incapable of being performed’ according to ZPO Section 1032(1).63 On this point, the German law is identical with the Model Law in which it has its roots.
Overall, though the German approach to kompetenz-kompetenz is close to the arbitral efficiency end of the spectrum it is more nuanced and calibrated than the French approach. It reflects relatively deeper commitment to ensuring arbitration is consent-based and seeks more the legitimacy that such consent fosters.64
English Law
The Arbitration Act 1996 confers on an arbitral tribunal power to rule on its own jurisdiction. The tribunal may rule on the existence of a valid arbitration agreement, proper constitution of the tribunal and the scope of coverage of the arbitration agreement.65 However, the positive rule of kompetenz-kompetenz embodied under Section 30(1) of the Act is non-mandatory.
56 Id. 57 German Civil Procedure Code, ZPO, supra note 50, Section 1032(2). 58 Berman, supra note 1, at 21. 59 German Civil Procedure Code, supra note 50, Section 1040(3) 60 Barceló, supra note 53, 1131. According to Section 1040(3) of the ZPO, any party that feels aggrieved by the finding of the arbitral tribunal on its own jurisdiction may request the court, within a ‘month after having received a written notice of that ruling’ to decide on the question of arbitral jurisdiction. This again could result in a possibility of parallel proceedings as the foregoing application to the court does not have the effect of halting arbitration where the finding of the arbitral tribunal had been in favour of its own jurisdiction. 61 UNCITRAL Model Law, supra note 27, Article 16(3). According to Article 16(3) if the arbitral tribunal chooses to rule on its own jurisdiction as a preliminary question and the decision is that it has jurisdiction any party may within a month from having come to know of the decision appeal to a court with jurisdiction. The decision of such court is not appealable. 62 Bermann, supra note 1, at 19 63 Id. 64 Id., at 21 65 Arbitration Act 1996 (of England), Section 30(1). Incidentally, despite its name, the Act applies where the seat of arbitration is in England, Wales and Northern Ireland according to Section 2(1) of the Act.
Parties to arbitration agreement can in writing limit the jurisdiction of the arbitral tribunal to rule on its own jurisdiction.66 This is in contrast with the Model Law.67
As regards the timing of the decision, normally the tribunal has discretion to decide on its own jurisdiction as a preliminary award or in the final award under the Arbitration Act.68 However, the Act affords parties to arbitration the possibility of, by agreement, compelling the arbitral tribunal to decide on its jurisdiction in a preliminary award.69 The purpose of giving this right to parties to arbitration is to minimize the possibility of arbitral tribunals abusing the discretion vested in them, and delaying decision on the tribunal’s jurisdiction to the detriment of the parties.70
Concerning negative kompetenz-kompetenz, the Act entitles a party to arbitration agreement against which legal proceedings are brought in a court, to apply to the court in which such proceedings have been brought for a stay of the judicial proceedings.71 Upon such application, the court has the obligation to grant a stay unless satisfied that ‘the arbitration agreement is null and void, inoperative, or incapable of being performed.’72 We note, in this regard, that the Act uses identical language with the New York Convention and the Model Law. 73
Nevertheless, English courts have dealt with negative kompetenz-kompetenz in ways that do not necessarily conform to the Model Law rule.74 In one case, faced with an application for stay, an English court has held various procedural options are open to the court.75 The first is conducting a full review and finding that there is arbitration agreement. Second, conducting a full review and finding there is no arbitration agreement and dismissing the application for stay. The third avenue is simply staying the judicial proceeding pending determination on arbitral jurisdiction by the arbitral tribunal. The fourth option is for the court to refrain from making an immediate decision, rather ordering the trial of the issue.76 In going for one or the other of these options English courts weigh, among other things, ‘the interest of the parties and avoidance of unnecessary delay or expense.’
Consistent with the foregoing, in a 2011 case, the English High Court declined to stay judicial proceeding before it in a matter that was at the same time pending before an ICC
66 BRUCE HARRIS, ET AL. THE ARBITRATION ACT 1996: A COMMENTARY 151 and 154 (Blackwell Publishing Inc. 4th ed., 2007). Note that Model Law does not indicate any possibility for parties to limit the arbitral tribunal’s power to decide on its own jurisdiction. Article 16(1) of the Model Law, simply and only reads: ‘(t)he Arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.’ 67 UNCITRAL Model Law, supra note 27, Article 16 68 Barceló, supra note 53, at 1130 69 Id. 70 Id. The party opposing arbitration naturally prefers an early decision on arbitral jurisdiction. Even the party favouring arbitration may want early ruling on this. That party may worry that a belated decision might result in waste of time and resource if a court reverses the finding by the arbitral tribunal in favour of arbitration. 71 The Arbitration Act of England and Wales of 1996, supra note 65, Section 9(1) 72 Id., Section 9(4) 73 New York Convention of 1958, supra note 32, Article II(3) and UNCITRAL Model Law supra note 27, Article 8(1). 74 Harris, et al., supra note 66, at 64-65 75 Id., at 63 to 64. In Birse Construction Ltd v. St. David Ltd, the issue was whether a contract incorporating arbitration was entered into. 76 Id. 77 Id., at 64
tribunal in New York. In fact, in Excalibur Ventures LLC v. Texas Keystone Inc & Ors the court went to the extent of issuing anti-arbitration injunction despite not even having supervisory role on the foreign arbitration.78 In that case, ‘the Gulf Defendants’ claimed that they were not actually party to the arbitration agreement. The English Court was convinced that indeed the ‘Gulf Defendants’ were not party to the arbitration agreement and had objected to the jurisdiction of the arbitrators in a timely manner though the objection was rejected.79 Given this state of affairs the High Court felt continuation of the arbitration would be ‘unconscionable,’ ‘oppressive’ and ‘vexatious’ and hence issued injunction against the arbitration relying on Section 37 of the 1981 Senior Courts Act, a law that predates the 1996 Arbitration Act.80 Similarly, in Albon v. Naza Motor Trading, the English Court took jurisdiction to decide the competence or otherwise of an arbitral tribunal seating in Malaysia because the claimant convincingly argued that the signature on the arbitration agreement was forged.81 In yet another case, Claxton Engineering v. TXM, the English Court took jurisdiction where the applicant disputed the very existence of the arbitration agreement that allegedly mandated arbitration abroad.82
In Excalibur Ventures, Globster J said section 30 of the Act does not require the arbitral tribunal to decide on its own jurisdiction. It only allows it to determine its own jurisdiction.83 Besides, he maintained that the Act does not impose obligation on a person who contends he is not a party to arbitration agreement to have this question determined by the arbitral tribunal whose authority is being disputed.84 Hence, a person who disputes the arbitral jurisdiction can apply to a court to determine whether the arbitral tribunal has jurisdiction, so long as that person has not participated in the arbitration itself. Such court can give injunction against the other party from starting the arbitration or to discontinue the same.85
Another noteworthy feature of the English law is that once both sides have commenced participation in the arbitration the arbitral tribunal may itself request the court to determine the arbitral jurisdiction. The court will accept the request if it is satisfied that the court taking jurisdiction is likely to save cost of adjudication and the application is made promptly enough.86
78 John Gaffney, Non-Party Autonomy: Displacing the Negative Effect of the Principle of ‘CompetenceCompetence’ in England? A Comment on Excalibur Ventures LLC v. Texas Keystone Inc & Ors, 29(1) J. INT. ARB. 107, 113-114 (2012) 79 Id. 80 Id., at 111 and 115. Gaffney contends though this decision infringes upon competence-competence, too much should not be read into it. Rather he maintains the case should be understood in its context and the unique situation under which it arose. From the facts of the case one gathers that the party that started arbitration in New York, Excalibur started the court proceeding in England in order to get some technical advantage which it could not get in New York. Once it failed to get the tactical benefits it sought in UK it applied for the discontinuation of the court case it started. The author says the court found this behaviour of Excalibur ‘unconscionable’ ‘oppressive’ and ‘vexatious’. So, Gaffney holds this decision of the English Court should be seen in this special context. Secondly, the English court was relying on ‘Senior Court’s Act’ rather than the 1996 Act for its conclusion according to him. I do not think the latter argument of Gaffney carries much water. The court did what it did despite the 1996 Arbitration Act which as a latter law should have prevailed over the Senor Courts Act in case of inconsistency between the two. It rather seems that this is how English courts understand the negative effect of kompetenz-kompetenz. 81 TANG, supra note 11, at 86 82 Id. 83 Id. at 84 to 85 84 Id. at 84 85 Id. 86 Id.
The foregoing shows that English courts are inclined to intervene in matters of arbitral jurisdiction despite the 1996 Arbitration Act embodying the kompetenz-kompetenz rule both in the positive and negative sense of the rule. Hence, we can conclude, compared to the French, German and even Model Law jurisdictions there is more emphasis on the legitimacy of arbitration under English law.
Kompetenz-kompetenz under the US Law
The development of the kompetenz-kompetenz doctrine has been a very slow process in the United States. In fact, we do not come across this term as such.87 The Federal Arbitration Act (FAA) that governs international commercial arbitration does not embody this doctrine.88 On the contrary, Section 4 of the FAA assigns to courts determination of whether parties agreed to arbitrate.89 So, this doctrine owes its existence to the jurisprudence of the courts of the United States.
In First Options, Inc. v. Kaplan, the US Supreme Court held that the right starting point is a presumption that a court must decide ‘arbitrability’, which in the parlance of US courts includes determination of ‘existence, validity and scope of any arbitration agreement.’90 However, in a dicta of this same case, the Court said the presumption that courts, and not arbitral tribunals, decide ‘arbitrability’ can be overcome by adducing ‘clear and unmistakable’ evidence that shows parties wished to delegate to the arbitral tribunal the power to decide on its own jurisdiction.91 What was raised as a hypothetical situation in First Options was presented before the Court as a real situation in Rent-A-Center, West, Inc. v. Jackson. In Rent-A-Center, the arbitration agreement contained an actual ‘delegation’ of jurisdictional issue to arbitrators. Hence, faced with the choice between confirming its dicta from First Options and explaining it away, the Supreme Court by a majority vote confirmed the possibility of contractually empowering arbitrators to decide on their own jurisdiction.92 The Supreme Court reasoned that subjecting jurisdictional dispute to arbitration is not any different from subjecting any other contractual dispute to arbitration grounding its conclusion on FAA Section 2.93
That means in contrast to what we saw above regarding other countries, positive kompetenzkompetenz, emanates from contract rather than the law itself in the USA.94 As a result, arbitrators in the US have no jurisdiction to decide on a challenge directed at the very
87 Jack M. Graves and Yelena Davydan, ‘’Competence-Competence and Separability American Style’’ in STEFAN KRöLL, ET AL (eds.), INTERNATIONAL ARBITRATION AND INTERNATIONAL COMMERCIAL LAW: SYNERGY, CONVERGENCE AND EVOLUTION 158 (Kluwer Law International, 2011) 88 Janet A. Rosen, Arbitration under Private International Law: the Doctrines of Separability and Compétence de la Compétence, 17(3) FORDHAM INT’L LAW J. 619, 599 (1993). 89 United States Federal Arbitration Act, enacted on February 12, 1925. Section 4 reads in relevant part ‘(a) party aggrieved by the alleged failure, neglect or refusal of another to arbitrate under a written agreement for arbitration may petition any United States district Court which, save for such agreement, would have jurisdiction . . . .’ 90 Jack Graves and Yelena Davydan, supra note 87, at 161 91 Id. While the US Supreme Court has not yet dwelt on what exactly constitutes ‘clear and unmistakable’ evidence for the purpose the vast majority of lower courts have found, for instance, incorporation of arbitration rules that provide for kompetenz-kompetenz is sufficient. See page 162 of the same 92 Id., at 165 93 Id., at 161 to 162 94 Id., at 162
existence of the agreement giving them such powers. In such a case, a court and sometimes a jury will have to decide whether the agreement exists at all.95
As regards the negative effect of kompetenz-kompetenz the Federal Arbitration Act Section 201 incorporates the New York Convention Article II(3)96 when the arbitration in question is international.97 According to this provision, the court of a Contracting State that is seized of a matter covered by an arbitration agreement is under obligation to ‘refer the parties to arbitration unless it finds that the said agreement is null and void, inoperative, or incapable of being performed.’98 The review at this stage is not prima facie in the US though some have contended the language of Article II(3) of the Convention calls for superficial review at this stage.99
Overall, the foregoing shows that the US law emphasises legitimacy of arbitration more than any of the major jurisdictions of significance to international commercial arbitration discussed above.
Kompetenz-kompetenz
under Ethiopian Law Now that we have had a bird’s-eye view of kompetenz-kompetenz in jurisdictions of significance to international arbitration we will look at its status under Ethiopian law. We will start with the power of the arbitral tribunal to determine its own jurisdiction, positive kompetenz-kompetenz, and then proceed to the role of courts in the determination of arbitral jurisdiction
Positive Kompetnz-kompetenz:
Its Basis and Scope The provisions of relevance to positive kompetenz-kompetenz in Ethiopia are Civil Code Articles 3330 and 3329. The former is titled ‘scope of jurisdiction’ and reads,100
(1) [t]he arbitral submission may authorize the arbitrator to decide difficulties arising out of the interpretation of the submission itself.
(2) It may in particular authorize the arbitrator to decide disputes relating to his own jurisdiction.
(3) The arbitrator may in no case be required to decide whether the arbitral submission is or is not valid.
95 Park, supra note 6, at 246. 96 Barceló, supra note 53, at 1135. Section 208 of the FAA clearly stipulates that Chapter 1 of the FAA applies in so far as it does not contravene with the New York Convention. 97 Id. supra note 53, at 1135. For this purpose arbitration is international if the arbitration agreement contemplates the issuance of an award in a country, other than the United States, that is a party to the New York Convention or though the seat of arbitration is the US, if the US does not all the same consider the arbitration as domestic arbitration. The latter of these possibilities raises complex questions which we need not dwell on for our purpose. 98 The New York Convention, supra note 32, Article II(3). 99 O Susler, supra note 5, at 138. Note that it makes sense for the judicial review at the outset to be rigorous given that the review of arbitral tribunal on its own jurisdiction is not subject to review by courts as a result of the Supreme Court’s decision in Hall Street. As seen already post award review is limited to the grounds under section 10 of the FAA under which review of the arbitrators’ decision on their own jurisdiction does not appear. 100 CIVIL CODE OF THE EMPIRE OF ETHIOPIA, PROCLAMATION NO. 165/1960, Negarit Gazeta, 19th Year, No. 2 (1960), Article 3330
Particularly, reading Article 3330(2) and (1) of the Civil Code together we understand that the arbitrator will have authority to decide on ‘disputes relating to his own jurisdiction’ or ‘difficulties arising out of the interpretation of the submission itself’ only where the arbitral submission authorises him to do so. We gather from these provisions that positive kompetenz-kompetenz, to the extent it does exist under Ethiopian law, emanates from contract rather than the law itself. Hence, where the contract is silent on the subject the arbitral tribunal will have no power at all to decide on any type of challenge directed at its own jurisdiction. So, the law in Ethiopia is similar to the US law discussed above on this point.101 In contrast, positive kompetenz-kompetenz emanates from the law itself, rather than contract in the more arbitration friendly jurisdictions like France, England, Germany and Model Law based jurisdictions.102
Another noteworthy point is that under Ethiopian law even the parties themselves cannot vest in the arbitral tribunal power to decide on the very existence or validity of contract giving it jurisdiction.103 The law provides, particularly, the ‘arbitrator may in no case be required to decide whether the arbitral submission is or is not valid.’104 The maximum parties to an arbitration agreement can do is authorising the arbitrator to decide on the ‘scope’ of his own ‘jurisdiction.’
This is a logical consequence of positive kompetenz-kompetenz grounded on contract rather than the law itself. It would be a contradiction in terms to maintain the basis of kompetenzkompetenz is contract, on the one hand, and allow arbitrators to sit in judgment on challenges directed at the very existence or validity of the contract that allegedly ‘establishes’ their own very authority, on the other hand. Therefore, the inclusion of the prohibition under Article 3330(3) in the Civil Code gives internal logical coherence to the law.
Its logical consistency aside, this rule makes obstructing arbitration a walk in a park. All the party that wants to impede arbitration has to do is just make an allegation, even a patently false one, challenging the validity or existence of the arbitration agreement. Since, arbitral tribunals cannot decide on such challenges, the arbitration will have to stop until a court finds the allegation is unfounded and orders resumption of arbitration. At this juncture we recall that in the US, where kompetenz-kompetenz is similarly grounded on contract, challenges to the very existence or validity of the arbitration clause itself are decided on by court or even by jury in certain cases rather than by arbitrators themselves.105 So, the Ethiopian law and the US law on international arbitration are once more similar.
101 Graves and Davydan, supra note 87, at 165. In Rent-A-Centre, West, Inc. v. Jackson, the Supreme Court confirmed by a majority vote the possibility of contractually empowering arbitrators to decide on their own jurisdiction. 102 See the French Decree No. 2011-48, Article 1465, the Arbitration Act of England and Wales of 1996, Section 30, German Civil Procedure Code (ZPO) of 1998, Section 1040(1), UNCITRAL Model Law of 2006, Article 16(1) discussed already. 103 This is in contrast with French law according to which the parties cannot even by explicit deny arbitrators to decide on their own jurisdiction by ruling on challenges to the validity of the arbitration agreement, if that is questioned. The principle of kompetenz-kompetenz cannot be overridden by the parties even if they so wish according to Castellane. See Castellane, supra note 23, at 373. 104 Civil Code of Ethiopia, supra note 100., Article 3330(3) 105 The Federal Arbitration Act provides in relevant part of Section 4 ‘[i]f the making of the arbitration agreement or . . . be in issue, the court shall proceed summarily to the trial thereof.’ The party alleged to be in default of the arbitration agreement may within a legally specified period also demand a jury trial of the issue.
Yet another noteworthy point about Ethiopian law is that even in cases where the arbitration agreement confers on the arbitrator authority to decide disputes regarding the ‘scope’ of his own jurisdiction the arbitrator is required to interpret powers vested in him ‘restrictively.’ The Civil Code provides, ‘[t]he provisions of the arbitral submission relating to the jurisdiction of the arbitrators shall be interpreted restrictively.’106 We do not come across similarly restrictive rule of interpretation in other jurisdictions of significance discussed already.
Negative Kompetenz-Kompetenz and Judicial Intervention in Ethiopia
The laws of jurisdictions that are known to be significant players in the field of international arbitration explicitly embody the negative kompetenz-kompetenz rule tying the hands of courts to prevent intervention in matters of arbitral jurisdiction once arbitral tribunal has been constituted, save on narrowly defined grounds.107 Ethiopian law imposes no comparable restrictions on courts. What follows demonstrates this.
Judicial Intervention Possible at Any Stage of Arbitration Ethiopian law does not prohibit courts from entertaining challenge to arbitral jurisdiction at any stage of the arbitral proceeding so long as the objection had been made to the arbitral tribunal itself in a timely manner. Objection to a court’s jurisdiction must be raised in the statement of defence.108 Since the procedural aspect of arbitration must ‘. . . as near as may be, be the same as in a civil court,’ jurisdictional objection to arbitration too must be made in the statement of defence in principle.109 The outcome of delay, in our view, should be refusal by courts to entertain the belated objection to arbitration. Unfortunately, we could not find any court case that either affirms or negates this viewpoint as regards arbitration.
Interestingly, an arbitral tribunal was confronted with a belated challenge to its jurisdiction in Chanyalew Yilma v. Flora Eco Power (Ethiopia) PLC. 110 After the parties exchanged statements of claim and defence, the Respondent applied to the Tribunal seeking leave to amend its statement of defence. The petition was granted. The Respondent introduced preliminary objections, among others, an allegation that there was no valid arbitration
106 Civil Code of Ethiopia, supra note 100, Article 3329. Incidentally, this provision applies to courts too. Hence, whoever is called upon to interpret arbitral submission regarding the jurisdiction of arbitrators is required to interpret the agreement restrictively. This provision is underscoring the fact that the law presumes judicial jurisdiction. In other words, the law is not pro-arbitral jurisdiction. 107 Park, supra note 6, at 235, 239 and 242. As discussed in the foregoing part French courts will entertain disputes on the validity of arbitration agreement only so long as arbitral tribunal has not been constituted and even then in the most superficial manner such as when the clause is clearly void for lack of the requisite signatures of parties. In England, the situation is slightly different from France. Litigants have right to seek declaratory decision by court on arbitral jurisdiction only if they did not start taking part in the arbitration. In Switzerland, even a court asked to appoint arbitrators cannot engage in full examination of arbitral agreement. Full review of the agreement has to wait till after arbitration has taken its course. 108 THE CIVIL PROCEDURE CODE OF ETHIOPIA, DECREE No. 52/1965, Negarit Gazeta, 25th Year, No. 3, Article 234(1)(C). As a matter of exception objections that pertain to substantive jurisdiction of a court may be raised at any time according to Article 9(2) of the Same Code. We will discuss that at a more appropriate point below. 109 Id., Article 317(1) 110 Chanyalew Yilma v. Flora Eco Power (Ethiopia) PLC, an arbitration conducted under the auspices of the Arbitration Institute of Addis Ababa Chamber of Commerce and Sectorial Associations, (2013).
agreement and hence the Tribunal lacked jurisdiction in the amended statement of defence.111 It seems the Sole Arbitrator, Mr. Yazachew Belew, was of the view that this was a calculated move to stall the arbitration by relying on the Civil Code rule denying arbitrators jurisdiction to even consider challenges directed at the validity of arbitration agreement.112 To avert this, the Tribunal first established that leave to plead preliminary objections was neither requested by the Respondent nor granted by the Tribunal when it permitted amendment of the statement of defence. Then it ruled the challenge to the Tribunal’s jurisdiction was inadmissible. It reasoned,113
[t]he law [Article 244(3) of the Civil Procedure Code] on the consequence of failure to plead preliminary objections, if any, at the ‘earliest possible opportunity’ is crystal clear: such objections are deemed waived and hence cannot be raised at any later stages of a proceeding. The party who benefits from these objections simply loses the benefits if it fails to invoke the objections at the earliest possible opportunity. And that ‘earliest possible opportunity’ is at the time of filing a statement of defence [Article 234(1) (c)]. Thus, the defence of preliminary objection is time-bounded and stageprecluded. Belated preliminary objections are simply inadmissible and shall not be considered. This is the principle under Ethiopian law.
Under arbitration laws of jurisdictions like Germany, England and many other jurisdictions that followed the UNCITRAL Model Law, jurisdictional objections are deemed waived unless raised at an appropriate time.114 The conclusion reached by the sole arbitrator in Chanyalew Yilma v. Flora Eco Power (Ethiopia) PLC is of similar effect though he had to rely on general rules for making preliminary objections for lack of provisions specifically dealing with arbitral proceedings in such context.
The outcome is totally different when objection to the jurisdiction of an arbitral tribunal is made in a timely manner. The party that had made a timely objection reserves its right of recourse to court at any stage of the arbitral proceeding. For instance, the Federal First Instance Court of Ethiopia did entertain jurisdictional objections while arbitration was going on before an ICC Tribunal in Addis Ababa Water and Sewerage Authority v. SALINI Costruttori S.P.A as the jurisdictional objection had been made right from the outset of the arbitration. 115 We will discuss this case in detail later on. Suffice it, for now, to note that ordinarily Ethiopian courts will entertain recourse to them made by a party to arbitration where such party had objected to the jurisdiction of the arbitral tribunal in a timely manner.
111 The Respondent invoked, in the amended statement of defence, various grounds to call into question the validity and existence of the arbitration agreement. Among others, it alleged that the contract was not signed by Mr. François Achour, the General Manager of Flora Eco Power (Ethiopia) PLC, that the General Manager had no special power of attorney necessary to consent to arbitrate, and no attempt to solve the dispute amicably was made though that is a precondition to arbitration in the agreement. 112 Civil Code of Ethiopia, Article 3330(3) provides arbitral tribunals may not decide on challenges directed at the validity of the arbitral submission, even if parties to arbitration agreement expressly authorise them to do so. 113 Chanyalew Yilma v. Flora Eco Power, supra note110. 114 German Civil Procedure Code, ZPO, Section 1040(2), English Arbitration Act of 1996, Section 31(1) and UNCITRAL Model Law of 2006, Article 16(2). The Model Law allows the arbitral tribunal to as a matter of exception admit a delayed objection to its jurisdiction where the tribunal finds the delay is justified according to Article 16(3). 115 Addis Ababa Water and Sewerage Authority v. SALINI Costruttori S.P.A, Federal First Instance Court of Ethiopia, Case No. 1510/93, ruling rendered on May 14, 2001
As a matter of exception, recourse to court is also possible even where objection to the jurisdiction of an arbitral tribunal had not been made in a timely manner, if the ground for objection is inarbitrability of the matter in dispute. The defence of lack of jurisdiction owing to inarbitrability is never waived.116 This is because this limit to the jurisdiction of the arbitral tribunal arises from the law itself. Parties cannot by their consent or failure to object in a timely manner confer jurisdiction on an arbitral tribunal where the subject matter of the dispute is not arbitrable under the law. A party can raise this kind of objection at any time and stage of the arbitration arguably without the need for even amending its statement of defence.117
So, if a party to arbitration makes a belated objection alleging the dispute is not arbitrable, for instance, the arbitral tribunal in Ethiopia will be compelled to stop the arbitration pending determination of the issue by a competent court. This is the case, because unlike in most other jurisdictions, in Ethiopia an arbitral tribunal has no jurisdiction to decide on challenges directed at the validity or existence of the arbitration agreement.118 The law denies effect to even an express agreement conferring on an arbitral tribunal jurisdiction to decide disputes affecting the validity of the arbitration agreement.119 Hence, a party that feels the case is beginning to go against it can easily stall an ongoing arbitration at any stage of the proceeding by just alleging that the dispute is not arbitrable.
Under the US law that comes closest to Ethiopian law courts may at any stage of arbitration order a full examination of the validity of the arbitration clause to determine whether the parties did in fact agree to arbitrate.120 That said, even in the US one comes across pale hints of negative kompetenz-kompetenz. For instance, in Pacificare v. Book, the US Supreme Court takes a ‘wait and see’ approach with respect to public policy questions relating to arbitration of treble damages claim.121
Parallel Proceedings Not Guaranteed Ethiopian law does not guarantee the possibility of even parallel proceedings before an arbitral tribunal and court on the issue of arbitral jurisdiction, unlike German law, for example.122 In Germany, once initiated, arbitration is allowed to run its course even where a party has sought judicial declaration on the issue of arbitral jurisdiction pursuant to Section 1032(2) of the ZPO. In fact, even where a court has first started considering the issue of arbitral jurisdiction the party seeking arbitration is at liberty to initiate arbitral proceeding.123 In other words, even though German law does not embody negative kompetenz-kompetenz in
Parallel Proceedings Not Guaranteed Ethiopian law does not guarantee the possibility of even parallel proceedings before an arbitral tribunal and court on the issue of arbitral jurisdiction, unlike German law, for example.122 In Germany, once initiated, arbitration is allowed to run its course even where a party has sought judicial declaration on the issue of arbitral jurisdiction pursuant to Section 1032(2) of the ZPO. In fact, even where a court has first started considering the issue of arbitral jurisdiction the party seeking arbitration is at liberty to initiate arbitral proceeding.123 In other words, even though German law does not embody negative kompetenz-kompetenz in
116 Civil Procedure Code of Ethiopia, supra note 108, Article 9(2) provides that ‘[w]hen and as soon as a court is aware that it has no material jurisdiction to try a suit, it shall proceed in accordance with Art.245, notwithstanding that no objection is taken under Art. 244 to its material jurisdiction.’ That means even where the parties do not raise objection to the jurisdiction of a court pursuant to Article 244 the court is required to strike out the suit where it lacks material jurisdiction under Article 245. 117 A court may allow amendment of pleading by either party under Ethiopian law ‘. . . at any time before judgment’ according to Article 91(1) of the Civil Procedure Code. 118 Civil Code of Ethiopia, supra note 100, Article 3330(3). 119 Id. 120 Park, supra note 6, at 235. 121 Id., at 242 122 Bermann, supra note 1 at 21. See also UNCITRAL Model supra note 27, Article 8(2). 123 German Civil Procedure Code, supra note 50, Section 1032(3) provides arbitral proceeding may ‘be commenced or continued’ even where the issue of arbitral jurisdiction is already pending before a court either because that was raised by a party that wants the dispute to be referred to arbitration or just because an application was lodged to a court to determine whether or not arbitration is admissible.
the manner the French law does, it does not lend a free hand to a party that wants to disrupt arbitral proceedings.124 The two proceedings are allowed to go ahead concurrently.
Similarly, the UNCITRAL Model Law envisages the possibility of simultaneous proceedings on arbitral jurisdiction before a court and arbitral tribunal. It does not give the Court the right to give injunction against arbitration going forward pending its own determination of the issue of arbitral jurisdiction.125 Ethiopian law does not embody similar prohibition against the court. So, the court can issue injunctive order against the arbitral proceeding pending settlement of the dispute on jurisdiction before it.126 This is yet another testament to primacy accorded to legitimacy of arbitration over its efficacy in Ethiopia.
Appeal to a Higher Court: Another Avenue to Prolong Disruption of Arbitration
Under Ethiopian law the plaintiff or the defendant may ‘appeal against any final judgment of a civil court.’127 As a an exception to this rule, the law provides, no appeal may be lodged, even when an appeal lies from a judgment or order, if under the Civil Procedure Code ‘a remedy is available in the court which gave such judgment or made such order’ without first exhausting the available remedy.128 The decision of a court finding a dispute is subject to arbitration and declining to entertain the dispute any further is a ‘final judgment’ within the meaning of Article 320(1) of the Civil Procedure Code. This is so because no remedy is available in the same court from this decision. So, appeal is not barred on the ground of availability of remedy within the same court from decision finding arbitral jurisdiction.
Another rule in the Civil Procedure Code that precludes appeal from a court decision is that which deals with decisions on ‘interlocutory matter.’129 By way of exemplification, the Civil Procedure Code lists as interlocutory matters, ‘. . . decision or order on adjournments, preliminary objections, the admissibility or inadmissibility of oral or documentary evidence and permission to sue as a pauper.’130 A decision or order on an interlocutory matter may be raised as a ground for appeal when ultimately the court makes a final judgment and when appeal is lodged against the latter.131 As we can gather from the examples, interlocutory decisions or orders are decisions made by a court pending final disposition of the dispute. In other words, a party against whom an interlocutory order or decision is given still has the chance of winning the case in the same court. In contrast, there is no possibility of ultimately winning before the same court, if a court makes a determination that it has no jurisdiction because the dispute is subject to arbitration. That means the law prohibiting appeal from a court decision on interlocutory matters does not cover a court decision finding in favour of arbitral jurisdiction.
In sum, there is no prohibition, express or otherwise, in the Civil Procedure Code against lodging an appeal from a court decision finding a dispute is subject to arbitration. That means, a court ruling in favour of arbitral jurisdiction can be regarded as a ‘final decision’