Whether it is a court proceeding or an arbitration proceeding, all that the parties seek is to be served with a fair and unbiased judgment. In the case of arbitration proceedings, the parties enjoy procedural freedom like deciding on what laws are applicable for their case, nominating an experienced arbitration lawyer to preside over their case, determining the language in which the proceedings should be conducted, etc., as opposed to the court proceedings. Arbitration is a process, wherein, the parties in dispute agree to resolve their conflict by referring the matter to the arbitrators. Thus, the arbitrators play a crucial role in upholding justice. Therefore, the arbitrators need to be impartial and unbiased while carrying out the arbitration proceedings. The number of arbitration centers in the United Arab Emirates (UAE) reflects the growing demand for resolving international commercial disputes via arbitration proceedings. Therefore, the UAE government acknowledging the need to have separate federal and streamlined legislation to effectively govern the arbitration proceedings in UAE, introduced Federal Law Number 6 of 2018 on Arbitration (the Arbitration Law). The Arbitration Law repealed the arbitration provisions specified in Federal Law Number 11 of 1992 on the Civil Procedures Code (the Civil Law). Further, there are at least seven arbitration centers in the UAE to accommodate various kinds of international commercial disputes that arise in the UAE. The seven arbitration centers in the UAE are as follows:
As per article 2 of the Arbitration Law, the provisions of the Arbitration Law shall apply to all the arbitration proceedings which are carried out in the state, unless the parties have agreed to be governed by the provisions of another Arbitration Law, provided such provisions are not in contradiction to the public order and morality of the state. Further, even if the arbitration is carried outside the state, the scope of application of the Arbitration Law shall be extended to the parties who have agreed to be governed by the provisions of UAE’s Arbitration Law. It is pertinent to note that the Arbitration Law provisions shall not apply to the financial free zones like DIFC and ADGM, as they are governed by their legislation. However, depending upon which arbitration center the parties have agreed to submit their disputes to, the rules stipulated by such arbitration center shall be applied in the arbitration proceedings. This article shall lay down the grounds as to when the arbitrator’s appointment can be challenged as per the Arbitration Law and the Arbitration Rules stipulated by DIAC and ADCCAC.
Article 10 of the Arbitration Law stipulates who can be eligible to be appointed as arbitrators as follows:
Article 9 (1) of the arbitration rules of DIAC, the arbitrators are required to be impartial and independent of the parties and are not allowed to even advocate for any of the parties during the arbitration proceedings. Article 10 of the arbitration rules of ADCCAC also mentions that the arbitrators must be neutral and independent to be eligible to carry out the arbitration proceedings. It is pertinent to note that one of the standard requirements stipulated by most of the arbitration laws and arbitration rules all across the globe to qualify to take up the role of an arbitrator is that the person elected to be as an arbitrator shall be able to conduct the arbitration proceedings without any kind of impartiality and independence of the parties. For instance, article 10 of the LCIA states that an arbitrator can be challenged in cases where their impartiality is questionable. Similarly, article 13 (2) of the Sharjah International Commercial Arbitration Center, also states that the executive committee may deny appointing any person as an arbitrator, where there are sufficient and justifiable reasons to believe that such person lacks neutrality or independence or is unqualified as per the other requirements stipulated either by the provisions of arbitration rules or the arbitration agreement.
Some of the determining factors that give rise to doubts as to the impartiality or independence of the arbitrator’s ability to justly conduct the arbitration proceedings are as follows:
Article 14 of the Arbitration Law lays down as to when the appointment of the arbitrator can be challenged as follows:
However, the parties are not allowed to challenge the appointment of the arbitrator in cases, the arbitrator is appointed by them or has given consent in the appointment of the arbitrator unless the parties have come to know of the reasons that can question the impartiality and independence of the arbitrators, only after such appointment has been made. Further, any second request challenging the arbitrator’s appointment from the party who has previously raised such request against the same arbitrator in the same arbitration proceedings shall not be entertained.
Article 15 of the Arbitration Law lays down the procedure of submitting the request challenging the appointment of the arbitrator as follows: The party who wishes to challenge the appointment of an arbitrator is required to send a written statement of the reasons for which the arbitrator’s appointment is being challenged within a period of fifteen (15) days from the time when such party has become aware of such arbitrator or the grounds which gave rise to initiate such request of challenging the arbitrator’s appointment. Thereafter, if the arbitrator whose appointment has been challenged fails to remove himself from the arbitral panel or if the other party fails to give consent for the removal of the challenged arbitrator, within a period of fifteen (15) days from the date when such challenged arbitrator or the other party have been notified of such request challenging the appointment of the arbitrator, then the party seeking removal of the arbitrator may proceed with the removal request of such arbitrator with the competent authority. The competent authority shall pass their decision regarding the removal request within a period of (10) days; this decision shall be non-appealable. However, the existence of the removal request shall by no means put a stay on the arbitration proceedings. The arbitral tribunal, along with the challenged arbitrator, can continue with the arbitration proceedings and issue the arbitral award, even when the competent authority has not yet passed any decision regarding the removal request. Further, the withdrawal by the challenged arbitrator from the arbitral panel or if the parties have given consent for the removal of the challenged arbitrator shall be deemed as to making the reasons for such removal request valid.
Article 13 of the DIAC arbitration rules, a party may challenge the arbitrator’s appointment if there exist any reasonable grounds that give rise to doubts as to the arbitrator’s neutrality or independence. The party intending to challenge the appointment of the arbitrator shall submit a written statement of the reasons, for which the arbitrator’s ability to impart impartial decision is being questioned within a period of fifteen (15) days, from the date when the arbitral tribunal is formed or from the time when the initiating party has become aware of such reasons that gave rise to arbitrator’s impartiality or independence or ineligibility, to the arbitration center, tribunal, and other parties. Thereafter, if the challenged arbitrator fails to withdraw or the other party fails to give consent for such removal, then the arbitration centre shall decide on the challenge submitted.
Article 11 of the ADCCAC arbitration rules mention that any party may challenge the appointment of the arbitrator for the same reasons as stated above (impartiality & independency or ineligibility) The party shall submit their request of challenging the appointment of the arbitrator, along with the grounds on which such challenge is based upon and also other supporting evidence and documents to the director within a period of fourteen (14) days from the date when the party challenging has been notified of the arbitrator’s appointment or from the time when the challenging party has become aware of such grounds justifying the challenge request. After that, the director shall inform the challenged arbitrator, the other tribunal members of such challenge. In case the challenged arbitrator fails to withdraw, he is required to submit his observations to the director within a period of ten (10) days from the date when he received the notice of such request challenging his appointment. The parties are also required to submit their observations within the same period as stated above. Thereafter, such request and the observations shall be further referred to the Committee for a final decision on the matter within a period of fourteen (14) days. Although the grounds on which an arbitrator may be challenged could be the same in all the arbitration rules prescribed by the arbitration centers in UAE, the procedure and the time period within which such request can be submitted may vary. Further, what remains the same is that the existence of the removal request shall not put a stay on the arbitration proceedings. Even when the removal request is submitted and yet to be decided by the competent authority, the arbitral tribunal may, along with the challenged arbitrator, continue the arbitration proceedings and issue the award. However, if the competent authority decides to remove the challenged arbitrator, then the arbitral award issued by such challenged arbitrator shall become null and void. Further, the parties are not allowed to raise the challenge against the arbitrator that they appointment or gave consent while appointing such arbitrator, unless they have come to know of such challenging grounds only after such appointment has been made. One of the main determining factors for a successful case of the removal of the arbitrator is the reasons on which the challenge has been raised shall be reasonable enough to establish the biased nature of such arbitrator or the ineligibility of such arbitrator.