Arbitration - Law Reform Commission
Arbitration
Description
Following a referral from the Attorney General in January 2009, the Law Reform Commission (“the Commission”) placed the review of the Arbitration Law in the Cayman Islands on its law reform agenda.
The review was prompted by the fact that the existing arbitration legislation was widely regarded as outdated and as a deterrent to arbitration business being conducted in the Cayman Islands.
The review focused on the Foreign Arbitral Enforcement Act (1997 Revision) and the Arbitration Act (2001 Revision), which together governed domestic arbitration proceedings and the enforcement of foreign arbitral awards.
Terms of Reference
The objectives of the Commission’s review were:
1. to determine whether a single arbitration regime should be formulated on the basis of the UNCITRAL Model Law on International Commercial Arbitration, for all types of arbitration in the Cayman Islands;
2. to ensure that the law on arbitration is responsive to the issues surrounding the resolution of domestic and transnational commercial disputes, by enabling the business community and arbitration practitioners to operate in a regime which is consistent with acceptable international arbitration practices and developments; and
3. to consider whether any steps can be taken to promote the Cayman Islands as a jurisdiction of choice for international arbitration. In carrying out the review, the Commission examined arbitration legislation and practice in other jurisdictions, including the United Kingdom, Bermuda, Singapore, and Hong Kong as well as the UNCITRAL Model Law on International Commercial Arbitration.
Outcomes
On 11 May, 2009, the Commission published a Discussion Paper titled “Review of the Arbitration Laws of the Cayman Islands”, which was circulated to key stakeholders for consultation.
The Discussion Paper examined, among other matters:
(a) the concept of arbitration;
(b) Cayman Islands arbitration law;
(c) sources of arbitration business;
(d) the UNCITRAL Model Law on International Commercial Arbitration; and
(e) arbitration legislative models in other jurisdictions.
The consultation period commenced on 11 May, 2009, and concluded on 19 June, 2009.
Following consultation and further research, the Commission submitted its Final Report titled “Review of the Arbitration Law of the Cayman Islands” to the Attorney General on 4 January, 2012. The Final Report was supported by a proposed Arbitration Bill, 2012.
The Final Report recommended that the Arbitration Act (2001 Revision) be repealed and replaced with a modernised Arbitration Act, informed by the structure and principles of the UNCITRAL Model Law on International Commercial Arbitration, while also drawing on legislative models from other jurisdictions.
The proposed legislation was intended to:
-provide for party autonomy in the arbitration process;
-limit judicial intervention in arbitral proceedings;
-recognise the separability of the arbitration clause; and
-confer on arbitral tribunals the competence to rule on their own jurisdiction.
The Arbitration Bill, 2012 was passed by the Legislative Assembly on 5 April, 2012 and came into force on 2 July, 2012.
