Table of Contents
Introduction
There may be various Arab elements to an international arbitration. You may be an Arab lawyer. If you are not, you may be acting alongside or opposite one. You may be advising on an arbitration arising out of a contract governed by the law of an Arab jurisdiction. The arbitration clause in that contract may provide for a seat in that same jurisdiction, or perhaps in another Arab one. One or more arbitrators may be Arab, and so might be some of the fact- and expert witnesses on either side. The administering institution might be based in an Arab territory, or possibly in a jurisdictional freezone like the Dubai International Financial Centre. Or there may be nothing Arab to the dispute, until you identify the award debtor’s assets in an Arab jurisdiction and try to enforce your award there.
In practice, the number of Arab elements and the concordance between them can vary. For example, the parties can share the same Arab nationality and agree to a domestic seat and applicable law, yet opt for arbitration under the rules and supervision of a non-Arab institution. A diversity of cultural considerations will likely come into play in this instance.
The more detailed the procedural rules, the better
When approaching an arbitration case involving Middle Eastern parties, counsel should bear in mind that they are penetrating a legal environment largely dominated by the civil legal tradition, with influences of traditional concepts inspired by shariah law in some parts of the Middle East.
Concretely, this means that it is not infrequent that a number of concepts that are ingrained in the common law tradition, such as the practice of party-appointed witnesses or of cross-examination, are misunderstood by some party representatives who are not experienced in international arbitration. In these circumstances, the preliminary meeting between the parties and the arbitral tribunal will be an essential step towards ensuring that both parties agree on the basic rules that will frame the arbitration proceedings and understand how the subsequent stages of the arbitration will unfold.
Beware misunderstandings
The more detailed the procedural rules, the less room will be left for misunderstandings and diverging interpretations. For instance, in view of the importance of witness examination for both parties, it is essential to foresee at the outset of the arbitration and in the procedural rules, that all technicalities relating to oral evidence on the day of the hearing are determined. This includes a consideration for potential translations of oral testimonies and the use of appropriate and efficient technology if the witnesses are to be heard in different locations.
Due consideration is also to be given to the particularities of the law of the seat of the arbitration. If seated in the Middle East, the lex loci arbitri could disallow the application of principles that are well accepted in common law jurisdictions, such as the power of arbitrators to order interim measures, without the parties’ agreement to confer such power on the tribunal. Consideration should also be given to principles specific to certain Middle Eastern jurisdictions, such as the necessity for witnesses to swear an oath on a relevant holy book, failing which the arbitral award may be at risk of annulment.
– Nayla Comair-Obeid, Obeid Law Firm
Also by way of example, both parties can be Arab, but they might agree a neutral seat and governing law neither of which are Arab. Cultural considerations will still be relevant here, by virtue of the parties’ culture and that of their owners, managers or employees whom you may need to interview to build your case or cross-examine to undermine the other side’s.
In either scenario, your Arab culture or understanding of it may guide your approach as an advocate. If you are not Arab, have never lived in an Arab country and never got to experience Arab culture indirectly, you may decide to read up on the subject. What you read may influence the impression that you retain.
However, whatever experience, knowledge or understanding one may have of ‘Arab culture’ – even as an Arab – will probably be incomplete at best or partial at worst. That is because the ‘Arab world’ comprises 22 states that have significant cultural disparities both between and within them. These disparities are influenced by a range of social, economic and political factors.
The main unifying features between Arabs are perhaps the Arab language and literature. But there are others relevant to cultural considerations in advocacy involving Arab elements. On one level, Arab states share common legal traditions that continue to be relevant even though they evolved within different socio-political contexts. On another more significant level, various Arab states share ambitions of economic liberalisation and diversification. In pursuit of these ambitions, resource-rich Arab states in particular have adapted their national policies and reformed their legal systems. Their adaptations and reforms have often been modelled on or at least inspired by foreign laws and practices, including the law and practice of international arbitration. This increasingly attenuates cultural gaps and provides lawyers with a common frame of reference when acting in disputes that involve Arab elements.
Notwithstanding these cultural bridges and common frames of reference, lawyers nevertheless may encounter particularities to which they are not accustomed. In previous editions of this book, authors have provided invaluable insight into these particularities. The present chapter is intended to complement those editions’ entries rather than substitute them. In doing so, it first presents general observations about Arab states’ common legal roots and increasingly common ambitions. Subsequently, it presents a selection of practical cultural considerations that tend to be relevant in the authors’ experience and opinion.
Because culture is an inherently human characteristic, these considerations are structured according to their relevance to interactions with other key participants in the arbitration process: namely co-counsel and opposing counsel, arbitrators, administering institutions (i.e. their members and staff), and national courts (i.e. their judges). There are obviously other participants, starting with the parties themselves. However, because Arab parties are simply too diverse to discern any meaningful cultural similarities between them, we do not purport to offer any comment in their respect.
Advice to sceptical Middle Eastern counsel: embrace the process
At the crossroads of the East and the West, the Middle East has historically been the theatre where civil and common law-trained arbitrators and counsels came together. While a lot of ink can be spilt on the differences in the approaches between arbitration practitioners from these two summa divisio legal traditions, in my experience, I found civil law-trained counsels from the Middle East were often unused to the dynamics of international arbitration. In particular, I found they tended to be perplexed by the collaborative approach of international arbitrators, especially those coming from common law jurisdictions.
Often parties are invited to engage actively in the arbitral process by expressing opinions on certain issues or clarifying a specific defence. I found that this regularly surprised civil lawyers from the Arab regions who were not used to interacting with arbitrators, who are habitually regarded as judges. To this end, it was not customary for such counsels to engage actively in the discussion of the issues at stake, or even seek to clarify the factual matrix of the case as part of their submissions. Based on my experience, doing so has been traditionally perceived by fellow civil-trained counsels as a form of influence as to the direction of the anticipated final award and, therefore, as an attack on the sanctity of the arbitrator’s duties of impartiality and independence.
Such a misplaced belief does not contribute to the spirit of arbitration as a credible, efficient and trustworthy dispute resolution mechanism. As a matter of fact, such an interaction between the arbitrators and the counsels should not be feared, as it does not purport to change the facts or the legal arguments of the case, which ultimately remain untouched by the often-needed clarifications brought to the arbitrators’ attention.
Practitioners in the Middle East are now realising that a collaborative approach cannot only assist the parties to streamline and clarify their arguments but, more importantly, can provide valuable support to the arbitrators in reaching a much more informed and just decision.
Undoubtedly, international arbitration is moving towards more efficiency and transparency. One way this can be achieved is through interaction between the parties, their counsel and the arbitrators to get to the bottom of the facts so as to reach a fair outcome in the best interests of the parties. Arbitrators in the Middle East, who are nowadays increasingly adopting a more collaborative approach, should not have their credibility and impartiality called into question for doing so. The traditional litigation-style approach in arbitral proceedings in the Middle East, where the parties would solely file and rely on their submissions and expect the arbitrators to remain silent until the issuance of the final award, is fortunately shifting towards a more collaborative approach, and this can be perceived through counsel’s approach and demeanour.
– Essam Al Tamimi, Al Tamimi & Co
In fact, this chapter’s key take-away point may be that cultural considerations with respect to any Arab participant should not be exaggerated. While they exist, they are increasingly overtaken by other considerations that find their roots in those participants’ education, experience, opinions and outlooks. And the most consequential influence on these tends to be whether or not the Arab participant has experience in, knowledge of, and a positive attitude towards international arbitration.
Arab states’ common legal roots and ambitions
The legal roots
Writing in 2009, Ibrahim Fadlallah noted that ‘[t]he law of almost the whole Arab world (except Saudi Arabia and the Sultanate of Oman) is codified in texts inspired by the civil law with a dose of Muslim law’. This commonality is owed in part to the work of Abdelrazzak Sanhouri. Considered to be the modern Arab world’s ‘foremost comparative lawyer’, Sanhouri sought to consolidate the rules of the 1878 Islamic Majallat inherited from the Ottoman Empire with those contained in the Napoleonic Code in France at the time. In doing this, he envisioned an Arab region united by a shared legal history.
To some extent, Sanhouri succeeded in achieving his vision. He ‘masterminded’ the Egyptian Civil Code, which then informed the elaboration of various other Arab states’ civil and commercial codes. These codifications diminished the position that shariah (i.e. Islamic law) occupied in most of the Arab region, except in certain states that maintained its relevance by placing it at the apex of their constitutions (e.g. Saudi Arabia, Somalia, Oman, Yemen).
While Arab legal systems generally coincide in their preference for ‘Western-style specialist commercial law’ when it comes to commercial matters, many did not keep up with the growing complexity of commercial transactions and investments. They acceded to bilateral, regional and international treaties ultimately aimed at encouraging business and attracting investment, but their legal systems sometimes lagged in sophistication, predictability or accessibility.
The legal ambitions
Arab states with the necessary political stability and economic means have sought meaningfully to address their stagnation, not just on paper but also in practice. Some of them have done this progressively, while others precipitously. Either way, Arab states have often looked to more developed legal systems for inspiration, borrowing or altogether transplanting industry-specific legislation from them.
Of course, the effectiveness of these modernisation efforts depends on other factors that require commensurate improvement. In this respect, various Arab states have been investing heavily in judicial reforms. Beyond those aimed at judicial independence and training, reforms include the establishment of specialised bodies tasked with the upkeep of regulations and adjudicative bodies entrusted with the resolution of industry-specific disputes. They also include new policies to implement a greater use of technology in court-related processes (e.g. issuing powers of attorney, e-filing, summoning by SMS, e-hearings). They further include policies aimed at improving accessibility to laws and court decisions. In Saudi Arabia for example, court judgments are either unpublished or notoriously inaccessible yet carry a growing de facto value in legal argument and predictability. Conscious of this, the Saudi Arabian Ministry of Justice recently published a compendium of judicial principles and court decisions rendered between 1971 and 2016 and announced its intention to pursue this transparency effort going forward.
In parallel, Arab states have also been striving to promote and facilitate alternative means of dispute resolution. Some of them have recently overhauled their arbitration regimes to bring them in line with international standards. They also established new arbitration centres that play a significant role in relaying the know-how from experienced institutions, complementing the role that existing institutions had already been playing in this regard. And in doing so, some states like the United Arab Emirates have already established themselves as arbitration hubs.
Simultaneously, mediation is undergoing renewed popularity in the Arab world, further to its traditional importance as a method of dispute settlement. Here again, some Arab states have been actively trying to seeking to facilitate it, sometimes even imposing it as a pre-litigation requirement. Here again too, arbitration centres have been a vector in the supply of rules and services.
The market for provision of legal services is evolving correspondingly. The relevance of generalist lawyers is diminishing in cross-border transactions and disputes, as they are replaced by specialists who often capitalise on their foreign education, experience or affiliations with international law firms. And there is a growing tendency among these local Arab lawyers to dedicate themselves purely to international dispute resolution, especially in jurisdictions that see of lot of it. Within the Arab Gulf region, it is expected that these lawyers will extend their influence in light of regulations that relax restrictions on their ability to practise in other Gulf states.
Practical considerations when dealing with Arab participants
With the above in mind, this section sets out a selection of practical considerations the authors consider to be relevant for arbitration counsel regarding Arab participants (i.e. co-counsel, opposing counsel, arbitrators, administering institutions and national courts).
The lawyers
Selecting co-counsel
Unlike other legal practice codes, many Arab codes do not restrict attorneys from accepting mandates in fields outside their competence. It is unfortunate to come across instances where local counsel do exactly that.
Therefore, consider carefully screening local counsel whenever their assistance is required. Current or previous affiliation with an international firm should not be used as a sole gauge of competence; neither should law firm rankings. Recommendations, based on first-hand practical experience of local counsel’s services, should ideally be obtained.
Even then, recommendations may be inconclusive. Consider soliciting a sample memorandum on unrelated legal issues, to assess the rigour and style of the legal advice. Doing this is not customary, but it avoids costly disappointments. Subsidiarily, the tone of local counsel’s response to the unusual request may itself reveal whether and to what extent you will want to work with them on a personal level.
Regardless of local counsel’s competence, consider asking them to submit the full text of all supporting legal authorities, with translations if the budget permits it. Often local counsel do not have the same intimate knowledge of the case as you do. And they are unlikely to have the motivation to proactively educate themselves on it unless they are paid for it. As a result, when preparing their advice and reviewing legal authorities, they may be unable to identify relevant parts favouring or even undermining your case.
Adapting to opposing counsel
Maintaining a cordial rapport with opposing counsel may be difficult. ‘Guerrilla tactics’ are still-too common among Arab counsel:
In international arbitrations seated in the Arab world or involving Arab parties or counsel, it is not anomalous for counsel to employ one or more . . . dispute-aggravating attitudes or demonstrate a lack of appreciation for arbitration-specific procedures. This is primarily due to lack of specialisation and possible overlap between arbitration and litigation, where counsel’s approach to arbitration is profoundly affected by long-standing intricacies and perceptions of traditional litigation in local courts.
Faced with such ‘dispute-aggravating attitudes’, responding in kind is counterproductive. It is best to adapt with level-headedness and consciousness of the tribunal’s ability for discernment. Depending on the type of stunt opposing counsel pulls, it may be sufficient to draw the tribunal’s attention to it, while also reserving the right to respond fully down the line and make any appropriate cost applications.
Even if the attack is personal (e.g. an open accusation of unethical behaviour), it is more effective to respond cordially. The use of strong adjectives and emotive language is superfluous; follow the example of how experienced arbitrators respond to personal attacks against them whenever they are accused of bias. Needless to say, avoid attacking opposing counsel personally or imputing bad faith on their part unless you have proof to back it up.
Similarly, if opposing counsel’s case contains flaws apparently owed to inexperience, consider how best to bring the flaws to the tribunal’s attention. This can be a fine line in practice. For example, opposing counsel may be unable to formulate their client’s case clearly and instead repeatedly confuse the relevant legal tests that they ask the tribunal to apply. While it is incumbent on you to draw the tribunal’s attention to the incoherence, the manner in which you do it may influence how you come across to the tribunal, especially if opposing counsel’s inexperience is owed to their client’s inability to afford better legal advice and representation. It may also reflect negatively on your client.
More generally, early experience of opposing counsel’s tactics should be an indicator of what to expect after the award is rendered. If you win, do not expect opposing counsel to advise their client to comply voluntarily. You may have to defend spurious attempts to challenge the award at the seat or resist its enforcement at the place of enforcement. Opposing counsel may be willing to fight until the end if their client supports this and can afford it.
Counsel can confuse the roles of the tribunal and the institution
‘Egypt’, as Joshua Karton noted in a November 2018 CRCICA seminar, ‘is such a globalised arbitration community even amongst people who never practiced outside Cairo. It is surprising how much what is in Egypt that is similar to what we expect to see in London, Paris or New York and the really large arbitration centers.’
However, some legal counsel in Egypt – and the Middle East more broadly – can confuse the authority of the arbitral tribunal with that of the arbitral institution.
For example, there is a wide misconception among counsel who mix the rules of institutional arbitration and that of ad hoc arbitration to try to get their way in certain procedures. Some refer to the supplemented (i.e., non mandatory) rules of the lex arbitri (for example, Egyptian Arbitration Law No. 27 of 1994) in their case and believe it can supersede the applicable institutional rules stipulated in their contract; although the latter shall prevail. Some counsel try to bypass the authority of the arbitral tribunal and request either from the arbitral institution, or even through court proceedings, termination of the arbitral proceedings once it exceeds the time limits for rendering arbitral awards specified in the lex arbitri and not applicable to institutional arbitration. In the same pattern, some counsel tend to request the court of the seat to appoint or recuse the arbitrator and to override the applicable rules of the arbitral institution by referring to the rules of the local arbitration law.
Another example is counsel making their submissions without specifying the amount in dispute and attempting to leave it to be quantified by the arbitral tribunal or, at a later stage, through expert reports. Counsel tend to do this so they can manipulate the calculation of fees according to the method of calculation of the arbitral institution. This leads to a deal of frustrating back and forth between the arbitral institution and the parties.
Finally, there are counsel who bring the arbitration institution as respondents in court proceedings filed for the setting aside of awards rendered under the auspices of the institution. These claims usually fail, since the institution has no standing in these cases, but is a significant nuisance for the arbitral institution.
– Ismail Selim, CRCICA
Horror stories aside, the relationship with opposing counsel is habitually cordial, and the possibility of settling one or more disputed issues should not be underestimated.
Initiating a settlement effort may come across as a sign of weakness. It may be received with scepticism. And it may fail. Nevertheless, it is surprising how often an unexpected but genuine show of amicability towards an Arab counterparty is welcomed and reciprocated when opposing counsel are sensible. If you suspect that opposing counsel may unwillingly obstruct the initiative, consider letting it come directly from your client.
In any event, cordiality should not be conflated with carelessness. Owing to their shared legal-family roots and court practices within them, Arab jurisdictions approach issues of privilege similarly by relying on professional conduct rules. These typically require lawyers to protect the confidentiality of their communications with their clients. And while they implicitly prevent lawyers from disclosing settlement communications, genuine misunderstandings can arise. More importantly, the clients themselves are not bound by confidentiality obligations and remain free to divulge the communications. At least one Arab-based arbitral institution has tried to anticipate this in its rules by requiring arbitrators to take into account applicable rules of privilege.
Consider, therefore, taking all available measures to counter the risk of detrimental disclosure of settlement communications. For example, initial communications should express interest in an amicable resolution of the dispute, without going as far as making any concessions or proposals. Subsequent exchanges should be used to agree terms on which negotiations will take place and any settlement will be formalised. These terms ideally ought to be robust (e.g. a confidentiality agreement with explicit undertakings, coupled with a choice of law and jurisdiction that maximise the agreement’s enforceability).
These precautions may come across as excessive given how unlikely international arbitrators are to consider settlement communications that were wrongly disclosed to them. But inexperienced ones may consider it acceptable for truth’s sake, so might an Arab curial or enforcement court if the matter ever comes before one.
The arbitrators
Selecting an arbitrator
There is a unanimous consensus that the quality of the arbitration depends on that of the arbitrators. The basic qualities that parties and their counsel should look for in candidate arbitrators are well known. Qualities aside, four interrelated observations are worth considering when selecting arbitrators.
First, some candidate arbitrators may have obtained their education, training and preponderant experience in a particular jurisdiction. Their ensuing national ‘legal culture’ may well impact their approaches to specific procedural or substantive issues. In theory, conscientious arbitrators must strive to quell the effect of the ‘bag and baggage’ that they carry over from their national legal cultures. In practice, they may retain their legal culture’s influence despite their best efforts to attenuate it, or they may convey it legitimately through their ‘legal opinions’.
Show some deference to ancient (or modern) Arab culture
‘Read in the name of thy Lord’, states one of the Qur’an surahs (96:1-5). Contrary to what is too often said, Arab advocacy is not based primarily on oral skills and the art of pleading. Writing, papers and documents do play a major role in this culture and are not to be overlooked. This means, in practice, that Arab counsel and arbitrators appreciate accurate, reliable and thorough sources or quotations, rather than vague legal principles. I remember having encountered in some arbitrations (sometimes elaborate) arguments that, purportedly, in some Arab jurisdictions, a woman could not be appointed as an arbitrator, that only counsel based in the jurisdiction of the seat could represent a party or that no non-Muslim witness could be heard . . . It sufficed to dig into the actual sources to show the other party and the arbitrators, some of whom were not Arabs, that, while I could understand where the point was coming from, it was not actually rooted in good law or strictly accurate. The argument could be overcome and proven wrong based on hard evidence, since, today, much more than in the past, all sorts of reliable authorities have become available, especially online, in Arabic (see the Majallat available on LexisNexis Middle East database), but also in English (see the IJAA available on Kluweronline). By the same token – and this applies to other cultures – each time you demonstrate, to the extent possible, some deference to ancient or modern Arab culture (by referencing, for example an Arabic poem that powerfully illustrates a legal or factual point), to religious nuances (by considering the Ramadan period and the difference in weekends when fixing the procedural calendar, as well as some subtle differences between Shia and Sunni traditions), and to the actual reality on the ground (such as by addressing issues of visas for witnesses of specific nationalities), this will come to support and even enhance your position. Otherwise, you may be less convincing on procedural issues, despite having a very good grasp on the substance of the dispute.
– Jalal El Ahdab, Bird & Bird
National legal culture may therefore serve as a criterion by which to assess Arab candidates’ strategic suitability for your case. Owing to the shared civil law roots of Arab jurisdictions, the general assumption is that Arab candidates will be predisposed to adhere to civil law approaches.
Second, the above assumption is overly simplistic because predispositions do not automatically translate into dispositions. Experience teaches that Arab arbitrators are able to transcend their national legal culture and to adapt their approaches to the needs of each case.
Third, Arab arbitrators’ ability and willingness to adapt in that manner often seems to be contingent on their knowledge and experience of international arbitration theory and practice. This can be problematic in cases requiring a tribunal competent in one or more Arab procedural or substantive laws. Relative to the number of lawyers and law graduates in Arab jurisdictions, there is a disproportionate shortage of individuals with expertise in both local Arab laws and international arbitration law. The best ones tend to be too busy or conflicted, or both.
As a result, counsel sometimes make the difficult decision of prioritising expertise in local law over expertise in international arbitration, even though the approach to the former is contingent on a certain literacy in the latter. While this prioritisation may be strategic, its advantages can be rendered redundant by its other consequences.
If short on options, keep in mind that local law expertise is increasingly permeable to foreign scholars and practitioners (similarly to international arbitration expertise regarding non-lawyers). For example, many Egyptian and Lebanese scholar-practitioners are considered excellent picks in cases governed by the law of other civil law states, whether Arab or not.
Fourth, the long-standing apprehension that women may not serve as international arbitrators in shariah law jurisdictions is gradually eroding. In Saudi Arabia for example, the possibility of appointing women as arbitrators is not explicit in the Arbitration Law 2012 or its Implementing Regulations 2017. That said, Saudi courts not only have admitted the appointment of women to arbitration tribunals, but also are planning on finally appointing female judges to their ranks.
Adapting to the tribunal
Notwithstanding their efforts or abilities, Arab arbitrators may retain some influence from their national legal culture. Beyond that, they may also have personal attitudes, preferences and opinions (legal or otherwise).These can impact almost every aspect of the arbitration and will require you to adapt accordingly.
Preliminarily, the law of the seat or of the contract may contain mandatory rules that the arbitrators cannot ignore, especially in light of their potential effect on the validity of the award at its seat or its enforceability elsewhere. Problematically, Arab seats and laws seldom identify whether a given rule or principle is generally mandatory, let alone mandatory in international arbitration proceedings or under international contracts between sophisticated parties. Try to anticipate these – and the abitrators’ attitudes toward them – as early as possible in the dispute, as they may affect your entire case strategy.
For example, in Saudi Arabia and Oman, shariah principles on the prohibition of interest and speculation are increasingly relegated to a secondary position each time a lex specialis exists in the contract or in an applicable legal rule. That said, the same principles continue to weigh on issues such as the validity of certain financial instruments, the recoverability of liquidated damages and interest, and the scope of exclusions in insurance contracts.
Procedure
International arbitration has gone a long way in harmonising approaches to evidence. Parties are free to agree in advance rules of evidence. If they do not, the arbitrators will prescribe them. The rules that they ultimately prescribe will typically depend on the dispute’s particularities and the parties’ submissions. And the discretion that they exercise when applying those rules will generally depend on how they reconcile competing demands of accuracy, speed, efficiency and procedural fairness.
Given their civil law background, Arab arbitrators are believed to prefer inquisitorial-style approaches to evidence and procedure. This is often contrasted with the adversarial style of common law jurisdictions, which include document production, cross-examination and party-appointed experts. Other commentators have commented at length on these tendencies and their practical repercussions. Suffice it to say that you may have to adapt to the arbitral tribunal’s combined experience and preferences unless the parties can agree on mutually acceptable rules.
Substance
To foreign practitioners, various Arab legal systems lack the predictability or maturity to which they may be accustomed. This makes devising a case strategy and articulating a persuasive case on the substance a bit tricky, even with the help of local counsel. For this reason, you may find guidance or support in other legal sources, even where the solution is prima facie already available under the contract and its applicable law. Some of these sources are discussed below.
- Foreign national law and doctrine: For example, because of its maturity and influence on other Arab civil and commercial laws, Egyptian law can serve as a useful tool in advocacy where the law of the contract is governed by the law of an Arab state modelled on the Egyptian Civil Code. Lawyers in addition can capitalise on authoritative Egyptian court rulings, and on the breadth and sophistication of Egyptian legal commentary. You may even go beyond that and refer to other relevant civil laws, whether Arab or not.
- Transnational soft law and industry-specific norms: The UNIDROIT Principles of International Commercial Contracts can be highly effective in disputes over the interpretation of general principles of contract law. Furthermore, industry-specific norms can be especially relevant for elucidating the meaning of the contractual terms or the parties’ intentions when concluding them. For example, in a sophisticated insurance contract governed by an Arab law, you will look to commentary on the London Engineering Group’s suite of exclusionary clauses; in sale and purchase disputes, the International Chamber of Commerce’s International Commercial Terms; in construction disputes, the International Federation of Consulting Engineers’ relevant contract template.
- Arbitration-specific commentary: Particular attention should be paid to the wealth of academic scholarship on international arbitration. Divergences of legal opinions among scholars can be instrumental to arguments on certain issues. For example, whether you are arguing in favour of the strict application of the applicable law or against it, there is a diversity of legal opinions on this issue that you can use.
- International law: International law can become relevant in disputes arising out of concession contracts with Arab states or their organs. Even where the contract is governed exclusively by the national law of the state in which the investment is made, mandatory principles of international investment law may become relevant depending on the gravity of the alleged violations. Related to the previous point, legal opinions on this diverge. This provides scope for employing supporting opinions in your arguments.
The particularities of each case will inform which of these or other ‘outside’ legal sources may be relevant or useful.
That said, do not lose sight of the margin for legal argument under the applicable contract law and its principles or rules of interpretation. Contract laws generally seek to strike a balance between pacta sunt servanda, on the one hand, and the multitude of exceptions to it, on the other. Judges in different jurisdictions – including Arab ones – will resort to different so-called ‘techniques’ to strike an appropriate balance. And their willingness to employ these techniques may boil down to how they individually conceive their function.
Arbitrators, in principle, have the same techniques at their disposal. And their willingness to employ them may likewise depend on how they conceive their adjudicative function. Familiarise yourself with them and think about how best to adapt them to the context of international arbitration in general, as well as to that of the dispute in particular.
Relatedly, remind yourself that facts may determine outcomes more than law. As arbitrators might concede, the finality of their decisions on the merits places a moral burden on them to try to render what they perceive to be a fair decision. In the authors’ modest experience – and further to the observations made earlier regarding arbitrator selection – arbitrators differ in their sense of fairness and their ability and willingness to put their legal reasoning at its service. If that is right, neglecting the law would be negligent, but fetishising it would be ignorant.
The arbitration institution
Do not assume that Arab-based institutions – whether old or recently established – lack knowledge of and acquaintance with best practices. Their casework staff are invariably highly qualified and experienced. Furthermore, their ad hoc decision-making bodies and committees typically comprise illustrious members of the international arbitration community. When entrusted with deciding, for example, a challenge against an arbitrator for alleged lack of independence and impartiality, these figures will approach the challenge in line with international practice.
More generally, the assistance of Arab-based arbitration institutions is underrated. In an effort to establish themselves and solidify their reputation, infant institutions in particular tend to go out of their away to provide assistance. When asked, they provide lists of qualified arbitrators, point to relevant publicly available resources and provide supplementary explanations regarding their services, rules and policies. That said, do not expect them to overstep their role and provide legal advice.
The competent courts
The seat of the arbitration remains important irrespective of aspirations for a transnational arbitral legal order. It will determine which courts will provide curial support during the arbitration. It will also empower those courts to rule on the validity of the award, which may impact its enforceability elsewhere.
In this context, the court’s attitude towards arbitration is relevant. Even in jurisdictions that recently modernised their arbitration laws and in which the competent courts strive to prove their friendliness towards international arbitration, judges may still lack familiarity with international arbitration law and practice. The inverse may also be true. The same Arab courts’ eagerness to manifest their pro-arbitration attitude could cause them to shirk their duty. This risk is merely theoretical and drawn from certain commentators’ criticisms of US, English and French courts’ arguably overzealous pro-arbitration attitudes. Either way, you may have to present your arguments didactically, explaining why a particular principle or practice exists, the objectives it serves to achieve, and why the court should either follow or adapt it.
Furthermore, present arguments on the practice of foreign pro-arbitration courts – whether Arab or non-Arab – with consideration. Arab courts will be interested to find out about that international practice but, depending on the court’s attitude and perhaps even the specific judge’s, arguments rooted in local law and policy may be more effective. In all circumstances, formulate arguments on public policy diplomatically. It would be unwise to argue before a national court that, for example, its jurisdiction’s public policy is backward or idiosyncratic.
The same logic extends to enforcement courts. They may differ in their experience of and attitude towards international arbitration, regardless of commitments to enforce foreign awards according to the New York Convention.
Last but not least, local procedures for execution against the award debtor’s assets should not be ignored. Idiosyncrasies often come to the foreground here. They are exacerbated when the award debtor is a state or state entity in light of conservative approaches to attaching assets that may be remotely covered by sovereign immunity. Discuss this with local counsel carefully, given the potential complications and associated costs in navigating them.
Concluding remarks
Cultural disparities within the Arab world are numerous. While there is overlap in Arab jurisdictions’ legal origins and present aspirations, their legal cultures have evolved separately. Yet, in the field of commerce, the emphasis has been on predictability and modernisation.
As the frame of reference for Arab countries shifts outside the Arab world, so too do the considerations for participants. Cultural considerations remain, but they are increasingly overtaken by others rooted in reformed policies and specialised fields of law, starting with the policies and specialism of international arbitration and the diversity of opinions within it.