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Distinction between domestic and international arbitration considered and restrictive interpretation of arbitrariness reaffirmed in domestic arbitration

15 September 2015

Authors: Nathalie Voser; Elena Trabaldo-de Mestral

In a French-language decision dated 14 July 2015, the Swiss Supreme Court has rejected an application to set aside an award on the ground of arbitrariness in domestic arbitration proceedings.
As a preliminary question, the Swiss Supreme Court examined the international or domestic nature of the arbitration, as only awards issued in the context of domestic arbitrations can be set aside on grounds of arbitrariness. The Swiss Supreme Court acknowledged that its previous leading decision has been criticised by legal scholars. However, the court did not elaborate further on this issue, finding that it was not necessary to determine whether the present arbitration was international or domestic as the challenge had to be rejected.
Although the court left open the issue of whether the current test for determining whether an arbitration is international or domestic is correct, the fact that it recognised that its previous case law has been criticised can be seen as a sign that it may revisit its position when another case presents itself. This decision is also a useful reminder of the meaning of arbitrariness in domestic arbitration. (Decision 4A_143/2015.)

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Published in Practical Law Arbitration


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