1. Introduction
Understanding arbitration in any given national context can be challenging at the best of times. Undertaking such a task in respect of the Syrian Arab Republic (hereafter “Syria”), which finds itself gripped by almost a decade of violence, having its territorial integrity threatened on various fronts and a significant percentage of its population forced into refugee status, becomes an especially entangled process. Amidst these most pressing and pervasive safety and security concerns, this contribution addresses a jurisdiction that has been paid scant attention in respect of both its arbitration lawsFootnote 1 and the development of its legal system generally.Footnote 2
This contribution aims to chart the growth of arbitration law in Syria and the extent of Syria’s contemporary arbitration frameworks, thereby reflecting on possibilities for developing its existing arbitral infrastructure, which at least in principle offers methods for resolving various commercial, trade, and investment disputes. In confronting the dearth of available literature in this field, the focus of this article is necessarily both explanatory and exploratory. It intends to offer a window into Syria’s arbitration landscape as a way of encouraging further engagement with the Syrian legal system generally. Extensive further work is required to provide more analytical findings, including but not limited to studies of Syrian court judgments relating to arbitration, statistical data concerning the number of cases filed and their outcomes, and the enforcement of Syria-related arbitral awards. There is also considerable scope for socio-legal studies relating to the day-to-day experiences of legal practitioners in Syria.
Section 2 illustrates a brief history of arbitration in Syria, the salient features of Syria’s current national arbitration law, and the proliferation of recent arbitration-related legislation in Syria. Section 3 considers aspects of Syria’s existing investment arbitration frameworks, exploring the capacity for local institutional advancements and areas for potential development across Syria’s arbitral infrastructure more generally. While there is scope for considering the value of the term “arbitrating for peace,”Footnote 3 the international arbitration community has yet to reflect on possibilities for establishing domestic, regional, and international tribunals for the settlement of disputes arising out of or in connection with the conflicts in Syria.
At a crucial juncture in its modern history, the Syrian state has continued to promulgate legislation and develop its domestic legal infrastructure, including with respect to arbitration. Albeit under far from ideal circumstances, individuals, companies, and state parties have continued to engage in commercial activities and trade either within or involving Syria since 2011. As to concluded or prospective transactions of this nature, it remains incumbent on various stakeholders to understand the available methods for conducting independent, efficient, and effective arbitration, whether in relation to disputes prior to, during, or after the most testing period of Syria’s modern history. Cautioning against approaches that efface or ignore national law landscapes, this contribution suggests that an awareness of Syria’s existing arbitration landscape and infrastructure is a necessary precursor to exploring the possible role of arbitration and other dispute-resolution processes for resolving conflict-related disputes involving Syria.
2. Overview of the Syrian arbitration landscape
2.1 A brief history of arbitration in Syria
Arbitration, or tahkeem (تحکیم) in Arabic, has long been used as an Arab customary law technique of alternative dispute resolution (ADR). Interwoven throughout the dispute-resolution doctrines of Judaism and Christianity, deriving from the Arabic word for judgment or hukum (حکم), and rooted as a concept in pre-Islamic Arab societies, arbitration has survived various Arab empires and enlightenments, Ottoman and European imperialism in the Middle East. Retaining its etymological continuity throughout, arbitration resiliently takes its place within the dispute-resolution tapestries of modern Middle Eastern states.
Whereas, in the absence of any legislative authority, intertribal disputes would be settled by force, indigenous Arab legal culture dictated that disputes within tribes would be resolved by recourse to arbitration.Footnote 4 There is evidence to suggest that rather developed arbitration mechanisms were utilized to settle commercial disputes in ancient Palestine, Syria, and Egypt,Footnote 5 as later reflected in the Roman-law arbitral tradition of compromissum.Footnote 6 Pre-Islamic Arab societies governed themselves through unwritten customary law principles in which “law enforcement was the responsibility of the wronged individual…through ad hoc arbitration before a suitable hakam.”Footnote 7 This arbitral idiosyncrasy, whereby the onus to commence proceedings rests firmly with the claimant, remains a feature in contemporary arbitration practice.Footnote 8
According to Islamic law scholar Wael B. Hallaq, the Prophet Muhammed “was very much part of his environment which was deeply rooted in the traditions of Arabia.”Footnote 9 In a particular social and political context, the Prophet Muhammed could not have abandoned or ignored the legal rules and principles by which Arab customary law persisted, and which later rode alongside the Shari’a.Footnote 10 Indeed, the Prophet Muhammed was himself a “prominent arbitrating judge (hakam)” conscious of “maintaining continuity with past traditions and laws.”Footnote 11 As an Arab-law concept, arbitration persisted through the passage of Islam, later becoming a part of the Islamic legal tradition.
The advent of Islam and subsequently the Koran further indicates the utility of arbitration as a form of ADR in traditional Arab societies. The Koran references the need for arbitration as a form of reconciliation in family matters,Footnote 12 the impartiality of arbitrators,Footnote 13 the relationship between arbitrators and judges,Footnote 14 and the finality of arbitral decisions.Footnote 15 There is also evidence from the Sunna and subsequent interpretations in the different jurisprudential schools of Islamic laws to suggest that juristic endeavours were key to the development of arbitration in accordance with Islamic law principles.Footnote 16
During the period of the early Arab caliphates, arbitration was most notably used as an alternative to and cessation of war. In 657, the battle of Siffin ensued between ‘Ali ibn-abi Taleb, leader of al-‘Iraq, and Mu’awiyah ibn-abi-Sufyan, Governor of al-Sham, comprising Syria, Palestine, Lebanon, and Jordan, resulted in “Mu’awiyah’s proposal to arbitrate according to the word of Allah.”Footnote 17 A tribunal comprising two party-appointed arbitrators, “each accompanied by four hundred witnesses, held a public session in January 659 at Adhruh, on the main caravan route between Damascus and Medina.”Footnote 18 An arbitration agreement, or what might now be considered terms of reference, was signed prior to the commencement of proceedings, as later recorded by Abu Hanifa Al-Dinawari (d. 282/896) in the ninth century.Footnote 19
Under Ottoman rule in the Middle East, arbitration remained a utilized ADR technique to resolve civil and commercial disputes as evidenced by the arbitration law under the Majallat al-ahkam al-‘adiliyya (the “Majalla”).Footnote 20 Articles 1841–1851 of the Majalla contain express provisions on the arbitrability of disputes concerning rights over property,Footnote 21 the appointment and recusal of arbitrators,Footnote 22 the binding nature of arbitral awards,Footnote 23 and the execution of arbitral awards.Footnote 24 At the turn of the twentieth century, arbitration was repeatedly used to resolve various territorial disputes concerning international boundaries within the Arabian peninsula, commonly referred to as the Arabian Boundary Disputes.Footnote 25 The transitional period of legal development in Syria between the late nineteenth and early mid-twentieth centuries was lucidly summarized by Jacques El-Hakim in 1994:
Syria inherited from the Ottoman Empire, of which it was a part between 1516 and 1918, a set of Napoleonic-inspired Codes, following the “reorganization” (tanzimat) …. Those included, mainly, the Criminal, Commercial, Maritime, Procedure and Real Estate Codes. As to the Civil Code (Majalla), promulgated as from 1876, it was the first compilation in history of Islamic Hanafi law.
After a short period of independence under King Faisal I in 1920, Syria was put under French rule. It gained complete independence in 1946, and promulgated several modern Codes, inspired by French law, relating mainly to: Evidence (1947), Civil, Commerce, Criminal Law (1950) and Civil Procedure (1953). They all reproduced the corresponding Lebanese Codes, except for the Evidence, Contracts and Civil Procedure Codes, which mainly adopted Egyptian Codes. The Codes are supplemented by decrees (marsum if issued by the President of the Republic and qarar if issued by a subordinate authority—President of the Council, Minister, director of a specific service or autonomous organization) and circulars (balagh) organizing internal work within a specific Ministry or organization.Footnote 26
As a consequence of this common heritage across Middle Eastern jurisdictions, the modern development of the Syrian legal system was broadly in line with those of other Arab states, particularly those of Lebanon and Egypt. Similar to other Middle Eastern jurisdictions at the time, Syria’s modern arbitration law was included under Articles 506–534 of the Syrian Civil Procedure Code (“the Syrian CPC”).Footnote 27 The arbitration-related provisions of the Syrian CPC were repealed and superseded by Syrian Law No. 4 of 2008, on Arbitration (“the Syrian Arbitration Law 2008”).Footnote 28
The Syrian CPC provisions on arbitration continue to apply to disputes subject to arbitration agreements concluded prior to the entry into force of the Syrian Arbitration Law 2008, whether or not arbitral proceedings have commenced in such disputes.Footnote 29 Notwithstanding that Syria is a signatory to the New York Convention,Footnote 30 the Syrian Arbitration Law 2008 does not refer to the enforcement of foreign arbitral awards, which remain subject to Articles 306–311 of the Syrian CPC. The interruption of arbitral proceedings continues to be governed by the relevant conditions under the Syrian CPC.Footnote 31 While the Syrian Arbitration Law 2008 provides that Articles 506–534 of the Syrian CPC as amended shall be repealed,Footnote 32 no all-encompassing reference was made to other arbitration-related domestic laws governing certain disputes. One specific reference under Article 2(1) of the Syrian Arbitration Law 2008 provides that disputes concerning procurement contracts remain subject to the provisions of Article 66 of Syrian Law No. 51 of 2004.Footnote 33 The are no other express references to certain other disputes, such as those arising out of contracts concluded with government agencies or organizations.Footnote 34
2.2 The Syrian Arbitration Law 2008
The Syrian Arbitration Law 2008 contains nine chapters comprising 66 articles, which are largely inspired by the provisions within the UNCITRAL Model Law on International Commercial Arbitration 2006 (“the UNCITRAL Model Law”) and Egyptian national arbitration law.Footnote 35 The articles of the Syrian Arbitration Law 2008 have been subjected to testing in the Syrian courts,Footnote 36 although these court decisions and the Syrian Arbitration Law 2008 itself have received limited professional and academic attention.Footnote 37 Some of the salient and unique features of the Syrian Arbitration Law 2008, are summarized as follows:
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The general provisions place emphasis on party consent, in respect of both the definitions of “arbitration” and “arbitration agreement”Footnote 38
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“International commercial arbitration” is defined broadly to include arbitrations in which “the subject matter of the dispute is related to international trade, even if the arbitration is conducted in Syria”Footnote 39
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The Syrian Court of Appeal has jurisdiction over all matters within the scope of the Syrian Arbitration Law 2008.Footnote 40 This appears intended to avoid an additional level of judicial scrutiny in arbitration matters before the Syrian Court of First Instance, while laying down a marker for developing arbitration expertise within the appeal division
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A claim notice for disputes related to real property rights shall be inserted into the record of the real property by order of the competent Syrian court,Footnote 41 presumably insofar as the sale and purchase of land are matters of public order
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The parties are free to determine the applicable law to the subject matter of the disputeFootnote 42 and applicable proceduresFootnote 43
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Arbitration agreements must be in writing, which will include the reference to arbitration in official or ordinary documents, minutes drafted before the arbitral tribunal, and written communications establishing common intention between the parties to be bound by arbitrationFootnote 44
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Arbitration agreements are not permitted in matters contrary to public order related to nationality, personal status, or where compromise is precluded, except where the agreement concerns the financial effects resulting from such matters.Footnote 45 The term “financial effects” is undefined in the law
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There is no requirement for arbitrators to be of a specific sex or nationality, unless otherwise agreed by the partiesFootnote 46
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A court order rejecting a request to appoint an arbitrator shall be subject to appeal before the Syrian Court of CassationFootnote 47
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Those perpetrating assaults against arbitrators in the lead-up to or during the exercise of their mandate shall face the same penalty applicable to assaults against judgesFootnote 48
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Arbitrators have a duty to disclose “any circumstances which are likely to raise doubts as to their impartiality or independence, whether existing upon accepting their mission or occurring during the arbitral proceedings”Footnote 49
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The competence–competence doctrine applies to the mandate of an arbitral tribunalFootnote 50
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The parties are free to agree on the geographic place of the arbitration, whether in Syria or abroadFootnote 51
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Unless otherwise agreed by the parties or decided by an arbitral tribunal, arbitrations will be conducted in the Arabic languageFootnote 52 and awards will be rendered in the language of the arbitrationFootnote 53
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Arbitral hearings will be held in camera, unless the parties agree otherwiseFootnote 54
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Arbitral tribunals are empowered to instruct experts, either on their own motion or at the request of the partiesFootnote 55
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Arbitral tribunals are empowered to hear witnesses, either on their own motion or at the request of the partiesFootnote 56
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In the absence of party agreement, and notwithstanding the right of the arbitral tribunal to order an extension of 90 days,Footnote 57 arbitral awards must be issued within 180 days of the arbitral tribunal holding its first hearingFootnote 58
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The parties can expressly agree to authorize the arbitral tribunal to act as amiable compositeur, to rule on the dispute ex aequo et bono, without being bound by legal normsFootnote 59
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Arbitral awards shall be issued in writing and signed by the arbitratorsFootnote 60
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Arbitral awards shall include the names of the tribunal members; the names and addresses of the parties; their capacities and nationalities; a copy of the arbitration agreement; a summary of the parties’ claims, statements, and evidence; the dispositive part of the award; and the date and place of issuanceFootnote 61
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Arbitral awards must specify the arbitration fees and expenses, and the way in which such fees and expenses will be allocated between the partiesFootnote 62
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Arbitral awards shall be final and not subject to appealFootnote 63
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Actions to nullify arbitral awards are possible only where no arbitration agreement exists or such an agreement is void or has expired; the parties lacked capacity to enter into an arbitration agreement; a party was not properly notified of the arbitration and was unable to present a defence during the proceedings; the arbitral tribunal disregarded the applicable law agreed between the parties; the composition of the arbitral tribunal was contrary to law; the arbitral award was decided on matters not included in or outside the scope of the arbitration agreement; if nullity occurs in the arbitral award; or if the arbitral proceedings are tainted by nullity affecting the awardFootnote 64
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The competent Syrian court can, on its own motion, rule on the annulment of arbitral awards if the content of such awards violates the public order of SyriaFootnote 65
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The ruling of a competent Syrian court to annul an arbitral award can be challenged before the Syrian Court of Cassation within a period of 30 days following the notification of the annulment rulingFootnote 66
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Arbitral awards have the authority of res judicata and shall be binding on the partiesFootnote 67
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The commencement of any annulment proceedings shall not stay the execution of arbitral awardsFootnote 68
2.3 Arbitration-related legislation in Syria
In addition to its national arbitration law, Syria has over the past two decades promulgated legislation in a number of areas of law, providing for either the practice of arbitration or the future establishment of arbitral infrastructure. Recognizing this body of supporting legislation is necessary for parties navigating certain industry disputes within the Syrian arbitration landscape but, more broadly, for developing a holistic understanding of the place of arbitration within the Syrian legal system. The existence of these supplementary Syrian arbitration laws is perhaps indicative of a domestic aspiration towards decentralized and specialist dispute resolution that encompasses the ability to both alleviate and exasperate the limits of national state courts. More generally, and despite facing comprehensive US sanctions,Footnote 69 Syria’s broad uptake of arbitration reflects an acceptance of its global prevalence among other forms of ADR in international and interstate disputes concerning matters of investment, commerce, and industry.
Examples of this supporting legislation, which are set out below,Footnote 70 can be understood in two categories, namely (1) legislation containing substantive provisions governing the arbitration of certain disputes; and (2) legislation endorsing arbitration and/or the future establishment of an arbitral infrastructure.
2.3.1 Legislation containing substantive provisions governing the arbitration of certain disputes
Syrian Law No. 38 of 2006, Customs Law (the “Syrian Customs Law”). Under Article 43 of the Syrian Customs Law, where customs-related disputes arise, applicants that reject a written decision by the “Director General of Customs”Footnote 71 shall have such disputes referred to arbitration in accordance with Chapter Four (Articles 89–93) of the Syrian Customs Law, concerning arbitration.Footnote 72 These articles state as follows:
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An arbitral tribunal shall be entitled to hear disputes concerning a discrepancy in customs duties and other taxes of over 5,000 Syrian pounds or where a decision leads to the prohibition of goods worth over 25,000 Syrian pounds, failing which disputes arising between the Customs Department and concerned parties as to the specifications, origin, or value of goods shall be subject to a final decision of the “Customs Department Manager”Footnote 73
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Disputes referred to arbitration shall be conducted by a tribunal composed of two experienced arbitrators: one named by the customs administration and the other by the owner of the goods or such other authorized representative. Where the owner of the goods fails to name an arbitrator within eight days from the date of the first appointment, the “Customs Department Manager” shall issue a final and binding decisionFootnote 74
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The two members of the arbitral tribunal shall issue their decision within ten days of having the file referred to them and their decision can be subject to appeal before an appellate arbitral committee within five days from the date of its notificationFootnote 75
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The three-member appellate arbitral committee shall be composed of a permanent Commissioner, to be appointed as chairman under a decision by the minister,Footnote 76 and two other members: one to be named by the “Director General of Customs” or an authorized representative and the other by the owner of goods or their legal representative.Footnote 77 The appellate arbitral committee shall render its decision unanimously,Footnote 78 which shall be final and binding on the parties, with the losing party bearing the costs of the arbitrationFootnote 79
Syrian Law No. 15 of 2008, Real Estate Investment Law. Article 32 of Syrian Law No. 15 of 2008 provides the following provisions on disputes involving real-estate developers:
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The civil division of the Syrian Court of First Instance shall have sole competence to hear disputes arising between real-estate developers and individuals, applying the principles applicable to summary proceedings, its decisions being subject to appeal. Decisions issued by the Syrian Court of Appeal in disputes involving real-estate developers and individuals shall be deemed final and not subject to appeal
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The “State Council” shall, through the administrative judicial Commission, have sole competence to hear disputes arising between an administrative entity and a real-estate developer. Arbitration may be sought in accordance with procedures adopted by the “State Council” if provided for under the contract
Syrian Decree No. 52 of 2009, Regulating the Creation of Chambers of Industry. Under the section “Terms of Reference of the Chamber,” Article 6 of Syrian Decree No. 52 of 2009 provides that the scope of competences of the respective chambers of industry shall include:
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Supervising arbitration proceedings relating to industrial disputes in which one of the parties is a member of the chamber, at the request of parties, and documenting the issuance and signature of arbitral instrumentsFootnote 80
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Nominating arbitrators and experts, at the request of the parties, to be submitted to the respective chambersFootnote 81
Syrian Decree No. 17 of 2010, Syrian Labour Law (the “Syrian Labour Law”). Footnote 82 The Syrian Labour Law applies to labour relations in the private sector, Arab and foreign union companies, the co-operative sector, and the mixed public–private sector not covered by the Syrian Law No. 50 of 2004, the Civil Service Law. Regarding labour disputes, the Syrian Labour Law states as follows:
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All prejudiced employees have the right to claim compensation before a primary civil tribunal for labour disputes,Footnote 83 to be established in each governorate of Syria by a decision of the Minister of Justice.Footnote 84 In cases of collective dispute between employers and trade unions, the law requires amicable settlement by way of collective bargaining
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Failing settlement, the Syrian Labour Law permits mediation to be initiated by the “Directorate of Social Affairs and Labour,” at the request of the parties or their legal representativesFootnote 85
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Failing settlement of any dispute by mediation, the Syrian Labour Law provides for the possible referral to arbitration before an arbitral tribunal, the procedures to be established in each governorate by a ministerial decision.Footnote 86 Decisions rendered by an arbitral tribunal may be appealed before the Syrian Court of Cassation within 30 days of notification of the arbitral awardFootnote 87
Syrian Law No. 18 of 2010, on Telecommunications (the “Syrian Telecommunications Law”). Part 13 of the Syrian Telecommunications Law contains provisions on the “Settlement of Disputes and Complaints” (Articles 52–58), which mandate the Syrian Telecommunication Regulatory Authority (Syrian TRA) to formulate a permanent Settlement of Disputes Committee (SDC) with judicial competency specialized in examining civil and commercial disputes arising between licensees.Footnote 88 The Council of MinistersFootnote 89 is tasked with deciding the procedures and regulations to be approved by the SDC and the applicable procedures in such disputes shall be those stipulated in the Syrian CPC unless otherwise stated in the procedures and regulations of the SDC.Footnote 90 Under the heading “Arbitration,” Article 53 of the Syrian Telecommunications Law provides that:
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The parties may expressly agree, before a dispute arises or thereafter, to resort to arbitration, in which case the SDC shall refer such disputes among licensees to arbitration
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Upon the decision of a council of the Board of Commissioners in the Syrian TRA (the “Council”), the arbitration rules shall be issued to the Syrian TRA subject to the provisions of the Syrian Arbitration Law 2008
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The Council shall issue a roster of arbitrators who are experienced, competent, and certified by the Syrian TRA to be used by the parties in forming an arbitral tribunal
Syrian Law No. 5 of 2016, Concerning Partnership between the Public and Private Sectors. In disputes over the financial balance of contracts between public–private partnerships, Article 75 of Syrian Law No. 5 of 2016 states that where parties to a “Participatory Contract”Footnote 91 fail to reach a common understanding, the private partner may demand the “Board”Footnote 92 to pay compensation or to increase the period of investment by extending the term of the contract. Where the private partner has not received fair compensation, it may resolve the dispute according to the dispute-resolution conditions in the contract, provided that the private partner continues to execute its contractual and legal obligations. In such circumstances, the contracting public entity may not terminate or rescind the contract until a final court order or arbitral award has been issued and duly executed. Under the heading “Dispute Resolution,” Article 78(A) and (B) of Syrian Law No. 5 of 2016 provides as follows:
(A) Disputes between a contracting public entity and private partner
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Disputes in connection with the execution, interpretation, validity, termination, or rescission of a Participatory Contract or any ancillary subcontract that may arise between the contracting public entity and the private partner shall be settled amicably
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Where the parties fail to reach an amicable settlement within 30 days from the date of either contracting party giving a notice in writing for amicable settlement to the other contracting party, either party may resort to any of the following methods:
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○Syrian Administrative Court
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○Arbitration inside Syria
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○Arbitration outside Syria
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The Participatory Contract shall include one of the above methods for dispute resolution and where the Participatory Contract does not contain an arbitration clause, the parties may subsequently agree to submit to arbitration
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Where the partners have not agreed to resolve the dispute by arbitration, the interested party may resort to the Syrian Administrative Court to resolve the dispute
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Any dispute referred to arbitration shall be governed by the applicable laws in Syria unless otherwise agreed in the Participatory Contract or the subcontract
(B) Settlement of disputes with clients of a project
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The contracting public entity may demand the private partner or the project company to pay the costs of simplified and efficient mechanisms to deal with project client complaints if the private partner or the project company provides services to the public directly or operates infrastructure facilities used by the publicFootnote 93
Syrian Law No. 32 of 2019, on the Formation of the State Council and its Powers (the “Syrian State Council Law”). Footnote 94 Article 1 of the Syrian State Council Law forms the “State Council” as an independent judicial and advisory body that handles the administrative judiciary based in the city of Damascus and issues its rulings in the name of the Arab people in Syria. The State Council also serves as an advisory body to public entities, comprising two divisions, namely the Judicial DivisionFootnote 95 and the Advisory Division.Footnote 96 In addition to a wide range of administrative judicial powers, the State Council can rule on all administrative disputes and disputes in relation to which other laws provide for the jurisdiction of the State Council.Footnote 97 Regarding arbitration, the Syrian State Council Law contains the following specific provisions:
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The State Council has the authority of an administrative judiciary to adjudicate disputes related to commitment contracts, public works, and supply contracts or any other administrative contract, as well as contracts concluded by professional unions and grass-roots organizations that are concluded in accordance with the provisions of the public agency contracts regulations.Footnote 98 It is permissible to resort to arbitration disputes arising out of contracts over which the Council of State has the authority to rule as an administrative judiciaryFootnote 99
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Under Article 14 of the Syrian State Council Law, the State Council Administrative Courts have jurisdiction to rule on a wide range of disputes including those related to:
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○Taxes, fees, and general costs, whether the dispute relates to the legal basis for the assignment or the value of the assignmentFootnote 100
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○Disputes in which the law stipulates that the jurisdiction of the Administrative Courts must be examined according to prescribed principlesFootnote 101
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○Urgent requests related to arbitration matters involving the State Council, requests for the interpretation and correction of material errors in arbitral awards, and arbitral decisions concerning enforcement, as well as disputes concerning the naming, dismissal, retirement, or reinstatement of arbitratorsFootnote 102 and
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○Actions to annul arbitral awards whereby a court decision to dismiss the annulment proceedings is deemed an enforcement of the arbitral awardFootnote 103
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Largely reflecting the nullity provisions contained at Article 50(1)(a)–(g) of the Syrian Arbitration Law 2008, Article 15(1)(a)–(g) of the Syrian State Council Law provides that an action to invalidate an arbitral award shall not be accepted before the State Council courts, except in the following cases:
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○Where no arbitration agreement exists or such an agreement is null or void having expiredFootnote 104
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○If a party to an arbitration agreement at the time of its conclusion lacked capacity to enter into an arbitration agreement according to the law governing their eligibilityFootnote 105
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○If one of the parties to the arbitration is unable to present a defence due to their failure to announce a correct declaration regarding the appointment of an arbitrator, the arbitration procedures, or any other reason beyond their controlFootnote 106
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○If the arbitration award disregarded the applicable law agreed between the parties on the subject matter of the disputeFootnote 107
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○If the arbitral tribunal was constituted or the arbitrators appointed in violation of the agreement of the partiesFootnote 108
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○If the arbitral award decided on matters not included in or exceeding the scope of the arbitration agreement. If it is possible to separate decisions on matters subject to arbitration from those not subject to arbitration, only the latter part of the award shall be capable of being nullifiedFootnote 109
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○If nullity occurs in the arbitral award, or if the arbitral proceedings are tainted by nullity affecting the awardFootnote 110
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Pursuant to Article 15(2) of the Syrian State Council Law, the competent Syrian court can, on its own motion, rule on the annulment of arbitral awards if the content of such awards violates the public order of Syria
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Under Article 127 of the Syrian State Council Law, proceedings commenced before the ordinary courts of law that have become the prerogative of the State Council will be stayed until the issuance of a judicial ruling of a peremptory degree.Footnote 111 Awards issued by arbitral tribunals before the entry into force of the Syrian State Council Law and that have not been declared final shall remain subject to appeal before the Supreme Administrative CourtFootnote 112
2.3.2 Legislation endorsing arbitration and/or the future establishment of an arbitral infrastructure
For reference, these legislative instruments include:
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Syrian Law No. 65 of 2002, Creating a National Tourism Federation and Tourism ChambersFootnote 113
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Syrian Decree No. 43 of 2005, Reorganising Insurance and Reinsurance Companies, previously governed by Syrian Legislative Decree No. 195 of 1959Footnote 114
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Syrian Decree No. 43 of 2005, Regulating the Insurance MarketFootnote 115
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Syrian Law No. 20 of 2006, Maritime LawFootnote 116
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Syrian Law No. 8 of 2007, on Trademarks, Geographic Indicators, Industrial Drawings and Designs, and Unfair CompetitionFootnote 117
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Syrian Decree No. 8 of 2007, the Syrian Investment LawFootnote 118
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Syrian Law No. 4 of 2009, Implementing the Electronic Signature and Network Services LawFootnote 119
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Syrian Decree No. 29 of 2011, Regulating the Establishment of all Legal Forms of CompaniesFootnote 120
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Syrian Decree No. 62 of 2013, Implementing the Provisions Governing Copyright and Related Rights Protection LawFootnote 121
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Syrian Law No. 3 of 2016, Establishing the Agency for Supporting and Developing Local Products and Exports (ASDLPE)Footnote 122
3. Navigating postwar disputes
While it is difficult to project when a cessation of ongoing conflicts in Syria might allow the peaceful resolution of connected disputes, various prospective issues can be borne in mind with respect to instituting, managing, and officiating postwar disputes. For states, investors, commercial entities, or other interested parties, the identity and classification of the parties, jurisdictional matters, as well as the applicable law in such disputes are each likely to raise contentions, particularly given what are often blurred lines between commercial and investment disputes. Despite disputes inevitably giving rise to a nexus of competing stakeholder interests, there remains scope for converging shared needs to establish effective and independent dispute-resolution fora. Such fora can be beneficial for a cross section of actors involved, as well as wider peacekeeping efforts. Insofar as such postwar disputes may envelope aspects of Syrian investment law, it is worth considering Syria’s existing investment arbitration landscape, including the treaties and conventions to which Syria is a party, and their corresponding arbitration and dispute-settlement provisions.
Between 1975 and 2010, Syria signed over 40 bilateral investment treaties (BITs), each of which contains different dispute-settlement provisions. In line with Syria’s broader economic position, a significant proportion of these BITs were concluded with Arab countries,Footnote 123 non-aligned regional partners,Footnote 124 various Association of Southeast Asian Nations (ASEAN) countries,Footnote 125 as well as China, India, and Russia. In doing so, Syria adopted atypical BIT forms whereby the arbitration-related provisions differ vastly from treaty to treaty. By way of example, the Syria–Germany BIT is absent any provisions whatsoever on dispute settlement between investors and contracting parties; the Syria–Indonesia BIT limits dispute settlement between contracting parties to the possibility of settlement through diplomatic channels;Footnote 126 while the Syria–Egypt BIT, in addition to having separate articles regarding the settlement of investor–state and state–state disputes, also establishes a joint ministerial committee for implementing the BIT, which is authorized to conduct the reconciliation of disputes over investment activities.Footnote 127 It remains to be seen whether the dispute-settlement provisions within these treaties are sufficiently durable and comprehensive to sustain arbitration processes arising out of or in connection with postwar disputes.Footnote 128
In addition to the above-mentioned BITs, Syria is a signatory to the following regional treaties and conventions that either include standing arbitration provisions or concern the recognition and enforcement of judgments and arbitral awards:
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Arab League Convention on the Enforcement of Judgments and Arbitral Awards 1952Footnote 129
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Inter-Arab Investment Guarantee Corporation 1971Footnote 130
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Unified Agreement for the Investment of Arab Capital in the Arab States 1980Footnote 131
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OIC Investment Agreement 1981Footnote 132
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Riyadh Convention 1983Footnote 133
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The Amman Arab Convention on Commercial Arbitration 1987Footnote 134
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Islamic Corporation for the Insurance of Investment Credit 1992Footnote 135
It is worth noting that the Syrian state has appeared as a party to a number of international commercial arbitrations under the institutional auspices of the International Court of Arbitration of the International Chamber of Commerce (ICC). In Papillon Group Corporation (Panama) v. Syria and others,Footnote 136 various disputes arose in relation to contracts for advertising services tendered by Syria to Papillon regarding the Mediterranean Olympic Games held in Latakia in 1987. Following a first ICC award rendered in respect of a restitution claim and various damages arising from alleged non-performance under these contracts,Footnote 137 Syria refused to sign terms of reference and otherwise refrained from participating in subsequent ICC proceedings arising under the same contracts. The tribunal in the second ICC proceedings declared itself incompetent to rule on the claims, absent any grounds to indicate Syria was a party to the arbitration or had expressed a clear and explicit will to participate in an international commercial arbitration. On substantive grounds, the tribunal also rejected Papillon’s claims for sums in excess of $30 million.
In another ICC arbitration between an Italian company as claimant and a Syrian company representing the government of Syria,Footnote 138 a dispute arose over supplemental pricing in connection with the performance of a contract for works, the delivery of supplies, and other transactions approved by the Syrian minister of petroleum, electricity, and mineral resources, and which was ratified by specific Syrian legislation. The existent of contradictory references to applicable law in the contract left the tribunal having to determine between “the general principles of law and justice” and the “laws of Syria.” Taking a holistic approach, the tribunal adopted both references, stating that the agreement to “general principles prima facie include those which are derived from the Syrian legal system, as well as those which are developed in international arbitral case-law.”Footnote 139
In an interim award settling the interpretation of the applicable law, the tribunal acknowledged the parties’ impassioned and “even philosophical” submissions, citing the claimant’s perception that submitting to Syrian law was tantamount to an automatic disadvantage and finding that such a perception “is obviously totally unreal but exists in the mind of the merchant who often has only a vague concept of foreign legal systems.”Footnote 140 This serves as a reminder that, irrespective of the wider institutional and procedural context, paying attention to the formation of arbitration agreements, seemingly basic contract-drafting skills, and employing disputes foresight in contract negotiations can avert unnecessary procedural delays and legal disputes during the course of arbitral proceedings.
The ICC case Syrian State Trading Organization v. Ghanaian State Enterprise Footnote 141 concerned a dispute over delays in the procurement into Syria of plywood and blockboard from Ghana, precipitating various claims over an irrevocable letter of credit, performance guarantee, alleged contractual breaches, force majeure, damages, and loss-of-profit claims arising out of the procurement contract. In view of a contractual reference to “French International Arbitration Law,” the tribunal opted to apply English law as the law applicable to the substance of the dispute, taking into account “trade usages” referenced under the French Civil Code and ICC Rules, and the parties’ respective claims to apply Syrian, Ghanaian, and English national laws. In a dispute over the general conditions applicable to the contract, the tribunal dismissed a version of general conditions submitted by the Syrian party the evening before the hearing and which were deemed inadmissible.
Making a general remark regarding Ghana’s force majeure claim over the 1979 oil crisis following the Iranian revolution, the tribunal indicated that “if every governmental reshuffle and accompanying public excitement constitutes force majeure, world trade would in modern times be bogged down by uncertainty.”Footnote 142 It is equally notable that in respect of loss-of-profit claims made by the Ghanaian party, the tribunal stated under general principles that upon non-delivery, the buyer can mitigate its loss by procuring substitute goods on the open market, although “to the extent to which he [the buyer] suffers further loss by not going to the market, he cannot hold the seller responsible.”Footnote 143
In a more recent investment dispute between Gamesa Eolica, S.L.U. v. Syria,Footnote 144 a tribunal constituted under the auspices of the Permanent Court of Arbitration (PCA) found Syria liable for breaching the Syria–Spain BIT after the Syrian authorities had seized bank guarantees posted by Gamesa in relation to a project to build a wind farm in Syria that was derailed by conflicts and sanctions. At the subsequent enforcement stage, Syria did not appear in the proceedings or file any challenge against the award under the New York Convention. In 2014, the Spanish High Court of Justice in MadridFootnote 145 delivered a decision recognizing the PCA award.
In terms of Syria’s broader national policy towards arbitration, there remains scope for development, notwithstanding the above-mentioned domestic commercial arbitration provisions and Syria’s existing investment arbitration frameworks. Long before the current conflicts in Syria, the widely held perception was that despite Syria’s local arbitration provisions, “in actual practice, Syrian entities do regularly submit to all forms of arbitration outside Syria.”Footnote 146 In more recent scholarship, Nathalie Najjar suggests that this position prevails, in part, owing to the absence of any recognizable arbitral institutions in Syria:
In the absence of a permanent national Syrian arbitration centre, the most important chambers of commerce, those in Damascus and Allepo as well as the Syrian Federation of Chambers of Commerce based in Damascus, act as local arbitration institutions. The continuous hostility shown in this country towards international arbitration, which some interpret as a kind of reaction to cases involving a Syrian party, explains why these chambers have prerogatives in theory more than in practice. They are rarely solicited by international traders, who generally prefer ad hoc arbitration or, in the best case scenario, the reputed arbitration centres.Footnote 147
In view of this position, national stakeholders in Syria may take future steps to encourage domestic and international parties to conduct arbitral proceedings and other forms of dispute settlement within Syria. The development of a local arbitral infrastructure, including a recognized internationally facing arbitral institution and a domestic judicial infrastructure capable of delivering independent, efficient, and dependable judicial assistance during arbitral proceedings as well as the enforcement of arbitral awards, will be key to revitalizing Syria’s national economy and a likely precursor to attracting foreign direct investment. However, at least with respect to state–state disputes and potential mass claims arising out of the Syrian conflicts, such claims might mandate recourse to international tribunals and other forms of institutionalized dispute settlement, requiring the buy-in of international stakeholders and regional partners.
To this end, the trajectory of established models, such as the Iran–US Claims Tribunal,Footnote 148 may be considered as a useful reference point. Following the end of World War I, the establishment of Mixed Arbitral Tribunals (MATs) represented a significant development of international adjudication systems. Despite being fairly limited in number, these MATs decided tens of thousands of cases in little over a decade during the interwar period. The jurisprudence of these MATs remains substantially untouched by academics and practitioners,Footnote 149 as does the scope for drawing lessons for creating novel institutional fora or other international tribunals. Unsurprisingly therefore, the prospects for establishing domestic, regional, and international tribunals to resolve and settle disputes relating to Syrian conflicts since 2011 have been and remain unexplored.
4. Conclusion
Following Syria’s civil war of 1860, Butrus Al-Bustani delivered a series of fabled clarions that subsequently became known as Nafir Surriya. Aimed at those entangled in the war as well as outside interlocutors, and “with a style oscillating between Paulinian sermon and Socratic dialogue,”Footnote 150 Al-Bustani noted:
As for the claim that the Syrian unrest is the start of a worldwide war causing total destruction, we believe it is baseless. Our limited insight tells us that the desired goal of bringing peace and prosperity back to Syria can be achieved through extensive means. Otherwise, we are left to conclude that the world has gone old and mad or to agree with some of the astrologers who, guided by their visions and observations, have ordained that the Day of Judgment has arrived at our gates. If this were really the case, we would not need to feel sorry that it is too late or too early; we would need to worry about neither past nor future losses and destructions.Footnote 151
The principle of arbitration is a deeply rooted ancient ADR practice within the customary legal traditions of Syria. As such, the modern technique of arbitration resiliently takes its place within Syria’s contemporary dispute-resolution systems, encompassing a vast cross section of personal, private, and international disputes. Section 2 summarized the salient features of the Syrian Arbitration Law 2008, identifying that a raft of arbitration-related legislation either institutes provisions for arbitration in certain industry disputes or aspires towards developing industry-specific arbitral infrastructure. As a reference point for readers, and given the limited nature of available sources, Section 2 purposely exhibited these legislative provisions in a descriptive rather than discursive fashion.
Section 3 reflected on the possibilities for navigating postwar disputes arising out of the current Syrian conflicts, appraising aspects of Syria’s investment-law frameworks for arbitration and dispute settlement generally. By assessing certain international commercial and investment arbitration cases involving the Syrian state or state entities, it was shown that navigating postwar disputes effectively can rest equally on in-case management as it can on the institutional frameworks and systems governing them. In a reconnaissance of sorts, it was also recognized that potentially relevant regional and historical dispute-settlement systems have received diminutive academic attention. As such, and with those lurching towards the subject merely dusting the periphery, new opportunities for constituting institutional and other fora for resolving postwar disputes remain all but unexplored.
There is scope for Syria to develop its local arbitral infrastructure, and particularly the need to establish a recognized arbitral institution. Such developments remain a matter of national policy that speak more to a pervasive need for independent and transparent institutions, and for the purposes of strengthening the rule of law generally. Whether Syria can develop domestic technologically advanced administrative facilitates and an institutional infrastructure capable of meeting the needs of tomorrow’s disputes will be of secondary importance if the basic safety and security of parties and other professional participants cannot be guaranteed. This should neither detract from attempts to understand Syria’s existing arbitration landscape nor should it derail legitimate efforts to explore opportunities for using arbitration and other ADR processes to settle and resolve postwar disputes, either within or concerning Syria.
Acknowledgements
This contribution corresponds to a lecture presented by the author as part of the Law after Lunch lecture series at the University of Halle & Wittenberg in Germany on 2 July 2020, under the title “Arbitration in Syria: Navigating Post-War Disputes.” The author is grateful to Professor Dr Hatem Elliesie and Dr Matthias Vanhullebusch for their contributions during the preparation and editing of this article.
