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CS Professional · Arbitration, Mediation and Conciliation · Commercial Transactions

In an international commercial arbitration seated in Mumbai between Rao Pharma Ltd and a German distributor, the contract designates no governing law. What is the tribunal's duty on the substance of the dispute?

The tribunal applies the rules of law it considers appropriate given all the circumstances surrounding the dispute. Where parties have designated no law in an international commercial arbitration seated in India, the tribunal has this discretion rather than being bound to Indian law.

  1. AApply Indian substantive law mandatorily
  2. BApply the rules of law it considers appropriate given all the circumstances surrounding the disputeCorrect
  3. CApply the law of the distributor's country
  4. DRefer the parties to court to fix the governing law

Explanation

Failing a designation by the parties, the tribunal in an international commercial arbitration seated in India applies the rules of law it considers appropriate given all the circumstances. Indian law is mandatory only for domestic arbitrations.

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