Originally from Arbitration Law and Practice in the Middle East - Second Edition

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I. INTRODUCTION: ARBITRATION IN PAKISTAN—HISTORY AND INFRASTRUCTURE

A. History and Current Legislation on Arbitration

1. Legal System of Pakistan

Pakistan became an independent state in 1947, as a result of de-colonization of sub-continent. Legal system, which Pakistan inherited, was common law. After independence most of the law practised in Pakistan was the law of Indo-Pakistan, before its partitioning. Major improvements have been made since then and a number of new laws have been introduced. The laws, which keep a binding effect in Pakistan include Parliamentary Acts; Presidential Ordinances; Executive Orders; Statutory Rules; Customary Practices; and Judgments passed by the Superior Judiciary.  The Constitution of Pakistan, 1973, being the supreme law of the land, overrides all the foregoing forms of law. An international law can only be enforced through a legislative instrument and not otherwise. Apart from that, the sources which bear a great deal of persuasive value (often presented before judicial authorities during arguments) consist of the court judgments from common law jurisdictions, especially those of England, United States, and India. Moreover, the treatises of distinguished authors (foreign and local) are taken as a gap filling source.

2. History and Evolution of Arbitration in Pakistan

After independence, the laws which succeeded to Pakistan included the Arbitration Act, 1940, as well as the Arbitration (Protocol and Convention) Act, 1937. The 1940 Act contains substantive provisions relating to the procedure of arbitration and does not distinguish between domestic, foreign, and international arbitration. Unlike that, the 1937 Act was responsible to implement the Geneva Protocol on Arbitration Clauses, 1923, and the Geneva Convention on the Execution of Foreign Awards, 1927. A development was made, when Pakistan signed the United Nations Convention on Recognition and Enforcement of Foreign Arbitral Awards on December 30, 1958. Since NYC was not ratified along with its signing, therefore, the 1937 Act continued to apply upon the enforcement of arbitration agreements and foreign awards.