A heavily debated topic in the literature on international arbitration is that referring to the distribution of powers between courts and arbitrators in order to determine the validity and the personal and subject matter scope of an arbitration clause.
It is generally felt that arbitrators at least need to be allowed the power to ascertain provisionally whether they are entitled to hear a particular case. This is not logically inconsistent when a challenge is brought with regard to the personal or subject matter reach of an arbitration clause itself, because such a challenge does not question the validity or existence of the agreement instituting the arbitral authority. However, it does present a basic logical problem in the event of a challenge to the validity or existence of the parties’ agreement. Since arbitrators derive their power from the parties’ agreement, a challenge to this agreement’s validity or existence would logically leave them powerless to hear a case until it was determined that the agreement was indeed effective, conferring on them authority to resolve the relevant disputes. This seems to suggest the need for intervention by a third party whse competence is unchallenged, a role most commonly played by the judiciary.