Chief Justice of India Bhushan R Gavai has stressed on the importance of arbitration in justice delivery mechanism, calling it a prominent pillar that showcased the significant shift towards modes of alternative dispute resolution.
Delivering the keynote address at Navigating the Evolving Landscape: The Impact of the 7th Edition of the SIAC Rules on India-Related Arbitrations, organised by the Singapore International Arbitration Centre (SIAC) and Trilegal’s Joint Event (London International Disputes Week) on Friday, the CJI said in the past few decades, the justice delivery mechanism, once confined within the boundaries of courtrooms, has witnessed a significant shift towards modes of alternative dispute resolution, with arbitration emerging as a prominent pillar of that transformation.
He said the 7th Edition of the SIAC Rules represented a great step in enhancing efficiency of arbitrations globally and India-related disputes. Such changes were poised to bolster confidence in arbitration as a preferred mechanism for resolving international disputes.
From an Indian perspective, where prolonged litigation often stemmed from preliminary objections, such a mechanism would surely promote a culture of procedural discipline and early case management.
The 7th Edition of the SIAC Rules, combined with the robust and supportive legal systems of both Singapore and India, could play a significant role in promoting business activities. In particular, the strengthening of dispute resolution mechanisms would build greater confidence among international investors, encouraging them to engage in business ventures across borders.
By offering a reliable forum for resolving disputes, the 7th Edition of the SIAC
Rules could contribute significantly to reducing uncertainties that often accompanied cross-border transactions, thus making India and Singapore more attractive destinations for investment and trade, he noted.
The CJI said with the mutual support of Singapore’s renowned arbitration expertise and India’s growing prominence as a business hub, these rules would provide a unique opportunity to streamline commercial processes, minimise litigation risks, and create a climate of cooperation.
The new SIAC Rules encouraged
Indian institutions to take a leaf out of SIAC’s book and strengthen their own commitment to developing world-class
arbitration frameworks, including investing in necessary infrastructure, building a skilled and diverse cadre
of trained arbitrators, and ensuring consistent judicial non-interference.
The strides being made by SIAC and the
success story of Singapore as an arbitral destination provided many inspiring lessons for the Indian arbitral ecosystem. For instance, Indian legal institutions should foster a pool of skilled and well-trained arbitrators, equipped with the knowledge and expertise required to handle complex
international disputes.
A robust training system would ensure
that India remained at the forefront of global arbitration, providing parties with a trustworthy and efficient forum for
resolving their disputes.
Calling the SIAC Rules a forward-looking endeavour, the CJI said it aimed at enhancing efficiency while balancing fairness. For India, whose commercial players were increasingly global in outlook and operation, these rules offered both an opportunity and a challenge, the opportunity to align with
international best practices, and the challenge to elevate its own standards, while balancing them with India’s
practical realities.
He further said the contemporary global order has been marked by rapid transformations in economic, political, and social domains. These changes necessitated corresponding evolution in mechanisms for the administration of justice. In recent decades, the justice delivery mechanism, once confined within the boundaries of courtrooms, has witnessed a significant shift towards modes of alternative dispute resolution, with arbitration emerging as a prominent pillar of that transformation.
In India, the Arbitration and Conciliation Act, 1996, served as the backbone of arbitration framework, incorporating provisions for domestic arbitration,
international commercial arbitration, and the recognition and enforcement of foreign awards.
India and Singapore share a dynamic relationship in judicial and commercial cooperation. The legal systems of India and Singapore have been in constant
engagement via stakeholder-level dialogues to share their best practices.
In September 2023, a Memorandum of Understanding was signed between the Supreme Courts of the two nations, showing their commitment to maintain a collaborative approach in the judicial system of the two nations.
Moreover, the Supreme Court of India has also hosted Chief Justice Sundaresh Menon of the Supreme Court of Singapore as the Chief Guest of the function to mark the 73rd anniversary of the establishment of the Supreme
Court of India in February 2023. Both Indian and Singaporean courts co-hosted a number of conferences on topics such as technology and arbitration. Such constant and positive interactions have ensured continuous exchange of best practices and ideas for the betterment of the existing mechanisms, he added.
As per CJI Gavai, Singapore’s legal infrastructure, institutional support, neutrality, and efficiency have made it a preferred seat for arbitration globally and more particularly for the Indian parties.
The proceedings at the SIAC were characterised by the deployment of new and innovative procedures and technological initiatives which facilitated usage of latest efficiency-innovations for the benefit of the parties in conflict. Since 2010, Indian entities have consistently ranked among the top users of SIAC.
From 2011 to 2022, over 1,300 SIAC-administered arbitrations involved more than 2,000 Indian parties. No SIAC award was set aside by Indian courts during this period. Any changes brought to the
SIAC Rules would be of great interest to the Indian parties participating in arbitration wherein the seat is Singapore or SIAC Rules govern proceedings.
The release of the 7th Edition of the SIAC Rules, effective from January 1, 2025, marked a significant development in the evolution of institutional arbitration.
These new rules incorporated a host of innovative mechanisms designed to enhance procedural efficiency, reduce costs, and uphold the principles of fairness and party autonomy.
He said the 7th edition of the SIAC Rules incorporated various improvements as well as innovative attempts to enhance efficiency and accessibility in international arbitration. For instance, the streamlined procedure for small-value disputes was a welcome step from the perspective of small and medium Indian enterprises who have sometimes in the past shied away from international arbitration due to the costs involved.
The 2025 Rules apply to any arbitration starting on or after January 1, 2025, unless the parties agree otherwise.
Therefore, it was important to review the arbitration agreement or the underlying contract to see if the 2025 Rules will apply to a specific dispute. The streamlined procedure in the new SIAC Rules was likely to ensure access to international standards of arbitration without compromising on affordability. It was likely to ensure access to international standards of arbitration without compromising on affordability and would achieve the lofty aspirational targets.
This aligned conceptually with Sections 29A and 29B of India’s Arbitration and Conciliation Act, 1996, which were
added by way of amendments in 2016 and 2019. These provisions were introduced with a view to eliminating
inordinate delays and reinforcing the discipline of timeliness in arbitral proceedings. The converging goals of SIAC and Indian arbitration law on this front indicate a shared commitment to efficiency and outcome-oriented justice, he added.
The CJI said another interesting update on the 7th Edition was the addition of provision for “Coordinated Proceedings”7, a facility particularly useful in cases involving multiple arbitrations arising out of related transactions. Where similar
questions of fact or law were involved, parties may apply to consolidate or coordinate proceedings before the same
Tribunal. Such a measure can curtail the risk of contradictory awards, reduces duplication of effort, and economises both time and resources, all of which are highly relevant for Indian conglomerates and business entities operating across multiple jurisdictions.
The new SIAC Rules also empowered parties to seek “Preliminary Determination”8 of specific issues that may materially impact the subsequent conduct of proceedings. This allowed the parties to obtain clarity on substantial legal or jurisdictional questions at the outset, thereby streamlining the subsequent phases of arbitration, he noted.
SIAC has also incorporated hybrid mechanisms to resolve disputes by employing both arbitration and
mediation at different stages, under the SIAC-SIMC Arb-Med-Arb Protocol. This was an efficient mode of alternate dispute resolution which ensures the process to be more confidential and neutral. For instance, as per the SIAC-SIMC Arb-Med-Arb Protocol, the arbitrator and mediator will be separately appointed by the SIAC and SIMC, as per the applicable arbitration and mediation rules of each centre.
The appointed arbitrators and mediators were different persons. The settlement agreement obtained through the Arb-Med-Arb process, having the value of consent award, would be accepted as an arbitral award, and will be enforceable in over 170 countries under the New York
Convention. The Arbitration and Conciliation Act, 1996 also supported the Arb-Med-Arb model, even though it did not explicitly mention it. Under Section 30 of the Act, an arbitration agreement does not prevent an arbitral tribunal from encouraging the settlement of a dispute.
With the consent of the parties, the tribunal may employ mediation, conciliation, or other procedures at any stage during arbitral proceedings to facilitate resolution. If the parties reached a settlement during the proceedings, the tribunal would terminate the arbitration. Additionally, upon the parties’ request and if the tribunal has no objections, the settlement can be documented in the form of an arbitral award on agreed terms.
The CJI praised the SIAC on various other developments, including its cloud-based case management platform, SIAC Gateway, which assisted parties in conducting their arbitration in an end-to-end digital format. This is a positive development that will help save both time and paper.
The 7th Edition SIAC Rules demonstrated the progressive development and codification of arbitral
practice by giving express clarity to tribunals and parties on conduct of virtual and hybrid hearings; and various other aspects, which have become a part of arbitration convention in the last few years.
He further appreciated the SIAC for undertaking innovative experiments to push the traditional boundaries of dispute resolution in a manner befitting a global leader.
Noting that justice delivery in complex commercial disputes should not be adversarial or bureaucratic, but confidential, expert-driven and tailored to the needs of those seeking it, the CJI termed arbitration as the substantive recalibration of understanding and delivering justice.
He said over the last 10-15 years, India has made a multi-pronged effort towards its aspiration of building a favourable and sought after place of arbitration. While legislative reforms have significantly strengthened India’s
arbitration framework, the judiciary has also played a proactive role in fostering a more arbitration-friendly
environment. Various progressive judgments by the Supreme Court of India over the last few years stand
testament to this. Nonetheless, the enormity of India as a country has ensured that certain on-ground challenges continue.
The Indian judiciary has and will continue to recognise and respect the autonomy of the arbitral process, ensuring that the courts step in only when demanded by the needs of justice. By embracing international best practices and aligning them with its own legal and business ecosystem, India could create an arbitration environment that fostered confidence, encouraged investment, and propelled the country’s position in global economy.
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