In recent years, Spain and, more particularly, Madrid, has increasingly gained a major role among the international arbitration community as a seat of International Arbitration, especially, for LATAM countries.
This significant growth led to the recent creation, in Madrid, of the Madrid International Arbitration Centre (“MIAC”) with the purpose of becoming the leading Spanish arbitration institution to cope with this, hopefully, unstoppable trend.
Three milestones have driven the creation of the MIAC.
First, the enactment of the Spanish Arbitration Act back in 2003 (“Spanish Arbitration Act”), which allowed arbitration to flourish in Spain and encouraged the promotion in the international arbitration scene of Spain as a seat for International Arbitration.
Second, the Spanish Arbitration Club, in 2019, created the “Commission to promote Spain as a seat of International Arbitration“, which identified the reasons why, despite having the necessary pre-requisite of a high amount of skillful arbitration practitioners, Spain had not yet become a major International Arbitration Centre. The Commission then made the necessary proposals for Spain to achieve that status. The resulting report came to the conclusion that Spain needed an arbitration institution of worldwide reference to select and promote Spain as an international arbitration venue and, therefore, highly recommended creation of such an institution.
Third, the Spanish Arbitration Club also published the “Code of Best Practices in Arbitration” which aimed to enhance the standards of independence, impartiality, transparency and professionalism of arbitrators, lawyers and experts within arbitration in order to definitively consolidate society’s confidence and trust in arbitration instead of jurisdiction. Moreover, this Code served as the basis of the MIAC’s Arbitration Rules.
The outcome of the above three initiatives was the creation of MIAC in July 2019, through the merger of the three main arbitration institutions previously existing in Spain: the Madrid Court of Arbitration (“MCA”), the Civil and Commercial Court of Arbitration (“CCCA”) and the Spanish Court of Arbitration (“SCA”). Also, the Madrid Bar Association (“MBA”) was included as a strategic partner (the “Founding Institutions”).
The Centre focuses on administering international arbitration and mediation proceedings while the above referred Founding Institutions continue to conduct domestic arbitration.
To this end, the International Commission was created to determine the international nature of a case and, therefore, determine which cases can be administered by MIAC. It is important to highlight the truly international profile of this Commission, which is composed of 15 members with renowned experience as arbitrators, lawyers, and academic leaders from all over the world.
In particular, MIAC administers international arbitrations arising from:
- Arbitration agreements expressly designating MIAC as the administering institution (direct submission), or
- Arbitration agreements submitting the resolution of any disputes to any of the associated entities (MCA, CCCA, SCA and MBA) as the administering institution (submission by referral). The submission by referral is automatic when the parties have entered into an arbitration agreement as of 1 January 2020. If parties entered into an arbitration agreement before 1 January 2020 designating any of the Founding Institutions, the parties are then encouraged to refer the case to the MIAC.
Highlights of the Institution
MIAC offers a number of features that are both innovative and perfectly adapted to the post-pandemic world.
- International exposure: Internationality is the very essence of the Institution, as reflected in its governing bodies, its arbitrators, its mediators and in all the Institution’s collaborators. MIAC promotes arbitration proceedings in 4 different languages (Spanish, English, Portuguese and French).
- Technology: MIAC was born in the midst of the pandemic and, therefore, has offered completely virtual proceedings since its inception. The hearings may be held entirely remotely and the documents related to the proceedings are all available on an online platform to which the parties to the arbitration have access. In addition, MIAC has recently joined the Greener Arbitrations Pledge to reduce the environmental impact of its arbitrations.
- Appointment of Arbitrators: MIAC does not provide a closed list of arbitrators in order to truly guarantee their independence and impartiality with the parties.
- Strategic location: based in Madrid, the capital of Spain, it offers a key location constituting a bridge between Latin American and European countries and serving as a gateway to markets in Africa, Asia and the Middle East.
- Challenge of awards: If agreed between the parties in the arbitration agreement or at any time thereafter within the course of the proceedings, any party may be entitled to challenge the final award before the Centre, exclusively, on grounds of a manifest infringement of the substantive rules applicable to the arbitration or on a gross error in the determination of the facts, always provided that such infringement / determination was decisive for the final decision made in the award. This challenge is decided by a new arbitration panel appointed by the parties and the Centre.
With slightly more than one single year of existence, MIAC currently faces multiple challenges to really become a key player in the International Arbitration scene.
First, an international network of “Friends of MIAC” was recently created, enabling a diverse group of individuals and organizations across the globe to share knowledge, ideas and collaborations. An example is the cooperation agreement recently entered into between the Hong Kong International Arbitration Centre (“HKIAC”) and the MIAC.
Second, MIAC seeks to be a source of knowledge and education for international arbitration practitioners. To this end, working groups have been set up to bring together lawyers and arbitrators by economic sector. In addition, MIAC promotes conferences on the most relevant arbitration topics affecting International Arbitration (i.e. Code of good practices of experts or the brand new International Arbitration on Technology Disputes).
Finally, it is particularly noteworthy that Spain can be now definitively be regarded within the International Arbitration scene as an “arbitration friendly” venue after the two very recent rulings of the Spanish Constitutional Court (of 15 June 2020 and 15 February 2021). These judgements have undoubtedly confirmed that Courts are not legally entitled to set aside awards based on the – for Spanish scholars and arbitration practitioners – excessively broad interpretation of the concept of public order maintained over the last several years by the Madrid High Court of Justice. Instead, they are only allowed to determine whether the awards have infringed any procedural formalities or rules applicable to the arbitration. These rulings will no doubt contribute to strengthening MIAC’s role and encouraging Spain as a new seat of worldwide relevance for International Arbitration.