On 13 October 2015, the Civil Law and Justice (Omnibus Amendments) Bill 2015 received assent. With little fanfare, the Bill has made small, though important amendments to the International Arbitration Act 1974 (Act). The amendments further enhance Australia's reputation as a pro-arbitration jurisdiction.
A presumption in favour of confidentiality
Sections 23G-C of the Act previously provided for the confidentiality of international arbitrations seated in Australia on an opt-in basis. The effect was that where parties did not opt-in, the arbitral proceedings were private but not confidential (that is to say, an arbitration held pursuant to an agreement was private in the sense that it was not open to the public). In respect to arbitration agreements entered into after the date of assent, the Act now provides for a presumption in favour of confidentiality and the provisions operate on an opt-out basis. This brings the Act into line with the uniform domestic arbitration legislation.
Broadening the scope of the enforceability
Section 8(4) of the Act previously provided that awards made in countries that were not a party to the New York Convention were not capable of enforcement by parties who were not Australian or otherwise from a country who was a party to the Convention. This section of the Act has been repealed and this requirement for the enforceability of an award in Australia has fallen away. Although this may be of assistance to foreign parties seeking to enforce in Australia, it is no consequence for Australian parties.
Consistent capacity requirement
Section 8(5) of the Act previously provided that a party could resist enforcement on the basis that it did not have legal capacity at the time the arbitration agreement was made. This section has been broadened and made to be consistent with the UNCITRAL Model Law and the uniform State domestic arbitration legislation. The Act now provides that a party may resist enforcement on the basis that any party to the arbitration agreement did not have legal capacity at the time the arbitration agreement was made, not just the party resisting enforcement.
Plugging the black hole
A separate amendment to section 21 of the Act in August plugged what some commentators described as a "legislative black hole". Section 21 provides that, if the UNCITRAL Model Law applies to an arbitration, no State or Territory arbitral law (any of the uniform acts) will apply. Before 6 July 2010, however, parties could opt-out of the Model Law implemented by the Act and instead choose a State or Territory arbitral law. The so-called black hole arose because section 21 did not disclose whether it merely applied prospectively, or also retrospectively. If section 21 only applied prospectively, and an arbitration agreement entered into before 6 July 2010 opted out of the Model Law in favour of a State or Territory arbitral law, that arbitration agreement would have nominated an arbitral law which had ceased to exist because the former State and Territory arbitral laws have been progressively repealed since that date. To plug the black hole, the Act is now clear that section 21 operates in respect of any arbitration commenced after 6 July 2010.
All of the above amendments point to the continued support of Arbitration in Australia.
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