Introduction

These powerful words capture the very spirit of legal reform. In today’s fast-paced commercial landscape, the need for swift, enforceable, and efficient dispute resolution mechanisms has never been more pressing. Emergency arbitration has emerged as a crucial mechanism within the international arbitration landscape, allowing parties to obtain urgent interim relief before the constitution of an arbitral tribunal. This mechanism offers a swift and efficient remedy for parties facing imminent harm, preserving the status quo and ensuring that the eventual arbitral award remains meaningful. Over the past decade, international arbitral institutions such as the Singapore International Arbitration Centre (SIAC), International Chamber of Commerce (ICC), Hong Kong International Arbitration Centre (HKIAC) and London Court of International Arbitration (LCIA) have successfully institutionalized emergency arbitration provisions within their procedural rules. However, the Indian arbitration regime has yet to fully integrate this mechanism within its statutory framework, creating uncertainty and inconsistent judicial treatment.

In India, although courts have occasionally upheld emergency arbitration awards, there is no express legislative recognition of emergency arbitrators or their orders under the Arbitration and Conciliation Act, 1996. This gap has led to procedural ambiguity and enforceability concerns. Recognizing this lacuna, the Draft Arbitration and Conciliation (Amendment) Bill, 2024, proposes significant reforms to bring emergency arbitration within the statutory fold. As India aspires to become a global arbitration hub, the incorporation of emergency arbitration mechanisms is both timely and necessary.

Understanding Emergency Arbitration

Emergency arbitration is a pre-tribunal mechanism whereby a party can seek urgent interim relief from a specially appointed emergency arbitrator before the formal constitution of the arbitral tribunal. Such relief may include injunctions, asset preservation orders, or other protective measures to prevent irreparable harm to a party’s rights. Unlike Section 9 applications to courts, emergency arbitration offers a private, party-driven alternative that aligns with the core principles of arbitration: confidentiality, party autonomy, and procedural efficiency.

Several leading arbitral institutions have codified emergency arbitration procedures. For example, Rule 7 of Schedule I of SIAC Arbitration Rules provides for the appointment of an emergency arbitrator within one day of receiving the application. The ICC and LCIA Rules also contain similar provisions. These frameworks have facilitated the rapid adjudication of urgent disputes, encouraging parties to choose institutional arbitration over ad hoc processes.

In contrast, Indian parties often rely on Section 9 of the Arbitration and Conciliation Act, 1996, to seek interim measures from courts. While effective, this approach can be time-consuming and undermines the autonomy and confidentiality typically associated with arbitration. As such, a statutory framework for emergency arbitration in India would offer a more consistent and efficient option.

Legal Framework And Judicial Developments In India

The Arbitration and Conciliation Act, 1996, does not currently recognize emergency arbitrators. Section 2(1)(d) defines an “arbitral tribunal” as a sole arbitrator or a panel of arbitrators, without reference to emergency arbitrators. Consequently, interim orders passed by emergency arbitrators do not fall within the purview of Section 17, which deals with interim measures by an arbitral tribunal, nor are they directly enforceable under the Act.

Despite this, Indian courts have taken a progressive approach in certain cases.

1. HSBC PI Holdings (Mauritius) Ltd. v. Avitel Post Studioz Ltd.[i]

This case marked the first instance where an Indian court indirectly addressed the enforceability of emergency arbitration. The Bombay High Court considered an emergency arbitrator’s order issued under the SIAC Rules in a Singapore-seated arbitration. Despite the foreign seat, the Court granted similar interim relief under Section 9 of the Arbitration and Conciliation Act, 1996, since the arbitration agreement (entered prior to the BALCO judgment[ii]) explicitly retained Section 9. Although the Court did not formally enforce the EA order, it implicitly acknowledged its relevance by delivering a substantively similar order.

2. Raffles Design International India Pvt. Ltd. v. Educomp Professional Education Ltd.[iii]

The Delhi High Court dealt with a similar SIAC-based EA order from a Singapore-seated arbitration. However, unlike HSBC, the arbitration agreement was executed post-BALCO and lacked a clause preserving Section 9. The Court relied on the 2015 amendment to Section 2(2), which permits Indian courts to grant interim measures under Section 9 in international commercial arbitrations with a foreign seat. The Court emphasized that while such interim relief may be granted, an EA order cannot be directly enforced or treated as binding. Instead, courts must independently assess the merits of the Section 9 petition, thereby denying direct recognition of the EA order.

3. Amazon.com NV Investment Holdings LLC v. Future Retail Ltd.[iv]

This case involved an arbitration seated in India, governed by SIAC Rules. The Delhi High Court held that an emergency arbitrator appointed under institutional rules forms part of the “arbitral tribunal” as defined under Section 2(1)(d) of the Act. The Court reasoned that party autonomy, recognized under Sections 2(6), 2(8), and 19(2), enabled the parties to incorporate the institutional framework, thereby recognizing the emergency arbitrator’s authority. Consequently, the EA order was treated as an interim order under Section 17(1) and deemed enforceable under Section 17(2). This view was upheld by the Supreme Court, confirming that EA orders in domestic arbitrations are enforceable under the Act.

Therefore, while emergency arbitration orders in domestic-seated arbitrations are now expressly recognized by the court and enforceable under Section 17 of the Arbitration and Conciliation Act, 1996, the same cannot be said for foreign-seated arbitrations, particularly those falling within the ambit of international commercial arbitration. As illustrated in Raffles Design, such orders are not directly enforceable under Section 17 due to the inapplicability of Part I of the Act to foreign-seated proceedings. Consequently, parties are constrained to seek interim relief under Section 9 or by initiating independent civil proceedings under the Civil Procedure Code. However, even under Section 9, Indian courts do not treat emergency arbitrator orders as binding; instead, they exercise their discretion afresh to determine whether interim relief is warranted.

This divergence in treatment between domestic and foreign-seated arbitrations creates considerable uncertainty and inconsistency in the legal framework. The absence of express statutory recognition for emergency arbitrator orders in foreign-seated arbitrations continues to undermine the efficacy and predictability of the process. Addressing this gap requires comprehensive legislative reform, either through amendments to Part II of the 1996 Act or through a tailored provision that accords due recognition to emergency relief granted in foreign-seated arbitrations.

246^th Law Commission Report And Justice Srikrishna Report

When the Arbitration and Conciliation Act, 1996 was drafted, one of its key objectives was to reduce delays often associated with traditional court litigation. Over time, however, it became clear that even within the arbitration framework, parties sometimes needed urgent relief before a full tribunal could be constituted. This gave rise to the concept of Emergency Arbitration (EA), which allows parties to seek interim measures on an urgent basis from an emergency arbitrator, without having to approach the courts.

Although parties still have the right to seek interim relief from courts, EA offers several advantages that align better with the principles of arbitration. These include confidentiality, party autonomy, speed of proceedings, flexibility in procedure, and greater control over the appointment of arbitrators. EA also helps avoid some of the challenges found in the traditional judicial system, such as delays and lack of specialization.

Recognising these benefits, EA has gained popularity across the globe, especially in jurisdictions where institutional arbitration is well developed. Many international arbitral institutions such as the Singapore International Arbitration Centre (SIAC) and the Mumbai Centre for International Arbitration (MCIA) already have clear provisions for EA in their rules.

In India, the 20th Law Commission, under the chairmanship of Justice A.P. Shah, addressed this issue in its 246th Report. The Report recommended amending the 1996 Act to formally recognise the role of emergency arbitrators. Specifically, it suggested updating the definition of “arbitral tribunal” under Section 2(1)(d) to include emergency arbitrators. The Report also urged the courts to support institutional arbitration by referring matters to institutions that provide for EA. However, despite the Report’s recommendations, these changes were not reflected in the 2015 or 2019 amendments to the Act.

The Law Commission also identified reasons why parties in India often prefer ad hoc arbitration over institutional arbitration. These include a lack of trusted arbitral institutions, limited awareness about institutional arbitration, insufficient government support, and some degree of judicial hesitation towards arbitration.

To address these concerns and strengthen institutional arbitration, the Ministry of Law and Justice constituted a High-Level Committee[v] under the chairmanship of Justice B.N. Srikrishna in 2017, Justice Srikrishna Commission suggested that the definition of “arbitral award” under Section 2(1)(c) of the Act should be amended to include “emergency awards.” This would help enforce interim decisions made by emergency arbitrators, including those in foreign-seated arbitrations.

However, this suggestion has sparked debate. Some experts argue that emergency decisions are interim in nature and do not resolve disputes conclusively, so they should not be treated as “awards” under the New York Convention, 1958. Others believe that the Convention’s purpose is to uphold the enforceability of arbitration agreements and outcomes, and since it does not expressly exclude interim decisions, they should be considered enforceable.

Despite these discussions, the Indian legislature did not adopt the recommendations concerning EA in the 2015 or 2019 amendments. As a result, Indian courts have occasionally had to address questions about the validity and enforceability of EA orders on a case-by-case basis, which was discussed above.

Now, with the release of the Draft Arbitration and Conciliation (Amendment) Bill, 2024, the Indian government appears to be revisiting these long-pending recommendations. If the proposed changes are implemented, they could mark a significant step forward in positioning India as a global hub for arbitration and a preferred seat for dispute resolution.

Recognition Of Emergency Arbitration Under The Draft Arbitration And Conciliation (Amendment) Bill, 2024

To address these concerns, the Draft Arbitration and Conciliation (Amendment) Bill, 2024, proposes to amend the definition of “arbitral tribunal” under Section 2(1)(d) to expressly include emergency arbitrators appointed under institutional rules. This amendment would confer legal recognition on emergency arbitrators and bring their interim orders within the ambit of Section 17.

Furthermore, the Bill seeks to clarify that emergency awards shall be enforceable in the same manner as orders of an arbitral tribunal. This would eliminate the current enforcement ambiguities and reduce reliance on judicial discretion. Importantly, the Bill aligns India’s arbitration law with international best practices, such as those embodied in the UNCITRAL Model Law and institutional rules of global arbitral forums.

The proposed insertion of Section 9A into the Arbitration and Conciliation Act, 1996, represents a progressive step towards recognising and reinforcing the framework of Emergency Arbitration (EA) in India. Recommended by the High-Level Committee chaired by Justice B.N. Srikrishna, this provision seeks to statutorily acknowledge the role and authority of Emergency Arbitrators appointed under institutional rules. It addresses longstanding ambiguity regarding whether emergency arbitrators fall within the definition of an “arbitral tribunal” under Section 2(1)(d) of the Act.

Section 9A ensures that orders passed by an Emergency Arbitrator are enforceable in the same manner as interim orders under Section 17(1), thereby providing parties with effective and timely relief even before the constitution of the full tribunal. It also minimises the need for parties to rush to courts for urgent interim protection, thus promoting party autonomy and reducing judicial intervention in the arbitral process.

A particularly noteworthy feature of this provision is sub-section (4), which allows the final arbitral tribunal to confirm, modify, or vacate the order passed by the Emergency Arbitrator, either partially or wholly. This clause serves as a crucial safeguard by granting the full tribunal the authority to reassess the emergency relief once it is formally constituted. It not only instils greater confidence in the arbitral mechanism but also ensures that emergency orders are subject to review and are not left unchecked.

Overall, the insertion of Section 9A promises to enhance the efficiency and credibility of institutional arbitration in India and aligns the Indian legal regime with international best practices in arbitration.

The proposed reforms signal a strong commitment by the Indian legislature to modernize arbitration law and promote institutional arbitration. If enacted, these changes will enhance the efficiency of the arbitration process, reduce court intervention, and reinforce India’s image as an arbitration-friendly jurisdiction.

Challenges And Way Forward

Despite the promise of the 2024 Draft Bill, several challenges must be addressed to ensure the effective implementation of emergency arbitration in India.

First, there remains a lack of awareness among domestic parties and counsel about the availability and advantages of emergency arbitration. Capacity building and training for arbitrators, lawyers, and judges will be essential to support this reform.

Second, institutional capacity must be strengthened. Domestic arbitral institutions like the Mumbai Centre for International Arbitration (MCIA) and Delhi International Arbitration Centre (DIAC) should adopt and promote emergency arbitration provisions within their rules. These institutions must also develop robust administrative mechanisms to handle emergency applications promptly.

Third, courts must adopt a consistent approach in recognizing and enforcing emergency awards, both domestic and foreign. Judicial restraint in intervening with emergency relief granted by arbitrators will be crucial to fostering confidence in the process.

Fourth, procedural safeguards must be incorporated to ensure that emergency arbitration does not become a tool for tactical abuse. For instance, mechanisms for review, time-bound decisions, and limits on repeat applications should be clearly specified.

Finally, legislative clarity should be accompanied by harmonized institutional rules and proactive stakeholder engagement. A concerted effort involving lawmakers, arbitral institutions, legal professionals, and academia will be essential to integrate emergency arbitration seamlessly into India’s arbitral framework.

Conclusion

Emergency arbitration represents a dynamic and essential component of contemporary arbitration practice. In India, while judicial recognition has laid the groundwork, legislative reform is the key to institutionalizing this mechanism. The Draft Arbitration and Conciliation (Amendment) Bill, 2024, provides a much-needed opportunity to align India’s arbitration law with international norms and bolster its status as a preferred arbitration seat. By embracing emergency arbitration and addressing implementation challenges, India can enhance its dispute resolution framework and reaffirm its commitment to an efficient, party-centric, and globally harmonized arbitration regime.

Endnotes

[i] 2014 SCC OnLine Bom 102 (‘HSBC’).

[ii] (2012) 9 SCC 552.

[iii] 2016 SCC OnLine Del 5521 (‘Raffles Design’).

[iv] 2021 SCC OnLine Del 1279.

[v] The High-Level Committee, Report of the High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India (July 2017).