Sections 1032(2) and 1029(1) of the German Code of Civil Procedure (Zivilprozessordnung – ZPO) provide as follows:

Section 1032(2):

Section 1029(1):

The claimant was a Belgian corporation and the respondent was a leading manufacturer of navigation and mapping software and a German subsidiary of a Finnish corporation. They entered into a Data Access Agreement that contained an arbitration agreement providing for arbitration "in accordance with the arbitration rules of the German Chamber of Commerce". The seat of the arbitration was Berlin and the governing law was German law.

The claimant wished to initiate arbitration proceedings because the respondent had stopped paying an access fee. However, the arbitral institution named in the arbitration agreement (the "German Chamber of Commerce"), does not exist. Therefore, the claimant made an application under section 1032(2) ZPO to the Higher Regional Court of Berlin to determine that arbitration in Berlin was still admissible in accordance with the rules of the "German Institution of Arbitration (DIS)".

The Higher Regional Court of Berlin held that arbitration under the rules of the "German Institution of Arbitration (DIS)" was admissible.

The court held that the parties had concluded a valid arbitration agreement, but had designated a non-existent institution to administer the arbitration. In such instances, German case law provides that arbitration agreements are to be interpreted broadly so as to give them effect whenever possible. The court must determine the will of the parties by interpreting the contract according to their interests and intent, insofar as both parties were aware of such intent.

The court found that, by referring to the "German Chamber of Commerce", the parties had indicated that they wished any dispute to be settled by institutional arbitration with its seat in Germany. By naming a German institution, the parties further expressed their will for a national institution, not an international institution such as the International Chamber of Commerce. Both parties further submitted that they had not had a specific institution in mind when naming the German Chamber of Commerce. Rather, they had exchanged draft contracts referring first to the Finnish, then to the Swedish Chamber of Commerce, as well as Finnish and Swedish law respectively. Finally, they had decided on a neutral forum in Germany and changed the draft to "German Chamber of Commerce" and German law.

According to the court, this showed that the parties had wanted to agree on a central national institution. In Germany, there are a large number of separate chambers of commerce joined under the umbrella organisation of the German Chamber of Industry and Commerce (DIHK). However, the DIHK does not administer arbitrations. Nevertheless, the DIHK was found by the court to strongly and significantly back and support the DIS, and it is a member of the DIS. Therefore, the court held that arbitration under the rules of the DIS would give effect to the will of the parties to the best possible extent.

This decision once again confirms the pro-arbitration stance adopted by German courts. The Higher Regional Court of Berlin ensured that the arbitration agreement was operable, despite the fact that the parties had designated a non-existent arbitration institution.

However, this should serve as a reminder to parties that they should always check, prior to signing a contract, whether the designated arbitration institution exists and has been cited with its correct name. If parties fail to do so, this will certainly prolong proceedings if a dispute arises and may even lead to an inoperable arbitration agreement, if a court finds that the will of the parties regarding arbitration cannot be determined.