Construction firms in Northern Ireland could get faster resolution of contractual or financial disputes under legislative proposals to update the arbitration framework.
Stormont this week (9 December) backed the extension of the provisions of the Arbitration Bill, currently progressing through Westminster’s parliament, to Northern Ireland.
The bill would see tweaks made to the Arbitration Act 1996 to ensure more efficient resolution of disputes, for example by empowering arbitrators to make awards on a summary basis on issues that have no real prospect of success.
It also creates a new legal duty for arbitrators to disclose any conflicts of interest they may have in a case.
Because of its flexibility and confidentiality, arbitration has become a popular alternative to conventional court proceedings in the construction sector, particularly to deal with cross-border issues arising from international contracts.
Initially introduced last year, the bill was picked up again by the incoming Labour government and started its parliamentary journey after being included in the King’s Speech.
Arbitration is a devolved matter, but Northern Ireland justice minister Naomi Long said it would be “disadvantageous” for the provisions of the bill not to be extended to Northern Ireland, and there was “no appetite for divergence” from England and Wales in this area.
“The bill will simply modernise and clarify an existing legislative framework that already extends to Northern Ireland,” she said.
“No issues specific to this jurisdiction that would require a different approach from that in England and Wales have been identified.
“It would be disadvantageous to parties and practitioners here were the changes to be made by the bill to the 1996 act not to apply to Northern Ireland at the earliest opportunity.”
Long told members of the Northern Ireland Assembly that the provisions of the bill served to modernise the legislative framework to ensure it remained fit for purpose and that the UK continued to attract domestic and international arbitration.
“There is no appetite for divergence from England and Wales among practitioners, and I want to ensure that businesses here, especially those that operate in both jurisdictions, will also be able to avail themselves of a legislative framework for arbitration that is modern, fair and efficient,” she said.
The bill, which started in the House of Lords, is expected to have its second reading in the Commons shortly.
