Article: The ‘burning issue’[1] of mandatory rules of law in international commercial arbitration
Penny Thew FCIArb GAICD
Barrister, State Chambers, Sydney, Australia
A. Abstract
This article examines the treatment of mandatory rules of law in international commercial arbitration,[2] having regard in particular to the obligation of arbitral tribunals[3] to determine arbitrations in accordance with the substantive law chosen by the parties (pursuant to the UNCITRAL[4] Model Law (Model Law)[5] Article 28(1)), and the foundational principle of party autonomy underpinning the Model Law.[6] This article also considers this issue in more specific terms, examining the ability of parties to an arbitration agreement to exclude mandatory proportionate liability laws,[7] and the ‘tension’ that ‘arises between the capacity of parties to choose their substantive law and the mandatory national law that binds one or more of the parties to the transaction’.[8] The corollary is how to reconcile Article 28 of the Model Law (and ‘the freedom of the parties to submit a dispute to the legal regime established pursuant to the Model Law’ ‘recognised extensively’ by Art 1),[9] on the one hand, with Articles 34(2)(b) and 36(1)(b) of the Model Law, as well as Article V(2)(b) of the New York Convention,[10] on the other.[11]
B. Keywords
International arbitration, arbitration agreement, mandatory rules of law, public policy, mandatory proportionate liability laws, choice of law, party autonomy, enforceability, validity, Australia
1. Introduction
Given the increased popularity of arbitration and expanded notions of arbitrability, mandatory rules issues have been said anecdotally to arise in over 50 per cent of cases,[12] with how to approach mandatory laws described as ‘one of the most burning issues in daily international arbitration practice’.[13]
Key is at what point a failure by an arbitrator to apply a mandatory law of the governing law or seat is capable of rendering the arbitration agreement unenforceable[14] by operation of Article V(2)(b) of the New York Convention and/or Article 36(1)(b)(ii) of the Model Law, or liable to be set aside under Article 34(2)(b)(ii).[15]
Flowing from this are the related questions of what constitutes a ‘mandatory law’, what constitutes ‘public policy of the state’ under the Model Law and New York Convention[16] and which ‘mandatory laws’ constitute ‘public policy of the state’.[17]
These issues were brought into sharp focus in respect of proportionate liability laws by the recent High Court of Australia (HCA) decision in Tesseract International Pty Limited v Pascale Construction Pty Limited [2024] HCA 24; (2024) 98 ALJR 880. In Tesseract, the majority[18] found that non-mandatory[19] legislative proportionate liability provisions[20] applied to an arbitration (arising out of a construction dispute) seated in South Australia (SA).[21] The governing law was also that of SA,[22] with the Commercial Arbitration Act 2011 (SA)[23] the lex arbitri.[24]
The effect of the majority decision in Tesseract was to overturn a long-standing principle in Australian jurisdictions of solidary liability in arbitrations. This was an outcome said in Tesseract to be opposed[25] by the Australian Centre for International Commercial Arbitration (ACICA), the Chartered Institute of Arbitrators (CIArb) and the Institute of Arbitrators and Mediators Australia (IAMA), with ACICA appearing in Tesseract as amicus curiae.[26]
Of note is that, in Australia, whether proportionate liability legislation is interpreted as ‘mandatory’ in nature differs from Australian state to Australian state. By way of example, Queensland’s proportionate liability legislation is ‘mandatory’ in that it expressly prohibits contracting-out.[27] Other Australian states (such as New South Wales, Tasmania and Western Australia) expressly permit it[28] and others are silent.[29] While the SA proportionate liability legislation is silent on contracting-out, it is interpreted as containing no such prohibition.[30] By contrast, the Victorian counter-part legislation is also silent on contracting out of proportionate liability but is said to prohibit it.[31] More globally, some aspects of proportionate liability laws in states within the United States of America similarly contain prima facie ‘mandatory’ elements.[32]
These issues are examined, within this article, as follows:
- Chapter I: What constitutes a mandatory law?
- Chapter II: Implications of failing to apply mandatory laws.
- Chapter III: What constitutes public policy?
- Chapter IV: Mandatory laws once considered non-arbitrable.
- Chapter V: Proportionate liability law.
- Chapter VI: Solutions.
2. Chapter I: What constitutes a ‘mandatory law’?
Mandatory laws are said to be ‘imperative norms’ from ‘which parties may not derogate’.[33] The Rome I Regulation[34] defines ‘overriding mandatory provisions’ as being those provisions ‘the respect for which is regarded as crucial by a country for safeguarding its public interests, such as its political, social or economic organisation, to such an extent that they are applicable to any situation falling within their scope, irrespective of the law otherwise applicable to the contract under this Regulation.’[35] This enables courts to give effect to the overriding mandatory provisions of the law of the forum of performance. A failure of an arbitrator to apply a mandatory law between member states to the Rome I Regulation could result in refusing enforcement.[36]
Such norms present ‘particular difficulties and uncertainties in international arbitration’ because ‘mandatory laws promulgated by the state are meant to protect the interests of the public, and are [therefore] considered as limitations to party autonomy.’ [37]
By contrast, the fundamental principle of party autonomy in arbitrations, which flows from the authority given to the arbitral tribunal by the parties’ agreed submission to arbitration,[38]is demonstrated by the ability of parties to an arbitration agreement[39] to select and contractually appoint the arbitral tribunal,[40] the governing law of the contract,[41] the procedure,[42] and the law of the seat,[43] and to exclude certain provisions of those laws.[44]
It is said that ‘arbitrators are safer sticking to their contractual mandate unless exceptional facts before them suggest that mandatory rules are highly pertinent’[45] and that the only ‘mandatory rules’ an arbitral tribunal is required to apply are those chosen by the parties as the law of the contract (lex contractus).[46]
However, this approach is criticised as being ‘practically … unrealistic and isolated as it does not address later threats to the validity, recognition and enforcement of the arbitration award’,[47] particularly where the parties have made no choice as to the governing law of the arbitration agreement.[48]
In Online Dispute Resolution – Theory and Practice[49] the learned authors state that one of the ADR Directives is that ADR entities must be able to comply with ‘legality’, giving as an example that ‘mandatory consumer law is respected’. [50]
Moreover, this protection has been recently expanded by the Court of Justice of the European Union which held that even when businesses choose a law different to that of the consumer jurisdiction, consumers cannot be led ‘into error’ of thinking that only the business’ proposed governing law applies; that is implying that consumers do not have the protection afforded by the mandatory laws from their own jurisdictions.[51]
3. Chapter II: Implications of failing to apply mandatory laws
Failing to apply mandatory laws of a State can lead to:
- a ‘competent authority’ (a court) ‘in the country where recognition and enforcement [of the award] is sought’ refusing to recognise or enforce the award should the court find that to do so would be ‘contrary to the public policy of that country’ under Article V(2)(b) of the New York Convention; and/or
- a court refusing to enforce or recognise an award where to do so would be ‘contrary to the public policy of this state’ under Article 36(1)(b)(ii) of the Model Law.
In addition, parties can seek to have an award set aside based on an alleged lack of arbitrability and/or failure to comply with public policy, including as a result of failing to apply a mandatory law, under Articles 34(2)(b)(i) and (ii) of the Model Law. The New York Convention then allows non-enforcement of an award that has been set aside.[52]
The above is crucial given the number of States that will often have involvement in an arbitration at various stages.[53] Enforcement may be sought in various States where assets are held, the contract may be performed in numerous jurisdictions and the law of the seat may or may not be chosen by the parties as the curial law of the arbitration agreement. [54]
The point at which a failure to apply a mandatory law can render an award liable to be set aside and/or unenforceable remains fraught, notwithstanding the Model Law having been specifically ‘developed to address considerable disparities’ and ‘recurrent inadequacies’ in national arbitration laws, including where those ‘inadequacies’ could lead to the ‘expectations of the parties as expressed in a chosen set of arbitration rules or a ‘one-off’ arbitration agreement’ being ‘frustrated’, ‘especially by mandatory provisions of applicable law.’ [55]
Commensurately, the pro-enforcement bias of the New York Convention (demonstrated in numerous United States decisions,[56] as well as decisions issued in Korea, the Netherlands, Italy, India and under English law)[57] has been said to imply that not all failures to apply a nation’s mandatory law will fall within the public policy exception. [58]
However, more recently, the observation is that an arbitral tribunal failing to apply the mandatory laws of the seat will ‘most likely’ result in the award being ‘annulled on public policy grounds’,[59] and that arbitrators generally give effect to the mandatory rules of the seat.[60] Further, while in 2022, the ‘pro-enforcement bias’ was confirmed by a US District Court in Esso v Nigerian Nat’l Petroleum Corp,[61] at 62 the Court also said:[62]
… In practice, however, our Circuit has treated a primary jurisdiction’s decision to set aside an arbitral award as conclusive. … unless the judgment that set it aside is “repugnant” to U.S. public policy.
ACICA[63] argues that Art 28 of the Model Law requires an arbitrator to apply the substantive law without any ‘outer limit’ imposed by Art 34(2)(b),[64] with set aside issues under Art 34(2)(b)(i) or (ii) ‘external’ to the arbitration and relevant only to the supervising court, an argument rejected by the HCA Chief Justice (in the majority) in Tesseract.[65]
Indeed, by contrast to the position taken by ACICA, Gageler CJ said in Tesseract at [44]-[45] (forming part of the majority decision):
Article 28 of the Model Law should not be construed to compel an arbitral tribunal to engage in the futile exercise of applying the substantive law to produce an award which, by reason of its application of that law, would be liable to be set aside by a supervising court under Art 34(2)(b)(i) or (ii) of the Model Law applying the law or public policy of the place chosen by the parties as the place of the arbitration.
Overall, a ‘wrong decision’ will not justify review or non-enforcement provided the arbitrator applied and decided a mandatory law issue.[66]
Separately, in the US there is a ‘non-statutory and judicially-created’ basis[67] to seek to set aside an award for ‘manifest disregard of the law’ by the arbitrator[68] if a party can demonstrate the arbitrator knew of a legal rule but intentionally disregarded it.[69] This is criticised as ‘lacking a firm doctrinal footing’[70] and recently confirmed as available ‘only in those exceedingly rare instances where some egregious impropriety on the part of the arbitrator is apparent’ with the courts upholding awards where ‘the arbitrator has provided even a barely colorable justification’. [71]
4. Chapter III: What constitutes ‘public policy’?
Having regard to the authorities above, a key question is what constitutes ‘public policy’ of the state in which the award is sought to be enforced, and is it ‘domestic public policy’,[72] ‘international public policy,’[73] or ‘transnational public policy,’.[74]
It is said that ‘international public policy’ is viewed through the lens of the ‘fundamental conceptions of the legal order’ identified as being relevant in the particular enforcing jurisdiction.[75] A breach of these values must be such that they ‘cannot be tolerated’ for a court to refuse to enforce an award. [76] Similarly, under domestic public policy, in the much-cited Parsons & Whittemore[77] decision, the US Court of Appeals held that, for enforcement of an award to be refused, it must violate ‘the State’s most basic notions of morality and justice’.[78]
Transnational public policy reflects basic ethical standards and the ‘enduring moral consensus of the international business community,’ examples of which are opposition to human rights violations, discrimination and slavery, corruption, fraud, drugs or arms trafficking, kidnapping, murder, or ‘generally the subversions or evasion of imperative laws’.[79]
In 2002, the International Law Association (ILA) endorsed a narrowly defined interpretation of ‘international public policy’ to apply to the New York Convention,[80] adopting the Parsons & Whittemore ‘morality and justice’ test and the European Court of Justice (ECJ) finding[81] that refusal to enforce ‘can be envisaged only where’ to do so ‘would be at variance to an unacceptable degree with the legal order of the State in which enforcement is sought inasmuch as it infringes a fundamental principle’.[82]
In 2007 the Singapore Court of Appeal[83] adopted the Parsons & Whittemore ‘narrow scope’, that enforcement ought only be refused ‘where the upholding of an arbitral award would ‘shock the conscience’ … or is ‘clearly injurious to the public good or … wholly offensive to the ordinary reasonable and fully informed member of the public’ or where it violates the forum’s most basic notion of morality and justice’. The Court observed this was consistent with the UNCITRAL Commission Report.[84]
Similarly, the Hong Kong Court of Appeal (in a decision applied in Australia in 2022)[85] has said that there must be ‘compelling reasons’ for a court to refuse enforcement, in that ‘the award must be so fundamentally offensive to that jurisdiction’s notions of justice that, despite its being a party to the Convention, it cannot reasonably be expected to overlook the objection.’[86]
It is these concepts of international public policy that are generally relied upon under the New York Convention.[87] While mandatory law is capable of constituting international public policy,[88] including as identified by the ILA,[89] the issue remains that, in line with the position of the ECJ adopted by the ILA[90] enforcement ought only be refused where an award gives effect to a principle prohibited under the mandatory rule and would ‘manifestly disrupt the essential political, social or economic interests protected by the mandatory rule’.[91] That is, the mandatory rule ‘must be described as essential to the legal order of the State,’ making it ‘unlikely that a failure to apply a State’s mandatory law will regularly give rise to a ground to refuse to enforce an award.’ [92]
Exceptions to this position are said to be in jurisdictions in which ‘public policy’ has been judicially or legislatively expressly defined as ‘domestic public policy’, such as in Singapore,[93] Hong Kong[94] and Malaysia.[95] In Australia, a high bar must be met;[96] while the words ‘public policy of Australia’ are legislatively used,[97] the courts follow the approach in Hong Kong,[98] giving weight to international public policy considerations: [99]
The scope of public policy … is not intended to incorporate any idiosyncratic national approach…[it] is limited to the fundamental principles (or norms) of justice and morality (or fairness) of the state, recognising the international dimension of the context.
5. Chapter IV: Mandatory laws once considered non-arbitrable
It is helpful to consider other mandatory laws once considered non-arbitrable due to their mandatory nature. Globally, competition (or ‘anti-trust’ or trade practices) laws are often mandatory in that contracting out of them is legislatively prohibited. A concern has long been that parties could use arbitration as a means of contracting out of otherwise mandatory laws, including proportionate liability laws[100] and competition laws.[101] In respect of the latter, for that reason competition laws have in the past been considered non-arbitrable, although in the US, UK, Canada and NZ competition claims are now generally considered arbitrable.[102]
In 1985 in Mitsubishi Motors Corp v Soler Chrysler‑Plymouth Inc,[103] the US Supreme Court held that competition claims under a US statute were arbitrable under an arbitration agreement seated in Japan under the rules of the Japanese Commercial Arbitration Association where the choice of governing law of the contract was Swiss law.
The US Supreme Court in Mitsubishi observed at 636 that ‘the international arbitral tribunal owes no prior allegiance to the legal norms of particular states; hence, it has no direct obligation to vindicate their statutory dictates. The tribunal, however, is bound to effectuate the intent of the parties.’ The Supreme Court in Mitsubishi acknowledged that the arbitrator being ‘required to effectuate the intent of the parties, rather than to enforce the statute’ this could result in an award ‘inimical’ to public policy ‘thus depriving’ ‘protected statutory rights’.[104]
The arbitrability of competition laws in the US has remained generally uncontroversial since.[105] The observations of the US Supreme Court in Mitsubishi were cited by the HCA in 2024 in Tesseract.[106]
Notably, the Court in Mitsubishi did however warn against deliberate attempts to oust ‘a party’s right to pursue statutory remedies for antitrust violations’, upon which the Court ‘would have little hesitation in condemning the agreement as against public policy.’[107] Commentators have similarly envisaged deliberate attempts to oust proportionate liability laws,[108] as also observed in Tesseract.[109]
After Mitsubishi, European courts also accepted that competition claims were arbitrable. [110] By contrast, claims under Australian competition law have generally been considered inarbitrable.[111] In Clough Engineering Limited v Oil & Natural Gas Corporation Limited, [112] the Federal Court held that the operation of competition legislation ‘cannot be ousted by private agreement’ and that an attempt to do so may be void.[113]
Similarly, while not involving an arbitration clause, the Australian Federal Court in Epic Games v Apple Inc (Stay Application) [2021] FCA 338 held that the federal competition law constituted a mandatory law and that the parties were not permitted to choose a governing law of the contract excluding it.[114] On appeal, the Full Court refused to allow the matter to be litigated in the parties’ chosen forum (California),[115] despite the ‘usual rule’ that the parties’ agreement as to choice of forum is to be enforced.[116]
6. Chapter V: Proportionate liability laws
Jurisdictions worldwide have differing joint and several (or solidary) liability, or alternatively proportionate liability, laws[117] with some proportionate liability laws mandatory.[118] As at 2024, twenty-one USA states have adopted proportionate liability laws[119] in respect of tort claims,[120] and all Australian jurisdictions have adopted similar regimes.[121] By contrast, the UK,[122] New Zealand,[123] Canada,[124] France and Germany[125] retain solidary liability regimes.[126]
Of the jurisdictions in which proportionate liability regimes are adopted, Queensland’s and Victoria’s laws can be considered mandatory,[127] and some aspects of proportionate liability laws in USA states contain prima facie ‘mandatory’ elements.[128]
As has been observed, proportionate liability laws (particularly those considered mandatory by reason of prohibiting contracting-out) can become relevant in respect of construction contracts (for instance) containing arbitration agreements in common scenarios such as when a builder engages a subcontractor to perform works which are then defective.[129] The principal pursues the builder (who is insured with assets) for rectification, the builder denies liability and the matter is referred to arbitration whereby the principal may recover against the builder’s assets.[130] The builder is then left to pursue the subcontractor in contribution[131] who may be uninsured and impecunious.[132]
A similar situation as contemplated above led to the HCA decision in Tesseract. The builder (Pascale) contracted with the consultant (Tesseract) to provide engineering consultancy. A dispute arose about Tesseract’s work[133] and the dispute was referred to arbitration with Pascale claiming damages for breach of contract, negligence and misleading or deceptive conduct.[134] Tesseract denied liability, and alternatively relied upon the proportionate liability regimes, which Pascale denied applied.[135] The arbitrator ordered Tesseract to seek leave[136] for court determination of the question as to whether the proportionate liability laws did in fact apply, which the SA Court of Appeal answered in the negative.[137] On appeal, the HCA answered this in the affirmative. In Tesseract, as was observed by the HCA, the applicable SA proportionate liability legislation was not expressed to be mandatory.
Before the HCA, Tesseract had argued that, as a consequence of Art 28 of the Model Law (reflected in domestic Australian legislation),[138] the arbitrator was required to apply the proportionate liability provisions of the laws of South Australia.[139]
Pascale argued that, because of the general inability to join non-consenting parties to arbitrations, proportionate liability provisions could not be applied to arbitrations (consistently with the proportionate liability legislation applicable in SA) and, further, that Tesseract had waived its right to rely on proportionate liability laws by submitting to a two-party arbitration.[140]
The majority in Tesseract held that the operation of the proportionate liability provisions does not depend on all concurrent wrongdoers being parties to one proceeding for a determination to be made as to the proportionate liability of any one concurrent wrongdoer, and nor does their operation depend on any effect that the resolution of a dispute between parties might have on third parties.[141] In addition, Gordon and Gleeson JJ observed that a right to solidary liability in fact no longer formed part of the laws of South Australia (nor the common law of Australia).[142]
The effect of Tesseract is that respondents in commercial arbitrations in Australia can now rely upon proportionate liability statutory provisions to reduce their liability commensurate with loss caused by third parties, notwithstanding those third parties refusing to be joined to the arbitration. Nonetheless, parties could arguably choose in advance a governing law that excludes proportionate liability provisions.
With solidary liability no longer applicable to international commercial arbitrations in Australia, not only will arbitrators need to consider prima facie ‘mandatory’ proportionate liability laws for arbitrations seated in Queensland or Victoria,[143] but parties will likely seek to join concurrent wrongdoers.
It has been suggested that an arbitrator in Victoria would have power to join concurrent wrongdoers[144] and then ‘must’ apportion liability as between them.[145] Australian proportionate liability laws allow for joinder of all parties,[146] although the HCA in Tesseract acknowledged that non-parties can only be joined to arbitration proceedings with the consent of that non-party and all other parties.[147]
In Australia, the situation is further impacted by a further recent HCA decision (Pafburn Pty Limited v The Owners – Strata Plan No 84674 [2024] HCA 49) in which the HCA majority found that those ‘upstream’ who delegate construction work will be vicariously liable for that work and cannot delegate their statutory duty or seek to limit their liability using apportionment legislation.
Finally, a criticism of the different treatment of proportionate liability within all regimes, has been the absence of any discernible ‘good, generalisable ethical argument in favour of a proportionate liability rule and we firmly reject the idea … that proportionate liability is another manifestation or natural extension of the ethics of ‘sharing’ that is to be found in modern comparative (contributory) negligence doctrine.’ [148] Such lack of clear underpinning policy may undermine any attempt to rely upon departure from any ‘mandatory’ aspects of proportionate liability laws to set aside or challenge the enforcement of an award.
7. Chapter VI: Solutions
A way of avoiding mandatory proportionate liability laws in Victoria (for instance), where not all wrongdoers are joined, could be for the arbitrator to decide as ‘amiable compositeur’,[149] eschewing the strict application of legal principles in favour of general notions of fairness and equity.[150]
More generally, suggestions include giving weight to mandatory laws only if the probable place of enforcement can be identified. [151] If assets are only in one jurisdiction, that could be a compelling reason to apply that jurisdiction’s mandatory rules to assist with protecting enforceability.[152]
If assets are in multiple States and only one of those has enacted a mandatory law, it may be that it need not be considered (for enforcement purposes at least).[153] However, if there are mandatory laws in each of the States, at least one would sensibly be considered. [154] A mixed method of Med-Arb is suggested to resolve any conflicts between each relevant state and the parties.[155]
An alternative solution is to simply apply the lex contractus and exclude all mandatory laws excluded by the parties.[156] This applies contractual theory, under which arbitration is ‘unbound from its seat’ and mandatory rules should only be relevant if they form part of the lex contractus, or prove the invalidity or illegality of the parties’ contract, with consent to their application never implied.[157]
This approach, however, risks enforceability issues. Plus, if third party rights are involved and the excluded mandatory law benefits those third parties, the arbitrator is nonetheless restricted by the confines of the arbitration agreement and cannot act contrary to the parties’ directions, so could only stand down if s/he felt compelled. [158]
On the other hand, an arbitrator could apply a mandatory law excluded by the parties on the grounds of the arbitrator’s duty to render an enforceable award or to comply with the parties’ ‘legitimate expectations’. [159]
If the parties chose the ICC Rules as the procedural rules applicable, this could be taken as the parties impliedly consenting to the arbitrator applying the mandatory laws of the seat,[160] given the 2021 ICC Rules[161] provide that: ‘When the Court scrutinizes draft awards in accordance with Article 34 of the Rules, it considers, to the extent practicable, the requirements of mandatory law at the place of the arbitration.’
At the other extreme (under jurisdictional theory), all aspects of the arbitration, including the validity of the arbitration agreement, the powers of the arbitrator and the enforcement of the award, are governed by domestic laws, predominantly the laws of the seat or where enforcement is sought. [162] Such an approach is said to be on the basis that ‘it would be intolerable if the country of the seat could not override whatever arrangements the parties may have made’ and if the arbitrator is allowed to accept the commands of the parties, that is because the ‘local sovereign so provides’ and has expressly permitted that:[163]:
The reality is that arbitration depends upon a hybrid of elements of both the contractual and jurisdictionalist theory,[164] namely the consensual basis with the support of national legal systems, given arbitration is somewhat dependent on ‘sovereign beneficence’[165] and courts capable of determining to ‘oversee’ arbitral proceedings where those were judicially referred.[166]
The solution of applying all mandatory laws regardless of the strength of connection to the dispute may be inefficient, given the potential number of mandatory laws, and could also disadvantage less arbitration savvy parties. [167] This does, however, deny party autonomy and may exceed arbitrator authority for the reasons discussed.
Applying no mandatory laws as sought by the parties, while aligning with express authority given to the arbitrator, runs the risk already identified of the award being set aside and/or refused enforcement. [168]
Using a specified formula to determine which mandatory laws to apply is a further option. [169] Methodologies include the ‘close connection’ approach based on the Rome Convention[170] (which provides that mandatory rules ‘with which the situation has a close connection’ ‘must be applied’, having regard also to the nature, purpose and consequences of application/non-application);[171] or identifying the ‘legitimate expectations’ of the parties as to which mandatory laws to be applied, including where those were expressly excluded by the parties.[172]
It has been suggested that the ‘legitimate expectations’ of the parties ought be immediately identified,[173] including whether those are limited by public policy[174] and then ‘yield to the parties’ stipulation’ and not apply any expressly excluded mandatory law. [175]
A contrary proposed solution is that a party expressly accepts the application of a mandatory law before the forum court (similar to what was ordered by the arbitrator in Tesseract), to oblige the arbitral tribunal to apply the mandatory law and to assure enforcement in the forum of the award.[176] A similar approach was adopted in the Australian Federal Court in respect of a competition claim, with the proceedings resolving by the respondent undertaking that, to the extent that the competition legislation prohibited certain conduct, that legislation is a mandatory law that the arbitrator must apply.[177]
8. Conclusion
There is no clear path, with some observing that mandatory laws should generally be presumed not to apply, [178] and others referring to the risk inherent in such an approach, particularly where the parties have made no choice as to the laws applicable to the arbitration agreement, [179] observed to be most often.[180]
The likelihood of an award being set aside and/or not enforced is subject largely to the laws applicable to the arbitration agreement. Using a specified formula to determine which mandatory laws to apply, [181] with that formula dependent on the laws applicable to the arbitration agreement, seems the most risk-averse approach.
A sensible suggestion is that ‘practical guidelines should be drafted for use by arbitrators, courts and legislatures when addressing mandatory rules of law in arbitration practice’.[182]
[1] Baraclough and Waincymer “Mandatory Rules of Law in International Commercial Arbitration” (2005) 6 Melbourne Law Journal of International Law 205 at 207.
[2] The Model Law defines an arbitration as international if ‘the parties to an arbitration agreement have, at the time of the conclusion of that agreement, their places of business in different States’ (Article 1 (3)).
[3] Defined as a sole arbitrator or panel of arbitrators: Art 2(b) of the Model Law.
[4] United Nations Commission on International Trade Law (UNCITRAL). In respect of the term ‘commercial’, the Model Law provides no strict definition. The footnote to Article 1(1) calls for ‘a wide interpretation’ and offers an illustrative and open-ended list of relationships that might be described as commercial in nature, ‘whether contractual or not’: Explanatory Note by the UNCITRAL secretariat on the 1985 Model Law on International Commercial Arbitration as amended in 2006 (UNCITRAL Explanatory Note 2006) [12].
[5] UNCITRAL Model Law on International Commercial Arbitration (1985) adopted at the end of the eighteenth session of the Commission, with the General Assembly, in its resolution 40/72 (with amendments as adopted in 2006), recommending ‘that all States give due consideration to the Model Law on International Commercial Arbitration, in view of the desirability of uniformity of the law of arbitral procedures and the specific needs of international commercial arbitration practice’: Explanatory Note 2006 [1].
[6] Born, International arbitration: law and practice, 3rd ed, Kluwer Law International, 2021, pp. 38, 39, 86, 94; CBI Constructors Pty Ltd v Chevron Australia Pty Ltd [2024] HCA 28 at [15] citing Tesseract International Pty Limited v Pascale Construction Pty Limited [2024] HCA 24 at [19]- [29], [87], [147], [157]-[162], [230], [273]. In particular see Edelman J (in the minority) in Tesseract at [162].
[7] Although, significantly, it is observed that ‘parties rarely choose the law applicable to the arbitration clause’: Nazzini (ed) Construction Arbitration and Alternative Dispute Resolution: Theory and Practice Around the World informa lodge Routledge 2022 p5 [2.1].
[8] Villiers “Breaking the ‘Unruly Horse’: The Status of Mandatory Rules of Law as a Public Policy Basis for the Non-Enforcement of Arbitral Awards” (2011) 18 Australian Int’l Law Journal 155 at 155.
[9] Explanatory Note 2006, p26 [11].
[10] Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted by the United Nations Conference on International Commercial Arbitration in 1958 (the New York Convention).
[11] Tesseract International Pty Limited v Pascale Construction Pty Limited [2024] HCA 24 at [43]-[46] per Gageler CJ (in the majority).
[12] Baraclough and Waincymer “Mandatory Rules of Law in International Commercial Arbitration” (2005) 6 Melbourne Law Journal of International Law 205 at 208.
[13] Baraclough and Waincymer ibid, at 207; Martin, “Jurisdictionalists v Contractualists: Who is Winning the Mandatory Law Debate in International Commercial Arbitration?” (2017) 27 Am Rev Int’l Arb 475 at 475.
[14] Otherwise enforceable under Art 35 of the Model Law.
[15] Priskich “Mandatory Laws Applicable to an Arbitration: A view from Australia” Kluwer Arbitration Blog 24 July 2021, p1; Villiers op cit at 156.
[16] Villiers ibid at 161.
[17] Two discrete, distinct concepts to be distinguished from each other: Martin, “Jurisdictionalists v Contractualists: Who is Winning the Mandatory Law Debate in International Commercial Arbitration?” (2017) 27 Am Rev Int’l Arb 475 at 480.
[18] Consisting of Gageler CJ joining with Gordon, Gleeson, Jagot and Beech-Jones JJ.
[19] In Tesseract Jagot and Beech-Jones JJ (in the majority) observed at [365] that it was the legislative intent under both the Commonwealth Consumer Act as well as the South Australian legislation that contracting out of the proportionate liability provisions was permitted.
[20] In Part VIA of the Competition and Consumer Act 2010 (Cth) (Consumer Act) and correspondent proportionate liability provisions of South Australian State legislation.
[21] Tesseract at [4], [27].
[22] Tesseract at [4], [27].
[23] The Commercial Arbitration Act 2011 (SA) is an adaptation of the UNCITRAL Model Law (with its 2006 amendments). The UNCITRAL Model Law is adopted in Australia under the International Arbitration Act 1974 (Cth).
[24] The law chosen by the parties to govern arbitral procedure, or the procedural law governing the conduct of the arbitration.
[25] Tesseract at [208], [349].
[26] Tesseract at [7].
[27] Section 7(3) of the Civil Liability Act 2003 (Qld); Tesseract [319].
[28] NSW, Tasmania and WA expressly permit contracting out of proportionate liability: Civil Liability Act 2002 (NSW), s 3A(2); Civil Liability Act 2002 (Tas), s 3A(3); Civil Liability Act 2002 (WA), : Tesseract [319].
[29] South Australia, Victoria, ACT, Northern Territory.
[30] Tesseract [131] per Gordon and Gleeson JJ (in the majority); [319], [326] per Jagot and Beech-Jones JJ (in the majority).
[31] Australian Government Solicitor, Legal Briefing: Proportionate Liability, 2015, p5; PWC Proportionate Liability January 2016, p10, [6.1]; Whitten “Arbitration, Apportionment and Part IVAA of the Wrongs Act 1958 (Vic)”, 2007, [88].
[32] Discussed below.
[33] Fazilatfar “Arbitration and the Mandatory Law Problem: A Mixed Mode ADR Approach” (2024) J Disp Resol 56 at 57.
[34] Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the Law Applicable to Contractual Obligations (Rome I) [2008] OJ L 177/6.
[35] Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the Law Applicable to Contractual Obligations (Rome I) [2008] OJ L 177/6.
[36] Villiers op cit p169.
[37] Fazilatfar op cit at 60.
[38] Associated Electric and Gas Insurance Services Ltd v European Reinsurance Co of Zurich [2003] UKPC 11; [2003] 1 WLR 1041 at 1046 [9].
[39] By which the parties submit to the arbitration under Art 7 of the Model Law, using either Option I (required to be in writing) or Option II (not required to be in writing): Explanatory Note 2006, p28.
[40] With the parties free to choose the procedure for appointment (Art 11(2) of the Model Law), subject to Art 11(4) and (5) of the Model Law, and free to choose the number of arbitrators (Art 10(1) of the Model Law).
[41] Art 28(1) of the Model Law.
[42] Art 19 of the Model Law.
[43] Art 20(1) of the Model Law.
[44] United Nations General Assembly, Report of the United Nations Commission on International Trade Law on the work of its eighteenth session, 40th sess, Supp No 17, UN Doc A/40/17 (3–21 June 1985) at 45 [232].
[45] Martin, op cit at 475, 491.
[46] Fazilatfar op cit at 62.
[47] Fazilatfar id.
[48] Baraclough and Waincymer, op cit at 209, cited in Fazilatfar id.
[49] Daniel Rainey Ethan Katsh Mohamed S. Abdel Wahab (eds) Online Dispute Resolution – Theory and Practice: A Treatise on Technology and Dispute Resolution 2nd ed, Eleven, 2021.
[50] Daniel Rainey Ethan Katsh Mohamed S. Abdel Wahab (eds) op cit, p267.
[51] See Verein fur Konsumenteninformation v Amazon EU Sarl (C-191/15).
[52] Art V(1)(e).
[53] Baraclough and Waincymer op cit at 207.
[54] Baraclough and Waincymer id.
[55] Explanatory Note by the UNCITRAL secretariat on the 1985 Model Law on International Commercial Arbitration as amended in 2006 (Explanatory Note 2006), p24 [5]-[7], [10].
[56] Such as Esso Expl. & Prod. Nigeria Ltd. v. Nigerian Nat’l Petroleum Corp 40 F.4th 56, 62 (2d Cir 2022) (quoting Corporacion Mexicana de Mantenimiento Integral, S. de R.L. de C.V. v. Pemex-Exploracion y Produccion, 832 F.3d 92, 105-06 (2d Cir. 2016)); Karaha Bodas Co. v. Pemsahaan Pertambangan Minyak Dan Gas Bumi Negara, 364 F.3d 274, 296 (5th Cir. 2004); Calbex Min. Ltd. v. ACC Res. Co., 90 F. Supp. 3d 442, 462 (W.D. Pa. 2015), cited in Brower, ‘Dirty Secret: The Laundering of Foreign Arbitral Awards’ (2024) 75 UC L J 261 at 267.
[57] Eg Adviso NV v Korea Overseas Construction Corporation (1996) XXI Yearbook Commercial Arbitration 612; Societe European d’Etudes et d’Enterprises v Federal Republic of Yugoslavia (1976) I Yearbook Commercial Arbitration 195; Allsop Automatic Inc v Technock SNC (1997) ICAA Yearbook 142 Corte di Appello; Renusgar Power Limited v General Electric Co AIR 1994 SC 860; Omnium de Traitement et de Valorisation SA v Hilmarton Limited [1999] 2 Loyd’s Rep 222, 244-5, each cited in Villiers op cit at 165.
[58] Villiers “Breaking the ‘Unruly Horse’: The Status of Mandatory Rules of Law as a Public Policy Basis for the Non-Enforcement of Arbitral Awards” (2011) 18 Australian Int’l Law Journal 155 at 165.
[59] Fazilatfar op cit at 65, citing Shore, “Applying Mandatory Rules of Law in International Commercial Arbitration” (2007) 18 AM Rev Int’l Arb 91.
[60] Fazilatfar ibid at 65.
[61] 40 F.4th 56, 62-63 (2d Cir. 2022).
[62] Citations omitted.
[63] Australian Centre for International Commercial Arbitration.
[64] Tesseract [44].
[65] Tesseract [44]-[45] per Gageler CJ (in the majority).
[66] Villiers op cit at 168.
[67] Based on Wilko v. Swan, 346 U.S. 427 (1953) (since overruled but the principle continues to be applied nonetheless): Park, Arbitration of International Business Disputes, Oxford University Press, 2006, p18.
[68] Park, Id.
[69] Drahozal “Codifying Manifest Disregard” (2007) Nevada Law Journal Vol. 8:234 at p235.
[70] Drahozal ibid at p234.
[71] Risen Energy Co. v. Focus Futura Holding Participações S.A., No. 1:23-cv-10993 (S.D.N.Y. June 11, 2024) at 4 (application to set aside a US$65M award dismissed).
[72] Meaning ‘those principles of morality and justice which a state sets into its domestic laws’: Villiers op cit at 161.
[73] Meaning ‘those principles of a State’s domestic public policy that a State insists should apply in an international relationship’: Changorath “International Arbitration – A Consensus on Public Policy Defences” (2008) 4 Asian International Arbitration Journal 143, 156.
[74] Meaning ‘those principles of universal justice and morality accepted by civilised nations’: Villiers Id.
[75] Villiers ibid at 162.
[76] Villiers id.
[77] Parsons & Whittemore Overseas Co Inc v Societe Generale de l’Industrie du Papier RAKTA and Bank of America 508 F 2d 969 (2nd circ 1974).
[78] Parsons & Whittemore Overseas Co Inc v Societe Generale de l’Industrie du Papier RAKTA and Bank of America 508 F 2d 969 (2nd circ 1974) cited in Villiers ibid at 161.
[79] Kleinheisterkamp “The Myth of Transnational Public Policy in International Arbitration” (2023) The American Journal of Comparative Law 98 at 118; Baraclough op cit, 218.
[80] International Law Association New Delhi Conference Committee on International Commercial Arbitration (2002) (ILA Final Report) at [10]-[16].
[81] In Krombach v Bamberski ECJ Case C-7/98 [2001] 3 WLR 488 at [19].
[82] ILA Final Report at [12]-[14].
[83] PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA [2007] 1 SLR(R) 597 at 622 at [59].
[84] Report of the United Nations Commission on International Trade Law on the Work of its Eighteenth Session, UN GAOR, 40th sess, Supp No 17, UN Doc A/40/17 (1985) at 57 [296]-[297].
[85] Guoao Holding Group Co Ltd v Xue (No 2) [2022] FCA 1584 at [33]; and in TCL Air Conditioner (Zhongshan) Co Ltd v Castel Electronics Pty Ltd (2014) 232 FCR 361 at [79]
[86] Hebei Import & Export Corp v Polytek Engineering Co Ltd [1999] HKCFA 40; [1999] 2 HKC 205 at 215-216 and 232-233.
[87] Villiers op cit at 166. Although some commentators propose that utilisation of transnational public policy principles would give rise to ‘a concept for legitimizing a far-reaching autonomy of the arbitral system, in terms of self-regulation and regulation’: Kleinheisterkamp “The Myth of Transnational Public Policy in International Arbitration” (2023) The American Journal of Comparative Law 98 at 99-100; Ma, “Public Policy in the Judicial Enforcement of Arbitral Awards: Lessons for and from Australia,” Doctoral thesis submitted to Bond University, 2005, p130.
[88] Villiers, op cit, p166.
[89] Audley Sheppard, ‘Interim ILA Report on Public Policy as a Bar to Enforcement of International Arbitral Awards’ (2003) 19(2) Arbitration International 217.
[90] ILA Final Report [14].
[91] Villiers op cit p166.
[92] Villiers op cit p167.
[93] Section 34(1)(b) of the International Arbitration Act 1994.
[94] Hebei Import & Export Corp v Polytek Engineering Co Ltd [1999] HKCFA 40; [1999] 2 HKC 205 at 215-216 and 232-233.
[95] Banque Nasionale de Paris v Wuan See May [2003] 3 MLJ 587.
[96] Croft, Stamboulakis and Warren International and Australian Commercial Arbitration LexisNexis Australia 2022, [11.42].
[97] Section 39(1)(a)(iv) of the International Arbitration Act 1974 (Cth).
[98] Guoao Holding Group Co Ltd v Xue (No 2) [2022] FCA 1584 at [33]; and in TCL Air Conditioner (Zhongshan) Co Ltd v Castel Electronics Pty Ltd (2014) 232 FCR 361 at [79].
[99] Guoao Holding Group Co Ltd v Xue (No 2) [2022] FCA 1584 at [32].
[100] Horan, Proportionate Liability: Towards National Consistency (2007) at 109 [395], 121 [446]; Stephenson, “Proportional Liability in Australia—the Death of Certainty in Risk Allocation in Contract” (2005) 22 International Construction Law Review 64 at 66.
[101] Okezie Chukwumerije, Choice of Law in International Commercial Arbitration 180 (Quorum Books, 1994); see for instance Clough Engineering Limited v Oil & Natural Gas Corporation Ltd [2007] FCA 88.
[102] see Mitsubishi Motors Corp. v Soler Chrysler-Plymouth, Inc. [1985] USSC 203; 473 US 614 (1985); Attorney General v Mobil Oil NZ Ltd [1989] 2 NZLR 649; ET Plus SA v Welter [2005] EWHC 2115; Murphy v Amway Canada Corporation ; E.T. Plus S.A. v Welters [2005] ALL ER (D); Hodge-Englishby op cit at p36.
[103] (1985) 473 US 614.
[104] Citing Barrentine v. Arkansas-Best Freight System, Inc., [1981] USSC 65; 450 U.S. 728, 101 S.Ct. 1427, 67 L.Ed.2d 641 (1981).
[105] Hodge-Englishby “Can Australia Compete? A Tri-Jurisdiction Analysis of Competition Law Arbitration: How do the United States, England and Australia treat the issue of the Arbitrability of Competition Law? (2020) 5 Perth International Law Journal 29 at p34.
[106] Per Jagot and Beech-Jones JJ at [334] (in the majority).
[107] Mitsubishi at footnote 19.
[108] Horan, op cit at 109 [395], 121 [446].
[109] At [207].
[110] Eco Swiss China Time Ltd v Benetton International NV (Court of Justice of the European Union, C–126/97, 1 June 1999) [1999] ECR 1–3055; [1999] 2 All ER (Comm) 44; Hodge-Englishby op cit at p35.
[111] Hodge-Englishby ibid at p37. However, see Freedom Foods Pty Ltd v Blue Diamond Growers [2021] FCA 172.
[112] [2007] FCA 881 per Gilmour J.
[113] At [41].
[114] Epic Games v Apple Inc (Stay Application) [2021] FCA 338 per Perram J at [19], [21], [23]; not disturbed on appeal: Epic Games, Inc v Apple Inc [2021] FCAFC 122 at [48].
[115] Epic Games, Inc v Apple Inc [2021] FCAFC 122 at [122].
[116] Epic Games per Perram J at [26] citing Huddart Parker Ltd v Ship ‘Mill Hill’ [1950] HCA 43; (1950) 81 CLR 502 at 508-509 per Dixon J; The Eleftheria [1970] P 94 at 99 per Brandon J; Akai Pty Ltd v People’s Insurance Co Ltd [1996] HCA 39; (1996) 188 CLR 418 (‘Akai’) at 427-429 per Dawson and McHugh JJ, at 445 per Toohey, Gaudron and Gummow JJ; Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWCA 196 (‘Global Partners’) at [88]-[89] per Spigelman CJ, Giles JA agreeing at [101], Tobias JA agreeing at [102].
[117] Eg Barker and Steele “Drifting Towards Proportionate Liability: Ethics and Pragmatics” (2015) 74 The Cambridge LJ 49 at 52.
[118] For instance, Queensland and Victoria in Australia as discussed above.
[119] American Medical Association Advocacy Resource Center “State Laws Chart I: Liability Reforms”, 2024; Prof Jones, “Proportionate Liability Revisited”, presented at the 8th Pinsent Masons Lecture, 17 November 2020, p15; Bloomberg Law “Apportionment of Fault Rules”, 2022. The 21 US states in which proportionate liability laws have been adopted are: Alaska, Arizona, Colorado, Connecticut, Florida, Georgia, Hawaii, Idaho, Iowa, Kansas, Mississippi, Nebraska, New Jersey, New Mexico, New York, North Dakota, Oregan, South Carolina, Utah, Wisconsin, Wyoming.
[120] Other than for ‘intentional tortfeasors’: Barker and Steele “Drifting Towards Proportionate Liability: Ethics and Pragmatics” (2015) 74 The Cambridge LJ 49 at 53. Although the situation differs again in the US in respect of contract law: Prof Jones, “Proportionate Liability Revisited”, presented at the 8th Pinsent Masons Lecture, 17 November 2020, p16.
[121] Competition and Consumer Act 2010 (Cth), Part VIA; Corporations Act 2001 (Cth), Division 2A; Australian Securities and Investments Commission Act 2001 (Cth) Subdivision GA; Corporations Act 2001 (Cth), Part 7.10, Division 2A; Civil Law (Wrongs) Act 2002 (ACT), Chapter 7A; Civil Liability Act 2002 (NSW), Part 4; Proportionate Liability Act 2005 (NT); Civil Liability Act 2003 (Qld), Part 2; Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (SA), Part 3; Planning, Development and Infrastructure Act 2016 (SA) section 158 – in relation to defective building work; Civil Liability Act 2002 (Tas), Part 9A; Wrongs Act 1958 (Vic), Part IVAA; Civil Liability Act 2002 (WA), Part 1F.
[122] Prof Jones, “Proportionate Liability Revisited”, presented at the 8th Pinsent Masons Lecture, 17 November 2020, p14.
[123] Adjunct Prof Lovegrove, “Developing Sustainable Construction Liability Allocation Laws: Victoria vs. New Zealand” 3 July 2024 (https://lclawyers.com.au/developing-sustainable-construction-liability-allocation-laws-australia-vs-new-zealand/ accessed 7 November 2024).
[124] Ontario Trial Lawyers Association “Joint and Several Liability” 2024 (https://www.otla.com/?pg=JointandSeveralLiability accessed 7 November 2024).
[125] Prof Jones, “Proportionate Liability Revisited”, presented at the 8th Pinsent Masons Lecture, 17 November 2020, p16.
[126] As do the remaining 29 USA states (or they retain hybrid regimes): Eg Barker and Steele “Drifting Towards Proportionate Liability: Ethics and Pragmatics” (2015) 74 The Cambridge LJ 49 at 52-53.
[127] Paragraph [6] herein above.
[128]For instance, the Connecticut General Statutes expressly prohibits the court from reallocating ‘uncollectible non-economic damages’; under the Delaware Code recovery is barred when a plaintiff is more than 50 per cent at fault and the defendant’s conduct was plain negligence; other state statutes use prohibitive language.
[129] As contemplated in Whitten “Arbitration, Apportionment and Part IVAA of the Wrongs Act 1958 (Vic)”, 2007, [6]-[11].
[130] Ibid, [6]-[7].
[131] Under s23B of the Wrongs Act (Vic) for instance.
[132] Whitten, op cit, [6]-[7].
[133] Tesseract at [326].
[134] Under s18 of the Australian Consumer Law at Schedule 2 of the Competition and Consumer Act 2010 (Cth).
[135] At [80]-[81]; [312].
[136] Under s27J of the Commercial Arbitration Act 2011 (SA) for a determination from the SA Supreme Court.
[137] Tesseract International Pty Limited v Pascale Construction Pty Limited [2022] SASCA 107 per Livesey P, Doyle and Bleby JJA.
[138] Relevantly in Tesseract, section 28 of the Commercial Arbitration Act 2011 (SA).
[139] Being Pt 3 of the Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (SA) (Law Reform Act) and/or Part VIA of the Competition and Consumer Act 2010 (Cth).
[140] Tesseract at [119]-[124], [134]; [357].
[141] Tesseract at [63]-[64] (Gageler CJ); [130], [138] (Gordon and Gleeson JJ); [360]-[364] (Jagot and Beech-Jones JJ).
[142] Tesseract at [133] (Gordon and Gleeson JJ); Steward J agreeing at [281] (otherwise in dissent).
[143] Perhaps with the governing law also within the same jurisdiction as in Tesseract in respect of SA.
[144] For instance under s24AL of the Wrongs Act 1958 (Vic): Whitten op cit [22].
[145] Under s24AI of the Wrongs Act 1958 (Vic): Whitten op cit [22].
[146] The South Australian proportionate liability laws have similar statutory counterparts across Australia. See Civil Liability Act 2002 (NSW), Pt 4; Civil Liability Act 2002 (Tas), Pt 9A; Wrongs Act 1958 (Vic), Pt IVAA; Civil Liability Act 2002 (WA), Pt 1F; Civil Law (Wrongs) Act 2002 (ACT), Ch 7A; Proportionate Liability Act 2005 (NT): Tesseract [125] per Gordon and Gleeson JJ (in the majority); [359] per Jagot and Beech-Jones JJ.
[147] At [126].
[148] Barker and Steele “Drifting Towards Proportionate Liability: Ethics and Pragmatics” (2015) 74 The Cambridge LJ 49 at 53, 57.
[149] Whitten op cit [26].
[150] For instance under s28(4) of the Commercial Arbitration Act 2011 (Vic) (cf Art 29 of the Model Law), but would need the consent of the parties.
[151] Baraclough and Waincymer op cit at 216.
[152] Id.
[153] Id.
[154] Id.
[155] Fazilatfar op cit at 76-80.
[156] Baraclough and Waincymer op cit at 219.
[157] Baraclough and Waincymer op cit at 209-210.
[158] Baraclough and Waincymer op cit at 220.
[159] Baraclough and Waincymer op cit at 221, 226.
[160] Baraclough op cit at 223.
[161] International Chamber of Commerce Arbitration Rules 2021, Art 7 of Appendix II: Internal Rules of the International Court of Arbitration.
[162] Baraclough and Waincymer op cit at 210.
[163] Mann “The UNCITRAL Model Law – Lex Facit Arbitrum” reprinted in {1986) 2 Arbitration International 241, at p246, 254, 256, 259.
[164] Martin, “Jurisdictionalists v Contractualists: Who is Winning the Mandatory Law Debate in International Commercial Arbitration?” (2017) 27 Am Rev Int’l Arb 475 at 481.
[165] Baraclough and Waincymer op cit at 210, 214.
[166] Eg PPG Industries v Pilkington plc 825 F Supp 1465, 1483 (D Ariz, 1993).
[167] Unless the mandatory law was designed specifically to protect that category of party: Baraclough and Waincymer op cit at 225.
[168] Baraclough and Waincymer op cit at 226.
[169] Baraclough and Waincymer op cit at 227.
[170] Convention 80/934/EEC on the law applicable to contractual obligations opened for signature in Rome on 19 June 1980.
[171] Rome Convention, Article 7.
[172] Baraclough and Waincymer op cit at 234-235.
[173] Fazilatfar op cit at 62.
[174] Fazilatfar ibid at 63.
[175] Fazilatfar id.
[176] Fazilatfar op cit 63.
[177] Freedom Foods Pty Ltd v Blue Diamond Growers [2021] FCA 172 at [66].
[178] Baraclough and Waincymer op cit at 236.
[179] Baraclough and Waincymer, op cit at 209, cited in Fazilatfar id.
[180] Nazzini op cit [2.1].
[181] Baraclough and Waincymer op cit at 227.
[182] Martin, “Jurisdictionalists v Contractualists: Who is Winning the Mandatory Law Debate in International Commercial Arbitration?” (2017) 27 Am Rev Int’l Arb 475 at 475.