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A Facelift for Dutch Arbitration Law

Published online by Cambridge University Press:  21 May 2009

Harry Duintjer Tebbens
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Extract

On December 1st, 1986, an important change took place in Dutch arbitration law. Until then, the old provisions of the Code of Civil Procedure dating from 1838 had governed arbitrations conducted in the Netherlands. In spite of judicial attempts to adapt those rules to modern commercial circumstances, many of them had clearly become obsolete. The present state of arbitration law could only be understood in the light of a body of caselaw, which did little to promote the attractions of a Dutch arbitral forum to international business. This became an increasing source of concern in the Netherlands as international commercial arbitration was expanding and came to offer an alternative to court litigation in many branches of trade and industry. By modernising their arbitration law various other Western European States had taken steps to enhance their chances of being selected as the arbitration host country.

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Articles
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Netherlands International Law Review , Volume 34 , Issue 2 , August 1987 , pp. 141 - 161
Copyright
Copyright © T.M.C. Asser Press 1987

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References

1. To mention a few: Switzerland, Intercantonal Arbitration Convention ( Concordat) of 17 March 1969, Swiss Federal Law Register 1969, 279; England, Arbitration Act, 1979 c 42; France, Decree of 14 May 1980, No. 80.354, Journal Officiel, p. 1238, and Decree of 12 May 1981, No. 81.500, Journal Officiel, p. 1380.

2. A Bill on the applicability of Dutch law to awards rendered by the Iran-US Claims Tribunal was introduced on 14 July 1983, but is to be amended as a consequence of the new arbitration law. See on the need for such enactment the discussion between Hardenberg, L. and Van den Berg, A.J. in International Business Lawyer (1984) p. 337Google Scholar and p. 341 respectively, and cf., Schultsz, J.C., ‘Legislation in the Netherlands and International Arbitration’, Mededelingen Nederlandse Vereniging voor Internationaal Recht No. 93 (1986) p. 32Google Scholar.

3. ‘Naar herziening van ons arbitragerecht?’ (Towards a revision of our arbitration law?), Farewell Lecture, Erasmus University, Rotterdam, 7 07 1981Google Scholar.

4. On the Bill, see Sanders, P., ‘A New Arbitration Law for the Netherlands’, 4 Pace LR (1984) p. 581Google Scholar.

5. See the texts and comments in Tijdschrift voor Arbitrage (TVA) (1984) special issue 4 A, special issue 6; (1986) pp. 31–127, 185–200, 213–228; Hardenberg, L., ‘De overeenkomst tot arbitrage‘, NJB (1985) p. 517Google Scholar; Franx, J.P., Het Ontwerp Boek IV van het Wetboek van Burgerlijke Rechtsvordering (1985)Google Scholar; Rozemond, J., ‘De nieuwe arbitragewet’, Bouwrecht (1984) p. 877Google Scholar; Van den Berg, A.J., ‘Dient er een aparte Nederlandse wet voor internationale arbitrage te komen?’, Ars Aequi (1985) p. 389Google Scholar.

6. Act of 2 July 1986, Staatsblad (1986) No. 372Google Scholar, entered into force on 1 December 1986.

7. Sanders, P., Het nieuwe arbitragerecht (1987)Google Scholar; Stein, P.A., De nieuwe arbitragewet (1986)Google Scholar; P. Sanders and A.J. van den Berg, an annotated English and French edition of the Act, which is forthcoming.

8. UN General Assembly, Official Records, 40th Session, Suppl. No. 17 (A/40/17), 24 ILM (1985) p. 1302Google Scholar; 11 Yearbook Comm. Arb. (1986) p. 380Google Scholar.

9. See n. 1 supra and Derains, Y., ‘National Reports-France’, 6 Yearbook Comm. Arb. (1981) p. 1Google Scholar, and 7 Yearbook Comm. Arb. (1982) p. 3Google Scholar.

10. See Arts. 1027 (2) and 1035 (4).

11. Sanders, P., ‘Het nieuwe arbitragerecht’, TvA (1984) special issue 4 A, p. 4Google Scholar.

12. Art. 1 (3) and (4) of the Model Law.

13. Franx, , op.cit. n. 5, p. 96Google Scholar.

14. Sanders, , loc.cit. n. 11, p. 4Google Scholar.

15. For example, appointment of arbitrators along the lines of Art. 7 (1) of the UNCITRAL Arbitration Rules (party arbitrators jointly choosing the third arbitrator).

16. The New York Convention alludes in Art. I(1), second phrase, and V (l)(e) to the possibility of arbitration in country A under the procedural law of country B, but this appears to have no practical significance and is not to be recommended; van den Berg, A.J., The New York Arbitration Convention of 1958 (1981) pp. 26, 350Google Scholar.

17. Court of Appeal of Paris, 21 February 1980 (GNMTC v. Götaverken), Rev. Arb. (1980) p. 524, 6 Yearbook Comm. Arb. (1981) p. 221Google Scholar.

18. Cf., Schultsz, , loc.cit. n. 2, p. 11Google Scholar.

19. See, for an account of the pre-1986 arbitration law, Sanders, P., ‘National Reports-The Netherlands‘, 6 Yearbook Comm. Arb. (1981) p. 60 (63)Google Scholar.

20. See van den Berg, A.J., ‘Wetsontwerp nieuwe arbitragewet’, TvA (1984) special issue no. 6, p. 11/179Google Scholar.

21. Art. II (2) New York Convention; Art. 7 (2) UNCITRAL Model Law; Art. 1443 of the French Nouveau Code de procédure civile (CCPr).

22. This is not compensated by the possibility that the foreign country offers a more favourable provision under Art. VII (1) of the Convention, mentioned by Schultsz, , loccit. n. 2, p. 15Google Scholar.

23. See Schultsz, , loc.cit. n. 2, p. 39Google Scholar.

24. Ibid., at p. 42; contra Hondius, E.H., ‘Arbitral Clauses/Some Comparative Observations’, in Essays on International and Comparative Law in Honour of Judge Erodes (1983) p. 79 (90)Google Scholar.

25. Judgments of 24 June 1981 (Elefanten Schuh), Case 150/80, [1981] ECR 1671; 22 October 1981 (Rohr), Case 27/81, [1981] ECR 2431; 31 March 1982 (C.H.W.), Case 25/81, [1982] ECR 1189; and 14 July 1983 (Geriing), Case 2017sol;82, [1983] ECR 2503.

26. Berg, Van den, loccit. n. 20, p. 220Google Scholar; Schultsz, , loc.cit. n. 2, p. 15Google Scholar.

27. Art. 7 (2) allows a court to apply the rules of the law of the forum where they are mandatory, irrespective of the law otherwise applicable to a contract.

28. Art. 1022 (2).

29. The Dutch CCPr in Arts. 727 et seq., generally requires leave to be given, a prima facie case, and a danger that assets will be removed from the creditor's reach.

30. Definition chosen in conformity with draft legislation on the law of evidence, see Explanatory Memorandum, Doc. Tw.K. 18464, No. 3, TvA (1984) special issue 4A, p. 22Google Scholar.

31. Infra, section 6.

32. See, in this sense, also Raad, Hoge, 11 Janauary 1985, Schip en Schade (1985) no. 36, NJ (1985) no. 421 (Citronas v. Egyptian Navigation Co.)Google Scholar, note by Sanders, , TvA (1985) p. 67Google Scholar.

33. Art. 29(3) CCPr, abolished by Art. V(l) of the Act.

34. Explanatory Memorandum, n. 30 supra, at p. 25, and Statement of Reply to the Second Chamber, Doc. Tw. K. 18464, No. 6, TvA (1986) p. 61.

35. Cf., e.g., Art. 12 (2) UNCITRAL Model Law and Art. 4 IBA Guidelines for international arbitrators, 26 ILM (1987) p. 583Google Scholar.

36. Art. 1452(2) French CCPr; Art. 12(1) UNCITRAL Model Law.

37. Arts. 1038, 1039(1) and (2), 1042(3)–(5).

38. Supra, section 2.1.

39. European Convention on information on foreign law, London, 7 06 1968Google Scholar, ETS no. 62, in force in some twenty European States.

40. Judgment of 23 March 1982, Case 102/81, [1982] ECR 1095, extract in 8 Yearbook Comm. Arb. (1983) p. 183Google Scholar, criticised by de Mello, X., ‘Arbitrage et droit communautaire’, Rev. Arb. (1982) p. 390Google Scholar; Hepting, R., ‘Art. 177 EWGV und die private Schiedsgerichtsbarkeit’, Europarecht (1982) p. 315Google Scholar; Bebr, G., ‘Arbitration Tribunals and Article 177 of the EEC Treaty’, 22 CML Rev. (1985) p. 489Google Scholar.

41. Cf., Storm, P.M., ‘Quod Licet Iovi … The Precarious Relationship between the Court of Justice of the European Communities and Arbitration’, in Essays on International and Comparative Law in Honour of Judge Erodes (1983) p. 144Google Scholar, at p. 170. See also the scepticism of the French Arbitration Committee, in its report by Fouchard, Ph. in Rev. Arb. (1982) p. 491Google Scholar.

42. See Bernini, G., ‘Report for the ICCA Interim Meeting, Warsaw 1980’, 5 Yearook Comm. Arb. (1980) p. 291Google Scholar; by the same author, 6 Yearbook Comm. Arb. (1981) p. XXVIIGoogle Scholar; see also Multiparty Business Disputes, Institute of International Business Law and Practice, ICC publication no. 359 (1980); Dika, M. and van Marwijk Kooij, B., ‘Multi-Party Arbitration’, in Voskuil, CCA. and Wade, J.A., eds., 5 Hague-Zagreb Essays on the Law of International Trade (1985) p. 125Google Scholar et seq., with bibliography at p. 158.

43. See, as to this, the earlier text of Art. 1046 of the Bill, cf., Statement of Reply to the Second Chamber, n. 34 supra, p. 77.

44. Amsterdam was selected since, inter alia, the Arbitration Council for the construction industry is located there.

45. Art. 17 Dutch Constitution (1983), English translation in 30 NILR (1983) p. 387CrossRefGoogle Scholar et seq.: ‘No one may be prevented against his will from being heard by the courts to which he is entitled to apply under the law’.

46. See Stein, P.A., in TvA (1984) p. 197Google Scholar (questioning the constitutionality), and opposed by A.J. van den Berg, ibid.

47. Art. 1046 (1) in fine, inserted during the parliamentary debates as a reaction to the discussion referred to in the previous footnote.

48. Art. 1466 French CCPr; Art. 16(1) UNCITRAL Model Law.

49. The pre-1986 Dutch caselaw on arbitration was already established in this respect, see Sanders, P., ‘National Reports-The Netherlands’, 6 Yearbook Comm. Arb. (1981) p. 65Google Scholar.

50. Cf., Art. V European Arbitration Convention of 1961, and Art. 16 (2) UNCITRAL Model Law.

51. See ten Cate, W., Bouwrecht (1986) p. 329Google Scholar.

52. Statement of Reply to the First Chamber, Doc. E.K. 1985–1986, 18464, No. 191 b, TvA (1986) p. 178.

53. Neither the European Convention nor the UNCITRAL Model Law seem to have envisaged arbitration disputes between business parties and consumers.

54. Art. 289 CCPr; the kort geding has assumed a significant place in many areas of civil and commercial litigation.

55. Cf., Rozemond, J., ‘Arbitraal kort geding en “de President”’, TvA (1985) p. 37Google Scholar, criticising an earlier version of Art. 1051.

56. Art. 1055 juncto Art. 53 No. 7, CCPr.

57. Art. 1056 junctis Art. 611a et seq., CCPr.

58. In particular, invalidity of the settlement is not a ground for annulment, unlike Art. 1044 of the German Zivilprozessordnung.

59. Art. 1060; cf., Art. 33(l)(a) and (2) UNCITRAL Model Law and Art. 36 UNCITRAL Arbitration Rules.

60. Art. 1061; cf., Art. 33(3) UNCITRAL Model Law and Art. 37 UNCITRAL Arbitration Rules. Interpretation of the award may not be requested under Dutch law since abuse was feared, see Statement of Reply to the Second Chamber, n. 34 supra, p. 85.

61. Use of conflict rules is prescribed by Art. 28(2) UNCITRAL Model Law; Art. VII(1) European Arbitration Convention; Art. 33(1) UNCITRAL Arbitration Rules; and Art. 13(3) ICC Arbitration Rules 1975. Even without such rules the arbitrators have to carry out some choice of law process, see Schultsz, , loc.cit. n. 2, p. 20Google Scholar.

62. The Explanatory Memorandum, n. 30 supra, at p. 40, defines lex mercatoria as the international, generally accepted trade usages that obtain, in principle, independently from national law (author's translation). See further Goldman, B., ‘Lex Mercatoria’, Forum Internationale, no. 3 (1984)Google Scholar.

63. Accord, Art. 28 (3) UNCITRAL Model Law; Art. 1496 (2) French CCPr (for international arbitration only).

64. Raad, Hoge, 13 may 1966 (Alnati case), NJ (1967) p. 3Google Scholar, Rev. crit. (1967) p. 522, 15 NILR (1968) p. 82CrossRefGoogle Scholar; the doctrine is reflected in Art. 7(1) of the Rome Convention on the law applicable to contractual obligations.

65. See the award of an appeal board of the Amsterdam Grain Trade Association, 11 January 1982, TvA (1982) p. 72, 8 Yearbook Comm. Arb. (1983) p. 158Google Scholar, involving Austrian exchange control regulations (applicability denied).

66. Under Art. V (2)(b) of the New York Convention; see on the definition of ‘international’ public policy, Berg, Van den, op. cit. n. 16, p. 361Google Scholar.

67. Further grounds are that the award has been declared provisionally enforceable or reinforced by a penalty in violation of Arts. 1055 or 1056 respectively.

68. Unless the respondent appears and submits evidence of a ground for refusal.

69. See the text at n. 37, supra.

70. Art. 1063 (3) and (4) fix the time limit in both cases at two months.

71. Act of 27 March 1985 inserting Art. 1717(4) into the Judicial Code, Belgisch Staatsblad/Moniteur belge (13 April 1985); notes by van Houtte, H., ‘La loi beige du 27 mars 1985 sur l'arbitrage international’, Rev. Arb. (1986) p. 29Google Scholar, Storme, M. (who proposed the bill), ‘Belgium: A Paradise for International Commercial Arbitration’, International Business Lawyer (1986) p. 294Google Scholar, Vander Elst, A., ‘Increasing the Appeal of Belgium as an International Arbitration Forum? — The Belgian Law of March 27, 1985 Concerning the Annulment of Arbitral Awards’, 3 J. Int. Arb. no. 2 (1986) p. 77Google Scholar.

72. Sanders, , loc.cit. n. 19, p. 80Google Scholar.

73. Art. 1068, inspired by similar rules for court decisions, Art. 382 et seq. Dutch CCPr.; cf., the French recours en révision, Art. 1491 French CCPr. (domestic arbitration only).

74. Arts. 1065(2), 1052(2) and 1020(3), and cf., supra, sections 3.2 and 6.

75. Explanatory Memorandum, n. 30 supra, p. 48, ad Art. 1066.

76. Explanatory Memorandum, n. 30 supra, p. 51; van den Berg, A.J., The New York Arbitration Convention of 1958 (1981) p. 128Google Scholar.

77. Berg, Van den, op.cit. n. 76, p. 123Google Scholar et seq.

78. As a result of the so-called ‘reciprocity reservation’ made by the Netherlands under Art. 1(3) of the Convention, which must be deemed to encompass agreements as well as awards.

79. In this sense, Kantonrechter (labour court of first instance) Rotterdam, 20 January 1982, Praktijkgids 1982, No. 1771, p. 304 (Dutch parties, work to be performed in the Netherlands, choice of law and arbitration: New York).

80. Cf., in the domestic context, Art. 1022 (2), supra section 3.1, in fine.

81. See the list in 11 Yearbook Comm. Arb. (1986) p. 395Google Scholar, and add Canada, Singapore and the People's Republic of China (situation as of 1 May 1987).

82. Art. 1076 was inspired by J.C. Schultsz's essay ‘Recognition and Enforcement of Foreign Arbitral Awards Without a Convention Being Applicable’, in Schultsz, J.C. and Van den Berg, A.J., eds., The Art of Arbitration — Liber Amicorum Pieter Sanders (1982) p. 295Google Scholar.

83. For example, Argentina, Brazil and various Middle-East countries.