The Arbitration and Conciliation Act, 1996, was amended by the Arbitration and Conciliation (Amendment) Act, 2015 in order to make arbitration process user-friendly, cost-effective and ensure speedy disposal and neutrality of arbitrators.
To give a boost to institutional, arbitration vis-a-vis ad hoc arbitration and to remove some practical difficulties in the applicability of the Arbitration and Conciliation (Amendment) Act, 2015, the Government has recently amended the Arbitration and Conciliation Act, 1996 by the Arbitration and Conciliation (Amendment) Act 2019. Certain provisions of the Amendment Act have been enforced w.e.f 30.08.2019.
The Amendment Act inter-alia seeks to insert a new Part 1A to the Act of 1996 for the establishment and incorporation of an independent body namely, the Arbitration Council of India (ACI) for the purpose of grading of arbitral institutions and accreditation of arbitrators, etc.
As per Section 43C of the Act, ACI will be headed by a Chairperson, who has been a Judge of the Supreme Court or a Chief Justice or Judge of a High Court or an eminent person, having special knowledge and experience in the conduct or administration of arbitration, to be appointed by the Central Government in consultation with the Chief Justice of India. Besides, it will also have two Full-time Members from amongst eminent arbitration practitioners and academicians. In addition, one representative of a recognized body of commerce and industry shall be nominated on rotational basis as a Part-time Member. The Secretary, Department of Legal Affairs, Ministry of Law & Justice; Secretary, Department of Expenditure, Ministry of Finance and Chief Executive Officer, ACI will be ex-officio Members.
Section 43M of the Act provides for the Secretariat to the Council consisting of such number of officers and employees as may be prescribed by the Central Government.
In this regard, the Department of Legal Affairs has prepared the following draft Rules:
- The Arbitration Council of India (the Salary, Allowances and other Terms and Conditions of Chairperson and Members) Rules, 2020.
- The Arbitration Council of India (the Travelling and other Allowances payable to Part-time Member) Rules, 2020.
- The Arbitration Council of India (the Qualifications, Appointment and other Terms and Conditions of the service of the Chief Executive Officer) Rules 2020.
- The Arbitration Council of India (the Number of Officers and Employees of the Secretariat of the Council and the qualifications, appointment and other terms and conditions of the officers and employees of the Council) Rules 2020.
The Government intends to consult all stakeholders in the process. A copy of the aforesaid draft Rules have been uploaded on the website of the department of Legal Affairs (http://legalaffairs.gov.in/).
Ministry Of Law & Justice
[Press Release dt. 12-02-2020]