A Roadmap of Non-Signatories Being a Part of Arbitration Proceedings

Divita Ballewar
Amity Law School, Amity University Chhattisgarh, India

Volume III, Issue II, 2020

Arbitration is a process which is often used globally to settle disputes in the international arena; because it is a private practice outside the public eye with experts as judges and results in an award that is relatively easier to enforce than court decisions, it can be the most effective way to settle foreign disputes. In order to be eligible to begin arbitral proceedings instead of prosecution, the only provision for this is an agreement between two or more parties and when a conflict occurs later in which a non-signatory third party is so involved with the conflict that it appears unlikely or perhaps even futile to settle it without third party being part of the proceedings, he cannot legally participate in the arbitration proceedings.If such an issue is at hand, or if a third party itself wishes to invoke arbitration against one of the signatories, the courts and arbitral tribunals have established procedures by which third parties can be bound by an arbitration agreement with their express consent.

The previously so relevant notion of consent in arbitration has increasingly been replaced by the consideration of efficiency and fairness with regard to third parties. Thereof, in this research paper an attempt has been made to justify the link between two doctrines i.e. ‘Group of Companies’ and ‘Piercing of Corporate Veil’ as well as its implication,Pre and Postamendment. The paper analyses various modes through which a non-signatory party can be made binding in an arbitration agreement. This paper would be also dealing with the applicability of these two doctrines in domestic arbitration.

Further, this paper would be concluding with the process and meaning of party autonomy in context of third party and as a consequence the development of the doctrine of‘Corporate Veil piercing’ and the doctrine of ‘Group of Companies’.

Keywords: Non-signatory; Arbitration Agreement;Corporate Veil Piercing; Group of Companies; Party autonomy.


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