ReSolution Issue 19, November 2018 | Page 13

true purpose of the proposed Article 16(4). However, as the Final Report supersedes and does not refer to the Interim Report at all, it is unnecessary to further discuss it.
The Final Report recommends inserting a revised Article 16(4) into the Arbitration Act, worded as follows:
To avoid doubt, it is declared that the failure to pursue a request made under paragraph (3) in a timely manner operates as a waiver of any right to later object to a ruling of the arbitral tribunal as to its jurisdiction.
The Revised Article 16(4): Same, Same but Not Different.
The Final Report states that revision of the original Article 16(4) is necessary because the original provision left it ‘unclear [by] when a party to arbitration must have raised an objection to the jurisdiction of an arbitration tribunal’.19 However, with respect, it is not at all clear that the revised Article substantively differs from the original version or clarifies its operation.
The principal drafting change is that the ‘failure to pursue a request made under [Article 16(3)] in a timely manner’, rather than the ‘failure to submit a timely request to the High Court under [Article 16(3)]’, operates to trigger a deemed waiver. With respect, it is not apparent that the revised wording is any better than the original wording.
Non-Participating Parties
Moreover, the Justice Committee asserts in the Final Report that Article 16(4) ‘would not apply when a party does not participate in the arbitration at all’.20 As Article 16(4) only operates as an extension of Article 16(3), the Justice Committee is effectively saying that the preclusive effect of Article 16(3) only applies to parties that actively participate in an arbitration.
There are two separate questions involved in relation to Article 16(3). First, may a non-participating party activate the right to apply to the court at the seat to review a preliminary
ruling on jurisdiction by an Arbitral Tribunal? Secondly, having failed to do so, is a non-participating party precluded from raising a jurisdictional objection as a ground for setting aside or, alternatively, resisting enforcement of a later award on the merits?
Apropos the first question, it should be noted that an Arbitral Tribunal may make a preliminary ruling on jurisdiction on its own motion or on application by a party to the arbitration. To this point, the Chartered Institute of Arbitrators’ International Arbitration Guideline on Party Non-Participation — which seeks to set out ‘the current best practice in international commercial arbitration’ — advises arbitrators to ‘consider and ascertain, if necessary, whether they have jurisdiction to determine the matters referred to arbitration, even though no challenge has been raised by either party’.21 There is no good reason why a non-participating party should not be able to come out from behind the woodwork after being served with an Arbitral Tribunal’s preliminary ruling on jurisdiction and apply to the court at the seat to review that ruling. Nothing in the text of Article 16 or the travaux of the Model Law suggests otherwise.
The more difficult question is the second question. The text of Article 16 does not answer that question. On the other hand, the travaux suggests that Article 16(3) should not have a preclusive effect in respect of non-participating parties. Indeed, Belinda Ang J, at first instance, explicitly made this point, albeit in obiter:
if a party does not raise a timely objection to jurisdiction in accordance with [Article 16(3)] of the Model Law ,22 then the party cannot raise the same objection to jurisdiction under Arts 34 and 36. The only exception is where a party has boycotted the proceedings altogether…The jurisdictional award would not be final vis-à-vis the boycotting party, and the opposing party would have ample notice of this from the boycotting party’s absolute refusal to participate. This possibility is hinted at in the UNCITRAL Commentary (A/CN 9/264) on Art 16(2) at para 9. 23
In particular, [9] of the Analytical Commentary