Maritime Arbitration in Bangladesh
This guide provides an overview of maritime arbitration as an alternative dispute resolution method for admiralty and maritime disputes in Bangladesh.
Legal Framework for Maritime Arbitration
Maritime arbitration in Bangladesh is governed by the Arbitration Act, 2001, which is based on the UNCITRAL Model Law on International Commercial Arbitration. This modern legislation provides a comprehensive framework for both domestic and international arbitration proceedings.
Key Features of the Arbitration Act, 2001:
- Recognition of party autonomy in arbitration agreements
- Limited court intervention in arbitration proceedings
- Enforcement of foreign arbitral awards
- Interim measures of protection
- Confidentiality of arbitration proceedings
While Bangladesh does not have a specialized maritime arbitration institution, parties can agree to arbitrate under the rules of international maritime arbitration bodies or ad hoc arbitration with customized rules.
Advantages and Disadvantages of Maritime Arbitration
Advantages
- Confidentiality of proceedings and awards
- Flexibility in procedural rules and scheduling
- Selection of arbitrators with maritime expertise
- Potentially faster resolution than court litigation
- Finality of awards with limited grounds for appeal
- International enforceability under the New York Convention
Disadvantages
- Potentially higher costs for arbitrator fees
- Limited ability to join third parties
- No binding precedent for future disputes
- Limited discovery/disclosure procedures
- Challenges in obtaining interim measures
- Potential for parallel proceedings
Popular Maritime Arbitration Venues and Rules
Maritime disputes involving Bangladesh parties are often arbitrated under the rules of established international arbitration institutions:
| Institution |
Location |
Key Features |
| London Maritime Arbitrators Association (LMAA) |
London, UK |
- Specialized maritime arbitration rules
- Experienced maritime arbitrators
- Three-tiered procedure (Small Claims, Intermediate, Full)
- Most widely used for maritime disputes globally
|
| Singapore Chamber of Maritime Arbitration (SCMA) |
Singapore |
- Growing popularity in Asia
- Maritime-specific rules
- Expedited procedure for smaller claims
- Geographically closer to Bangladesh
|
| Hong Kong Maritime Arbitration Group (HKMAG) |
Hong Kong |
- Operates under HKIAC rules
- Panel of specialized maritime arbitrators
- Strong enforcement record in Asia
|
| International Chamber of Commerce (ICC) |
Paris (HQ), worldwide offices |
- Institutional supervision of proceedings
- Scrutiny of awards by ICC Court
- Not maritime-specific but widely respected
|
Emerging Trend:
There is growing interest in establishing a Maritime Arbitration Association of Bangladesh (MAAB) to provide a local forum for maritime disputes. This initiative is supported by the Bangladesh Shipping Agents' Association and the Chittagong Port Authority.
Drafting Effective Maritime Arbitration Clauses
A well-drafted arbitration clause is essential to avoid jurisdictional disputes and ensure an efficient arbitration process. Key elements to include:
- Scope of disputes covered - Clearly define which disputes are subject to arbitration
- Arbitration rules - Specify which institutional or ad hoc rules will apply
- Seat of arbitration - Designate the legal place of arbitration
- Number of arbitrators - Typically one or three, depending on complexity and value
- Method of appointment - How arbitrators will be selected
- Language of proceedings - Usually English for international maritime disputes
- Governing law - Law applicable to the substance of the dispute
Sample Arbitration Clause:
"Any dispute arising out of or in connection with this contract, including any question regarding its existence, validity or termination, shall be referred to and finally resolved by arbitration under the Rules of the Singapore Chamber of Maritime Arbitration, which Rules are deemed to be incorporated by reference into this clause. The seat of the arbitration shall be Singapore. The Tribunal shall consist of three arbitrators. The language of the arbitration shall be English. The governing law of this contract shall be the laws of Bangladesh."
Enforcement of Maritime Arbitration Awards
Bangladesh is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, which facilitates the enforcement of foreign arbitral awards.
Enforcement Procedure:
- Application to the District Court or High Court Division
- Submission of original award or certified copy
- Submission of original arbitration agreement or certified copy
- Translation of award and agreement if not in English or Bengali
- Court examination of formal requirements
- Issuance of enforcement order if requirements are met
Grounds for Refusing Enforcement:
Under the Arbitration Act, 2001, enforcement may be refused if:
- A party to the arbitration agreement was under incapacity
- The arbitration agreement is invalid under the applicable law
- Proper notice of arbitrator appointment or proceedings was not given
- The award deals with matters beyond the scope of submission to arbitration
- The composition of the tribunal or procedure was not in accordance with the agreement
- The award has not yet become binding or has been set aside
- The subject matter is not capable of settlement by arbitration under Bangladesh law
- The award conflicts with Bangladesh's public policy
