B- Problems regarding Arbitrability of cross border merger
disputes
Arbitrability of cross border merger disputes is a classic
sensitive area that raises issues relating to competition and antitrust law
which are complex matters, not discussed in this paper. If the merger involves
competition and antitrust law topics, mandatory provisions of the domestic law
of the place in these areas, if any, must be carefully studied before deciding
the seat of arbitration. The following is a brief comparative outline
addressing the state of affairs of arbitrability of cross border mergers
disputes in some European countries like in France, in Tunisia and in the
US.
To start, the French civil law on Arbitration considers
Arbitration as a creature of contract and that, the contractual recourse to
Arbitration is limited to those areas in which rights fall within the domain of
contractual freedom (droits disponibles)214. In terms of basic
principles, civil law system recognizes a clear distinction between contractual
and statutory claims, between the jurisdictional domain of Arbitration and the
public
214 French Civil Code article 2059
authority and adjudicatory duties of the judiciary. Carbonneau
quoted that Arbitrability establishes a dividing line between the transactional
pursuit of private rights and the courts' role as custodians and interpreters
of the public interest"215.
Contractual disputes ordinarily involve matters relating to the
formation, the governing law, and the performance (e.g., timeliness of payment,
delivery, conformity to specifications), as well as the impossibility of
performance, while statutory disputes involves matters relating s to commercial
competition, sale of securities, mergers and normally fall outside the
contractual mandate of arbitration216.
The arbitrability regime under the Tunisian Law on Arbitration is
governed by the provisions of article 7 of the Tunisian code of
Arbitration217, while under French law the arbitrability regime is
regulated by articles 2059/2060 of the French civil Code. The reading of the
these articles show that are excluded from Arbitration, the disputes, mentioned
by article 2060 of the French civil Code and article 7 of the Tunisian
Arbitration Code, relating to public interests reserved to the court as well as
disputes linked to the Public order , and not available at the disposal of the
parties.
In the US, after the Congress enactment of the Federal
Arbitration Act (FAA), which legitimized the contractual recourse to
Arbitration218, the elaboration of a federal court doctrine on
international commercial litigation and Arbitration, disputes that could not be
submitted to Arbitration under domestic law (securities, mergers and anti-trust
matters) could be submitted to Arbitration in the international context.
215 CARBONNEAU, Th E. ," Cartesian Logic and Frontier
Politics: French and American Concepts of Arbitrability", Tulane Journal of
International and Comparative Law, Spring, 1994
216 French Law Decree No. 85-1387 of Dec. 27, 1985,
art. 174, 1986 D.S.L. 1 (Fr.)
217 Promulgated by Law n°93-42 dated April 26th , 1993
218 United States Arbitration Act, chapter 213, 43 Stat. 883-86
(1925) (codified at 9 U.S.C. §§ 1-16 (1993) [hereinafter
FAA]. § 2 of the Federal Arbitration Act provides: A written provision in
any. . . contract evidencing a transaction invoiving commerce to settie by
Arbitration a controversy thereafter arising out of such contract or
transaction, or the refusai to perform the whoie or any part thereof, or an
agreement in writing to submit to Arbitration an existing controversy arising
out of such a contract, transaction or refusai shaii be vaiid, irrevocabie, and
enforceabie, save upon such grounds as exist at Law or in equity for the
revocation of any contract
This radical development in the US Arbitration law coincided
with the spectacular rise of the alternative dispute resolution ADR movement
and the associated paralysis of federal judicial system219 .
The US law of Arbitration has demonstrated acceptance of
arbitrability without restriction regarding antitrust disputes, particularly
cross-border merger disputes. The Mitsubishi Motors Corp. y. Soler
Chrysler-Plymouth, /nc. rulings220 recognizes the Arbitrability of
antitrust disputes. In other words, statutory claims based upon the securities
acts221, antitrust laws, and even civil rights legislation could be
submitted to Arbitration in a domestic settings. By contrast, the tendency
noted in European countries such as France has indicated that there is an
increased acceptance of the arbitrable issues that may arise in these
transactions with some limits. One can ask the following question: do cross
border mergers disputes must be limited to contractual issues and therefore not
be extended to issues including abuses of dominant position or monopoly
power?
It remain to be seen whether the arbitrability without
restriction regarding cross border mergers disputes will gain uniform
international acceptance, which will increase the use of Arbitration clause.
219 CARBONNEAU, T., "Arbitration and the U.S. Supreme
Court: A Plea for Statutory Reform", Ohio State Journal on Dispute Resolution.
(1990)
220 The Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth,
Inc) 473 U.S. 614, 617-23 (1985)
221 Securities Acts Popular name given to the two
major federal statutes regulating the issuing of and market trading in
corporate securities. Law Dictionary, 2003 by Barron,s
Educational Series, Inc
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