5. INTERNATIONAL RECOGNITION OF THE DOCTRINES OF SEVERABILITY AND
5.2 International Recognition of the Severability and Competence-Competence
5.2.2 The Arbitral Institutions Rules
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Under Article 11205 of the Cairo Convention206, the tribunal has the authority to rule on any jurisdictional challenge or objection to its jurisdiction. This includes challenges that it lacks jurisdiction, other additional challenges or direct defences in connection with the arbitrated dispute as well as other procedural issues. Therefore, the Cairo Convention recognizes the doctrine of Competence-Competence. However, there is no express provision or reference to the doctrine of severability.
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Container Contract, it shall be treated as an independent contract. That is why the arbitration agreement will not be nullified because of the mere invalidation or nullification of the Container Contract. Therefore, the LCIA Rules recognize both doctrines in question, namely, the doctrine of severability and the Competence-Competence doctrine.
Interestingly, the fourth paragraph of Article 23 goes further in providing a waiver of, or a negative obligation on, the parties. Under that provision the disputant parties are not allowed to recourse to any judicial body, including courts, to rule on the arbitral jurisdiction during the proceedings unless otherwise agreed.
(ii) ICC209 Rules of Arbitration Article 6 of the ICC Rules provides that:
“Effect of the Arbitration Agreement 210: 1)[----]
2)[----]
3)If any party against which a claim has been made does not submit an Answer, or raises one or more pleas concerning the existence, validity or scope of the arbitration agreement or concerning whether all of the claims made in the arbitration may be determined together in a single arbitration, the arbitration shall proceed and any question of jurisdiction or of whether the claims may be determined together in that arbitration shall be decided directly by the arbitral tribunal, unless the Secretary General refers the matter to the Court for its decision pursuant to Article 6(4).
4)In all cases referred to the Court under Article 6(3), the Court211 shall decide whether and to what extent the arbitration shall proceed. The arbitration shall proceed if and to the extent that the
23.4 By agreeing to arbitration under these Rules, the parties shall be treated as having agreed not to apply to any state court or other judicial authority for any relief regarding the Arbitral Tribunal's jurisdiction or authority, except with the agreement in writing of all parties to the arbitration or the prior authorization of the Arbitral Tribunal or following the latter's award ruling on the objection to its jurisdiction or authority.” (emphasis added).
209 International Chamber of Commerce Arbitration Rules effective from 1 January 2012.
210 http://www.iccwbo.org/products-and-services/arbitration-and-adr/arbitration/icc-rules-of-arbitration/ accessed 3 July 2014.
211 This term is defined in the ICC Rules as, and refers to, the International Court of Arbitration.
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Court is prima facie satisfied that an arbitration agreement under the Rules may exist. [---].
5)In all matters decided by the Court under Article 6(4), any decision as to the jurisdiction of the arbitral tribunal, except as to parties or claims with respect to which the Court decides that the arbitration cannot proceed, shall then be taken by the arbitral tribunal itself.” (emphasis added) Under Paras 3 and 5 of Article 6 of the ICC Rules, the tribunal is entitled to rule on its jurisdiction.
Further, under para 9 of Article 6 of the ICC Rules, the tribunal will assume that jurisdiction even if there are allegations to the validity or formation of the contract or even if the tribunal finds that the contract is invalid or non-existent. Therefore, the ICC Rules address the doctrine of Competence-Competence while there is no express provision on the doctrine of severability.
Having said that, it can be argued that the last sentence of Para 9212 of Article 6 of the ICC Rules, clearly raises the logical result of the severability doctrine. That Para entitles the arbitrator to rule on the disputed matter even if the main contract was not properly formed or void. This suggests that the invalidation or recession of the Container Contract will not render the arbitration agreement void. Therefore, severability is considered under the said rules.
(iii) AAA Rules213
The Article 7 of the AAA Rules provides that:
R-7. Jurisdiction214
“(a) The arbitrator shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope, or validity of the arbitration agreement or to the arbitrability of any claim or counterclaim.
212 Para 9 of Article 6 of the ICC Rules provides that: “9)Unless otherwise agreed, the arbitral tribunal shall not cease to have jurisdiction by reason of any allegation that the contract is non-existent or null and void, provided that the arbitral tribunal upholds the validity of the arbitration agreement. The arbitral tribunal shall continue to have jurisdiction to determine the parties’ respective rights and to decide their claims and pleas even though the contract itself may be non- existent or null and void.” (emphasis added).
213 American Arbitration Association Rules amended and effective since October 1, 2013.
214 https://www.adr.org/aaa/ShowProperty?nodeId=/UCM/ADRSTG_004103&revision=latestreleased accessed 1 July 2014.
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(b) The arbitrator shall have the power to determine the existence or validity of a contract of which an arbitration clause forms a part. Such an arbitration clause shall be treated as an agreement independent of the other terms of the contract. A decision by the arbitrator that the contract is null and void shall not for that reason alone render invalid the arbitration clause.
(c) [----].”
Under Article 7 of the AAA Rules, the arbitral tribunal is entrusted with the authority to rule on its own jurisdiction. Further, the tribunal is empowered to decide on the formation or validity of the Container Contract. The Arbitration clause is considered an independent contract separated from the Container Contract. The mere invalidation of the Container Contract will not negatively affect the arbitration clause which will remain in full force and effect.
Therefore, the AAA Rules recognize the two doctrines of severability and Competence- Competence doctrine and the same were addressed in one article, i.e. Article 7.