There has been lot of changes taking place across the country from
decriminalization of adultery to the present citizen ship amendment. Among all
such major changes one of a significant aspect was has been the Arbitration &
conciliation Amendment Bill 2019 .
The Arbitration & conciliation Amendment Bill 2019 was presented on July 15,2019
in Rajya sabha by Minister of Law and Justice Mr.Ravi Shankar Prasad and this
bill after due discussions was passed on July 18TH ,2019 and was then presented
in Lok sabha and was passed on August 1,2019 and was assented by the President
on 9th August ,2019.
The bill was introduced to make requisite amendments in the Arbitration and
Conciliation Act,1996.It mainly focused on insertion of various new provisions
that was required for development of ADR mechanism India.It also consisted
provision regarding the international and domestic arbitration and concentrated
on changing different aspects of the Act respectively
The arbitration and conciliation Act has been a dynamic area that has been
gradually improving in every new aspect leading to large contributions in the
area of ADR Mechanism .The arbitration and conciliation Amendment bill 2019
focused more on the changes that need to be implemented in the act to make
Arbitration and conciliation more adaptive with the contemporary changes .It
aimed in improvising the standard of alternate dispute resolution to a level
where people can rely on it without any second thought and build a strong
foundation for the mechanism.
Let us have a glance to the aspects of new Amendment
Establishment of Arbitration Institution
Sec 2 clause (ca) has defined the arbitral institution as the institution
designated by HON’BLE Supreme court of India or High court under this Act.These
institution has been established after recommendations of high power committee
who has raised the concern that there has to be more new ways and modes to be
formulated to develop arbitration in India These council has said that
establishment of this institutions will bring a more systematic structure of
Main objective of establishment of this institutions was to lessen the
difficulties that people are facing related to extensive delay in appointment of
arbitrators to the proceedings and also there has been an unexpected delay in
seeking arbitration as a remedy in dispute resolution as approaching high court
or Supreme court for filling the applications of arbitration has become a
cumbersome and delaying process.
To remove this difficulty, the Amendment bill 2019 has stressed on establishment
of these institutions so that the parties can avoid undergoing of this long
process and people need not approach supreme court or high court for seeking
arbitration as a medium of resolution to the dispute but rather approach these
institution which are designated by the member of arbitration council.
Theses institutions are responsible in training the arbitrators with proper
necessary skills and make the more effective and efficient in the proceeding
process and make sure that they are imbibed with the necessary skills that would
make arbitrators more expeditious.
this institutions act as an regulating body in appointment of the arbitrators
.The arbitration council of institution shall consist of retired judges and
retried scientific ,finance minister or such that and aid the arbitrators.
Sec 11 –Appointment of Arbitrators
According insertion of new clause -that is clause has been introduced as an
According it states that –the Hon’ble Supreme court and High court shall have
power to designate arbitral institutions from time to time which shall have been
graded by the council that has been formed under sec 43-I for the purposes of
Provided that in case of a high court there is no graded arbitral institution
available within its jurisdiction then in such case the Chief Justice of such
High court may maintain a panel of arbitrators who are transparent and
independent for discharging the functions and duties of arbitral institution and
any reference to the arbitrator shall be deemed to be an arbitral institution
for the purposes of this section and such arbitrator appointed by a party shall
be entitled to such fees as the rates specified in the schedule.
The chief justice of such High court may with time to time review the panel of
arbitrators . The application for appointment of the arbitrator shall be
disposed off in thirty days from the date of service of the notice on the
Arbitral Council of India-
The arbitral institutions shall be graded and evaluated by arbitral council of
India.The 2019 Amendment bill has made it compulsory for the establishment of
arbitral council of India. In lieu of this Amendment ,a new part -1A has been
inserted consisting of section 43A- 43M related to Arbitration council .
Arbitral councils of India shall be established by the notification in official
gazette by the central government. The council that has been established shall
be a body corporate having perpetual succession having common seal ‘and such
council shall have right to acquire or sell property in the name of council and
can sue anyone or can be sued. The head office is to be located in New Delhi.
Constitution of Arbitral Council of India-
The council shall consist of following members:
- person who has been Judge of supreme court high court / chief justice of
high court /Judge of high court or an eminent person having required
knowledge and experience in fields of conduct and administration of
arbitration who to be appointed by the central government in consultation
with the Chief justice of India who shall be chairperson
- an eminent arbitration practioner having required knowledge and
experience in institutional arbitration in both domestic and international
and such person shall be nominated by the central government who is a
- an eminent academician having experience in research and teaching in
field of arbitration and alternate dispute resolution laws who shall be
appointed in consultation with chairperson –member
- secretary to the Government of India in the Department of Legal affairs
,Ministry of Law and Justice or his representative not below a rank of joint
secretary –member ,ex officio
- one representative of a recognised body of commerce and Industry,choosen
on the rotational basis by the central government and such member is a part
- Secretary to the government of India in the Department of
Expenditure,Ministry of finance or his representative not below the rank of
- chief executive officer who shall be the Secretary or can be ex officio
Duties And Functions of Council-
It shall be the duty of the council to take all such measures as may be
necessary to promote and encourage arbitration and other various alternate
dispute mechanisms like mediation, negotiation, conciliation or any other
alternate dispute resolutions. It is established mainly to frame policy and
guidelines for the establishment ,operation and maintenance of uniform
professional standard in respect of matters relating to arbitration. The council
has been vested with many powers in order to properly discharge the duties and
functions that are need to be performed by the council in order to properly
implement and develop arbitration.
The council may:
- frame policies related to grading of the arbitral institutions.
- make recommendations to the central governments on various measure that
needed to be adopted to make provisions related to commercial disputes.
- promote industrial arbitration by strengthen arbitral institutions.
- such other functions as may be decided by the central government.
Grading of Arbitral Institution
The council shall make grading of arbitral institutions on the basis of criteria
relating to infrastructure ,quality and calibre of arbitrators ,performance and
compliance of time limits for disposal for domestic or international commercial
arbitrations, in such manner as may be specified by the regulations.
Standards Set Up For Arbitrators:
Also bill consists a clause which states that the qualifications, experience and
norms for accreditations of arbitrators shall be such as specified in Eighth
schedule which is inserted newly into the Act stating all the specifications
related to arbitrators which ensures that the arbitrators that are appointed has
the calibre and expertise in the matter and can effectively and efficiently pass
an award without jeopardising any party to dispute or negating the main
foundation of the arbitration proceedings. This was inserted mainly to win the
confidence of people in the alternate dispute resolution mechanism and
encouraging this kind of mechanism.
Electronic Deposit of Award
The new bill imposes a responsibility of maintaining an electronic depository of
arbitral awards made in India and such other records related thereto in such
manner as may be specified by the regulations. The main objective of maintaining
of award in electronic form is to maintain the safety of records so that they
are not manipulated at any time after the passing of the award
Retrospective or prospective effect of the Act
The 2015 Amendment Act shall be applied in following 2 cases unless the parties
to dispute have agreed to apply 2015 amendment -
- The court proceeding arising out of or in relation to such arbitral
proceeding irrespective of whether such court proceedings are commenced
prior to or after the commencement of arbitration and conciliation
(Amendment) ACT 2015.
- Arbitral proceedings commenced before the commencement of the
arbitration and conciliation (Amendment )Act 2015
And the 2015 shall apply only to arbitral proceedings commenced on or after the
commencement of the arbitration and conciliation Amendment Bill 2015 and to
court proceedings arising out of or in relation to such arbitral proceedings.
Insertion of Section 42A Confidentiality
Not regarding to anything contained in any other that is in force ,the
arbitrator,the arbitral institution and the parties to the arbitration agreement
shall maintain confidentiality of all arbitral proceedings except award where
its disclosure is necessary for the purpose of its implementation and
enforcement of award.
Insertion 42B Protection To Arbitrators
There is a protection provided against the arbitrators for anything done under
this Act or to be intended to be done under this Act or the rules or in good
International Commercial Arbitration
It states that award in international commercial arbitration shall be done in
expeditiously as possible and endeavour may be dispose of the matter within a
period of twelve months from the date of the completion of pleadings. Other than
international commercial arbitration shall be made by the arbitral tribunal
within 12 months from the completion of pleadings
Statement of Defence And Claim
The statement of defence and claim in regard to the arbitral proceedings shall
be completed within a period of six months from the date the arbitrator or all
the arbitrators ,as the case may be received noticed in writing of their
appointment. This clause ensures that there is no delay in the process of
arbitration and within estimated time limit the proceeding shall be completed.
These changes are brought with an intention to increase the application ADR
mechanisms in dispute resolutions and was mainly intended to gain confidence of
people by grading the arbitration institutions by eminent members in the
arbitration council.But there must be a proper check on the application of these
provisions ensuring that main intension and objective behind inserting these
clauses must be achieved and should enhance the arbitration proceedings at the