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The Law Applicable to Arbitrability

Bernard Hanotiau

(2014) 26 SAcLJ 874

This article deals with the determination of the law applicable to the issue of arbitrability. A first distinction has to be made between subjective arbitrability – by reason of the quality of one of the parties, when this party is a State, a public collectivity or entity or public body; and objective arbitrability, by reason of the subject matter of the dispute which has been removed from the domain of arbitrable matters by the applicable national law. With respect to subjective arbitrability, it is generally accepted that a State, a state enterprise or a state entity may not invoke its incapacity to enter into an arbitration agreement to refuse to participate in an arbitration to which it has previously consented. On the other hand, the determination of the law applicable to objective arbitrability is more delicate since the solution to the issue may vary depending on whether it is decided by an arbitral tribunal, by a state court to which one of the parties has concurrently submitted the dispute or in the course of a setting-aside or enforcement procedure. If it is accepted that the lex fori generally applies to the issue when it has to be decided by a court in the context of a setting-aside or enforcement procedure or when the court is concurrently seized by a party which deems the dispute is non-arbitrable, the answer is not as clear when the question of arbitrability has to be decided by an arbitral tribunal: the law governing the arbitration agreement seems to be the prevailing answer but the law of the seat is also sometimes applied.