Multiparty Arbitration

Arbitration involving more than two parties. Multiparty arbitration can create procedural complications that need to be considered during the drafting of an arbitration clause or during the conduct of an arbitral proceeding. Multiparty arbitration does not pose significant problems when the parties consist of two, clearly-defined groups having common interests and a common procedural position (claimant or defendant), with each side being able to nominate an arbitrator. When this is not the case, difficulties can arise with respect to the constitution of the arbitral tribunal. According to a decision of the French Cour de cassation, each party has, in principle, the right to nominate an arbitrator. Many institutional arbitration rules take this into account by requiring the arbitral institution to appoint all members of the tribunal if the parties have been unable to agree to an alternative procedure.