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CS Professional · Arbitration, Mediation and Conciliation · Conceptual Framework of International Commercial Arbitration

Mumbai-based Kalyani Machines Ltd and a Singapore firm agreed to arbitration seated in Mumbai, an international commercial arbitration. The contract says 'the substantive law of Singapore governs the contract'. Neither party said anything about conflict of laws rules. How should the tribunal read this choice?

The tribunal must treat the choice as pointing directly to Singapore's substantive law. Section 28(1)(b)(ii) says a designation of a country's law is read, unless otherwise expressed, as the substantive law and not the conflict of laws rules of that country.

  1. AAs referring directly to Singapore's substantive law, not its conflict of laws rulesCorrect
  2. BAs referring to Singapore's conflict of laws rules, which may then point to another country's law
  3. CAs referring to Indian substantive law because the seat is in Mumbai
  4. DAs leaving the tribunal free to apply any law it considers appropriate

Explanation

Under section 28(1)(b)(ii), where the seat is in India and the arbitration is international commercial, a designation of a country's law is construed, unless otherwise expressed, as referring directly to that country's substantive law and not its conflict of laws rules. The parties made no contrary statement. Option B ignores this default rule.

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