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ARBITRATION IN TRANSPORT DISPUTES IN FINLAND

ARBITRATION IN TRANSPORT DISPUTES IN FINLAND ” Arbitration clauses in standard charter parties referring to Umpire - an institution unfamiliar to Finnish law " 27.6.2014 NORA GAHMBERG-HISINGER. ARBITRATION CLAUSES IN STANDARD CHARTER PARTIES.

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ARBITRATION IN TRANSPORT DISPUTES IN FINLAND

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  1. ARBITRATION IN TRANSPORT DISPUTES IN FINLAND ”Arbitrationclausesin standard charter partiesreferringto Umpire - an institutionunfamiliarto Finnishlaw" 27.6.2014 NORA GAHMBERG-HISINGER

  2. ARBITRATION CLAUSES IN STANDARD CHARTER PARTIES • BIMCO Time charter parties LINERTIME, GASTIME (previouslyalso BALTIME version 1939) • LINERTIME Deep Sea Time Charter Clause 32 Arbitration ”Anydisputearisingunder the Charter to bereferred to arbitration in [London], oneArbitrator to benominatedby the Owners and the otherby the Charterers, and in case the Arbitratorsshallnotagreethen to the decision of an Umpire to beappointedbythem, the award of the Arbitratorsor the Umpire to befinal and bindinguponbothparties. [...]” London changed to HELSINKI (or Stockholm)

  3. NOMINATION OF ARBITRATORS AND UMPIRE UNDER FINNISH LAW • In accordance with the FinnishArbitration Act Section13 If there shall be more than one arbitrator but the parties have not agreed on the arbitrators or on the mode of their appointment, each party shall appoint the same number of arbitrators. The arbitrators thus appointed shall appoint one more arbitrator to act as the chairman, unless the parties have agreed that the dispute shall be decided by the arbitrators they have appointed. FinnishArbitration Act doesnotrecognize a twostepprocedure as seen in manycommonlyused charter parties; 1. nominatearbitrators, 2. ifarbitratorscannotagree, umpire to beappointedby the arbitratorslater inthe process

  4. CONSEQUENCES • Twoarbitratorswillbenominated in accordance with lex fori and a thirdarbitrator, the ”umpire” is appointed in case the twoarbitratorscannotagree Umpirewillnotparticipate in the process, willbe ”on hold” If the twooriginalarbitratorscannotagree, the umpiresteps in RESULT: The processwillhave to berenewed(witnessstatementsetc)

  5. SOLUTION • Deleteumpire and if Helsinki (orotherplace in Finland) is chosen as seat, rewrite the clause to statethatarbitrators to bechosen in accordance with the FinnishArbitration Act OR • Use BIMCO DisputeResolutionClause ”Law and Place of Arbitration as MutuallyAgreed” a) ThisContractshallbegoverned and construed in accordance with the laws of the placemutuallyagreedby the parties and anydisputearising out of or in connection with thisContractshallbereferred to arbitration at a mutuallyagreedplace, subject to the proceduresapplicablethere.

  6. THANK YOU FOR LISTENING! NORA GAHMBERG-HISINGER Partner Hammarström Puhakka Partners, Attorneys Ltd Bulevardi 1 A, 00100 Helsinki Puh. (09) 474 21, Telefax (09) 474 2222 nora.gahmberg@hpplaw.fi www.hpplaw.fi

  7. SPECIALIZED IN THE ESSENTIAL ASIANAJOTOIMISTO HAMMARSTRÖM PUHAKKA PARTNERS OY BULEVARDI 1 A 00100 HELSINKI +358 9 474 21 www.hpplaw.com

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