INTERNATIONAL

COMMERCIAL
ARBITRATION UNDER THE
ADR
ACT OF 2004 AND ITS
IMPLEMENTING RULES AND
REGULATIONS
International Commercial Arbitration
• Arbitration is international if:
1. The parties' place of business which at the time of the conclusion of the arbitration
agreement, is in different states;
2. The place of arbitration provided in the arbitration agreement and in which the parties
have their places of business, is outside the Philippines
3. The place where a substantial part of the obligation is to be performed or the place with
which the subject matter of the dispute is most closely connected, and in which the parties
have their place of business, is outside of the Philippines
4. The parties have expressly agreed that the subject matter of the arbitration agreement
relates to more than one country
• Arbitration is commercial if it covers matters arising from all relationships of a commercial
nature, whether contractual or not
• Applicability of ADR Act and the IRR:
• An international commercial arbitration with the Philippines as its seat even if place of
arbitration is outside the Philippines
• On the other hand, an international commercial arbitration whose seat is outside the Ph is a
foreign arbitration even if the place of arbitration is in the Ph.
Coverage of IRR Provisions (Chapter 4) on ICA
• Applicable only to international commercial arbitration conducted in accordance with Philippine
Law covering disputes that are not prohibited by Philippine law to be submitted for arbitration
• The rules of procedure for international commercial arbitration provided under the ADR Act
or its IRR may also be applied for international commercial arbitration conducted outside
the Ph of they are adopted as the rules of procedure by the parties
• Provisions of the IRR on ICA are default rules, which means that they are applicable only in
the
absence or in default of applicable provisions contained in:
1. An agreement in force between the Ph and other state or states
2. An agreement between the parties on the applicable rules
Rules of interpretations
1. Interpretations of the ADR Act
• The court shall have due regard to the policy of the law favoring arbitration
2. Interpretation of the Model Law
• There must be a uniformity in its interpretation
• Concepts and principles under the Model Law should be understood in the light of their
international usage rather than their ordinary domestic or local usage
3. Interpretation of the IRR
ADR Notes by: Paolo Ollero
• The same policies on the interpretation of the ADR Act and Model Law
• Party autonomy should be promoted
• The freedom of the parties to determine certain issues including the right to authorize a 3rd
party to make that determination
• A reference to an agreement of the parties includes any arbitration rules referred to in that
agreement
• The rules applicable to claims are equally applicable to counterclaims, and those applicable
to defenses are equally applicable to defenses against counterclaims
Receipt of Written Communications in ICA
• In line with the policy of party autonomy, the governing rules on the receipt of communications
in ICA are those provided for by the parties in their arbitration agreement. In default, comm is
received:
1. If it is delivered to the addressee personally or at his place of business, habitual residence
or mailing address; or
2. If there is none, if it is delivered by registered letter or any other means which provide a
record of the attempt to deliver it, to the last known place of business, habitual residence or
mailing address
Waiver of the right to object in ICA
• Objections to non-compliance with the rules or any requirement under the arbitration
agreement
must be raised without undue delay or within the time prescribed therefor, failing which, the right
to object is deemed waived
• Estoppel in pais - happens when one, by his acts, representations or admissions, or by his own
silence when he ought to speak out, intentionally or through culpable negligence, induces
another to believe certain facts to exist and such other person relies and acts on such belief in a
manner that he will be prejudiced if the former is permitted to deny the existence of such facts
Confidentiality in ICA
• Same in the case of mediation
• Confidential and shall not be disclosed except:
1. With the consent of the parties
2. For the limited purpose of disclosing to the court relevant documents in cases where resort
to the court is allowed
• The court may issue protective orders to prevent or prohibit the disclosure of documents or
information containing secret processes, developments, research and other information where it
is shown that the applicant shall be materially prejudiced by an unauthorized disclosure thereof.
Due process in ICA
• IRR mandates that the parties shall be treated equally and shall be given a full opportunity to
present their sides
• Due process is complied with if a party is given an opportunity to present his side of the
dispute
even if he does not actually avail of such opportunity
Place or venue of ICA
• The place or venue shall be determined by the parties
• Default place of arbitration shall be in Metro Manila, unless the arbitral tribunal decides on a
different place of arbitration taking into consideration the circumstances of the case
Commencement of ICA proceedings
• Date of commencement is determined by the parties
ADR Notes by: Paolo Ollero
• Default date of commencement of arbitration is the date on which a request for that dispute to
be referred to arbitration is received by the respondent
Language
• The parties to an ICA shall determine the language or languages to be used during the arbitral
proceedings
• The arbitral tribunal may order that any documentary evidence shall be accompanied by a
translation thereof in the language or languages to be used in the proceedings
• In default, English shall be used
Applicable law in ICA
• The parties in an international commercial arbitration can agree on the governing law that will
be
applied to the resolution of their dispute
• In default, the law determined by conflicts of law rules as determined by the arbitral tribunal to
be applicable taking into account the terms of the contract and the usages of the trade shall be
applied
Appointing authority in ICA
• Appointing authority - named in the arbitration agreement as such, authorized to make the
default appointment of arbitrators or the sole arbitrator.
• Functions:
1. Take the necessary measures to appoint an arbitrator in case any party, or the arbitrators
already appointed, or any 3rd party fails to perform any function necessary for the
appointment of the arbitrator
2. Decide on the challenge against an arbitrator if the arbitral tribunal rejects the challenge
3. Consider the qualifications of an arbitrator, the necessity of ensuring impartiality and
independence of the arbitrator, and the advisability of appointing an arbitrator who is of a
nationality different from those of the parties
Arbitrators and Arbitral tribunals in ICA
• Parties in ICA are free to determine the number of their arbitrators and the procedure for their
appointment
• Default number of arbitrators is 3
• Default procedure for the appointment of arbitrators:
1. In an arbitration with 3 arbitrators, each party shall appoint one arbitrator, and both
appointed arbitrators shall appoint the 3rd arbitrator, failing which the appointment shall be
made by the appointing authority
2. In an arbitration with a sole arbitrator, the arbitrator shall be appointed, upon the request of
a party, by the appointing authority
• The appointing authority shall consider the ff factors in the appointment of arbitrators:
1. Qualifications required by the agreement of the parties
2. Considerations as are likely to secure the appointment of an independent and impartial
arbitrator
3. In the case of sole or 3ed arbitrators, the advisability of appointing an arbitrator of a
nationality other than those of the parties.
• Note: If any party is not satisfied with the appointment of any of the arbitrators, he may file
a petition in court challenging the appointment of the arbitrators
Grounds for challenge of an arbitrator in ICA
• A person approached for possible appointment as arbitrator has the duty to disclose any
circumstance likely to raise doubts about his impartiality or independence
ADR Notes by: Paolo Ollero
• An arbitrator may be challenged only if circumstances exists that give rise to a justifiable doubt
as to his:
1. Impartiality or independence
2. Possession of the qualifications agreed upon by the parties
Procedure for the challenge in ICA
• Procedure for the challenge against an arbitrator in ICA is that agreed upon by the parties
• In default:
1. The challenging party shall send a written statement of the reasons for the challenge to the
arbitral tribunal within 15 days after becoming aware of the constitution of the arbitral
tribunal or after becoming aware of the circumstance constituting the ground for the
challenge
2. If the challenge before the arbitral tribunal is not successful, the challenging party may
request the appointing authority within 30 days from notice of the decision rejecting the
challenge, to decide the challenge, which decision shall be immediately executory, and not
be subject to a motion for reconsideration or appeal
Procedure in case the arbitrator fails to act in ICA
• If an arbitrator in an ICA becomes de jure or de factor unable to perform his functions or fails
to
act without undue delay, his mandate terminates if:
1. He withdraws
2. Or the parties agree on the termination
Jurisdiction of Arbitral Tribunal in ICA
• Jurisdiction:
• Right to act or the power and authority to hear and determine a cause
• Authority by virtue of which it can resolve disputes in am arbitration proceeding by
rendering an award
• Jurisdiction over the subject matter is conferred by law
• Jurisdiction also includes the power to determine the admissibility, relevance, materiality
and weigh of any evidence, and issuance of subpoena to compel the attendance of
witnesses and the production of documents
• Without jurisdiction:
1. Lack of jurisdiction
• In determining the jurisdiction, the arbitration agreement or arbitration clause should be
treated as an independent and separate agreement from the container agreement, and,
hence, the invalidity of the latter does not automatically result in the nullity of the former
• In general, jurisdiction over the subject matter being a matter of law, cannot be waived
and cannot be the subject of a compromise or the stipulation of the parties
• The rule is different in a challenge against the jurisdiction of AT in an ICA
• Challenge should be raised not later than the submission of the statement of
defense in the answer or in a motion to dismiss; otherwise, the objection is deemed
waived
2. In excess of jurisdiction
• Where an AT which has jurisdiction in the first place but exceeds the scope of authority
• Must be raised as soon as the excess of jurisdiction becomes apparent; otherwise, the
objection will be deemed waived unless the delay is justified
• If jurisdiction is challenged
• The AT may:
1. Consider the challenge as a preliminary question or a threshold issue and render a
ruling thereon before conducting the arbitration
• An aggrieved party may elevate the ruling for review by the RTC within 30 days
from receipt of the ruling
ADR Notes by: Paolo Ollero
2. Defer the resolution thereof until the rendition of the arbitral award and the resolution of
the jurisdictional issue shall form part thereof especially in instances when the
jurisdictional challenge does not appear to be indubitable
• The order of deferment is not susceptible of judicial relief
Procedure for granting interim measures in ICA
1. AFTER THE AT has been constituted, any party may request for the grant of interim
measures
from the AT. The request shall be in writing transmitted by reasonable means to the AT and the
adverse party
2. The relief may be granted in order to:
1. Prevent irreparable loss
2. Provide security for the performance of an obligation
3. Produce or preserve evidence
4. Compel any other appropriate act or omission
3. The grant may be conditioned upon:
1. The provision of security
2. Any act or omission specified in the order
4. The order shall be binding upon the parties and either party may apply with the courts for
assistance in implementing or enforcing it
5. A party who refuses to comply with the order for an interim measure shall be liable for
damages
6. Before the constitution of the AT, the interim measure may be requested from the court
Legal representation in ICA
• A party may be represented by a person of his choice even if a non-lawyer
Determination of rules and procedure in ICA
• General rule: the parties in an ICA are free to determine the rules that will govern their
arbitration
proceeding
• In default:
1. Statement of claims
• The claimant shall state the facts supporting his claim, the issues and relief or remedy
sought, and shall submit therewith or refer therein to relevant documents
2. Statement of defenses
• Respondent shall state his defenses thereto and submit therewith or refer therein to
relevant documents
3. Default of the parties
• The failure of the claimant or the respondent to communicate or failure to appear at the
hearing results in the default of the failing party
• Claimant: termination of the proceeding
• Respondent: proceeding with proceed without such failure being considered as an
admission of the claimant's allegation
4. Amendment of claims and defenses
• The parties may amend or supplement their claims or defenses unless the arbitral
tribunal considers the amendment inappropriate
5. Hearings
• The AT shall determine whether
1. To hold an oral hearings only
• Processes in taking evidence:
1. Court assistance in taking evidence
2. Subpoena
3. Expert
2. Oral arguments only
3. Or just require the submission of documents
ADR Notes by: Paolo Ollero
6. Conclusion/closure
1. By an award or settlement
• If more than 1 arbitrator, the decision shall be made by majority of the members
• The award shall be made in writing, signed by the sole arbitrator, or a majority of the
arbitrators, and the date and place of arbitration are stated, and a copy delivered to
each party
• AT's mandate extends:
1. To correct and interpret the award
2. To set aside an exclusive recourse against the arbitral award
3. When reserved, to the quantification of costs and the determination of the party
liable thereof, or the division thereof
2. Termination
1. The claimant withdraws his claim, unless the respondent objects thereto on the
basis of a legitimate interest in obtaining a final settlement of the dispute
2. The parties agree to terminate the proceeding
3. The arbitral tribunal finds that the continuation of the proceedings has become
unnecessary or impossible
4. If during the arbitral proceedings, the parties settle their dispute, the AT shall
terminate the proceeding
When arbitral award is final and executory
1. The rendition of the arbitral award
2. The hearing on the quantification of the costs and the determination of the party liable
thereof,
or the division thereof between the parties, provided that a reservation for such hearing and
quantification has been made by the AT
3. The expiration of the periods for correction and interpretation of the award without any party
or
the AT availing of the said remedies
4. If the remedies are availed of
Costs in ICA
• Includes:
1. Fees of the AT
2. Travel and other expenses
3. Costs of expert advise
4. Travel and other expenses of witnesses
5. Costs for legal representation and assistance
6. Fees and expenses of appointing authority
• In principle, the costs shall be borne by the unsuccessful party. However, the arbitral tribunal
may apportion the costs if reasonable under the circumstances of the case
Correction and interpretation of ICAA
• The arbitral award in an ICA does not become executory until after the lapse of the period for
its
amendment
• Period - subject to any agreement of the parties or to the extended period that the AT may
grant
• Award may be amended in any of the ff manners:
1. Agreement of the parties
• Arbitration agreement may provide for the instances when an amendment of the arbitral
award is allowed
• Parties are free to determine the rules that will govern their arbitral proceedings
2. Quantification of the costs and the determination of the party liable therefor, or the division
thereof between the parties
3. Correction of typographical and similar errors initiated by a party
ADR Notes by: Paolo Ollero
• A party may ask the AT for the correction of the award, within 30 days from receipt of the
award, and with notice to the other party, for any error in computation, clerical or
typographical error, or other errors of similar nature
• An error is typographical or clerical in character, and therefore, correctible even after the
decision has become executory, if the error is occasioned by a mistake in copying or
typing, does not alter the substance of the decision and does not affect or prejudice
substantial rights
4. Correction of typographical error initiated by the AT
• Within 30 days the AT may motu propio correct any typographical error
5. Interpretation of the award
• Same with #3, the parties may agree to request the AT to give an interpretation of a
specific point or part of the award
6. Additional award
• Within 30 days from receipt of the award, a party, with notice to the other party, may
request the AT to make an additional award as to claims presented in the arbitral
proceeding but omitted in the award
• Only the AT may correct an ICAA. Courts can only set them aside, extend recognition to them,
or
refuse to recognize them.
Setting aside an ICAA
• Grounds:
1. Petitioner furnishes proof that there was:
1. Defect in the arbitration agreement
2. Violation of due process
3. Lack or excess of jurisdiction on the party of the AT
4. The arbitral agreement was violated
2. The court finds that:
1. The subject of the dispute is not capable of settlement under the laws of the Ph
2. The award is in conflict with public policy of the Ph
• Venue to set aside shall be with the RTC where:
1. The arbitration proceedings took place
2. The asset to be attached or levied upon, or the act to be enjoined is located
3. Any of the parties to the dispute resides or has his place of business
4. National Capital Judicial Region, at the option of the applicant
• Petition must be filed within 3 months from the date on which the party making that application
received the award, or from the date on which a request for correction, interpretation or
additional award has been disposed of by the AT
Recognition and enforcement of ICA and foreign
arbitral award
• Recognition - means by which a Ph court gives legal acknowledgement to a foreign arbitral
award and confers upon it the capability to be enforced under Ph law through Ph legal
processes
• Confirmation - judicial affirmation of a domestic arbitral award
• Enforcement - the execution and implementation of the foreign arbitral award through Ph legal
processes
• foreign arbitral award - it is one rendered in an arbitration whose seat is outside the Ph
• Must go through recognition un order to be entitled to enforcement in the Ph
• Same thing with Ph ICA, recognition instead of confirmation
• Jurisdiction over these proceedings is vested on the RTC
ADR Notes by: Paolo Ollero
Grounds for refusing recognition and procedure for
recognition of convention and as-in convention
awards
• Conditions and requisites for recognition of foreign judgments:
1. Proof of the foreign judgment
2. Judgment must be on a civil or commercial matter
3. There must be no lack of jurisdiction, no want of notice, no collusion, no fraud, no clear
mistake of law or fact
4. The judgment must not contravene a sound and established public policy of the forum
5. The judgment must be res judicata in the state that rendered it
• Grounds for refusing recognition:
1. Defect in the arbitration agreement
2. Violation of due process
3. Lack or excess of jurisdiction on the part of the AT
4. Violation of the arbitral agreement
5. Court finding that:
1. The subject of the dispute is not capable of settlement under the laws of the Ph
2. The award is in conflict with public policy of the Ph
• Convention award - foreign arbitral award made in a state which is a party to the NYC
• Non-convention award - a foreign arbitral award made in a state which is not a party to the
NYC
• As-is convention award - one which is made in a state which is not a party to the NYC but
which, by reason of comity and reciprocity, may be recognized and enforced as if it is a
convention award

INTERNATIONAL
COMMERCIAL
ARBITRATION UNDER THE
ADR
ACT OF 2004 AND ITS
IMPLEMENTING RULES AND
REGULATIONS
International Commercial Arbitration
• Arbitration is international if:
1. The parties' place of business which at the time of the conclusion of the arbitration
agreement, is in different states;
2. The place of arbitration provided in the arbitration agreement and in which the parties
have their places of business, is outside the Philippines
3. The place where a substantial part of the obligation is to be performed or the place with
which the subject matter of the dispute is most closely connected, and in which the parties
have their place of business, is outside of the Philippines
4. The parties have expressly agreed that the subject matter of the arbitration agreement
relates to more than one country
• Arbitration is commercial if it covers matters arising from all relationships of a commercial
nature, whether contractual or not
• Applicability of ADR Act and the IRR:
• An international commercial arbitration with the Philippines as its seat even if place of
arbitration is outside the Philippines
• On the other hand, an international commercial arbitration whose seat is outside the Ph is a
foreign arbitration even if the place of arbitration is in the Ph.
Coverage of IRR Provisions (Chapter 4) on ICA
• Applicable only to international commercial arbitration conducted in accordance with Philippine
Law covering disputes that are not prohibited by Philippine law to be submitted for arbitration
• The rules of procedure for international commercial arbitration provided under the ADR Act
or its IRR may also be applied for international commercial arbitration conducted outside
the Ph of they are adopted as the rules of procedure by the parties
• Provisions of the IRR on ICA are default rules, which means that they are applicable only in
the
absence or in default of applicable provisions contained in:
1. An agreement in force between the Ph and other state or states
2. An agreement between the parties on the applicable rules
Rules of interpretations
1. Interpretations of the ADR Act
• The court shall have due regard to the policy of the law favoring arbitration
2. Interpretation of the Model Law
• There must be a uniformity in its interpretation
• Concepts and principles under the Model Law should be understood in the light of their
international usage rather than their ordinary domestic or local usage
3. Interpretation of the IRR
ADR Notes by: Paolo Ollero
• The same policies on the interpretation of the ADR Act and Model Law
• Party autonomy should be promoted
• The freedom of the parties to determine certain issues including the right to authorize a 3rd
party to make that determination
• A reference to an agreement of the parties includes any arbitration rules referred to in that
agreement
• The rules applicable to claims are equally applicable to counterclaims, and those applicable
to defenses are equally applicable to defenses against counterclaims
Receipt of Written Communications in ICA
• In line with the policy of party autonomy, the governing rules on the receipt of communications
in ICA are those provided for by the parties in their arbitration agreement. In default, comm is
received:
1. If it is delivered to the addressee personally or at his place of business, habitual residence
or mailing address; or
2. If there is none, if it is delivered by registered letter or any other means which provide a
record of the attempt to deliver it, to the last known place of business, habitual residence or
mailing address
Waiver of the right to object in ICA
• Objections to non-compliance with the rules or any requirement under the arbitration
agreement
must be raised without undue delay or within the time prescribed therefor, failing which, the right
to object is deemed waived
• Estoppel in pais - happens when one, by his acts, representations or admissions, or by his own
silence when he ought to speak out, intentionally or through culpable negligence, induces
another to believe certain facts to exist and such other person relies and acts on such belief in a
manner that he will be prejudiced if the former is permitted to deny the existence of such facts
Confidentiality in ICA
• Same in the case of mediation
• Confidential and shall not be disclosed except:
1. With the consent of the parties
2. For the limited purpose of disclosing to the court relevant documents in cases where resort
to the court is allowed
• The court may issue protective orders to prevent or prohibit the disclosure of documents or
information containing secret processes, developments, research and other information where it
is shown that the applicant shall be materially prejudiced by an unauthorized disclosure thereof.
Due process in ICA
• IRR mandates that the parties shall be treated equally and shall be given a full opportunity to
present their sides
• Due process is complied with if a party is given an opportunity to present his side of the
dispute
even if he does not actually avail of such opportunity
Place or venue of ICA
• The place or venue shall be determined by the parties
• Default place of arbitration shall be in Metro Manila, unless the arbitral tribunal decides on a
different place of arbitration taking into consideration the circumstances of the case
Commencement of ICA proceedings
• Date of commencement is determined by the parties
ADR Notes by: Paolo Ollero
• Default date of commencement of arbitration is the date on which a request for that dispute to
be referred to arbitration is received by the respondent
Language
• The parties to an ICA shall determine the language or languages to be used during the arbitral
proceedings
• The arbitral tribunal may order that any documentary evidence shall be accompanied by a
translation thereof in the language or languages to be used in the proceedings
• In default, English shall be used
Applicable law in ICA
• The parties in an international commercial arbitration can agree on the governing law that will
be
applied to the resolution of their dispute
• In default, the law determined by conflicts of law rules as determined by the arbitral tribunal to
be applicable taking into account the terms of the contract and the usages of the trade shall be
applied
Appointing authority in ICA
• Appointing authority - named in the arbitration agreement as such, authorized to make the
default appointment of arbitrators or the sole arbitrator.
• Functions:
1. Take the necessary measures to appoint an arbitrator in case any party, or the arbitrators
already appointed, or any 3rd party fails to perform any function necessary for the
appointment of the arbitrator
2. Decide on the challenge against an arbitrator if the arbitral tribunal rejects the challenge
3. Consider the qualifications of an arbitrator, the necessity of ensuring impartiality and
independence of the arbitrator, and the advisability of appointing an arbitrator who is of a
nationality different from those of the parties
Arbitrators and Arbitral tribunals in ICA
• Parties in ICA are free to determine the number of their arbitrators and the procedure for their
appointment
• Default number of arbitrators is 3
• Default procedure for the appointment of arbitrators:
1. In an arbitration with 3 arbitrators, each party shall appoint one arbitrator, and both
appointed arbitrators shall appoint the 3rd arbitrator, failing which the appointment shall be
made by the appointing authority
2. In an arbitration with a sole arbitrator, the arbitrator shall be appointed, upon the request of
a party, by the appointing authority
• The appointing authority shall consider the ff factors in the appointment of arbitrators:
1. Qualifications required by the agreement of the parties
2. Considerations as are likely to secure the appointment of an independent and impartial
arbitrator
3. In the case of sole or 3ed arbitrators, the advisability of appointing an arbitrator of a
nationality other than those of the parties.
• Note: If any party is not satisfied with the appointment of any of the arbitrators, he may file
a petition in court challenging the appointment of the arbitrators
Grounds for challenge of an arbitrator in ICA
• A person approached for possible appointment as arbitrator has the duty to disclose any
circumstance likely to raise doubts about his impartiality or independence
ADR Notes by: Paolo Ollero
• An arbitrator may be challenged only if circumstances exists that give rise to a justifiable doubt
as to his:
1. Impartiality or independence
2. Possession of the qualifications agreed upon by the parties
Procedure for the challenge in ICA
• Procedure for the challenge against an arbitrator in ICA is that agreed upon by the parties
• In default:
1. The challenging party shall send a written statement of the reasons for the challenge to the
arbitral tribunal within 15 days after becoming aware of the constitution of the arbitral
tribunal or after becoming aware of the circumstance constituting the ground for the
challenge
2. If the challenge before the arbitral tribunal is not successful, the challenging party may
request the appointing authority within 30 days from notice of the decision rejecting the
challenge, to decide the challenge, which decision shall be immediately executory, and not
be subject to a motion for reconsideration or appeal
Procedure in case the arbitrator fails to act in ICA
• If an arbitrator in an ICA becomes de jure or de factor unable to perform his functions or fails
to
act without undue delay, his mandate terminates if:
1. He withdraws
2. Or the parties agree on the termination
Jurisdiction of Arbitral Tribunal in ICA
• Jurisdiction:
• Right to act or the power and authority to hear and determine a cause
• Authority by virtue of which it can resolve disputes in am arbitration proceeding by
rendering an award
• Jurisdiction over the subject matter is conferred by law
• Jurisdiction also includes the power to determine the admissibility, relevance, materiality
and weigh of any evidence, and issuance of subpoena to compel the attendance of
witnesses and the production of documents
• Without jurisdiction:
1. Lack of jurisdiction
• In determining the jurisdiction, the arbitration agreement or arbitration clause should be
treated as an independent and separate agreement from the container agreement, and,
hence, the invalidity of the latter does not automatically result in the nullity of the former
• In general, jurisdiction over the subject matter being a matter of law, cannot be waived
and cannot be the subject of a compromise or the stipulation of the parties
• The rule is different in a challenge against the jurisdiction of AT in an ICA
• Challenge should be raised not later than the submission of the statement of
defense in the answer or in a motion to dismiss; otherwise, the objection is deemed
waived
2. In excess of jurisdiction
• Where an AT which has jurisdiction in the first place but exceeds the scope of authority
• Must be raised as soon as the excess of jurisdiction becomes apparent; otherwise, the
objection will be deemed waived unless the delay is justified
• If jurisdiction is challenged
• The AT may:
1. Consider the challenge as a preliminary question or a threshold issue and render a
ruling thereon before conducting the arbitration
• An aggrieved party may elevate the ruling for review by the RTC within 30 days
from receipt of the ruling
ADR Notes by: Paolo Ollero
2. Defer the resolution thereof until the rendition of the arbitral award and the resolution of
the jurisdictional issue shall form part thereof especially in instances when the
jurisdictional challenge does not appear to be indubitable
• The order of deferment is not susceptible of judicial relief
Procedure for granting interim measures in ICA
1. AFTER THE AT has been constituted, any party may request for the grant of interim
measures
from the AT. The request shall be in writing transmitted by reasonable means to the AT and the
adverse party
2. The relief may be granted in order to:
1. Prevent irreparable loss
2. Provide security for the performance of an obligation
3. Produce or preserve evidence
4. Compel any other appropriate act or omission
3. The grant may be conditioned upon:
1. The provision of security
2. Any act or omission specified in the order
4. The order shall be binding upon the parties and either party may apply with the courts for
assistance in implementing or enforcing it
5. A party who refuses to comply with the order for an interim measure shall be liable for
damages
6. Before the constitution of the AT, the interim measure may be requested from the court
Legal representation in ICA
• A party may be represented by a person of his choice even if a non-lawyer
Determination of rules and procedure in ICA
• General rule: the parties in an ICA are free to determine the rules that will govern their
arbitration
proceeding
• In default:
1. Statement of claims
• The claimant shall state the facts supporting his claim, the issues and relief or remedy
sought, and shall submit therewith or refer therein to relevant documents
2. Statement of defenses
• Respondent shall state his defenses thereto and submit therewith or refer therein to
relevant documents
3. Default of the parties
• The failure of the claimant or the respondent to communicate or failure to appear at the
hearing results in the default of the failing party
• Claimant: termination of the proceeding
• Respondent: proceeding with proceed without such failure being considered as an
admission of the claimant's allegation
4. Amendment of claims and defenses
• The parties may amend or supplement their claims or defenses unless the arbitral
tribunal considers the amendment inappropriate
5. Hearings
• The AT shall determine whether
1. To hold an oral hearings only
• Processes in taking evidence:
1. Court assistance in taking evidence
2. Subpoena
3. Expert
2. Oral arguments only
3. Or just require the submission of documents
ADR Notes by: Paolo Ollero
6. Conclusion/closure
1. By an award or settlement
• If more than 1 arbitrator, the decision shall be made by majority of the members
• The award shall be made in writing, signed by the sole arbitrator, or a majority of the
arbitrators, and the date and place of arbitration are stated, and a copy delivered to
each party
• AT's mandate extends:
1. To correct and interpret the award
2. To set aside an exclusive recourse against the arbitral award
3. When reserved, to the quantification of costs and the determination of the party
liable thereof, or the division thereof
2. Termination
1. The claimant withdraws his claim, unless the respondent objects thereto on the
basis of a legitimate interest in obtaining a final settlement of the dispute
2. The parties agree to terminate the proceeding
3. The arbitral tribunal finds that the continuation of the proceedings has become
unnecessary or impossible
4. If during the arbitral proceedings, the parties settle their dispute, the AT shall
terminate the proceeding
When arbitral award is final and executory
1. The rendition of the arbitral award
2. The hearing on the quantification of the costs and the determination of the party liable
thereof,
or the division thereof between the parties, provided that a reservation for such hearing and
quantification has been made by the AT
3. The expiration of the periods for correction and interpretation of the award without any party
or
the AT availing of the said remedies
4. If the remedies are availed of
Costs in ICA
• Includes:
1. Fees of the AT
2. Travel and other expenses
3. Costs of expert advise
4. Travel and other expenses of witnesses
5. Costs for legal representation and assistance
6. Fees and expenses of appointing authority
• In principle, the costs shall be borne by the unsuccessful party. However, the arbitral tribunal
may apportion the costs if reasonable under the circumstances of the case
Correction and interpretation of ICAA
• The arbitral award in an ICA does not become executory until after the lapse of the period for
its
amendment
• Period - subject to any agreement of the parties or to the extended period that the AT may
grant
• Award may be amended in any of the ff manners:
1. Agreement of the parties
• Arbitration agreement may provide for the instances when an amendment of the arbitral
award is allowed
• Parties are free to determine the rules that will govern their arbitral proceedings
2. Quantification of the costs and the determination of the party liable therefor, or the division
thereof between the parties
3. Correction of typographical and similar errors initiated by a party
ADR Notes by: Paolo Ollero
• A party may ask the AT for the correction of the award, within 30 days from receipt of the
award, and with notice to the other party, for any error in computation, clerical or
typographical error, or other errors of similar nature
• An error is typographical or clerical in character, and therefore, correctible even after the
decision has become executory, if the error is occasioned by a mistake in copying or
typing, does not alter the substance of the decision and does not affect or prejudice
substantial rights
4. Correction of typographical error initiated by the AT
• Within 30 days the AT may motu propio correct any typographical error
5. Interpretation of the award
• Same with #3, the parties may agree to request the AT to give an interpretation of a
specific point or part of the award
6. Additional award
• Within 30 days from receipt of the award, a party, with notice to the other party, may
request the AT to make an additional award as to claims presented in the arbitral
proceeding but omitted in the award
• Only the AT may correct an ICAA. Courts can only set them aside, extend recognition to them,
or
refuse to recognize them.
Setting aside an ICAA
• Grounds:
1. Petitioner furnishes proof that there was:
1. Defect in the arbitration agreement
2. Violation of due process
3. Lack or excess of jurisdiction on the party of the AT
4. The arbitral agreement was violated
2. The court finds that:
1. The subject of the dispute is not capable of settlement under the laws of the Ph
2. The award is in conflict with public policy of the Ph
• Venue to set aside shall be with the RTC where:
1. The arbitration proceedings took place
2. The asset to be attached or levied upon, or the act to be enjoined is located
3. Any of the parties to the dispute resides or has his place of business
4. National Capital Judicial Region, at the option of the applicant
• Petition must be filed within 3 months from the date on which the party making that application
received the award, or from the date on which a request for correction, interpretation or
additional award has been disposed of by the AT
Recognition and enforcement of ICA and foreign
arbitral award
• Recognition - means by which a Ph court gives legal acknowledgement to a foreign arbitral
award and confers upon it the capability to be enforced under Ph law through Ph legal
processes
• Confirmation - judicial affirmation of a domestic arbitral award
• Enforcement - the execution and implementation of the foreign arbitral award through Ph legal
processes
• foreign arbitral award - it is one rendered in an arbitration whose seat is outside the Ph
• Must go through recognition un order to be entitled to enforcement in the Ph
• Same thing with Ph ICA, recognition instead of confirmation
• Jurisdiction over these proceedings is vested on the RTC
ADR Notes by: Paolo Ollero
Grounds for refusing recognition and procedure for
recognition of convention and as-in convention
awards
• Conditions and requisites for recognition of foreign judgments:
1. Proof of the foreign judgment
2. Judgment must be on a civil or commercial matter
3. There must be no lack of jurisdiction, no want of notice, no collusion, no fraud, no clear
mistake of law or fact
4. The judgment must not contravene a sound and established public policy of the forum
5. The judgment must be res judicata in the state that rendered it
• Grounds for refusing recognition:
1. Defect in the arbitration agreement
2. Violation of due process
3. Lack or excess of jurisdiction on the part of the AT
4. Violation of the arbitral agreement
5. Court finding that:
1. The subject of the dispute is not capable of settlement under the laws of the Ph
2. The award is in conflict with public policy of the Ph
• Convention award - foreign arbitral award made in a state which is a party to the NYC
• Non-convention award - a foreign arbitral award made in a state which is not a party to the
NYC
• As-is convention award - one which is made in a state which is not a party to the NYC but
which, by reason of comity and reciprocity, may be recognized and enforced as if it is a
convention award