NEW DELHI: The Union Cabinet on Wednesday cleared a bill which seeks to make India a hub of domestic and global arbitration for settling commercial disputes, sources said.
The Arbitration and Conciliation (Amendment) Bill 2019 provides for a time-bound settlement of disputes as well as accountability of the arbitrator.
A previous bill was cleared by Lok Sabha in August 2018 but could not be passed by Rajya Sabha. The bill lapsed following the dissolution of the 16th Lok Sabha.
Successive governments have been pushing to make India a centre of domestic and international arbitration. The new bill seeks to provide for a robust mechanism to deal with institutional disputes, the sources said.
The amendments will facilitate achieving the goal of improving institutional arbitration by establishing an independent body to lay down standards, make the arbitration process more friendly, cost-effective and ensure timely disposal of cases.
It provides for setting up of an independent body -- Arbitration Council of India (ACI) -- to frame arbitral institution and accredit arbitrators by laying down norms.
The ACI would be mandated to frame rules on how institutions would be graded, norms to be followed, monitoring of quality and performance, and would also encourage the training of arbitrators.
The bill, which amends the 1996 Act, is part of the government's efforts to encourage institutional arbitration for settlement of disputes and make India a centre of robust alternative dispute resolution mechanism.
A large number of arbitration cases are conducted in countries such as Singapore, the UK and France. Commercial disputes have increased manifold due to globalisation, industrialisation and liberalisation.