NLSTIAC
The National Law School Trilegal International Arbitration Conference is an annual event that takes place alongside the National Law School Trilegal International Arbitration Moot. The conference is in its fourth edition and provides a unique opportunity for students, researchers, arbitration professionals, lawyers, and corporate firms to engage on contemporary issues impacting international arbitration in the ever-evolving legal and economic environment. The conference also offers participants the chance to engage with arbitration experts, academics, and professionals on these important themes. The conference aims to provide a platform for participants to engage in discussions and debates on these important themes and to learn from arbitration experts, academics, and professionals.
The concept note for the National Law School Trilegal International Arbitration Conference outlines the themes and topics that will be discussed during the conference.
INTRODUCTION TO THE V NLSTIAC
Insolvency and arbitration, as a matter of first principle, are understood to be at odds with each other. Insolvency is centralised and formalistic. It attempts to account for the interests of multiple creditors, who might not have a contractual relationship with each other. Arbitration, to the contrary, is a decentralised mechanism which prioritises party autonomy.
This interplay has become increasingly relevant due to the rise of global trade and investment. Companies operating across borders are more likely to encounter disputes requiring international arbitration. When such a company becomes insolvent, national courts may impose moratoriums, freezing assets, impacting the interpretation of arbitration agreements, determination of jurisdiction, and even enforcement of awards. In such situations, the overarching question arbitral tribunals are concerned with is as follows: whether arbitral tribunals are bound to recognise the insolvency proceedings, and if they do, what will be the effects of the same? It is surprising that while there is a mission to unify cross-border insolvency and international commercial arbitration laws across borders, there is glaring inconsistency in how tribunals deal with this question.
This creates uncertainty for creditors, thereby undermining the efficiency of international arbitration. In doing so, policy goals of both insolvency and arbitration are somewhat militated. Academic and policy discussion on the intersection between cross-border insolvency and international commercial arbitration has thus become all the more important. This year’s Conference will revolve around this interplay between insolvency and arbitration.
Panel I: Effects of Insolvency Proceedings on the Scope Ratione Materiae of Arbitration Agreements
Arbitration agreements, commonly used in contracts, can potentially be used to settle disputes even when a company becomes insolvent. This raises a question: can disputes arising during insolvency be settled through arbitration based on an agreement signed before insolvency?
Courts look at two key factors to decide this. The first is the wording of the arbitration agreement itself. Broadly worded agreements are more likely to encompass insolvency claims. Second, courts consider the nature of the claim. If the claim is directly tied to a specific contract covered by the agreement (debtor-derived claim), arbitration might be possible. However, claims based purely on insolvency law (non-debtor-derived claims) are typically not covered by arbitration agreements.
The complexity arises when claims have both contractual and insolvency aspects. Courts then face the challenge of balancing the principles of arbitration agreements with the specific rules of insolvency law. This Panel will engage on a discussion on developing a consistent approach for handling these intricate disputes.
Panel II: Rencoliation Arbitration and Cross-Border Insolvency - Role of Arbitral Institution in Insolvency Proceedings?
Can international commercial arbitration be a tool to resolve disputes in cross-border insolvency cases? This is a notion scholars have increasingly investigated recently, despite the traditional outlook that sees the two as inherently irreconcilable.
The distinction between core and non-core insolvency functions have supported the argument that arbitration can be explicitly used to facilitate certain kind of issues involved in insolvency. For instance, arbitration can be used for complex situations like debt restructuring across multiple countries.
Benefits will include reduced costs and time, centralized proceedings, and easier enforcement of decisions across borders. However, challenges include obtaining consent from all parties involved, potential inequality in treatment of creditors, and ensuring transparency in a typically confidential process. There are multiple considerations that need to be considered while evaluating such proposals. The Panel will engage on a discussion on the feasibility and desirability of explicitly allowing arbitration in cross-border insolvency to streamline the process and improve the outcomes for all parties.