Originally from American Review of International Arbitration - ARIA

Arbitration “is a matter of consent, not coercion.”  Consent is the cornerstone of arbitration and the basis for the legitimacy of any arbitral proceeding. Thus, the parties to a class arbitration must be bound by an arbitration agreement, i.e. an agreement between each member of the plaintiff class and the defendant to arbitrate the dispute at issue. But is such an agreement sufficient for the arbitration to proceed as class arbitration? The central issue of class arbitration is whether the parties need to authorize class arbitration as such by consenting, on a secondary level, to this particular form of arbitration, and how this consent must be expressed. While the first question has already been widely discussed, the second question remains open. This article will focus on the second question and discuss whether a preexisting relationship between the class members may serve as a basis for implied consent to class arbitration and thus render class arbitration permissible despite the silence of the arbitration clause (Section II). A comparison will then be drawn between arbitration in the corporate context in Germany and the U.S.  But in order to do so, a brief analysis of the requirement of an agreement to authorize class arbitration and the principles on which it is based will be helpful (Section I).