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MODEL ARBITRATION CLAUSE

Parties can decide the contents of the arbitration clause, on the basis of their legal advice. But sometimes parties incorporate arbitration clauses which require a judicial interpretation, since they are not clear. It is very important that the arbitration clause discloses basic information to form a complete arbitration clause. When there is an ambiguity or confusion in the arbitration clause, then the parties have to approach the court of law for a decision which will delay the whole process of arbitration. Hence to help the parties, the centre suggests the following model arbitration clauses:

1. Domestic Arbitration

Sole Arbitrator : In case parties wish to have one arbitrator to decide the disputes, they can incorporate the following clause into their contract.

Dispute Resolution : The parties shall resolve all the disputes arising out of the contract by way of an arbitration conducted as per Arbitration and Conciliation Act,1996 and IDAC India Arbitration Rules. The sole arbitrator appointed by IDAC India shall decide the matter. The language of arbitration shall be English and the seat of arbitration shall be Vadodara. (or incorporate the name of the place as parties jointly decide)

Three Arbitrators : In case parties wish to have a three member arbitration panel to decide the disputes, they can incorporate the following clause into their contract.

Dispute Resolution : The parties shall resolve all the disputes arising out of the contract by way of an arbitration conducted as per Arbitration and Conciliation Act,1996 and IDAC India Arbitration Rules. There shall be a three member arbitration tribunal. Each of the parties shall nominate one arbitrator and the presiding arbitrator shall be selected by both the party appointed arbitrators jointly. The language of arbitration shall be English and the seat of arbitration shall be Vadodara. (or incorporate the name of the place as parties jointly decide)

2. International Arbitration

Sole Arbitrator: In case parties wish to have one arbitrator to decide the disputes, they can incorporate the following clause into their contract.

Dispute Resolution: The parties shall resolve all the disputes arising out of the contract by way of an arbitration conducted as per Arbitration and Conciliation Act,1996 and IDAC India Arbitration Rules. The sole arbitrator appointed by IDAC India shall decide the matter. The substantive law governing the contract shall be the law under which the disputes have to get resolved. That means the arbitration tribunal has to interpret the contract between the parties only as per the substantive law decided by the parties. The language of arbitration shall be English and the seat of arbitration shall be Vadodara. (or incorporate the name of the place as parties jointly decide)

Three Arbitrators: In case parties wish to have a three member arbitration panel to decide the disputes, they can incorporate the following clause into their contract.

Dispute Resolution: The parties shall resolve all the disputes arising out of the contract by way of an arbitration conducted as per Arbitration and Conciliation Act,1996 and IDAC India Arbitration Rules. There shall be a three member arbitration tribunal. Each of the parties shall nominate one arbitrator and the presiding arbitrator shall be selected by both the party appointed arbitrators jointly. The substantive law governing the contract shall be the law under which the disputes have to get resolved. That means the arbitration tribunal has to interpret the contract between the parties only as per the substantive law decided by the parties. The language of arbitration shall be English and the seat of arbitration shall be Vadodara. (or incorporate the name of the place as parties jointly decide)

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