Should Lawyers Share Their Feedback On The New Arbitration Rules?

Arbitration has always been a complex field to navigate around. Especially so in India, where there is an emerging need for alternate dispute resolution but also, a certain reluctance to accept anything but dispute resolution by the traditional system of Courts exists. Thus, the Government of India has attempted constantly to draft and create and perfect the laws related to Arbitration.

The Arbitration and Conciliation (Amendment) Bill, 2019 was first introduced on the 15th of July, 2019 by the incumbent Minister of Law and Justice, Mr. Ravi Shankar Prasad, in the Rajya Sabha. It sought to amend the Arbitration and Conciliation Act of 1996. The Act contains provisions dealing with domestic and international arbitration, and defines the law for conducting conciliation proceedings.

Two important amendments have been put in the public domain by the Government, inviting recommendations and suggestions for the Amendments. These amendments are:

Draft Rules: Arbitration Council of India

Through the Arbitration and Conciliation (Amendment) Act 2019, the Government intends to add a new section, namely Part 1A to the Act of 1996, to establish and incorporate an independent body- the Arbitration Council of India (ACI), which will promote alternate mechanisms for dispute resolution and will maintain a repository of arbitral judgements, grading of arbitral institutions and accreditation of arbitrators, being a few of its important functions.

The Draft Rules: Arbitration Council of India specify the number of officers and employees that the Secretariat of the ACI will have, their qualifications, criteria for selection and age, level of pay and other terms of the officers including the Chairperson, Chief Executive Officer, Director and other full-time and part-time members.

As per section 43C of the Act, the ACI will be led by a Chairperson, appointed by the Central Government in consultation with Chief Justice of India. The Chairperson should either have been:

1. A Judge of the Supreme Court, or
2. A Chief Justice/Judge of a High Court; or
3. An eminent person having special knowledge and experience in the conduct or administration of arbitrations.

The Chairperson will hold the office for a term of 3 years or until 75 years of age whichever is sooner.

The other full-time members appointed will include an eminent arbitration practitioner and an academician with arbitration experience. In addition to this, one representative of a recognized body of commerce and industry shall be nominated on a rotational basis as a Part-time Member. The Secretary, Department of Legal Affairs, Ministry of Law & Justice; Secretary, Department of Expenditure, Ministry of Finance and Chief Executive Officer, ACI will be ex-officio Members.

Government appointees will hold the office for a term of 3 years or till 67 years of age, whichever is sooner.

In regard of the above, the Department of Legal Affairs has prepared the following Draft Rules:

1. The Arbitration Council of India (the Salary, Allowances and other Terms and Conditions of Chairperson and Members) Rules, 2020.

2. The Arbitration Council of India (the Travelling and other Allowances payable to Part-time Member) Rules, 2020.

3. The Arbitration Council of India (the Qualifications, Appointment and other Terms and Conditions of the service of the Chief Executive Officer) Rules 2020.

4. The Arbitration Council of India (the Number of Officers and Employees of the Secretariat of the Council and the qualifications, appointment and other terms and conditions of the officers and employees of the Council) Rules 2020.

New Delhi International Arbitration Centre Rules (NDIAC)

The New Delhi International Arbitration Centre (NDIAC) Bill 2019, was introduced with the aim to provide for the establishment and incorporation of the New Delhi International Arbitration Centre for the purpose of setting up an independent mechanism for the system of arbitration and to make it a hub for institutional arbitration. It intends to make the New Delhi International Arbitration Centre an institution of national importance and international significance. The NDIAC Act replaced the ordinance on the same, which had come into force on the 2nd of March, 2019.

According to Section 5 of the above Act, the NDIAC will be headed by a Chairperson, to be appointed by the Central Government in consultation with the Chief Justice of India. The Chairperson must be either:

1. A Judge of the Supreme Court, or
2. A Judge of a High Court; or
3. An eminent person, having special knowledge and experience in the conduct or administration of arbitration, law or management.

Besides, it will also have two full-time or part-time members from amongst eminent persons having substantial knowledge and experience in institutional arbitration, both domestic and international.

In addition to this, one representative of a recognized body of commerce and industry shall be nominated on rotational basis as a part-time member. The Secretary, Department of Legal Affairs, Ministry of Law & Justice; Financial Adviser nominated by Department of Expenditure, Ministry of Finance; and Chief Executive Officer, NDIAC; will be ex-officio members. Section 23 of the Act also provides for the Secretariat to the Centre inter alia comprising Registrar, Counsel and other officers & employees etc.

In this regard, the Department of Legal Affairs (DoLA) has prepared the following draft Rules:

1. The New Delhi International Arbitration Centre (the terms and conditions and the salary and allowances payable to the Chairperson and Full-time Members) Rules, 2020.

2. The New Delhi International Arbitration Centre (the travelling and other allowances payable to Part-time Members) Rules, 2020.

3. The New Delhi International Arbitration Centre (the number of officers and employees of the Secretariat of the Centre) Rules, 2020.

4. The New Delhi International Arbitration Centre (the qualifications, experience, method of selection and the functions of the Registrar, Counsel and other officers and employees of the Centre) Rules, 2020.

What Happens Next?

One common thing to note in both of these amendments that is the draft rules for the Indian council of Arbitration India and the Delhi International Arbitration Rules is that they end with a paragraph that reads as follows:

'The Government intends to consult all stakeholders in the process. A copy of the aforesaid draft Rules have been uploaded on the website of the department of Legal Affairs (http://legalaffairs.gov.in/).

The Government intends to consult all stakeholders in the process and is asking for our feedback on these Rules.'

This constitutes a part of, what is popularly known as, Pre-Legislative Consultation Policy.

The Pre-Legislative Consultation Policy is a policy that enables citizens to help shape the laws that impact us and our communities- before these laws are finalized. The policy states that every Government Department or Ministry should proactively publish and invite citizen's feedback on their draft/proposed bills for a minimum of 30 days.

These calls for feedback must contain the draft legislation or at least information about the bills, like its financial implications, and the impact of the Bill on environment, fundamental rights, lives and livelihoods of citizens. It simply aims to support citizens' legitimate and growing expectations of greater transparency from the Government and thus, strengthens the power in the hands of the People by simply involving them in law-making.

Entities like Civis are making the process of participating in public consultations easier and more accessible to citizens.

Civis is a web platform that enables citizens to understand draft policies in simple language by providing summaries for each Bill currently in the public domain. All that one must do is read the summary and share their feedback on these policies with the Government on Civis' website itself. It aims to make the process of participation in public consultations accessible, interactive and meaningful. Furthermore, you can also showcase your knowledge by submitting 'Public Responses' that your peers can adapt and use as their own.

Visit Civis' website to share your inputs/suggestions/recommendations on the Rules mentioned above:

1. Draft Rules: Arbitration Council of India: https://www.civis.vote/consultations/97/read
2. Draft New Delhi International Arbitration Centre Rules: https://www.civis.vote/consultations/98/read

Your inputs on Civis are presented to Government authorities. Each and every suggestion is valuable feedback to ensure the Act is as sound and as convenient as possible. The only recourse after Rules being passed is approaching the Courts, which is costly in terms of both time and finances.

The seasoned and budding arbitrators on Lawyers Club, will especially benefit from commenting on the Rules, because these policies will have a direct and tangible impact on our practice.

By participating and engaging with the process of pre-legislative consultations, one is not only fulfilling their duty of being an active and informed citizen in a democracy, but is going beyond that mandate to keep the spirit of democracy alive. It will only take a few minutes of your day to help form a part of a billion-strong citizenry, working together to build this massive project that we call, India.

Isha Prakash is a student at Government Law College, Mumbai. She is an intern at Civis.Vote, a platform that helps Governments and individuals co-create upcoming laws and policies.