2. Arbitral proceedings shall be deemed to commence on the date on which the notification of arbitration is received by the respondent. 3. The notice of arbitration shall include the following: (b) The names and addresses of the parties; (c) A reference to the arbitration clause or agreement that is invoked; (d) A reference to the contract out of or in relation to which the dispute arises; (e) The general nature of the claim and an indication of the amount involved, if any; (f) The relief or remedy sought; (g) A proposal as to the number of arbitrators (i.e. one or three), if parties have not previously agreed thereon. 4. The notice of arbitration may also include: (a) The proposals for the appointments of a sole arbitrator and an appointing authority referred to in article 6, paragraph 1; (b) The notification of the appointment of an arbitrator referred to in article 7; (c) The statement of claim referred to in article 18. Number of arbitrators Article 5 If the parties have not previously agreed on the number of arbitrators (i.e. one or three), and if within 15 days after the receipt by the respondent of the notice of arbitration the parties have not agreed that there shall be only one arbitrator, three arbitrators shall be appointed. Appointment of arbitrators (articles 6 to 8) Article 6 1. If a sole arbitrator is to be appointed, either party may propose to the other: (a) The names of one or more persons, one of whom would serve as the sole arbitrator; and (b) If no appointing authority has been agreed upon by the parties, the name or names of one or more institutions or persons, one of whom would serve as appointing authority. 2. If within 30 days after receipt by a party of a proposal made in accordance with paragraph 1 the parties have not reached agreement on the choice of a sole arbitrator, the sole arbitrator shall be appointed by the appointing authority agreed upon by the parties. If no appointing authority has been agreed upon by the parties, or if the appointing authority agreed upon refuses to act or fails to appoint the arbitrator within 60 days of the receipt of a party's request therefor, either party may request the Secretary-General of the Permanent Court of Arbitration at The Hague to designate an appointing authority. 3. The appointing authority shall, at the request of one of the parties, appoint the sole arbitrator as promptly as possible. In making the appointment the appointing authority shall use the following list-procedure, unless both parties agree that the list-procedure should not be used or unless the appointing authority determines in its discretion that the use of the list-procedure is not appropriate for the case: (a) At the request of one of the parties the appointing authority shall communicate to both parties an identical list containing at least three names; (b) Within 15 days after the receipt of this list, each party may return the list to the appointing authority after having deleted the name or names to which he objects and numbered the remaining names on the list in the order of his preference; (c) After the expiration of the above period of time the appointing authority shall appoint the sole arbitrator from among the names approved on the lists returned to it and in accordance with the order of preference indicated by the parties; (d) If for any reason the appointment cannot be made according to this procedure, the appointing authority may exercise its discretion in appointing the sole arbitrator. 4. In making the appointment, the appointing authority shall have regard to such considerations as are likely to secure the appointment of an independent and impartial arbitrator and shall take into account as well the advisability of appointing an arbitrator of a nationality other than the nationalities of the parties. Article 7 1. If three arbitrators are to be appointed, each party shall appoint one arbitrator. The two arbitrators thus appointed shall choose the third arbitrator who will act as the presiding arbitrator of the tribunal. 2. If within 30 days after the receipt of a party's notification of the appointment of an arbitrator the other party has not notified the first party of the arbitrator it has appointed: (a) The first party may request the appointing authority previously designated by the parties to appoint the second arbitrator: or (b) If no such authority has been previously designated by the parties, or if the appointing authority previously designated refuses to act or fails to appoint the arbitrator within 30 days after receipt of a party's request therefor, the first party may request the Secretary-General of the Permanent Court of Arbitration at The Hague to designate the appointing authority. The first party may then request the appointing authority so designated to appoint the second arbitrator. In either case, the appointing authority may exercise its discretion in appointing the arbitrator. 3. If within 30 days after the appointment of the second arbitrator the two arbitrators have not agreed on the choice of the presiding arbitrator, the presiding arbitrator shall be appointed by an appointing authority in the same way as a sole arbitrator would be appointed under article 6. General provisions Article 15 1. Subject to these Rules, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at any stage of the proceedings each party is given a full opportunity of presenting its case. 2. If either party so requests at any stage of the proceedings, the arbitral tribunal shall hold hearings for the presentation of evidence by witnesses, including expert witnesses or for oral argument. In the absence of such a request, the arbitral tribunal shall decide whether to hold such hearings or whether the proceedings shall be conducted on the basis of documents and other materials. 3. All documents or information supplied to the arbitral tribunal by one party shall at the same time be communicated by that party to the other party. Place of arbitration Article 16 1. Unless the parties have agreed upon the place where the arbitration is to be held, such place shall be determined by the arbitral tribunal, having regard to the circumstances of the arbitration. 2. The arbitral tribunal may determine the locale of the arbitration within the country agreed upon by the parties. It may hear witnesses and hold meetings for consultation among its members at any place it deems appropriate, having regard to the circumstances of the arbitration. 3. The arbitral tribunal may meet at any place it deems appropriate for the inspection of goods, other property or documents. The parties shall be given sufficient notice to enable them to be present at such inspection. 4. The award shall be made at the place of arbitration. Language Article 17 1. Subject to an agreement by the parties, the arbitral tribunal shall, promptly after its appointment, determine the language or languages to be used in the proceedings. This determination shall apply to the statement of claim, the statement of defense, and any further written statements and, if oral hearings take place, to the language or languages to be used in such hearings. 2. The arbitral tribunal may order that any documents annexed to the statement of claim or statement of defense, and any supplementary documents or exhibits submitted in the course of the proceedings, delivered in their original language, shall be accompanied by a translation into the language or languages agreed upon by the parties or determined by the arbitral tribunal. Statement of claim Article 18 1. Unless the statement of claim was contained in the notice of arbitration, within a period of time to be determined by the arbitral tribunal, the claimant shall communicate his statement of claim in writing to the respondent and to each of the arbitrators. A copy of the contract, and of the arbitration agreement if not contained in the contract, shall be annexed thereto. 2. The statement of claim shall include the following particulars: (a) The names and addresses of the parties; (b) A statement of the facts supporting the claim; (c) The point at issue; (d) The relief or remedy sought. The claimant may annex to his statement of claim all documents he deems relevant or may add a reference to the documents or other evidence he will submit. Statement of defense Article 19 1. Within a period of time to be determined by the arbitral tribunal, the respondent shall communicate his statement of defense in writing to the claimant and to each of the arbitrators. 2. The statement of defense shall reply to the particulars (b), (c) and (d) of the statement of claim (article 18, para. 2). The respondent may annex to his statement the documents on which he relies for his defense or may add a reference to the documents or other evidence he will submit. 3. In his statement of defense, or at a later stage in the arbitral proceedings if the arbitral tribunal decides that the delay was justified under the circumstances, the respondent may make a counterclaim arising out of the same contract or rely on a claim arising out of the same contract for the purpose of a set-off. 4. The provisions of article 18, paragraph 2 shall apply to a counterclaim and a claim relied on for the purpose of a set-off. Pleas as to arbitrator's jurisdiction Article 21 1. The arbitral tribunal shall have the power to rule on objections that it has no jurisdiction, including any objections with respect to the existence or validity of the arbitration clause or of the separate arbitration agreement. 2. The arbitral tribunal shall have the power to determine the existence or the validity of the contract of which an arbitration clause forms a part. For the purposes of article 21, an arbitration clause which forms part of a contract and which provides for arbitration under these Rules shall be treated as an agreement independent of the other terms of the contract. A decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause. 3. A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than in the statement of defense or, with respect to a counterclaim, in the reply to the counterclaim. 4. In general, the arbitral tribunal should rule on a plea concerning its jurisdiction as a preliminary question. However, the arbitral tribunal may proceed with the arbitration and rule on such a plea in their final award. Decisions Article 31 1. When there are three arbitrators, any award or other decision of the arbitral tribunal shall be made by a majority of the arbitrators. 2. In the case of questions of procedure, when there is no majority or when the arbitral tribunal so authorizes, the presiding arbitrator may decide on his own, subject to revision, if any, by the arbitral tribunal. Applicable law, amiables compositeurs Article 33 1. The arbitral tribunal shall apply the law designated by the parties as applicable to the substance of the dispute. Failing such designation by the parties, the arbitral tribunal shall apply the law determined by the conflict of laws rules which it considers applicable. 2. The arbitral tribunal shall decide as amiable compositeur or ex aequo et bono only if the parties have expressly authorized the arbitral tribunal to do so and if the law applicable to the arbitral procedure permits such arbitration. 3. In all cases, the arbitral tribunal shall decide in accordance with the terms of the contract and shall take into account the usages of the trade applicable to the transaction. Costs (articles 38 to 40) Article 38 The arbitral tribunal shall fix the costs of arbitration in its award. The term "costs" includes only: (a) The fees of the arbitral tribunal to be stated separately as to each arbitrator and to be fixed by the tribunal itself in accordance with article 39; (b) The travel and other expenses incurred by the arbitrators; (c) The costs of expert advice and of other assistance required by the arbitrators; (d) The travel and other expenses of witnesses to the extent such expenses are approved by the arbitral tribunal; (e) The costs for legal representation and assistance of the successful party if such costs were claimed during the arbitral proceedings, and only to the extent that the arbitral tribunal determines that the amount of such costs is reasonable; (f) Any fees and expenses of the appointing authority as well as the expenses of the Secretary-General of the Permanent Court of Arbitration at The Hague. Article 40 1. Except as provided in paragraph 2, the costs of arbitration shall in principle be borne by the unsuccessful party. However, the arbitral tribunal may apportion each of such costs between the parties if it determines that apportionment is reasonable, taking into account the circumstances of the case. 2. With respect to the costs of legal representation and assistance referred to in article 38, paragraph (e), the arbitral tribunal, taking into account the circumstances of the case, shall be free to determine which party shall bear such costs or may apportion such costs between the parties if it determines that apportionment is reasonable. Model Arbitration Clause or Separate Arbitration Agreement Any dispute, controversy or claim arising out of or relating to this contract. or the breach, termination or invalidity thereof, shall be settled by arbitration in accordance with the UNCITRAL Arbitration Rules as at present in force. Note-Parties may wish to consider adding: (name of institution or person); Conciliation U.S.-People's Republic of China On October 28, 1977, Donald B. Straus, president of the American Arbitration Association (AAA) Research Institute, announced the successful conclusion of the first joint conciliation case between a U.S. corporation and a Chinese foreign trade organization. The conciliation was jointly administered by the AAA and the Legal Affairs Department of the China Council for the Promotion of International Trade (CCPIT). Portions of the text of the October 28, 1977, announcement by the AAA follow: An American corporation and a Chinese foreign trade organization, assisted by an American conciliator appointed by the AÃÂ and a Chinese conciliator appointed by the CCPIT, agreed upon terms for the friendly settlement of a commercial dispute which had arisen in U.S.-China trade. The unique arrangements for joint conciliation were developed in three years of discussions on dispute resolution initiated by the National Council for U.S.-China Trade and carried on by the AAA and the Foreign Trade Arbitration Commission (FTAC) of the CCPIT. The joint conciliation took place in Peking over a ten-day period in October. Although the first conciliation was in Peking, future cases may be conducted either in China, the United States or at some other mutually agreed location. Before the conciliation meetings in Peking, the parties had exchanged written statements concerning the issues in dispute. The conciliation was administered jointly by the AAA and the FTAC. Donald B. Straus, president of the AAA Research Institute, and Howard M. Holtzmann, chairman of the AAA International Arbitration Committeee, attended the conciliation in Peking as observers and to assist in the administration of the case. Walter Sterling Surrey was the conciliator appointed by the AAA. The AAA and the CCPIT have begun to review the experience of the first case with the aim of further improving the process of joint conciliation. While in Peking, Mr. Straus and Mr. Holtzmann had extensive consultations for this purpose with Mr. Jen Tsienhsin, head of the Legal Department of the CCPIT and Secretary General of the FTAC. Also discussed were various arrangements for arbitration, including arbitration in a third country when the |