An Analysis of the Legal Framework and its Interpretation in Case Law and Literature
D. Basic Concepts on Control Exercised in International Arbitration 137
137 D. Basic Concepts on Control Exercised in International Arbitration In assessing which jurisdiction is competent to determine the effectiveness of an arbitral award, there are basically two opposing approaches: The traditional view attaches all relevant powers concerning the arbitration to the forum state and is therefore labelled as the ‘territorial’ approach. The more modern view aims to detach arbitration from almost any interference of national law or local courts, particularly at the seat of the arbitration, and is therefore identifi ed as ‘delocalised’ or ‘transnational’. These views represent contradictory concepts on the nature of international arbitration viewing arbitration either as a dispute resolution mechanism, which is part of a national legal system, or as a co-existing, autonomous pro cess. Such differentiation also involves diverging concepts as to the source and extent of the arbitrators’ powers to adjudicate the issue presented to them and where such adjudication may be reviewed: in essence, the argument focuses on the distinct roles attributed to the seat of the arbitration and its procedural law. Similarly, the issue of the applicable substantive law is highly controversial and almost omnipresent in international arbitration. It may arise at various moments of the arbitration and with regard to several (national) laws: Initially arbitrators have to consider the law governing the validity of the main contract and the stipulated matters (lex contracti), as well as the law applying to the arbitration agreement. Since the separability of the main contract and the arbitration agreement meanwhile is internationally recognised, they may...
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