Malta Arbitration Centre

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[edit] General Information

  • Official name: Malta Arbitration Centre
  • Country: Malta
  • City: Valletta
  • Type of organization: Independent Institution
  • Date of creation: -
  • Interests: Arbitration - Training
  • Fields of expertise: Domestic and International Commercial

[edit] Description

The Malta Arbitration Centre was set up to promote and encourage the conduct of domestic arbitration and international commercial arbitration. It is administered by a Board of Governors appointed by the President of Malta but is independent of Government.

The law setting up the Centre incorporates the UNCITRAL Model Law (First Schedule to the Act), the Geneva Protocol on Arbitration Clauses (Second Schedule to the Act), the Geneva Convention on the Execution of Foreign Arbitral Awards (Second Schedule to the Act), the UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards (Second Schedule to the Act) and the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (Third Schedule to the Act). It also provides for the formation of Arbitration Chambers between Maltese and non-residents of Malta for the purpose of international arbitration. A non-resident will pay only a modest amount of tax in Malta following a distribution made by an Arbitration Chamber.

[edit] Domestic Arbitration Procedure

Part IV of the Arbitration Act deals with the conduct of domestic arbitration in the settlement of disputes, which are defined to include any controversy or claim arising out of or relating to an agreement, or the breach, termination or invalidity thereof or failure to comply therewith.

Generally, any matter which is the subject of a dispute is capable of settlement by arbitration. The Act, however, excludes disputes concerning questions of personal civil status including those relating to personal separation and annulment of marriage. Nevertheless, questions relating to the division of property between spouses may be referred to arbitration subject to the approval by the competent court of the arbitration agreement and of the arbitrator to be appointed [Article 15(6)].

Part IV of the Act contains a comprehensive legal framework which regulates domestic arbitration proceedings. The main thrust of its rules is to grant the parties autonomy in determining the manner by which their arbitral proceedings are conducted. The parties are allowed the right to determine, inter alia, the choice and appointment of arbitrators, the choice of the language to be used in the arbitral proceedings, the submission of written statements, the establishment of time-limits, and the choice of location for the conduct of arbitration proceedings. In this regard, the role of MAC is primarily that of assisting the parties in the smooth running of the arbitral process. The Chairman of the MAC Board of Governors may be requested to intervene in matters when no agreement between the parties is possible, such as disagreement over the appointment of arbitrators, and in the event that an arbitrator, who is challenged by one of the parties, fails to withdraw.

In the case of domestic arbitration, it is of fundamental importance that the party, initiating recourse to arbitration, files the relative notice of arbitration with the MAC. Failure to do so shall render any procedures and any award pursuant thereto to be null and void, and unenforceable. Registration of the arbitration agreement is also required if the parties request interim measures and precautionary acts, or the taking of recourse against an award, or the resumption of arbitral proceedings.

The Arbitration Act requires an award to be in writing and the award shall be deemed to be delivered at the place agreed to by the parties as the place of arbitration, or, in the absence of agreement, the place determined by the arbitral tribunal. The parties are required to carry out the award without delay. In this respect a mechanism is provided for the successful party to apply for the registration of the award by MAC. Once this registration has taken place, the award constitutes an executive title for the purposes of Title VII of Part I of Book Second of the Code of Organization and Civil Procedure. There is no appeal from a registered award delivered pursuant to the provisions of the Arbitration Act. It is final and binding upon the parties.

The powers of the Maltese Courts to intervene or exercise jurisdiction in matters relating to arbitration are restricted to very exceptional and specific circumstances which are expressly provide for under the Arbitration Act. The parties may request the Court's assistance in the collection of evidence and the issue of interim measures and precautionary acts.

Recourse against an arbitral award can be taken either by requesting the Court to set aside the award in accordance with the provisions of Article 70 or by lodging an appeal against an arbitral award on points of law in accordance with Article 70A.

[edit] International Commercial Arbitration

Part V of the Arbitration Act deals with international commercial arbitration. It incorporates into Maltese Law, the Model Law on International Commercial Arbitration. Thus the conduct of international commercial arbitration under the Act will be regulated by a well-known and tested legal regime which has been adopted in many States. This should assist in providing the Arbitration Act with the necessary stability and security which the international arbitral process normally requires.

The Arbitration Act also allows the parties to an international commercial arbitration considerable flexibility in this regard. They may choose to exclude the operation of the Model Law, and apply their own rules or the Act's provisions on domestic arbitration. Indeed, if they do choose to apply the said provisions, there is no obligation to register the award with the MAC.

The setting aside of an award delivered under Part V is determined by the provisions of the Model Law, as are the grounds for refusing recognition or enforcement. In this respect, the Arbitration Act appoints the Court of Appeal as the competent Court to which a party applies for the recognition and enforcement of such an award.

The Arbitration Act, in its Second Schedule, incorporates, into Maltese Law, the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the 1923 Geneva Protocol on Arbitration Clauses and the 1927 Geneva Convention on the Execution of Foreign Arbitral Awards.

When acceding to the New York Convention, the Maltese Government made the following declaration:

"1. In accordance with the relevant provisions of the Convention, Malta will apply the Convention only to the recognition and enforcement of awards made in the territory of another Contracting State.

2.The Convention only applies in regard to Malta with respect to arbitration agreements concluded after the date of Malta's accession to the Convention and awards pursuant thereto made after the date of Malta's accession to the Convention."

The Third Schedule to the Arbitration Act incorporates the 1965 Washington Convention on the Settlement of Investment Disputes between States and Nationals of other States. The Arbitration Act provides that ICSID awards shall be recognized and enforced by the Courts of Malta as if such awards were final judgments under the laws of Malta.

The Malta Arbitration Centre is designated as the competent authority to receive certified copies of the award when a party seeks recognition or enforcement in Malta.

[edit] Arbitration Chambers

Arbitration as a means of settling international commercial disputes has long been established in a number of countries. Malta has devised an innovative feature which it is hoped will enable it to compete with long-established centers of arbitration. The Arbitration Act makes provision for the formation of "Arbitration Chambers" between residents and non-residents. The objects of such Chambers are limited to the provision of (i) services of representation and assistance in arbitration proceedings; and (ii) services as arbitrators.

The status of such an "Arbitration Chamber" is that of a limited liability company under the Malta Companies Act of 1995, however it has to be registered with MAC before it is allowed to commence its activities. Non- resident members of an "Arbitration Chamber" will be entitled to the advantageous fiscal treatment granted by the Act. In effect, non-residents will only pay a very modest amount of tax in Malta following the distribution made by such a Chamber. It is noteworthy that Malta has concluded a considerable number of double taxation agreements with other States. In order to enjoy this beneficial treatment the arbitration proceedings must be registered with MAC.

[edit] Contact

Palazzo Laparelli, 33, South Street, Valletta, VLT 1100 – Malta

Tel: (00356) 21222557, 21244497

Fax: (00356) 21230672

Email: malta.arbitration@mac.com.mt

Official Website

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