Like many countries in Asia, Australia has been working hard to promote itself as an arbitration hub. In line with this, the Australian Government has undertaken a number of reforms, in conjunction with Australia's various arbitration institutions, in an attempt to ensure that Australia will have an edge in what is becoming an increasingly competitive market to capture the lucrative business of hosting international arbitrations.

Legal Reforms

The most significant reforms currently taking place in Australia relate to the domestic arbitration regime. Between the mid-80s and early-90s, uniform domestic arbitration legislation was introduced in all Australian states. Unfortunately, its utility as uniform legislation was diminished by a number of drafting discrepancies in its implementation, and as a result, it was possible for different courts in different states to develop individual lines of jurisprudence. Further, as the legislation was first drafted in the early 1980s, it had become dated and ill-suited to meeting the needs of contemporary disputants.

In order to rectify this, the various Australian state governments have agreed to introduce new uniform legislation. The new Commercial Arbitration Acts are intended to be truly uniform, ensuring that regardless of which Australian state the domestic arbitration is taking place in, the applicable law will be the same. The new acts are built around the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration 1985 (incorporating the 2006 amendments). Currently, the new acts have been enacted in New South Wales, Tasmania, Victoria, the Northern Territory and South Australia. However, Western Australia, Queensland and the Australian Capital Territory are yet to have passed the new laws through their respective parliaments.

By using the UNCITRAL Model Law as a basis, the Australian domestic arbitration paradigm is brought into line with international standards. This will have a number of ramifications for Australia's dispute resolution landscape. Ideally, the updated legislation will ensure that arbitration plays an even more important role in resolving commercial disputes. This will, in turn, ensure that Australian clients, practitioners and industries are familiar and comfortable with arbitration as a viable alternative to litigation. This will serve to develop Australia's legal industry even further so that expertise in, and experience with, arbitration become hallmarks of the Australian legal system.

What does Australia have to offer?

One of the major selling points for Australia in its bid to become a venue of choice for arbitrations in the region is the attractiveness of its major cities, particularly Sydney, in hosting arbitrations. Capitalising on the reputation of its legal system, parties to arbitrations in Australia have lauded the presence of a supportive and proactive judiciary. Australia also boasts a well-established and reliable legal profession, with specialist legal advice readily available. Further, and importantly in the highly competitive market for arbitrations, Sydney is significantly cheaper in comparison to other popular arbitration locations such as London, Paris, New York, or Hong Kong.

There is also strong institutional support for parties arbitrating in Australia. The Australian Centre for International Commercial Arbitration (ACICA) is Australia's preeminent international arbitration institution. ACICA was established in 1985 and its members include leading practitioners and academic experts in both international and domestic arbitration. ACICA works closely with the Australian International Disputes Centre (AIDC), which is known for its world-class logistical support of arbitration. This logistical support is essential to the swift resolution of disputes, and the AIDC has proved capable of catering for both small and large disputes, from providing the necessary technologically-equipped meeting rooms to case management and trust account administration.

Recent changes to the ACICA Rules

In 2011, ACICA introduced new arbitration rules with the goal of expediting the resolution of international commercial disputes. The rules were updated in response to the Australian Government's decision to appoint ACICA as the sole default appointing authority under the International Arbitration Act 1974 (Cth). Having this authority allows ACICA to appoint arbitrators where the parties to an arbitration agreement are either unable to agree on the process for appointment, or where the appointment process to which they agree fails. The process of updating the rules involved extensive consultation with respected practitioners, policymakers, academics and business leaders.
The updated rules include Emergency Arbitrator provisions, which are a first for an Australian arbitral body, and will increase flexibility available to parties seeking to arbitrate. These provisions allow parties to obtain emergency interim measures by before an arbitral tribunal is formally constituted.

The introduction of these new rules was welcomed by industry leaders, including Damian Lovell, the Vice President of Litigation at BHP Billiton. Mr. Lovell noted that there was increasing demand for first-rate, cost-effective arbitration services, particularly in the Asia Pacific region, and that Australia was well placed to meet this demand.

Successes of ACICA

Another milestone for ACICA occurred in January 2012, when the New South Wales Bar Association announced it would follow the Victorian Bar by partnering with ACICA. The partnership allows Australia's largest state barrister body to participate more readily in international arbitration by giving members of the NSW Bar easier access to solicitors and clients involved in arbitration.

In February of this year, ACICA launched its International Program for 2012 in New Delhi and Mumbai. The ACICA delegation focused on the fact that Australia could provide a modern international arbitration law, a supportive judiciary, first class professional services facilities and purpose-built hearing locations.
The launch attained international acclaim, attracting the endorsement of various delegates including the Adani Group, the Indian conglomerate with the most major investments in Australia. The Adani delegation praised Australia's robust legal framework, noting that this was a key factor that gave Australia an advantage over Singapore and Hong Kong as an international dispute resolution destination.

Where to from here?

It is an exciting time to be involved in international arbitration in Australia. The current domestic reform process is well underway and has already had a positive impact on the perception and efficacy of domestic commercial arbitration in Australia.

Internationally, Australia's legal environment has been receiving much attention recently, with a number of larger international firms establishing a position in the Australian market. Along with this broader recognition of the strength of Australia's legal industry, the recent developments surrounding international arbitration have ensured that Australia is well-positioned to continue its growth in the international arbitration sphere.
 

Professor Doug Jones AO is a Partner at Australian law firm Clayton Utz and is a member at London’s Atkin Chambers.