In the developing economic and social reality, commercial disputes are inevitable. With the advantages of the Arbitration Center, legal entities tend to choose arbitration to resolve disputes. However, in the dispute settlement process, there will be many cases where assets related to the case are at risk of being destroyed or a third party holds evidence but they are not willing to cooperate with the Arbitrator. To ensure the interests of the parties, the law has stipulated that the Arbitration Center has the authority to apply temporary emergency measures, depending on the specific case that occurs during the dispute resolution process. In this article, TNTP will clarify the temporary emergency measures that the Arbitration Center can apply for readers or legal entities to refer to.
1. The temporary emergency measures
Pursuant to Clause 2, Article 49 of the Law on Commercial Arbitration 2010, temporary emergency measures include:
(i) Prohibiting any change in the status of assets under dispute;
(ii) Prohibiting or forcing any disputing party to commit one or more certain acts to prevent acts which adversely affect the process of arbitral proceedings;
(iii) Distraining assets under dispute;
(iv) Requesting preservation, storage, sale or disposal of any asset of one disputing party or all disputing parties;
(v) Requesting temporary money payment between the parties;
(vi) Prohibiting transfer of the rights to assets under dispute.
Thus, it can be seen that the temporary emergency measures that the Arbitration Center can apply are diverse and have important value in preserving the status of assets or forcing obligated persons or related persons not to carry out acts that obstruct or cause disadvantages to the Arbitration proceedings.
2. Time to request the Arbitrator to apply temporary emergency measures
• According to Clause 1, Article 48 of the Law on Commercial Arbitration 2010, the disputing parties may request the Arbitral Tribunal to apply temporary emergency measures. It means the time when the parties request the Arbitral Tribunal to apply interim urgent measures is when the Arbitral Tribunal has been formed.
• Article 40 and 41 of the Law on Commercial Arbitration 2010 shows that the time for the Arbitral Tribunal to be established after the plaintiff files a lawsuit is from 01 month to 02 months. During this period, the obligated party may have an act of dissipating assets. To prevent this act and also ensure the conditions for future enforcement, it is urgent to request the Arbitration to apply interim urgent measures.
Thus, when the Arbitral Tribunal has not been established, one or more disputing parties have the right to request the Court to apply one or several temporary emergency measures immediately after filing a lawsuit at Arbitration (the time the arbitration proceedings begin) to quickly prevent the dissipation of assets by the obligated party so that the arbitration proceedings can be carried out to ensure the rights of the requesting party.
3. Procedures for applying temporary emergency measures of the Arbitral Tribunal
To request the application of temporary emergency measures, the requesting party must carry out the procedures prescribed in Article 50 of the Law on Commercial Arbitration 2010, specifically:
(i) The party who request for application of temporary emergency measures shall send a written request to the arbitration council.
(ii) A written request for application of interim urgent measures must contain:
• Date of the application;
• Name and address of the petitioner;
• Name and address of the party to whom/ which temporary emergency measures are to be applied;
• Summary of the dispute;
• Reason for the application of temporary emergency measures;
• temporary emergency measures to be applied and specific requirements.
In addition to the request, the petitioner shall provide the Arbitral Tribunal with evidence to prove the necessity to apply such interim urgent measures.
(iii) As decided by the Arbitral Tribunal, the petitioner shall deposit a sum of money, precious metal, gemstone or valuable papers of a value set by the Arbitral Tribunal equivalent to the amount of the loss which could be caused by improper application of temporary emergency measures in order to protect the petitioner’s interests. Such a sum of money, precious metal, gemstone or valuable papers shall be deposited in a blocked account at a bank decided by the Arbitral Tribunal.
(iv) Within 3 working days after receiving a request, immediately after the requester has provided the security specified in the above provisions, the Arbitral Tribunal shall consider and decide to apply temporary emergency measures. In case of refusal, the Arbitral Tribunal shall issue a written notice clearly stating the reason to the petitioner.
Thus, the application of temporary emergency measures in arbitration proceedings can only be carried out upon the request of one or more parties. The Arbitration Center cannot apply interim urgent measures on its own. This is fundamentally different from the application of temporary emergency measures in civil proceedings in courts, where the Court can decide on its own to apply temporary emergency measures in certain cases prescribed by law.
The request for the application of temporary emergency measures helps the disputing parties to temporarily preserve the current state of the evidence, limiting the consequences of damage to the evidence caused by the actions of the obligated party. Above is the article of TNTP on ” temporary emergency measures that the arbitrator may apply” that experts share with readers. Hopefully the article will be helpful to readers.
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