Commercial Arbitration

Last verified on Thursday 13th April 2023

Commercial Arbitration: Jordan

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Infrastructure

1. Is your state a party to the New York Convention? Are there any noteworthy declarations or reservations?

Jordan

The New York Convention (NYC) was ratified by the Hashemite Kingdom of Jordan (Jordan) on 15 November 1979. However, it was only approved by a royal decree and, thus, became part of the national law on 16 November 1988 after it was published in the Official Gazette.

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2. Is your state a party to any other bilateral or multilateral treaties regarding the recognition and enforcement of arbitral awards?

Jordan

Jordan is party to the following multilateral treaties on recognition and enforcement:

  • Convention of the Arab League on the Enforcement of Judgments and Arbitral Awards (Arab League Convention) 1952 and entered into force in 1954;
  • Riyadh Arab Convention on Judicial Cooperation 1983, ratified in 1983 and entered into force in 1985;
  • Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States of 1965 (ICSID Convention), ratified in 1972 and entered into force in the same year; and
  • Legal and Judicial Cooperation Convention between members of the Arab Cooperation Council 1989 (this is between Jordan, Iraq, Egypt and Yemen).

Jordan is also party to several other bilateral treaties on mutual judicial assistance and legal cooperation, such as those with: Egypt (1987); Qatar (1997); Tunisia (through an annex to the original convention, which entered into force in 1997); United Arab Emirates (2000); Yemen (2001); Algeria (2002); and Kuwait (2006).

Of note, the Law on the Enforcement of Foreign Judgments No. 8 of year 1952 (LEFJ) remains of great relevance in relation to the enforcement of foreign arbitral awards, as it is perceived as the general law as to the enforcement of all foreign judgments and awards in the absence of a special provision in international conventions and it sets out the formalities that have to be followed to enforce a foreign arbitral award in Jordan. In accordance with the LEFJ, the party seeking to enforce an award must file an application to the Court of First Instance to render such an award enforceable. The award must not be contrary to Jordanian public order and must be issued in a state whose law recognises judgments issued in Jordan. Despite the scarcity of court decisions enforcing awards on the basis of the NYC, available ones demonstrate that Jordanian courts recognise the superiority of the NYC over national laws. Hence, reciprocity required under the LEFJ cannot be pleaded when an application to enforce an award under the NYC is submitted. 

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3. Is there an arbitration act or equivalent and, if so, is it based on the UNCITRAL Model Law? Does it apply to all arbitral proceedings with their seat in your jurisdiction?

Jordan

Arbitration proceedings in Jordan are subject to the Jordanian Arbitration Law No. 31 of year 2001 and its amendments (Arbitration Law). This law is derived from the Egyptian Arbitration Act, which is based on the UNCITRAL Model Law. [Hamza Haddad et al. ‘Jordan’ in Loukas Mistelis et al (eds), Arbitration Law and Practice in Middle East (Juris Arb Law, 2023) referred to as HH-Jordan].

The amendments of 2018 made the Arbitration Law significantly closer to the UNCITRAL Model Law, with some slight differences, such as:

  • the applicability of the Arbitration Law to both international and national arbitration;
  • the requirement of odd numbers of arbitrators;
  • a preliminary award on jurisdiction of the tribunal can only be challenged in the course of an annulment application of the final award;
  • the tribunal’s power to grant interim relief is not automatic, but subject to the parties’ agreement;
  • the application, by the tribunal, of the law that is most closely connected to the subject of the dispute should the parties fail to designate the applicable substantive law; and
  • the Arbitration Law goes beyond the Model Law through explicitly enabling virtual procedural meetings and hearings.

According to article 3(a) of the Arbitration Law, this Law applies to any “consensual arbitration, the seat of which is the Kingdom, and to any arbitration agreed to be subject to this Law, whether related to a civil or commercial dispute between parties of public or private law, and irrespective of whether or not the relationship subject of the dispute is contractual”.

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4. What arbitration bodies relevant to international arbitration are based within your jurisdiction? Do such bodies also act as appointing authorities?

Jordan

There is no arbitration body in Jordan per se compared to those known internationally. Hence, parties refer to foreign bodies in cases of institutional arbitration. The Jordanian Arbitration Association (JAA) was established in 1997, which individuals interested in arbitration can join as members. Theoretically, the JAA can administer an arbitration under the UNCITRAL Arbitration Rules. The JAA can also be chosen as an appointing authority by the parties, though this is quite rare in practice. Generally speaking, arbitration bodies can act as appointing authorities under the Arbitration Law, if the parties so agree. The President of the Court of Appeal acts as an appointing authority in case of parties’ disagreement or failure of a party to nominate an arbitrator according to an arbitration agreement.

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5. Can foreign arbitral providers operate in your jurisdiction?

Jordan

There is no restriction on foreign arbitral provider’s operation in Jordan. Institutional arbitration cases are conducted in Jordan, whereby parties opt for institutional arbitration rules to govern the proceedings and designate Jordan as the seat of arbitration.

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6. Is there a specialist arbitration court? Is the judiciary in your jurisdiction generally familiar with, and supportive of, the law and practice of international arbitration?

Jordan

There is no specialist arbitration court per se. However, the Jordanian Arbitration Law designates the Court of Appeal as the competent court in relation to certain matters that are governed by this Law, such as the provision of judicial assistance to the arbitration proceedings and the appointment of arbitrators. The Court of Cassation is the judicial entity competent to address the annulment and enforcement procedures of local arbitral awards. The enforcement of foreign arbitral awards, on the other hand, is subject to the jurisdiction of Court of First Instance. Jordanian courts are familiar with arbitration and the legal system is generally supportive of arbitral proceedings.

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Agreement to arbitrate

7. What, if any, requirements must be met if an arbitration agreement is to be valid and enforceable under the law of your jurisdiction? Can an arbitration agreement cover future disputes?

Jordan

An arbitration agreement must be executed in writing to be valid and enforceable. What constitutes ‘in writing’ is broadly defined in the Arbitration Law and includes: any documents signed by both parties; paper and electronic correspondence; any means of communication that may be considered as a record of the agreement and the receipt of which is capable of being evidenced; or any incorporation by reference to an arbitration agreement contained in another document, unless the parties explicitly exclude such incorporation. In insurance policies, however, the Civil Code requires the insertion of the arbitration clause in a sheet that is separate from the general conditions of the policy. It is also noteworthy that the Jordanian law does not require any special formality for arbitration agreements to which the state (or any of its entities) is a party.

An arbitration agreement can cover existing disputes (submission agreement) or future ones. The parties can even agree on submitting their dispute to arbitration after filing a lawsuit before the courts, in such case the submission agreement must precisely determine the subject of the dispute to be referred to arbitration otherwise it is considered void. The court’s decision to refer the dispute to arbitration in such case shall suffice without the need for a further submission agreement.  

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8. Are any types of dispute non-arbitrable? If so, which?

Jordan

As a general rule, all disputes (whether civil, commercial, contractual or noncontractual) can be referred to arbitration. The Arbitration Law deals with both subjective and objective arbitrability. As for the former, an arbitration agreement can only be concluded by natural or juridical persons who have the legal capacity to dispose their rights, otherwise the agreement is considered void.

As for objective arbitrability, any matter not capable of settlement (compromise) is non-arbitrable. The law does not provide a comprehensive list for such matters, but this may include criminal and administrative issues, and matters reserved for resolution by courts or state agencies. Furthermore, Arbitration Law explicitly states that matters related to employment contracts and consumer contracts based on pre-printed forms must not be subject to any prior agreement to arbitrate, as such is considered void.

Non arbitrability is further addressed in other laws, whereby exclusive jurisdiction is granted to Jordanian courts. The Maritime Law offers a good example, whereby Jordanian courts are explicitly granted exclusive jurisdiction in relation to disputes arising under bills of lading and contracts of carriage of goods and any agreement to the contrary is considered void. Courts have maintained this view in their decisions, though they have also recognised arbitration clauses in contracts that are subject to the Hamburg Rules of 1978 on the ground that the said Rules supersede the provisions of the Maritime Law. This is in accordance with the well-established principle in the Jordanian legal system regarding the precedence of international treaties and conventions over national laws to the extent that such treaties and conventions do not violate public order.

Of note, non-arbitrability is a matter of public order. Hence, the Arbitration Law grants the Court of Cassation the power to annul an award on its own motion if the subject matter of the dispute is non-arbitrable.

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9. Can a third party be bound by an arbitration clause and, if so, in what circumstances? Can third parties participate in the arbitration process through joinder or a third-party notice?

Jordan

Under Jordanian law, a contract (which may include an arbitration clause), is in principle only binding on its parties and their successors. Legal scholars, however, point out that in practice, arbitration agreements may inevitably apply to third parties, such as in the case where the memorandum of association of a company contains an arbitration clause covering disputes that may arise between the company and its shareholders. “By law, the memorandum applies to all current and future shareholder including, of course those who did not take part in signing it.” Hence it is plausible that such arbitration clause will apply to all current and future shareholders. [HH-Jordan, 248]

The Arbitration Law does not deal with the joinder of third parties. It is likely, however, that such a matter will not be possible unless all parties involved, including members of the tribunal, agree to such a joinder or if it is in accordance with the institutional rules that may be applicable to the case.

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10. Would an arbitral tribunal with its seat in your jurisdiction be able to consolidate separate arbitral proceedings under one or more contracts and, if so, in what circumstances?

Jordan

There is no specific provision on consolidation in the Arbitration Law. Such matter will likely be subject to the consent of the parties and the tribunal and the institutional arbitration rules that may govern the proceedings.

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11. Is the "group of companies doctrine" recognised in your jurisdiction?

Jordan

Arbitration agreements are binding only on the signatories. Jordanian law recognises the separate legal personality of a company and exceptions are very limited. 

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12. Are arbitration clauses considered separable from the main contract?

Jordan

Under the Arbitration Law, an arbitration clause is explicitly considered autonomous and separable from the main contract. An arbitration clause survives the annulment, termination or expiry of the contract that contains it.

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13. Is the principle of competence-competence recognised in your jurisdiction? Can a party to an arbitration ask the courts to determine an issue relating to the tribunal's jurisdiction and competence?

Jordan

The Arbitration Law recognises the principle of competence-competence. In terms of the positive effect of this principle, the arbitral tribunal has the power to determine its own jurisdiction and its decision in this regard can only be challenged in the annulment procedure.

As for the negative effect of the principle, if a court case is filed despite the existence of arbitration agreement, an objection to the jurisdiction of a court must be filed prior to entering into the merits of the case. Upon submission of such application, courts usually check that there is prima facie arbitration agreement and dismiss the case accordingly.

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14. Are there particular issues to note when drafting an arbitration clause where your jurisdiction will be the seat of arbitration or the place where enforcement of an award will be sought?

Jordan

Apart from the formal ‘in writing’ requirement, there are no specific constraints on drafting the arbitration clause. Nonetheless, certain basic elements must be observed to avoid disputes pertaining to the interpretation of a pathological clause. These elements include: the scope of the arbitration clause; number of arbitrators; procedural rules or law (whether ad hoc or institutional); substantive law (otherwise the tribunal would apply the law that is most closely connected to the dispute); the language of the arbitration (the default language is Arabic in the absence of parties’ agreement); and the tribunal’s power to grant interim measures.

It is also noteworthy that the current practice requires the appointment of Jordanian counsel to represent the parties in cases where Jordan is designated as the seat or the Jordanian Arbitration Law is applicable to the case, even if it pertains to a cross-border dispute and the applicable substantive law is not Jordanian.

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15. Is institutional international arbitration more or less common than ad hoc international arbitration? Are the UNCITRAL Rules commonly used in ad hoc international arbitrations in your jurisdiction?

Jordan

Though there is no reliable data available in this regard, the authors are of the view that both institutional and ad hoc arbitration are practised in Jordan; the former being generally less common. UNCITRAL Rules are not commonly chosen in ad hoc arbitration.

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16. What, if any, are the particular points to note when drafting a multi-party arbitration agreement with your jurisdiction in mind? In relation to, for example, the appointment of arbitrators.

Jordan

No specific requirements are provided in the Arbitration Law in relation to drafting multi-party arbitration agreements, as parties are free to choose the number and method of appointment. Nonetheless, the number of arbitrators is required to be odd, otherwise the arbitration proceedings are considered void. On the other hand, article 16 of the same law provides solutions when the parties fail to agree on certain matters in such multi-party agreement:

  • If the parties have agreed on the number of arbitrators and their method of appointment without agreeing on the method of appointment of the chairperson, then he or she will be determined through the consensus of the appointed arbitrators. Otherwise, the competent judge appoints the chairperson based on the parties’ request.
  • If the parties have agreed on the number of arbitrators but not their method of appointment, the competent judge appoints the arbitrators and determines the chairperson from among them.
  • If the parties have neither agreed on the number of arbitrators nor the method of their appointment, the number shall be three to be appointed by the competent judge who is also authorised to determine a chairperson from among the arbitrators.

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Commencing the arbitration

17. How are arbitral proceedings commenced in your jurisdiction? Are there any key provisions under the arbitration laws of your jurisdiction relating to limitation periods of which the parties should be aware?

Jordan

According to the Arbitration Law, proceedings only commence upon the full constitution of the arbitral tribunal, unless the parties agree otherwise. The Arbitration Law offers the parties a great deal of flexibility in setting their own timelines. However, unless the parties agree otherwise, if the tribunal consists of three arbitrators, each party must appoint an arbitrator within 15 days from the day following the date of receipt of the notice of arbitration. The two appointed arbitrators must then agree on the chairperson within 15 days from the day following the date of their appointment. In the case of failure to abide by these time limits, either party may request the competent judge to appoint the arbitrator.

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Choice of law

18. How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

Jordan

The tribunal will decide the dispute in accordance with the law chosen by the parties. According to the Arbitration Law, such choice of law clause will be limited to the substantive law, with the exclusion of conflict of laws rules. Failure by the tribunal to apply the chosen law may subject the award to annulment. Should the parties fail to clearly agree on a substantive law, the tribunal will apply the provisions of the law that is most closely connected to the subject matter of the dispute. In all circumstances, the tribunal is obliged by law to take into consideration the established customs in the field of the dispute and the usual dealings between the parties.

Should the parties agree to settle the dispute amicably and authorise the tribunal in this regard, the tribunal may decide the dispute on the basis of the principles of justice and equity without being bound by the provisions of the law.

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Appointing the tribunal

19. Does the law of your jurisdiction place any limitations in respect of a party's choice of arbitrator?

Jordan

The Arbitration Law does not place any limitations on the choice of arbitrators in terms of nationality, gender, required experience or skills, unless otherwise agreed by the parties or provided for in the applicable law. The only conditions required in an arbitrator according to the Arbitration Law are that he or she: must not be a minor; must not be interdicted; and must not be deprived of his or her civil rights, whether by virtue of a final conviction of a felony or misdemeanour involving moral turpitude, or due to the declaration of bankruptcy (even if he or she has been rehabilitated).

Parties can agree on the number of arbitrators and the procedure of appointment. In all cases, however, the number of arbitrators must be odd, or else the arbitration proceedings are considered void.

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20. Can non-nationals act as arbitrators where the seat is in your jurisdiction or hearings are held there? Is this subject to any immigration or other requirements?

Jordan

Unless the parties determine that arbitrators must be Jordanian nationals, non-Jordanians can act as arbitrators. Usual travel and entry requirements will apply.

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21. How are arbitrators appointed where no nomination is made by a party or parties or the selection mechanism fails for any reason? Do the courts have any role to play?

Jordan

Where parties have agreed to institutional arbitration, the rules will apply with regard to the default number of arbitrators and the procedure of appointment.

In the case of ad hoc arbitration where the Arbitration Law is applicable as the procedural law of the arbitration, and unless the parties have agreed on a different entity, the President of the Court of Appeal of the area of the seat of the arbitration acts as the default appointing authority upon the request of either party. In such a case, the said judge must hear the other party, take into consideration any conditions and/or qualifications that are agreed upon between the parties or required by the law and issue the decision "as soon as possible".

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22. Are arbitrators afforded immunity from suit under the law of your jurisdiction and, if so, in what terms?

Jordan

There are no specific rules on the immunity of arbitrators. This is governed by the general principles of law, whereby an arbitrator will be held liable for gross negligence, fraud, willful misconduct and denial of justice. Any agreement to contrary will be considered void.

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23. Can arbitrators secure payment of their fees in your jurisdiction? Are there fundholding services provided by relevant institutions?

Jordan

The Arbitration Law does not address methods for securing the fees of arbitrators, nor are there any fundholding services available in Jordan. Generally, parties are free to agree on such arrangements. In practice, the relevant institutional rules apply in the case of institutional arbitration, while tribunals in ad hoc arbitration request payment upon commencement of the arbitration proceedings.

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Challenges to arbitrators

24. On what grounds may a party challenge an arbitrator? How are challenges dealt with in the courts or (as applicable) the main arbitration institutions in your jurisdiction? Will the IBA Guidelines on Conflicts of Interest in International Arbitration generally be taken into account?

Jordan

An arbitrator can only be challenged based on serious circumstances that may raise doubts as to his or her impartiality and independence. According to the Arbitration Law, the arbitrator must disclose any circumstances that may cast doubt on his or her impartiality and independence. An arbitrating party cannot challenge the arbitrator it appointed except for a reason that only became evident post appointment. A party is also restricted from challenging the same arbitrator more than once during the same proceedings and for the same reason.

In the case of ad hoc arbitration, an application to challenge an arbitrator must be submitted to the tribunal within 15 days of appointment to the tribunal or of becoming aware of the facts underlying the challenge. Should the arbitrator not withdraw from the proceedings, he or she must provide a reply supported with evidence within 15 days of submission of the application. Upon the request of the challenging party, the application and the reply are then referred by the tribunal to the Court of Appeal. The court must review the application and issue its decision within 30 days of receiving the documents. The court’s decision in this regard is final and binding.

It is likely that the IBA Guidelines on Conflicts of Interest may be considered by the arbitral tribunals, since the Arbitration Law requires, for the purposes of interpreting its provisions, the observance of international business practices as well as the principles applied in international arbitration. Courts, on the other hand, are more likely to take guidance from the legal rules related to the independence and impartiality of judges.

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Interim relief

25. What main types of interim relief are available in respect of international arbitration and from whom (the tribunal or the courts)? Are anti-suit injunctions available where proceedings are brought elsewhere in breach of an arbitration agreement?

Jordan

In accordance with the Law of Civil Procedure, courts have the jurisdiction to orderany interim relief, on the motion of either party, whether prior to or during the arbitration proceedings. The court is authorised to order any provisional measures provided under that law.

According to article 23 of the Arbitration Law, the parties may agree to grant the tribunal the power to order any type of interim reliefs, whether on its own motion or upon the request of either party, as may be appropriate to the nature of the dispute. This provision has been broadly interpreted by courts, which have recognised the power of the tribunal to grant interim reliefs as long as there is no agreement to the contrary between parties that may restrict such power.

In all cases, if the party against whom an interim relief is ordered fails to comply with such, the tribunal may, upon the request of the other party, authorise the latter to take the procedures necessary for the implementation of the relief, including the right to apply to the competent court to issue an order of enforcement.

Anti-suit injunctions are not recognised or regulated under Jordanian law.

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26. Does the law of your jurisdiction allow a court or tribunal to order a party to provide security for costs?

Jordan

The only mention of security for costs in the Arbitration Law is in the context of interim relief. According to article 23 of the law, a tribunal can request the provision of such security when parties agree to grant the tribunal the power to issue interim relief. Nothing forbids the tribunal from generally ordering security for costs. The law is silent about the authority of the courts in this regard. In practice, courts do not issue such orders.

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Procedure

27. Are there any mandatory rules in your jurisdiction that govern the conduct of the arbitration (eg, general duties of the tribunal and/or the parties)?

Jordan

Since arbitration is consensual in nature, the parties are free to customise the process as they deem appropriate. Of note, the provisions of the Law of Civil Procedure and Law of Evidence will apply, as the Arbitration Law does not provide for detailed procedural rules. In practice, however, parties usually provide in the Terms of Reference, for subjecting the procedural matters to the general principles of Jordanian law while excluding the application of the aforementioned laws. One matter, however, that the Arbitration Law explicitly subjects to the Law of Civil Procedure is the suspension of the arbitral proceedings.

Notwithstanding the foregoing, there are certain basic principles of Jordanian law that are considered essential and their observance is mandatory; namely, those pertaining to the independence and impartiality of the tribunal, the parties' right to be heard and treated equally and the respect of due process.

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28. What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration?

Jordan

If a respondent is duly served yet fails to provide its statement of defence, the tribunal must continue the proceedings without treating such silence in itself as submission to the claimant’s assertions. If, however, the respondent was not able to present its case due to not being properly served and an award was issued, that award may be challenged and set aside by the Court of Cassation.

If the respondent, however, submits its statement of defence but fails to attend any of the hearings sessions or to provide any requested document, the tribunal may continue the proceedings and issue its award based on the available evidence.

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29. What types of evidence are usually admitted, and how is evidence usually taken? Will the IBA Rules on the Taking of Evidence in International Arbitration generally be taken into account?

Jordan

The Arbitration Law does not impose any restrictions on types of evidence to be admitted; this will entirely depend on the nature of the dispute; the applicable procedural rules (including evidence rules); and the agreement of the parties. The Law of Evidence will be applicable, unless otherwise agreed by the parties. Factual, expert and documentary evidence are commonly admitted, whether in written or oral form. Jordan being a civil law country, parties should expect national arbitrators to be influenced by the inquisitorial approach associated with civil law proceedings.

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30. Will the courts in your jurisdiction play any role in the obtaining of evidence?

Jordan

The tribunal is entitled, for the interest of arbitration proceedings, to seek the assistance of the competent court. Such assistance may be sought, for example, through summoning a witness or an expert, requesting the production of a document or any other matter that the tribunal deems appropriate.

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31. What is the relevant law and prevailing practice relating to document production in international arbitration in your jurisdiction?

Jordan

The Arbitration Law contains no specific rules on document production in international arbitration. Such matters will depend on the rules that parties have agreed to apply and the manner in which the tribunal exercises its power to order the same. In practice, proceedings inspired by Jordanian civil procedure generally follow a narrow approach toward document production compared to the common law style. A tribunal in international arbitration tends to follow a leaner approach in this regard but may still be influenced by the strict rules of document production under the Law of Evidence.

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32. Is it mandatory to have a final hearing on the merits?

Jordan

According to the Arbitration Law, the tribunal must hold hearings to enable the parties to explain and represent their respective claims, arguments and evidence. Nonetheless, the tribunal may, subject to the parties’ agreement, decide to forgo such hearings and opt to rely solely on written submissions and documents. As a matter of practice, written submissions are more prominent and oral hearings are usually held for witnesses’ and experts’ examination rather than hearing on the merits of the dispute.

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33. If your jurisdiction is selected as the seat of arbitration, may hearings and procedural meetings be conducted elsewhere?

Jordan

Yes, hearings may be conducted in a place that is different from the seat. As a matter of fact, the Jordanian Arbitration Law is one of the very few national laws that explicitly provides for the possibility of conducting hearings and procedural meetings virtually (through electronic means).

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Award

34. Can the tribunal decide by majority?

Jordan

Unless the parties have agreed otherwise, where there is more than one arbitrator, the tribunal must decide by a unanimous or majority vote. In the latter case, the reasons for non-signature must be stated in writing in the award. If, on the other hand, the tribunal is unable to reach a majority decision, the chairman’s vote prevails, if the parties so agree.

Procedural decisions may be issued solely by the presiding arbitrator if authorised to do so by the parties or all other members of the tribunal.

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35. Are there any particular types of remedies or relief that an arbitral tribunal may not grant?

Jordan

The Arbitration Law does not provide for any limitation on the types of remedies or relief. The tribunal has the power to grant any type of remedy or relief, including declaratory relief, monetary award, specific performance or interest. Nonetheless, such an award should not be contrary to public order, as it would be subject to annulment.

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36. Are dissenting opinions permitted under the law of your jurisdiction? If so, are they common in practice?

Jordan

Dissenting opinions are permitted under Jordanian Law. The Arbitration Law specifically provides that in the case where a decision is made by the majority of a tribunal, the reasons for any non-signature must be stated in writing in the award. In practice, dissenting opinions are not uncommon in Jordan.

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37. What, if any, are the legal and formal requirements for a valid and enforceable award?

Jordan

Article 41 of the Arbitration Law sets out the legal and formal requirements for an award. According to the said article, the award must:

  • be in writing and signed by the arbitrator(s), and in case the award is issued by the majority of a tribunal, the reason of any non-signature must be stated in writing;
  • be reasoned;
  • include the names and addresses of the parties;
  • include the names, addresses, nationalities and titles of the arbitrators;
  • include a summary of the arbitration agreement
  • include a brief of the facts of the dispute, as well as the parties’ claim, statements, defences and documents;
  • include the text of ruling;
  • include the date and place of issuance of the award; and
  • include the determination of arbitrator’s fees, costs of arbitration and distribution thereof.

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38. What time limits, if any, should parties be aware of in respect of an award? In particular, do any time limits govern the interpretation and correction of an award?

Jordan

Unless otherwise agreed by the parties, a tribunal must render its award within 12 months from the date on which the tribunal becomes fully constituted. The tribunal may decide to extend such period to a maximum of 12 additional months. In practice, parties usually agree on further extensions. Should the tribunal, nonetheless, fail to render a decision on time, any arbitrating party may request the President of the Court of Appeal to set a new time frame or terminate the arbitration proceedings upon hearing the other party. In case of termination of the proceedings, either party can file the claim with the competent court that originally has the jurisdiction to hear it.

A copy of the award must be delivered to the parties within 30 days of its issuance.

As for the issuance of interpretation or additional awards, an application in this regard must be submitted by a party within 30 days from the day following the date on which such party was served with the award. The tribunal then has 30 days to interpret the award (this may be extended for a further15-day period) and 60 days to render an additional award (this may be extended for a further 30-day period); all time limits to be counted from the date of submission of the application.

The Arbitration Law also provides that a tribunal may correct an error in the award, either on its own motion or upon the request of one of the parties, within 30 days from the next date of issuance of the award or the submission of an application in this regard by a party, as the case may be.

In cases where it is impossible for the tribunal to meet and decide on the requested interpretation or correction, the matter can be referred to the Court of Appeal, unless the parties agree otherwise.

Applications for the setting-aside of an award must be submitted to the Court of Cassation within 30 days from the day following the date on which the party seeking to set it aside was notified of it. The other party, in turn, must submit its response within 30 days from the day following the date on which it was notified of the setting-aside application.

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Costs and interest

39. Are parties able to recover fees paid and costs incurred? Does the "loser pays" rule generally apply in your jurisdiction?

Jordan

In an ad hoc arbitration, arbitrators’ fees and distribution of the same among the parties may be agreed upon between the parties and the tribunal. Failing such agreement, the fees are decided by the tribunal through its award and are split equally between the parties. This award may be challenged by the parties before the Court of Appeal, the decision of which is considered to be final and binding.

As for the expenses and legal fees, this is left to the tribunal’s decision. Arbitrators are usually influenced by “loser pays” (which is applied in Jordanian civil litigation) when allocating expenses and legal fees. The Arbitration Law does not, however, stick to these rules, which gives the tribunal room to deviate from these rules whenever it considers appropriate, by deciding, for example, that each party shall bear its own legal fees or on pro rata basis. This, however, can also be subject to the agreement of the parties.

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40. Can interest be included on the principal claim and costs? Is there any mandatory or customary rate?

Jordan

The Arbitration Law does not address this matter. In practice, however, arbitral awards that are issued in light of the Arbitration Law include interest rates. This practice is influenced by the rules set in the Law of Civil Procedure. The calculation of such interest depends on whether or not the parties have pre-agreed on a certain rate in their contract. If such an agreement exists, the court or tribunal would follow such agreement. If, on the other hand, a party has requested the tribunal to order the payment of interest in the course of its submissions, the tribunal would apply the 9 per cent rate provided for in the Law of Civil Procedure, unless the said party had explicitly claimed another rate. It must be noted in this regard that the maximum legal interest permissible under Jordanian law is a simple interest rate of 9 per cent annually and this rule, is considered one of public order that cannot be derogated from contractually unless the law allows a different rate (eg, banking transactions).

As for the application of interest in relation to costs, neither Jordanian law regulates such a matter nor has this been entertained before courts. This is likely to be subject to the agreement of parties in arbitration cases, as long as it is in conformity with the public order.

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Challenging awards

41. Are there any grounds on which an award may be appealed before the courts of your jurisdiction?

Jordan

An award issued pursuant to the Arbitration Law cannot be appealed in any case but be subject to annulment (setting-aside) only.

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42. Are there any other bases on which an award may be challenged, and if so what?

Jordan

Article 49 of the Arbitration Law provides for seven exclusive grounds for annulling (setting-aside) an award rendered under the law, as follows:

  • in the case of the absence of a valid and written arbitration agreement or if such agreement has become invalid or expired;
  • If at the time of concluding the arbitration agreement, any of the parties lacked legal capacity in accordance with the applicable law;
  • if any of the parties to the arbitration failed to present its case as a result of not being properly served of the appointment of an arbitrator or of the arbitral proceedings or for any other reason beyond its control;
  • if the arbitral award fails to apply the substantive law agreed upon by the parties;
  • if the composition of the arbitral tribunal or the appointment of the arbitrators was contrary to the provisions of the Arbitration Law or the agreement of the parties;
  • if the arbitral award rules on matters that are not included in the arbitration agreement or beyond the scope of such agreement. Nevertheless, if the parts of the award that pertain to arbitrable matters are separable from those that are not, then only the latter parts of the award will be considered null; or
  • if the arbitral tribunal did not satisfy the conditions required for the award in a manner that affects the award’s content, or if the award was based on invalid arbitral proceedings that had affected it.

The same article further provides that the Court of Cassation seised for such an action must, on its own motion, render the award invalid to the extent that such award is found to be inconsistent with public order in Jordan or if the subject matter of the dispute is non-arbitrable. The court’s examination of the annulment application takes place, revisio in iure (without a hearing), unless the court decides otherwise.

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43. Is it open to the parties to exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?

Jordan

The Arbitration Law considers invalid any waiver of the right to apply for annulment prior to the issuance of the award.

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Enforcement in your jurisdiction

44. Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?

Jordan

Enforcement of foreign arbitral awards is in principle governed by the LEFJ. According to article 2 of this law, the term Foreign Judgment includes any arbitral award that has become, by the virtue of the applicable law in the country in which the arbitration took place, enforceable as a judgment issued by the courts of that said country. Jordan is also a party to the New York Convention, which provides for non-enforcement of set-aside awards under article V(1)(e). Hence, a foreign annulled award will not be enforced by Jordanian courts.

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45. What trends, if any, are suggested by recent enforcement decisions? What is the prevailing approach of the courts in this regard?

Jordan

Jordanian courts are generally familiar with the enforcement process of arbitral awards. It is to be noted, however, that despite being a party to the NYC, Jordanian courts require the obtainment of an exequatur prior the enforcement of a foreign arbitral award.

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46. To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?

Jordan

In principle, when conducting commercial dealings, state or state entities are considered to be acting in their capacity as normal juridical persons. Nonetheless, according to the Enforcement Law, state assets are protected against enforcement measures. Enforcement in such a case will be through an application to the Prime Minister who shall take the decision accordingly.  

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Further considerations

47. To what extent are arbitral proceedings in your jurisdiction confidential?

Jordan

Though the Arbitration Law does not provide for the confidentiality of the proceedings as such, it does forbid the publication of awards unless the parties agree to it. The practice in Jordan is in line with the logical reasoning that the proceedings, all the more so, should be confidential. As a result, hearings are only attended by the parties themselves, their representatives, experts, witnesses and other concerned individuals.

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48. What is the position relating to evidence produced and pleadings filed in the arbitration? Are these confidential? Is there any way that they might be relied on in other proceedings (whether arbitral or court proceedings)?

Jordan

The Arbitration Law does not address these matters. Hence, nothing precludes a party from seeking to rely on evidence and pleadings filed in the arbitration in other proceedings. In fact, any party can rely on an arbitral award in later proceedings between the same parties and in relation to the same matter under the principle of res judicata.

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49. What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?

Jordan

The Arbitration Law does not provide for any code of ethics for the counsel or arbitrators. Arbitrators are, however, explicitly required by that law to be independent and impartial. Otherwise, the arbitrator may be challenged. Lawyers, whether acting as counsel or arbitrators, are bound by the ethical code of the Bar Association.

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50. Are there any particular procedural expectations or assumptions of which counsel or arbitrators participating in an international arbitration with its seat in your jurisdiction should be aware?

Jordan

While arbitral tribunals are by no means bound by the strict procedural rules followed in national courts and are generally willing to adapt the procedure to suit the arbitration process, some Jordanian arbitrators may still be influenced by those rules, especially in ad hoc arbitrations when local parties are involved. Examples of this are the rules pertaining to document disclosure and witness cross-examinations, which are usually stricter in civil law jurisdictions compared to common law systems.

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51. Is third-party funding permitted in your jurisdiction? If so, are there any rules governing its use?

Jordan

Neither the Arbitration Law nor any other national law addresses third-party funding in Jordan. This is still uncommon in Jordan and no professional litigation funders yet exist.

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