Arbitration and Conciliation Act 2019 Amendment: Key Changes and India as Arbitration Hub

The Arbitration and Conciliation Act 1996, significantly amended in 2015, 2019, and 2021, governs both domestic and international commercial arbitration in India. The 2019 amendment aimed to establish India as a global arbitration hub by introducing institutional arbitration, reducing court intervention, and setting time limits.

Key Changes in 2019 Amendment

• Arbitral Council of India (ACI): Regulatory body to grade arbitral institutions and arbitrators
• Appointment of Arbitrators: Designated arbitral institutions can now appoint arbitrators (previously only courts did) — reduces delay
• Confidentiality: Mandatory confidentiality in arbitration proceedings
• Immunity to Arbitrators: No legal action against arbitrators for acts in good faith
• Amended Section 87: Automatic stay on enforcement of arbitral award pending challenge REMOVED (amendment reversed previous High Court-created automatic stay)

Time Limits for Arbitration

• Domestic arbitration: Award must be given within 12 months from constitution of tribunal (extendable by 6 months by parties; beyond that, only court can extend)
• Fast-track arbitration: Award within 6 months
• International commercial arbitration: No time limit (aspirational)

Arbitral Tribunal Powers

• Grant interim measures (Section 17) — enforceable as court orders
• Order discovery, production of documents
• Appoint expert witnesses
• Award costs against parties
• Award interest on amounts (pre-award, post-award)

Challenge and Setting Aside of Awards

An arbitral award can be set aside by court (Section 34) within 3 months on grounds:

• Incapacity of party or invalid arbitration agreement
• No proper notice or opportunity to present case
• Award beyond scope of arbitration agreement
• Composition of tribunal contrary to agreement
• Patent illegality (domestic arbitration only)
• Conflict with public policy of India (narrow interpretation per SC)

Enforcement of Foreign Awards

Foreign arbitral awards from New York Convention countries (India is a signatory) are enforceable in India under Part II of the Act. Foreign award enforcement treated like a decree of the court — party must apply to High Court for enforcement.