French Committee on Arbitration comments on the European Commission's Green Paper | Practical Law

French Committee on Arbitration comments on the European Commission's Green Paper | Practical Law

Bree Farrugia (Solicitor Advocate), Herbert Smith LLP

French Committee on Arbitration comments on the European Commission's Green Paper

Practical Law Legal Update 2-386-3136 (Approx. 3 pages)

French Committee on Arbitration comments on the European Commission's Green Paper

Published on 24 Jun 2009 • European Union, France
Bree Farrugia (Solicitor Advocate), Herbert Smith LLP
The French Committee on Arbitration (FCA) has issued a Response to the European Commission's Green Paper on the application of the Brussels Regulation. The FCA Response expresses a number of concerns regarding the proposed modifications as they relate to arbitration.
The French Committee on Arbitration (FCA) has issued a Response to the European Commission's Green Paper on the application of the Brussels Regulation.
The FCA Response focuses on the proposed modifications as they relate to arbitration: in particular, the European Commission's suggestion that the arbitration exception from the Regulation be deleted altogether. This would mean that all arbitration-related court proceedings are brought within the scope of the Regulation. Such a change would entail a number of significant knock-on effects, including the recognition, in all member states, of judgments determining the validity of an arbitration agreement and of judgments setting aside an arbitral award.
Specifically, the FCA expressed a number of concerns regarding these proposals:
  • No justification has been offered by the European Commission to make such radical reforms to the existing system of arbitration and its operation at the European Community level.
  • Inadequate attention has been given to the autonomy of the arbitral process itself. The FCA argues that these proposals would substantially increase state court regulation, therefore defeating the very reason for choosing a non-judicial process.
  • In seeking to apply rigid conflict of laws rules relating to the seat of an arbitration, the European Commission has not had sufficient regard to the importance of guaranteed neutrality in any seat.
  • The European Commission has failed to properly appreciate the notion of kompetenz-kompetenz, that is, the tribunal's ability to rule on its own jurisdiction in the absence of judicial intervention.
  • The proposals do not reflect the varied nature of arbitration law amongst the member states themselves (particularly as to what constitutes a valid arbitration agreement) and would risk automatic application of the "lowest common denominator" throughout Europe.
  • These measures are likely to confuse arbitral processes in Europe which, commercially speaking, could have a negative impact on Europe as a choice of arbitration venue.