United States

UNITED STATES Catherine M. Amirfar, Natalie L. Reid, and Ina C. Popova* including ANNEX I: United States Arbitration Act (Federal Arbitration Act) (9 U.S.C. Sect. 1 et seq.) ANNEX II: Excerpts from the Patent Act (35 U.S.C. Sects. 135(f), 294) ANNEX III: Excerpts from the Foreign Sovereign Immunities Act (28 U.S.C. Sects. 1605, 1607, 1610, 1611) ANNEX IV: Uniform Arbitration Act (of 1955, as amended by the Uniform Law Commission in 2000) ANNEX V: Arbitration Statutes of the States of the United States, the District of Columbia and Puerto Rico ANNEX VI: Uniform Mediation Act ANNEX VII: 2012 Model BIT Chapter I. Introduction1 1. LAW ON ARBITRATION United States law reflects an “emphatic federal policy in favor of arbitral dispute resolution”.2 That policy applies “with special force” to agreements to arbitrate in international transactions.3 * The authors are members of Debevoise & Plimpton LLP, concentrating their practice in international disputes before United States courts, international arbitral tribunals, and international courts. Ms. Amirfar is Co-Chair of the firm’s Public International Law Group, currently serves as Vice President of the American Society of International Law, and previously served two years as the Counselor on International Law to the Legal Adviser at the U.S. Department of State, where she received the State Department’s Superior Honor Award. Ms. Reid is active in the firm’s Public International Law Group, currently serves on the Board of Editors of the American Journal of International Law and multiple committees of the American Society of International Law, and is Co-Chair of the Young Attorneys’ group of the International Institute for Conflict Prevention and Resolution. Ms. Popova, who is admitted to practice in Paris and New York and holds advanced degrees in English law, is a member of the International Court of Arbitration of the International Chamber of Commerce and the Court of the Casablanca International Mediation and Arbitration Center and also served on the 2018 ICCA Program Committee. The authors gratefully acknowledge the assistance of Carl Micarelli, Megan Corrarino, Victoria Demarchi, and other colleagues from Debevoise & Plimpton LLP. The authors also respectfully acknowledge the previous authors of this Report, including the late Judge Howard M. Holtzmann, a longtime member and Honorary Vice President of ICCA, and Donald Francis Donovan, former President of ICCA. 1. Except when otherwise indicated, this Report has been revised to reflect developments through October 2018. The statutes reproduced in Annexes I to III are those in effect as of October 2018; Annex V lists statutes in effect as of October 2018. Intl. Handbook on Comm. Arb. Suppl. 104 February 2019 United States – 1 UNITED STATES The law applicable to arbitration in the United States consists both of federal statutes enacted by the US legislature (the Congress) and statutes enacted by the legislatures of the various states that constitute the United States (i.e., state law). Arbitration law also derives from court decisions interpreting the governing statutes.4 This Report focuses mainly on international commercial arbitration and, therefore, will not cover subjects that are of interest primarily in domestic arbitration. a. Federal law The federal statutory law of arbitration is found mainly in the Federal Arbitration Act (the FAA),5 which Congress enacted in 1925 and has amended several times since. (The full text of the FAA is reprinted herein as Annex I.) Chap. 1 of the FAA governs arbitrations conducted within US borders, while Chap. 2 implements the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (the New York Convention),6 and Chap. 3 implements the Inter-American Convention on International Commercial Arbitration of 1975 (the Panama Convention).7 The FAA covers agreements to arbitrate future disputes (i.e., controversies that have not yet arisen at the time of the agreement to arbitrate), as well as agreements to arbitrate existing disputes (i.e., controversies that are not subject to an agreement to arbitrate when they arise but that the parties subsequently agree to arbitrate).8 2. Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 729 (1996) (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 631 (1985) (summarized in ICCA Yearbook Commercial Arbitration XI (1986) p. 555 (hereinafter Yearbook))). 3. Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 631 (1985) (summarized in Yearbook XI (1986) p. 555); see also id. at 628-640; Vimar Seguros y Reaseguros, S.A. v. M/V Sky Reefer, 515 U.S. 528, 541 (1995) (summarized in Yearbook XXI (1996) p. 773); Scherk v. Alberto-Culver Co., 417 U.S. 506, 515-18 (1974) (summarized in Yearbook I (1976) p. 203). 4. The US federal court system is divided into eleven circuits identified by number (i.e., First Circuit, Second Circuit, etc.), as well as the District of Columbia Circuit and the Federal Circuit; within each circuit are courts of first instance (known as district courts) and appellate courts (known as circuit courts). The decisions of the circuit courts are binding on the district courts in the circuit, but not on district courts or circuit courts in other circuits. Circuits may reach different decisions on the same question of law, and when that occurs in serious matters, a case raising the question on which circuits are divided may be heard by the US Supreme Court, whose ruling then binds all other courts, whether federal or state. On matters of federal law, state courts will also generally consider themselves bound by decisions of federal district courts in their state, and the corresponding circuit court. 5. 9 U.S.C. Sect. 1 et seq. 6. Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 10 June 1958, 21 U.S.T. 2517, 330 U.N.T.S. 38 (entered into force for the United States on 29 December 1970) (implemented by the Federal Arbitration Act, 9 U.S.C. Sect. 201). 7. Inter-American Convention on International Commercial Arbitration, 30 January 1975, O.A.S.T.S. No. 42, 14 ILM 336 (entered into force for the United States on 27 October 1990) (implemented by the Federal Arbitration Act, 9 U.S.C. Sect. 301). 8. 9 U.S.C. Sect. 2. Intl. Handbook on Comm. Arb. Suppl. 104 United States – 2 February 2019 UNITED STATES In addition to the FAA, provisions relating to arbitration are found in the Patent Act (see Chapter II.3.a below and Annex II) and the Foreign Sovereign Immunities Act (see Chapter II.2.c below and Annex III). b. State law Every state of the United States has an arbitration statute enacted by its state legislature. Forty states and the District of Columbia have adopted a version of the Uniform Arbitration Act (the UAA), a model law, which, like the FAA, provides for arbitration of both future and existing disputes. Eight other states and Puerto Rico have adopted arbitration statutes that also allow for arbitration of both future and existing disputes, though not modeled after the UAA.9 Two additional states have adopted arbitration statutes that allow for the arbitration only of existing controversies.10 The UAA was first prepared in 1955, and then amended in 1956. Much like the FAA, this version of the UAA, upon which nineteen state statutes are currently based,11 is limited to such basic procedural issues as enforcement of arbitration agreements, appointment of arbitrators, and review of arbitration awards. A revision to the UAA, approved by the National Conference of Commissioners on Uniform State Laws (the “Uniform Law Commission”) in 2000, contains provisions addressing a range of procedural issues that the 1955 version of the Law did not cover, such as consolidation of separate arbitration proceedings, disclosure of arbitrator conflicts, arbitrator immunity, and forms of discovery.12 Twenty-one states and the District of Columbia have adopted the revised UAA thus far.13 (The full text of the UAA of 1955, as amended by the Uniform Law Commission of 2000, is reprinted as Annex IV hereto. A list of arbitration statutes of the states, the District of Columbia and Puerto Rico appears as Annex V hereto.) Thirteen states have also adopted international arbitration statutes that are separate from their laws for domestic arbitration.14 Eight of those states – 9. California, Georgia, Louisiana, New Hampshire, New York, Ohio, Rhode Island, and Wisconsin. 10. Alabama and Mississippi. 11. Delaware, Idaho, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Missouri, Montana, Nebraska, South Carolina, South Dakota, Tennessee, Texas, Vermont, Virginia, and Wyoming. 12. See, e.g., 2000 UAA Sect. 6(c) (arbitrator determines arbitrability); Sect. 8 (provisional remedies); Sect. 10 (allowing consolidation of separate arbitration proceedings); Sect. 12 (arbitrator must disclose conflicts); Sect. 14 (arbitrator immunity); Sect. 17 (discovery). 13. Alaska, Arizona, Arkansas, Colorado, Connecticut, Florida, Hawaii, Kansas, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, North Dakota, Oklahoma, Oregon, Utah, Washington, and West Virginia have adopted and codified the Revised Uniform Arbitration Act. Pennsylvania has adopted the Revised Uniform Arbitration Act, which will become effective 1 July 2019. A bill to adopt the Revised Uniform Arbitration Act has also been introduced in Massachusetts. 14. California, Colorado, Connecticut, Florida, Georgia, Hawaii, Illinois, Louisiana, Maryland, North Carolina, Ohio, Oregon, and Texas. Intl. Handbook

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