A. LEGISLATION AND RULES
A.1 Legislation
International arbitration in Argentina continues to be governed by (i) the National Civil and Commercial Code (2015), (ii) the Law on International Commercial Arbitration (2018) and (iii) the New York Convention, to which Argentina is a signatory. No legislative amendments have been made since their enactment.
A.2 Institutions, rules and infrastructure
The Business Mediation and Arbitration Center created a Guide of recommendations for virtual hearings. Both the Business Centre for Mediation and Arbitration and the Commercial Mediation and Arbitration Center of the Argentine Chamber of Commerce are currently working on updating their rules.
B. CASES
B.1 Interpretation of the arbitration clause and the exclusion of consumer rights disputes from the arbitration agreement
In the case G., F. P. (“Plaintiff“) v. P. S. (“Defendant“)[1] Plaintiff filed a claim for damages for failure to deliver a property on the date stipulated in the contract. The first instance court had admitted the motion of lack of jurisdiction filed by Defendant, considering that the case corresponded to the arbitration jurisdiction designated by the parties. However, the National Court of Appeals on Civil Matters (“Court of Appeals“) upheld Plaintiff’s appeal, reversed the decision and rejected the lack of jurisdiction.
The Court of Appeals reviewed the arbitration clause and pointed out that the agreement on such jurisdiction was provided for in the event of divergences in the construction progress of the work due to delays in the deadlines for each stage. Thus, it held that the case is not included in the stipulated assumption since the claim is for damages as a result of a breach of contract, for which reason the arbitration jurisdiction cannot be extended to aspects not contemplated in the arbitration clause.
On the other hand, it further explained that the purchaser of a property to be built would in principle be protected by civil-commercial law and the Consumer Protection Law, and therefore considered the exclusion of such cases provided by section 1651, paragraph c) of the Argentine Civil and Commercial Code to be applicable.
It is a relevant decision considering that, in addition to applying the restrictive jurisprudential criteria on the attribution of arbitral jurisdiction, it incorporated as ground the ‘possible’ protection of the consumer protection regime over Plaintiff’s claim -an argumentative element not invoked by the parties (especially by the appellant)-, thus justifying the exclusion of the case as a matter subject to arbitration.
B.2 The kompetenz-kompetenz principle and the validity of the arbitration clause in adhesion contracts
In Rosario Maquinas Agricolas S.R.L. (“Plaintiff“) v. CNH Industrial Argentina S.A. (“Defendant“)[2] the National Court of Appeals on Commercial Matters (“Court of Appeals“) confirmed the first instance judgment that declared its lack of jurisdiction in the presence of an arbitration clause in the parties’ contract.
The Plaintiff complained that the arbitration clause was contained in a contract of adhesion in the terms of Section 1651, clause d) of the Civil and Commercial National Code (“Civil and Commercial Code“). However, the Court of Appeals analyzed the contract and the arbitration clause contained therein and held that (i) the contract was signed by two businesses and regulates patrimonial matters; therefore, it is not possible to assume the existence of an inequality of bargaining power; (ii) even if the Plaintiff had merely consented to the arbitration clause, it had acted with the freedom to enter into such agreement; and that, as a result, (iii) it cannot be considered that the Plaintiff was surprised by its incorporation.
Considering the above, the Court of Appeals admitted the enforceability of the arbitration clause —even if it were considered to be inserted in a contract of adhesion— as its abusiveness or possible threat to matters of public policy were not proven. Finally, and considering the kompetenz-kompetenz principle, the Court of Appeals decided not to analyze the claims against the validity or effectiveness of the arbitration clause, which are to be properly resolved by the arbitral tribunal itself, since it was not found that the clause was manifestly null and void.
The Court of Appeals’ judgment is an example of the implementation of the applicable arbitration principles and regulations that allow the proper enforcement of an arbitration clause. Indeed, the Court of Appeals limited itself to analyzing whether, at a preliminary stage, a manifest nullity could be detected under the terms of Section 1651 clause d) of the Civil and Commercial Code, and left it to the arbitral tribunal to decide on its own jurisdiction by resolving the issues regarding the validity and effectiveness of the arbitration clause in question.
B.5 The principle of iura novit curia and the ultra petita arbitration award
In the case Persist S.A. (“Plaintiff“) v. Fideera Chivilcoy S.A. (“Defendant“)[3] the National Court of Appeals on Commercial Matters (“Court of Appeals“) rejected the nullity action filed against the arbitration award issued by an arbitral tribunal from the Centro Empresarial de Mediación y Arbitraje.
The Defendant claimed that (i) if the arbitration award was validated, it would become an ultra petita award since the compensation awarded therein had not been requested by the Plaintiff; (ii) the grounds of the arbitration award were contradictory with the considerations of the arbitral tribunal and incompatible with each other; and that, therefore, (iii) the arbitration award was affected with an essential flaw in the process.
However, the Court of Appeals considered that the parties had not limited the arbitrators with respect to the application of the iura novit curia principle and, therefore, they were entitled to award the compensation in question. Thus, the Court of Appeals held that the arbitrators had sufficient powers to award said compensation and, therefore, the award was coherent, concrete, adequately grounded and without contradictions. Therefore, it did not find a violation of the principle of congruence or that the tribunal had ruled ultra petita as the awarded compensation was within the amount at issue in the litigation.
This judgment is relevant since the Court of Appeals considered the iura novit curia principle and the lack of agreement of the parties to limit its application by the arbitrators, thus enabling the arbitral tribunal to award a different compensation to the Defendant without that being an ultra petita ruling. It also ratified the trend of the Supreme Court to interpret restrictively the appeals for annulment filed against arbitration awards.
[1] Cámara Nacional de Apelaciones en lo Civil, Sala M, (National Court of Appeals on Civil Matters), 2 March 2023, “G., F. P. c. P. S. s/ Daños y perjuicios”, Exp. No. 75989/2019.
[2] Cámara Nacional de Apelaciones en lo Comercial, Sala B, (National Court of Appeals on Commercial Matters), 19 April 2023, “Rosario Maquinas Agricolas S.R.L. c/ CNH Industrial Argentina S.A. s/ Ordinario”, Exp. No. 2727/20233.
[3] Cámara Nacional de Apelaciones en lo Comercial, Sala F, (National Court of Appeals on Commercial Matters), 5 April 2023, “Persist S.A. C/ Fideera Chivilcoy S.A. S/ Organismos externos”, Exp. No. 7557/2022.
