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Choice of law by the arbitrator

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case study
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  1. Introduction
  2. The underlying clash between private interest and public policy
  3. The arbitrator's point of view
  4. The arbitrator's treatment
  5. Conclusion

One of the main problems faced by the arbitrator when it comes to choice of law is the question of mandatory rules of law. A mandatory rule, as defined by Professor Mayer, refers to ?an imperative provision of law which must be applied to an international relationship irrespective of the law that governs that relationship? It is the imperative nature per se of such rules that make them applicable? In matters of contract, the effect of a mandatory rule of law of a given country is to create an obligation to apply such a rule, or indeed simply a possibility of so doing, despite the fact that the parties have expressly or implicitly subjected their contract to law of another country.?1 Examples of this include competition law, securities regulation, blockade or boycott law, currency control, and confiscation and nationalization. This poses a problem to the extent that the mandatory rules of law are in conflict with the contracting parties' wishes as expressed in the main contract and the arbitration agreement. In this case, there is a fundamental tension between the arbitration of private interests and the need to address public concerns, and how one responds to the situation depends on whether one views international arbitration through the lens of contract or the lens of jurisdiction

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