Originally from Reflections on International Arbitration - Essays in Honour of Professor George Bermann

Preview Page

The Draft Restatement of the U.S. Law of International Arbitration and Investor-State Arbitration, whose Reporter is Professor George Bermann, is a major contribution to the law of international arbitration. Is it in line with the law in other countries? This will be the purpose of this article in relation to one specific issue: the issue of non-signatories.

Given the increasing number of international groups of companies and the growing complexity of commercial transactions, in the past few decades, there has been a corresponding rise in the number of multi-party, multi-contract arbitrations. According to the statistics generated by leading international institutions, they tend to represent one-third of all international arbitrations. 

One of the main issues that these arbitrations raise is the issue of non-signatories. In other words, when initiating an arbitration, it happens more and more frequently that the claimant will try to involve, together with signatories, an individual, a company or a state that did not formally sign the contract containing the arbitration clause; or conversely, that a signatory to the contract containing the arbitration agreement will try to join, as an additional claimant, an individual or company that did not formally sign that contract.

Arbitration is based on consent – with the consequence that ordinarily, only those who sign an arbitration agreement are bound by that agreement or entitled to invoke it.