Will India ever permit the arbitration of competition law matters? Nihal Dsouza and Johannes Ungerer examine the issues
At first glance arbitration and competition law have little in common. Historically, these two branches of law have largely developed without much overlap. This can be attributed to their partially conflicting objectives. While arbitration law seeks to protect party autonomy, i.e. the right of parties to privately resolve their disputes without having to rely on state courts, competition law serves the essential purpose of regulating the behaviour of companies to protect the interest of the market and consumers alike, sometimes at the expense of party autonomy.
Differing approaches have been taken across jurisdictions to ensure that party autonomy in arbitration of competition law related disputes does not provide parties with the leeway to breach essential policy considerations behind competition law.
In the past, competition law was considered to be within the exclusive domain of public authorities. Indeed, in most countries, principles of competition law have been accepted as an essential public policy. This is why arbitration of competition law matters has given rise to so much debate. In recent times, however, there has been a sea-change in the way in which both national courts and legislators view arbitration of competition law matters. In most major jurisdictions, the approach of lawmakers and courts towards arbitration of competition law has shifted from overt hostility to more benign acceptance.
The interplay between arbitration and competition law can mainly arise at three points of time. In the first instance, arbitrators during arbitral proceedings may look at whether such disputes are arbitrable in order to ensure that they fulfil their obligation to render an enforceable award. The next two situations may arise before state courts. Initially, when a court examines if the arbitral agreement per se is valid, or subsequently, in court proceedings for refusing enforcement of an award, where the losing party may try to render the award invalid by convincing the court that the subject matter of the award was not arbitrable or breaches public policy.
NIHAL DSOUZA is an assistant researcher at the University of Bonn, Germany, and a doctoral candidate at the International Max Planck Research School for Successful Dispute Resolution in Luxembourg. JOHANNES UNGERER is an assistant researcher at the University of Bonn, where he is a doctoral candidate at the Institute for Private International and Comparative Law.