International arbitration law and rules in Australia

1.1  Australia is a federation (officially known as the Commonwealth of Australia) consisting of six States and two major Territories.  

1.2 Traditionally, arbitration in Australia was governed by the legislative regimes of the individual States and Territories and closely followed the law of arbitration in England.  

1.3 Federal legislation governing international arbitration in Australia was introduced in the Arbitration (Foreign Awards and Agreements) Act 1974 (Cth), which also approved Australia’s accession to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention). Australia acceded to the New York Convention (which also applied to all of Australia’s then external Territories except Papua New Guinea), without any reservations, on 26 March 1975. This legislation was subsequently amended and renamed, with effect from 12 June 1989, to become the International Arbitration Act 1974 (IAA).

1.4 Section 16 of the IAA gives effect to the UNCITRAL Model Law on International Commercial Arbitration (Model Law) in relation to international arbitrations seated in Australia, which is set out in Schedule 2 of the IAA.

2.1.1 Australian law distinguishes between domestic and international arbitration.  

2.1.2 The Commonwealth government has legislative power over international arbitrations (with the IAA being the relevant legislation) while the States and Territories have the legislative power over domestic arbitrations seated within those individual States and Territories.  

2.1.3 An arbitration is international if: 

1. the parties to an arbitration agreement have, at the time of the conclusion of that agreement, their places of business in different countries; or 
2. one of the following places is situated outside the country in which the parties have their place of business:
   1. the place of arbitration if determined in, or pursuant to, the arbitration agreement;
   2. any place where a substantial part of the obligations of the commercial relationship is to be performed or the place with which the subject-matter of the dispute is most closely connected; or 
3.  the parties have expressly agreed that the subject matter of the arbitration agreement relates to more than one country.  1  

2.1.4 Each individual State and Territory has enacted its own Commercial Arbitration Act (CAA) (known as the uniform Commercial Arbitration Acts), which deals with arbitration of commercial disputes in a domestic setting: 

1. where parties have agreed that such disputes are to be settled by arbitration; 
2. the parties have, at the time of conclusion of an arbitration agreement, their place of business in Australia; and  
3. the arbitration is not an arbitration to which the Model Law (as given effect to by the IAA) applies. 2   

2.1.5 The uniform Commercial Arbitration Acts do not apply to international arbitrations and provide a generally consistent (albeit not identical) domestic regime across Australia’s multiple domestic jurisdictions, each of which are also consistent with the Model Law.  

2.1.6 Notably, if the IAA applies to an arbitration, the arbitration legislation of a State or Territory does not apply 3 as the Model Law (consistent with the provisions of the uniform Commercial Arbitration Acts) is said to “cover the field”. 

2.1.7 This chapter only addresses international commercial arbitration in Australia. Domestic arbitration and the enforcement of foreign arbitration agreements in Australia are beyond the scope of this publication. 

2.2.1 Most, but not all, commercial disputes are capable of being submitted to arbitration.  

2.2.2. Certain matters under the Corporations Act 2001 (Cth) are not arbitrable, such as matters involving insolvency or winding-up. 4 

2.2.3 In certain circumstances, disputes are only arbitrable if certain conditions are met. For example, the IAA is expressly subject to section 11 of the Carriage of Goods by Sea Act 1991 (Cth), which provides that arbitration agreements included in bills of lading or similar documents relating to the carriage of goods to or from Australia are void, unless the arbitration agreement provides that the arbitration must be conducted in Australia. 

2.2.4 Another example is an arbitration agreement in insurance contracts, which is void. In order to arbitrate any disputes arising out of, or in connection with, an insurance contract, the parties must agree to submit the dispute to arbitration after the dispute arises. 5   

2.3.1 The IAA (which largely adopts the Model Law) is founded on the principle that the Court shall not intervene in matters governed by the IAA, except as expressly provided for in the IAA. 6 

2.3.2 The circumstances where the court may intervene include:  

1. granting interim measures of protection (see section 5.2 below);  
2. assisting with the appointment and removal of arbitrators (see section 4.2 below); 
3. assisting with taking evidence (including for the production of documents) (see section 6.9 below); and
4. making orders to assist the arbitral tribunal (section 23A of the IAA). 

3.1.1 An “arbitration agreement” is defined as an agreement by the parties to submit to arbitration all or certain disputes which have arisen, or which may arise between them in respect of a defined legal relationship, whether contractual or otherwise. 7 

3.2.1 An arbitration agreement must be in writing. 8 The writing requirement is satisfied if the agreement’s content is recorded in any form, whether the arbitration agreement or contract has been concluded orally, by conduct or by other means. 9   

3.2.2 The agreement can be in an electronic communication if the information contained in it is accessible to be used for subsequent reference. Examples of acceptable forms of electronic communication include (but are not limited to), electronic data interchange, email, telegram, telex or telecopy. 10   

3.2.3 There is no requirement for a separate arbitration agreement. A clause in a contract will suffice. 11 Alternatively, an enforceable arbitration clause can be incorporated into a contract by reference to a separate document. 12   

3.3.1 Parties are generally free to agree the procedural rules that will apply to their arbitration, although it is common to adopt the rules of an arbitral institution (eg the Australian Centre for International Commercial Arbitration (ACICA), the Singapore International Arbitration Centre (SIAC) or the London Court of International Arbitration (LCIA)). Whatever procedural rules are adopted, they are subject to the mandatory provisions of the IAA that apply to all international commercial arbitrations seated in Australia.

3.3.2 The mandatory provisions include requirements that:  

1. the parties are to be treated with equality and each party is to be given a full opportunity to present its case (Article 18 of the Model Law); 13 and 
2. the parties are to be given sufficient advance notice of any hearing (Article 24 (2) of the Model Law). 14  

3.3.3 While the IAA largely adopts but also supplements the Model Law. For example, section 18C of the IAA provides that for the purposes of Article 18 of the Model Law, 15 a party is taken to have been given a “full opportunity” to present its case if the party is given a “reasonable opportunity” to present its case.

3.3.4 The IAA also supplements the Model Law by including additional provisions that will apply unless the parties “opt-out” of their application (in the arbitration agreement or otherwise in writing). Such provisions that apply unless the parties “opt-out” include:   

1. allowing a party (with the permission of the arbitral tribunal) to apply to the court for a subpoena requiring a person to attend for examination or to produce evidence; 16   
2. allowing a party to apply to the court for an order requiring compliance by the other party if there is a failure by that party to attend arbitral proceedings for examination (when required by a subpoena or by the arbitral tribunal), or to comply with orders of the arbitral tribunal or court in relation to production of documents, or if there is a more general default by that party; 17  
3. preventing parties disclosing confidential information in relation to the arbitration (except in specific circumstances); 18  
4. allowing the arbitral tribunal to make orders relating to the scrutiny of evidence, including allowing the arbitral tribunal or a person specified in the order to take a sample of evidence or to inspect, photograph, observe or conduct experiments on evidence in the possession of a party; 19 
5. allowing the arbitral tribunal to make orders relating to security for costs, and the costs of the arbitration; 20 and  
6. allowing the arbitral tribunal to provide for the payment of interest on awards. 21   

3.3.5 The parties may also agree to consolidate arbitral proceedings. 22   

3.4.1 The doctrine of separability is recognised in Australia, such that an arbitration clause is treated as separable from the contract which it is within. If the arbitral tribunal decides that the contract is null and void, that does not of itself invalidate the arbitration agreement. 23   

3.5.1 A fundamental principle of arbitration is that, except in the limited circumstances in which an award may be set aside, corrected or interpreted, the award is binding on the parties to the arbitration agreement.  

3.5.2 Subject to Articles 33 and 34 of the Model Law, an international arbitral award made in Australia is binding and may be recognised and enforced pursuant to Article 35 of the Model Law (which is also subject to the grounds for refusing recognition or enforcement in Article 36 of the Model Law). 24 This is addressed in more detail in section 10 below.  

3.6.1 The English approach to interpretation of arbitral clauses has been the subject of recent judicial consideration by the Australian courts.  

3.6.2 In England, in Fiona Trust v Privalov, 25 the House of Lords rejected a distinction between an interpretation of “arising under” or “arising out of” an agreement, calling for a “fresh start”. 26 Lord Hoffman was of the view that the construction of an arbitral clause should “start from the assumption that the parties, as rational businessmen, are likely to have intended any dispute arising out of the relationship into which they have entered or purported to enter to be decided by the same tribunal”, and that the clause should be construed in accordance with that presumption “unless the language makes it clear that the certain questions were intended to be excluded from the arbitrator’s jurisdiction”. 27   

3.6.3. The High Court of Australia, in Rinehart v Hancock Prospecting, 28 determined that the “proper” approach as to the interpretation of arbitration agreements is through the application of “orthodox principles of interpretation, which require consideration of the context and purpose of the [arbitration agreement]”. 29 The High Court of Australia held that in the circumstances of this case there was no need to have reference to the English position established in Fiona Trust v Privalov, leaving unresolved the issue of whether the principles of Fiona Trust v Privalov will be applied in Australia. While the case of Rinehart v Hancock Prospecting was decided in the context of domestic arbitration, these principles are highly likely to be applied consistently by Australian courts in the context of international arbitration.  

4.1.1 Parties are free to agree the procedure for the appointment of an arbitrator, 30 failing which the default procedure set out in Article 11(3) of the Model Law 31 will apply. This provides as follows:  

1. Where three arbitrators are to be appointed, each party is to appoint an arbitrator and the two arbitrators appointed must agree on a third arbitrator. 32   If the two arbitrators appointed by the parties fail to agree on the third arbitrator within 30 days of their appointment, the appointment is to be made upon request of a party by either the court or the prescribed authority. 33   
2. Where a sole arbitrator is to be appointed, if the parties cannot agree on the arbitrator to be appointed, then the appointment is to be made upon request of a party by either the court or the prescribed authority. 34  

4.1.2 The only prescribed authority for the purposes of Article 11(3) of the Model Law 35 is the ACICA. 36  

4.1.3 A person is not automatically precluded from appointment as an arbitrator by reason of their nationality. 37 However, the parties can agree to impose any requirement in relation to the qualifications of the arbitrator(s), including nationality. 38 Any agreement in relation to the necessary qualifications for the arbitrator(s) should be carefully drafted to avoid uncertainty or ambiguity which may give rise to a challenge to the appointment of an arbitrator. 

4.2.1 Parties are free to agree to a procedure for challenging an arbitrator. 39   

4.2.2 If the parties fail to agree a procedure for challenging an arbitrator, either party may challenge the arbitrator’s appointment where circumstances exist that give rise to “justifiable doubts” as to the arbitrator’s impartiality or independence, or if the arbitrator does not possess the qualifications the parties have agreed as being required. 40 A party may challenge an arbitrator appointed by him, or in whose appointment he has participated, only for reasons of which he becomes aware after the appointment has been made. 41  

4.2.3 Section 18A(2) of the IAA provides that a “justifiable doubt” only arises where there is a “real danger” of bias on the part of the arbitrator. This provision supplements Article 12 of the Model Law 42 and clarifies the interpretation of “justifiable doubts” for arbitrations under the IAA.  

4.2.4 If the parties have not agreed a procedure for challenging the arbitrator(s), Article 13(2) of the Model Law 43 provides that a party who intends to challenge an arbitrator shall submit a written statement of reasons for the challenge to the arbitral tribunal within 15 days of becoming aware of the constitution of the arbitral tribunal or any justifiable doubt as to the arbitrator’s impartiality and independence. Unless the arbitrator withdraws, or the other party agrees to the challenge, the arbitral tribunal will decide on the challenge. 44 If the challenge fails, then the party that brought it may, within 30 days of receiving the decision rejecting the challenge, apply to the court to hear and determine the challenge. 45 The arbitral tribunal may continue the proceedings and make an award while a challenge is before the courts. 46  

4.3.1 Section 28(1) of the IAA provides that “an arbitrator is not liable for anything done or omitted to be done by the arbitrator in good faith in his or her capacity as arbitrator”. 

5.1.1Article 16(1) of the Model Law 47 gives effect to the Kompetenz-Kompetenz principle which allows an arbitral tribunal to rule on its own jurisdiction. The arbitral tribunal may do so as a preliminary issue or in the final award.  

5.1.2 If a party wishes to challenge the jurisdiction of the arbitral tribunal it must do so no later than the submission of the statement of defence. 48 An allegation that the arbitral tribunal has exceeded the scope of its authority must be raised as soon as the matter alleged to be beyond authority arises. 49   

5.1.3 Where the arbitral tribunal rules on its jurisdiction as a preliminary issue, within 30 days of the arbitral tribunal making its ruling either party may request the court having jurisdiction (being the Federal Court of Australia or in the Supreme Court of the State or Territory of the place of arbitration) 50 to finally determine whether the arbitral tribunal does have jurisdiction. 51 The decision of the courts is not subject to appeal and the arbitral tribunal may continue with the proceedings (including making an award) while the challenge to their jurisdiction is before the court .52 

5.2.1The arbitral tribunal may make interim orders/measures at the request of either party, unless the parties to the arbitration have agreed otherwise. 53 

5.2.2 Article 17(2) of the Model Law 54 empowers the arbitral tribunal to grant interim measures ordering a party to: 

1. maintain or restore the status quo pending determination of the dispute; 
2. take action that would prevent, or refrain from taking action that is likely to cause, current or imminent harm or prejudice to the arbitral process itself; 
3. provide a means of preserving assets out of which a subsequent award may be satisfied; or 
4. preserve evidence that may be relevant and material to the resolution of a dispute.  

5.2.3 The party requesting the interim measure(s) must satisfy the arbitral tribunal that: 55  

1. damages are not likely to adequately compensate the party for the harm likely to be suffered if the requested measure is not ordered, and such harm substantially outweighs the harm that is likely to result to the other party if the measure is granted; and 
2. there is a reasonable possibility that the requesting party will succeed on the merits of the claim.  

5.2.4 The arbitral tribunal may require the party requesting an interim measure to provide security in connection with that measure 56 and to disclose any material change in the circumstances which supports the measure granted. 57 If the arbitral tribunal subsequently determines that an interim measure or preliminary order should not have been granted, it may order the party which sought the measure/order to pay any costs and/or damages caused to any party as a result of that measure/order. 58

6.1.1 Unless otherwise agreed by the parties (eg in institutional rules which the parties have adopted), Article 21 of the Model Law 59 provides that arbitral proceedings commence on the date the request for the dispute to be referred to arbitration is received by the respondent.  

6.2.1 Subject to any mandatory provisions (see section 3.3 above), the parties may agree on the procedural rules for the conduct of the arbitration; 60 and failing such agreement, the arbitral tribunal may conduct the arbitration in the manner it considers appropriate (including determining the admissibility, relevance, materiality and weight of any evidence). 61  

6.2.2 Chapter V of the Model Law 62 generally sets out provisions for the conduct of arbitral proceedings covering such matters as: 

1. equal treatment of the parties; 63  
2. determination of rules of procedure; 64 
3. determining the place of the arbitration (consistent with many other jurisdictions, it is permissible to have the arbitration hearing(s) at a different location to its juridical seat); 65  
4. when the arbitration commenced; 66   
5. the language of the arbitration; 67 
6. exchange of statements of claim and defence; 68   
7. the power of the arbitral tribunal to determine whether to hold oral hearings (which are mandatory if requested by a party); 69  
8. the powers of the arbitral tribunal where a party defaults in providing their statement of claim or defence, or by a failure to appear at a hearing or to produce documentary evidence; 70 
9. the power of the arbitral tribunal to appoint experts; 71 and  
10. the ability to seek the assistance of the courts in taking evidence. 72  

6.3.1 Article 20(1) of the Model Law 73 provides that the parties are free to agree on the place of arbitration. Failing such agreement, the place of arbitration will be determined by the arbitral tribunal having regard to the circumstances of the case, including the convenience of the parties. 

6.3.2 Notwithstanding Article 20(1) of the Model Law, 74 the arbitral tribunal may, unless otherwise agreed by the parties, meet at any place it considers appropriate for consultation among its members, for hearing witnesses, experts or the parties, or for inspection of goods, other property or documents .75 This mirrors common practice in many jurisdictions, such that it is possible to have hearings or meetings in relation to the arbitration at a different location than the seat. 

6.3.3 Article 22 of the Model Law 76 provides that the parties are free to agree on the language or languages to be used in the arbitral proceedings, failing which this shall be determined by the arbitral tribunal. Provision is also made for the arbitral tribunal to order that any documentary evidence be translated into the language of the arbitration .77 

6.4.1 Unless agreed by the parties, the format and timetable for submissions will be determined by the arbitral tribunal. 78   

6.4.2 In Australia, arbitrations generally follow a common law litigation style procedure where the parties exchange written submissions in the form of statements of claim and statements of defence (which define the parties’ respective cases), followed by disclosure, factual evidence and expert evidence followed by a hearing (or a determination on the papers). Notwithstanding the foregoing, there is nothing prohibiting the parties adopting, or the arbitral tribunal ordering, a memorial style process. 

6.5.1 Subject to any contrary agreement by the parties, or a request by any party that an oral hearing be held (which must be accommodated unless there was a prior agreement between the parties to proceed on the papers only), the arbitral tribunal will decide whether to hold oral hearings, or whether the proceedings shall be conducted on the papers. 79   

6.5.2 Ex parte communications with the arbitral tribunal are not permitted. All statements, documents or other information supplied to the arbitral tribunal by one party must also be provided to the other party .80  

6.6.1 As is common practice in international arbitrations elsewhere, the civil law rules of evidence applicable in litigation proceedings do not apply to arbitrations and the arbitral tribunal is empowered to determine the admissibility, relevance, materiality and weight of any evidence, subject to any agreement on such matters between the parties .81   

6.6.2 From a practical perspective, it is common for the International Bar Association (IBA) Rules on the Taking of Evidence in International Arbitration to be adopted as a guide.  

6.6.3 In addition to the provisions of the Model Law, the IAA expressly provides that the arbitral tribunal may make an order that allows the arbitral tribunal or a specified person to inspect, photograph, observe or conduct experiments on evidence that is in the possession of a party to the arbitral proceedings and that may be relevant to those proceedings. 82 The arbitral tribunal may also make an order allowing a sample of the relevant evidence to be taken by the arbitral tribunal or a specified person. 83 As set out in section 3.3 above, this applies unless the parties “opt-out” of this provision. 

6.7.1 Unless the parties agree otherwise, the arbitral tribunal may: 

1. appoint one or more experts to report to it on specific issues determined by it; and/or 
2. require a party to give the expert any relevant information or to produce, or to provide access to, relevant documents, goods or other property for inspection by the expert. 84 

6.7.2 Similarly, unless otherwise agreed by the parties, if a party so requests or if the arbitral tribunal considers it necessary, the expert shall, after delivery of their report (written or oral), participate in a hearing where the parties have the opportunity to question the expert and to present their own expert witness evidence on the relevant issues. 85 

6.8.1 Unless the parties “opt out” of the confidentiality regime (see section 3.3 above), 86 the parties may not disclose “confidential information” in relation to the proceedings, except in the very limited circumstances permitted by the IAA, 87 which are as follows:

1. all parties consent to the disclosure; 
2. disclosure is to a professional or other adviser of a party; 
3. disclosure is allowed by an order of the arbitral tribunal; 
4. disclosure is necessary to establish or protect the legal rights of a party (including for enforcement purposes); 
5. disclosure is necessary to ensure a party has a full opportunity to present its case (and the disclosure is no more than reasonable for that purpose);  
6. disclosure is required to comply with a subpoena or a court order; or 
7. disclosure is authorised or required by “another relevant law”. 88 

6.8.2 “Confidential information” is defined as having a wide ambit and includes information that relates to the proceedings or to an award made in the proceedings and includes pleadings, evidence, transcripts, rulings and awards. 89

6.8.3 The “opt-out” confidentiality regime in the IAA was inserted by way of legislative intervention to override the position that had previously been established by the High Court of Australia in Esso Australia Resources v Plowman, 90 in which the High Court of Australia held that confidentiality was not an essential feature of “private” arbitrations.  

6.9.1 An arbitral tribunal, or a party with the arbitral tribunal’s approval, may request assistance from a competent court in taking evidence. 91  

6.9.2 Save for when the parties “opt out” of these provisions, (see section 3.3 above), upon the application of a party to the proceedings, the Federal Court of Australia or the Supreme Court of the State of Territory where the arbitral proceedings are conducted 92 may issue a subpoena requiring a person to attend for examination before the arbitral tribunal, or to produce documents to the arbitral tribunal .93 This provision only applies to arbitrations seated in Australia. 94 A person may not be compelled to answer any question or to produce any document which they could not otherwise be compelled to answer or produce in proceedings before that court. 95  

7.1.1 The substantive law to be applied to determine the parties’ rights will be the governing law agreed to in the underlying contract or agreement, 96 or where the parties have failed to make such a provision the arbitral tribunal shall determine the law to be applied by reference to the conflicts of law rules that it considers appropriate. 97 

7.2.1 If the arbitral tribunal is of the view that it will narrow the issues in dispute, or that it is otherwise prudent to do so, the arbitral tribunal is free to render one or more partial awards determining some of the issues in dispute between the parties. Of course, any such partial award must comply with the form and content requirements set out in Article 31 of the Model Law 98 and a res judicata will arise in respect of any issue which is finally determined in such a partial award. 

7.3.1 The award must be in writing and signed by the arbitrator. 99 If there is more than one arbitrator, the signatures of a majority of the arbitral tribunal members is sufficient, provided that the reason for any omitted signature is stated. 100   

7.3.2 The award must state the reasons upon which it is based, unless the parties have agreed that no reasons are to be given (or where the award records an agreed settlement). 101 Although the courts have not determined what is required in order to satisfy this provision in the IAA, in Westport Insurance Corporation v Gordian Runoff Ltd, 102 which concerned a domestic arbitration in Australia, the court considered the requirement in the Commercial Arbitration Act 1984 (1984) (being the domestic legislation in force prior to the commencement of the uniform Commercial Arbitration Acts in each Australian State and Territory) that “reasons for making the award …be given”. The High Court held that the necessary standard is not equivalent to a judicial standard, but that the level of detail required “will depend upon the nature of the dispute and the particular circumstances of the case”. 103  

7.3.3 The award is also required to state the date and place of the arbitration 104 and a copy must be delivered to each party. 105  

7.4.1 If the parties settle the dispute while the proceedings are on foot, the arbitral tribunal shall terminate the proceedings and, if requested by the parties and not objected to by the arbitral tribunal, record the settlement in the form of an arbitral award on agreed terms. 106 

7.4.2 An award on agreed terms must still satisfy the form and content requirements for an award set out in Article 31 of the Model Law.107 

7.5.1 An award of costs is at the discretion of the arbitral tribunal. 108  The IAA does not stipulate any specific factors that an arbitral tribunal must consider when exercising its discretion in relation to costs.   

7.5.2 Australian courts have long followed the principal that ‘costs follow the event’ meaning that the successful party will ordinarily be awarded costs in its favour.  This is also the usual position that an arbitral tribunal will follow in Australia, but it is not bound to do so. For example, an arbitrator may choose to award costs to the parties based on which discrete issues in the dispute they succeeded in, or may order that each party is to bear their own costs.   

7.5.3 An arbitral tribunal is not required to use any court scales or other rules when making orders in relation to costs. 109 Amendments made to the IAA by the Civil Law and Justice Amendment Act 2018 (Cth) expanded the arbitral tribunal’s powers in relation to costs.  Previously, costs were awarded on a “party and party” or “solicitor and client” basis.  Party-party costs are typically significantly lower than solicitor-client costs.  The usual order that a court will make is for party-party costs to be paid to the successful party.  Australian courts have also been reluctant to make a “special rule” reversing the usual position and imposing a rebuttable presumption in favour of indemnity costs (solicitor-client costs). Notwithstanding this reluctance to create a “special rule”, the Australian courts have been prepared to award costs on an indemnity basis in appropriate circumstances. 110  

7.5.4 These amendments to the IAA provide the arbitral tribunal with “more flexibility in making costs awards” and now follow the principle that it is a “matter for the tribunal to settle an appropriate approach to awarding costs”. 111 In any event, arbitrators tend to take a more broad-brush approach than the courts, particularly given that there is no requirement to apply court scales or to tax the costs as in litigation. 

7.5.5 If the award does not make any award of costs, either party may apply to the arbitral tribunal for directions as to the payment of costs within 14 days of receiving the award. 112 The arbitral tribunal must then, after hearing any party who wishes to be heard, amend the award by adding to it such directions as the arbitral tribunal thinks proper with respect to the costs of the arbitration. 113   

7.6.1 Except where the parties have agreed otherwise, the arbitral tribunal has the power to award interest up to the making of an award and/or interest on a debt under an award. 114   

7.6.2 In relation to interest on a debt under an award, the arbitral tribunal may direct that compound interest is payable if payment is not made on or before the due date, 115 at a reasonable rate set by the arbitral tribunal .116  

7.6.3 Compound interest may not be ordered for the period between the date on which the cause of action arose and the making of the award. 117 

7.7.1 If an arbitrator becomes unable to perform their function or fails to act without undue delay (for example, if there is an undue delay in delivery of the award), either party may apply to the competent court (being the Federal Court of Australia or the Supreme Court of the State or Territory in the place of arbitration) 118 to decide on the termination of the arbitrator’s mandate .119   

7.7.2 Where an arbitrator’s mandate is terminated, a substitute arbitrator must be appointed according to the rules that applied to the appointment of the arbitrator being replaced. 120   

7.8.1 The arbitral proceedings are terminated by the final award 121 or an order under Article 32(2) of the Model Law (eg where the parties agree to the termination of proceedings). 122   

7.8.2 The arbitrator becomes functus officio in respect of their mandate with the termination of the arbitral proceedings except where: 

1. a party, with notice to the other party, requests the arbitral tribunal to correct in the award computational errors, clerical or typographical errors or errors of a similar nature (analogous to what is often referred to as the “slip rule” in litigation); 123  
2. the parties agree that a party, with notice to the other party, may request the arbitrator to interpret a specific point or part of the award; 124 
3. a party, with notice to the other party (subject to an agreement to the contrary) requests the arbitral tribunal within 30 days of receipt of the award to make an additional award to deal with claims presented in the arbitration which the tribunal did not deal with in any previous award(s); 125 or 
4. where court proceedings to set aside an award are suspended to give the arbitral tribunal an opportunity to take action that in the arbitral tribunal’s opinion will eliminate the grounds for setting aside. 126   

7.9.1 Within 30 days of receipt of the award, unless another time period has been agreed by the parties, a party, on notice to the other party, may request the arbitral tribunal to correct any errors in computation, any clerical or typographical errors or any errors of similar nature. 127 The arbitral tribunal may also correct any errors of this type on its own initiative within 30 days of the date of the award .128  

7.9.2 In addition, if the parties agree, a party, with notice to the other party, may request the arbitral tribunal to give an interpretation of a specific point or part of the award within the same time frame. 129  

7.9.3 If the arbitral tribunal considers the request to be justified, it shall make the correction or give the interpretation within 30 days of receipt of the request (subject to the tribunal’s right to extend this period under Article 33(4) of the Model Law) 130 and the interpretation forms part of the award .131  

7.9.4 Unless otherwise agreed by the parties, a party, with notice to the other party, may request, within 30 days of receipt of the award, that the arbitral tribunal make an additional award in relation to claims presented in the arbitral proceedings but omitted from the award. If the arbitral tribunal considers the request to be justified, it will make the additional award within 60 days. 132 

7.9.5 Any time limits which apply to the correction or interpretation of the award, or the delivery of an additional award in relation to an omitted issue, under Articles 33(1) to (3) of the Model Law 133 can be extended by the arbitral tribunal on its own initiative. 134    

8.1.1 The courts do not have jurisdiction to intervene in arbitral proceedings in relation to matters governed by the Model Law, except where the Model Law expressly permits such interference. 135  

8.2.1 Where there is an arbitration agreement between parties and a dispute arises which is within the ambit of that arbitration agreement then, where proceedings have been commenced in the courts and a party so requests (not later than when submitting its first statement on the substance of the dispute), the court must stay the court proceeding and refer the parties to arbitration to resolve that dispute, unless the court finds that the arbitration agreement is void, inoperative or incapable of being performed. 136    

8.3.1 The Model Law expressly recognises that it is not incompatible with an arbitration agreement for a party to request, either before or during arbitral proceedings, a court to grant an interim measure. 137 The IAA does not require a party to seek an interim measure from an arbitral tribunal before a party makes such a request.  

8.3.2 A court has the same power of issuing an interim measure in relation to arbitration proceedings as it has in relation to proceedings in court. 138   

8.3.3 The arbitration rules for an institution may also provide a more detailed (or constrained) procedure for applying to the courts or the arbitral tribunal for interim or emergency relief. For example, clause 7.1 of Schedule 1 to the ACICA Arbitration Rules provides that a party has the right to apply to the courts for emergency interim measures. 

9.1.1 An application to set aside an award must be made within: 

1. three months after the date of receipt of the award; or  
2. where a party has made a request under Article 33 of the Model Law, 139 within three months after the arbitral tribunal has disposed of the application to correct or interpret the award or to provide a further award in respect of an issue not dealt with in the award. 140  

9.2.1 There is no provision in the IAA that allows parties to agree to exclude the right to seek to set aside an award pursuant to Article 34 of the Model Law. 141 That right is a fundamental right afforded to each party. However, if a party wishes to rely upon this provision, it must comply with the strict time limit set out in Article 34(3); otherwise it would have no statutory right to seek to have an award set aside.  

9.3.1 For international arbitrations seated in Australia, there is no ability to appeal an award. The only recourse permitted is to apply to set aside the award on the limited grounds specified in Article 34 of the Model Law. 142 These are as follows:  

1. a party to the arbitration agreement was under some incapacity or the arbitration agreement is not legally valid; 143  
2. the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present its case; 144 
3. the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains decisions beyond the scope of the submission to arbitration (note that if those aspects of the decision can be separated from the matters properly decided then only the matters not properly decided shall be set aside); 145 
4. the composition of the arbitral tribunal was not in accordance with the parties’ agreement (unless that agreement breached a mandatory provision of the Model Law), or failing such agreement was not in accordance with the Model Law; 146  
5. the arbitration procedure was not in accordance with the parties’ agreement (unless that agreement breached a mandatory provision of the Model Law), or failing such agreement was not in accordance with the Model Law; 147  
6. (f) the subject matter of the dispute is not capable of settlement by arbitration under the laws of Australia; 148 or (g) the award conflicts with public policy in Australia. 149 An interim measure or an award will be contrary to public policy if the making of the interim measure or award was induced or affected by fraud or corruption, or where a breach of the rules of natural justice occurred in connection with the making of the interim measure or the award. 150 

10.1.1 Article 35 of the Model Law 151 governs the recognition and enforcement of international arbitration awards made in Australia.  

10.1.2 The first step to enforce an arbitral award is to apply to the Federal Court of Australia or the Supreme Court of a State or Territory for the award to be recognised. 152 The party applying for the enforcement is required to supply the original award or a copy. 153 If the award is not in English, the court may request the party supply a translation. 154 

10.1.3 An Australian court can refuse enforcement of an international award made in Australia if one of the grounds in Article 36(a) and (b) of the Model Law 155 exist. These are: 

1. a party to the arbitration agreement was under some incapacity or the arbitration agreement is not legally valid; 156  
2. the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present its case; 157 
3. the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains decisions beyond the scope of the submission to arbitration (note that if those aspects of the decision can be separated from the matters properly decided then only the matters not properly decided shall be set aside); 158  
4. the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the parties’ agreement (unless that agreement breached a mandatory provision of the Model Law), or failing such agreement was not in accordance with the Model Law; 159 
5. the subject matter of the dispute is not capable of settlement by arbitration under the laws of Australia; 160 or 
6. the award conflicts with public policy in Australia. 161 An interim measure or an award will be contrary to public policy if the making of the interim measure or award was induced or affected by fraud or corruption, or where a breach of the rules of natural justice occurred in connection with the making of the interim measure or the award .162  

10.2.1 As noted above, Australia is a signatory to the New York Convention. Foreign awards are enforceable in the Federal Court of Australia pursuant to section 8(3) of the IAA. The only grounds on which the Federal Court of Australia may refuse to enforce a foreign award are set out in section 8(5) and section 8(7) of the IAA, which provide for the court to refuse enforcement where: 

1. a party to the arbitration agreement, under the law applicable to them, was under some incapacity at the time when the agreement was made;  163  
2. the arbitration agreement is not valid under the law expressed in the arbitration agreement to be applicable to it or, where no law is so expressed to be applicable, under the law of the country where the award was made; 164  
3. that party was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present their case in the arbitration proceedings; 165   
4. the award deals with a difference not contemplated by, or not falling within the terms of, the submission to arbitration, or contains a decision on a matter beyond the scope of the submission to arbitration 166 (note that where the issues not contemplated by or falling within the submission to arbitration can be separated then the part of the award dealing with matters properly within the arbitral tribunal’s jurisdiction may be enforced); 167   
5. the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; 168   
6. the award has not yet become binding on the parties to the award or has been set aside or suspended by a competent authority of the country in which, or under the law of which, the award was made; 169  
7. the subject matter of the difference between the parties to the award is not capable of settlement by arbitration under the laws in force in the State or Territory in which the court is sitting; 170 or 
8. to enforce the award would be contrary to public policy (including, without limitation where the award was induced or affected by fraud or corruption or a breach of the rules of natural justice occurred in connection with the making of the award). 171