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Cabinet approves the Arbitration and Conciliation (Amendment) Bill, 2018

Capital Market 

The chaired by has approved the and (Amendment) Bill, 2018 for introduction in the Parliament. It is a part of the efforts of the Government to encourage institutional for settlement of disputes and make a centre of robust Alternative (ADR) mechanism.


The Amendments in the Act of 1996 will facilitate achieving the goal of improving institutional by establishing an independent body to lay down standards, make process more party friendly, cost effective and ensure timely disposal of cases.


i. To facilitate speedy appointment of arbitrators through designated arbitral institutions by the or the High Court, without having any requirement to approach the court in this regard. It is envisaged that parties may directly approach arbitral institutions designated by the for International Commercial and in other cases the concerned High Courts.

ii. The amendment provides for creation of an independent body namely the Council of (ACI) which will grade arbitral institution and accredit arbitrators by laying down norms and take all such steps as may be necessary to promote and encourage arbitration, conciliation, mediation and other ADR Mechanism and for that purpose evolve policy and guidelines for the establishment., operation and maintenance of uniform professional standards in respect of all matters relating to and ADR mechanism. The Council shall also maintain an electronic depository of all arbitral awards,

iii. The ACI shall be a body corporate. The of ACI shall be a person who has been a of the or or of any or any eminent person.

Further, the other Members would include an eminent academician etc. besides other Government nominees,

iv. It is proposed to amend sub section (1) of section 29A by excluding International from the bounds of timeline and further to provide that the time limit for arbitral award in other arbitrations shall be within 12 months from the completion of the pleadings of the parties.

v. A new section 42A is proposed to be inserted to provide that the and the arbitral institutions shall keep confidentiality of all arbitral proceedings except award. Further, a new section 42B protects an from suit or other legal proceedings for any action or omission done in good faith in the course of proceedings.

vi. A new section 87 is proposed to be inserted to clarify that unless parties agree otherwise the Amendment Act 2015 shall not apply to (a) Arbitral proceedings .which have commenced before the commencement of the Amendment Act of 2015 (b) Court proceedings arising out of or in relation to such arbitral proceedings irrespective of whether such court proceedings are commenced prior to or after the commencement of the Amendment Act of 2015 and shall apply only to Arbitral proceedings commenced on or after the commencement of the Amendment Act of 2015 and to court proceedings arising out of or in relation to such Arbitral proceedings.


The and Act, 1996, was amended by the and (Amendment) Act, 2015 in order to make process user friendly, cost effective and ensure speedy disposal and neutrality of arbitrators. However, to give a boost to institutional, vis-a-vis ad hoc and to remove some practical difficulties in applicability of the and (Amendment) Act, 2015, a (HLC) under the Chairmanship of Justice B. H. Srikrishna, Retired Judge, of India, was constituted by the Central Government, The HLC was given the mandate

to examine the effectiveness of existing mechanism by studying the functioning and performance of Arbitral Institutions in India;

to devise a road map to promote institutionalized mechanisms in India;

to evolve an effective and efficient eco-system for commercial and submit a Report on suggested reforms in the statute.

The HLC submitted its Report on 30th July, 2017 and has recommended for amendments in the and Act, 1996. The proposed amendments are as per the recommendations of the

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First Published: Thu, March 08 2018. 09:39 IST