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International Trade Arbitration Agreements - Full Text Of The Rule

Original Language Title: ACUERDOS ARBITRAJE COMERCIAL INTERNACIONAL - Texto completo de la norma

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Law 25.223

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The Agreement on International Commercial Arbitration of Mercosur and the Agreement on International Commercial Arbitration between Mercosur, the Republic of Bolivia and the Republic of Chile, signed in Buenos Aires, were adopted.

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Sanctioned: November 24, 1999.

Promulgated: December 23, 1999.

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The Senate and Chamber of Deputies of the Argentine Nation assembled in Congress, etc., sanction with force of Law:

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ARTICLE 1 Approval of the International Trade Agreement of MERCOSUR and the International Trade Agreement between MERCOSUR, BOLIVIA REPUBLIC AND REPUBLIC DE CHILE, subscribed in Buenos Aires on 23 July 1998, consisting of both VEINTISEIS (26) articles, whose authenticated photocopies are part of this law.

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ARTICLE 2 Contact the national executive branch.

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IN THE SESSION OF THE ARGENTINE CONGRESS, IN GOOD AIRES, TO THE VEINTICUATRO DAYS OF THE MONTH OF NOVENTY AND NEW YEAR.

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# 25.223—

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ALBERTO R. PIERRI. . EDUARDO MENEM. . Esther H. Pereyra Arandía de Pérez Pardo. . Juan C. Oyarzún.

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AGREEMENT ON ARBITRAJE

INTERNATIONAL TRADE OF

MERCOSUR

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The Argentine Republic, the Federative Republic of Brazil, the Republic of Paraguay and the Eastern Republic of Uruguay, henceforth the States Parties;

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CONSIDERING the Treaty of Asunción signed on 26 March 1991 between the Argentine Republic, the Federal Republic of Brazil, the Republic of Paraguay and the Eastern Republic of Uruguay, and the Protocol of Ouro Preto signed on 17 December 1994 among the same States;

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RECALLING that the founding instruments of MERCOSUR establish the commitment of States parties to harmonize their legislation in the relevant areas;

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RECALLING the will of MERCOSUR States Parties to agree on common legal solutions for the strengthening of the MERCOSUR integration process;

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SUBSTANING the need to provide the private sector of MERCOSUR States Parties with alternative methods for the resolution of disputes arising from international commercial contracts concluded between natural or legal persons of private law;

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CONVENTED with the need to standardize the organization and operation of international arbitration in States parties to contribute to the expansion of regional and international trade;

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DESEOSS to promote and encourage the extrajudicial settlement of private disputes through arbitration in MERCOSUR, a practice consistent with the peculiarities of international transactions;

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CONSIDERING that protocols providing for the election of the arbitral forum and the recognition and enforcement of foreign arbitral awards or judgements were adopted in MERCOSUR;

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NOTING the Inter-American Convention on International Commercial Arbitration of 30 January 1975, concluded in Panama City, the Inter-American Convention on Extraterritorial Effectiveness of Foreign Arbitral Awards and Awards of 8 May 1979, concluded in Montevideo and the Model Law on International Commercial Arbitration of the United Nations Commission on International Trade Law of 21 June 1985;

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ACUERDAN:

Article 1

Object

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The purpose of this Agreement is to regulate arbitration as a private alternative means of dispute settlement, arising from international trade contracts between natural or legal persons of private law.

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Article 2

Definitions

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For the purposes of the implementation of this Agreement, it is understood that:

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(a) Liarbitrage: private deinstitutional or mulad hoc for dispute settlement;

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(b) International arbitration: private means for the settlement of disputes relating to international trade contracts between individuals, individuals or legal entities;

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(c) Judicial self-authority: organ of the State judicial system;

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(d) Boundary basis: agreement originating disputes submitted to arbitration;

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(e) arbitration agreement: agreement by which the parties decide to submit to arbitration all or some disputes that have arisen or may arise between them regarding contractual relations.

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It may adopt the form of a arbitration clause included in a contract or an independent agreement;

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(f) Bitness of physical persons: their habitual and subsidiary residence is the main centre of their business;

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(g) lysicillium of legal persons or social headquarters: principal place of administration or seat of branches, establishments or agencies;

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(h) Foreign arbitral award or judgment: final settlement of the dispute by the arbitral tribunal based abroad;

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(i) rogance from the arbitral tribunal: State chosen by the contracting parties or in its default by the arbitrators for the purposes of the articles. 3, 7, 13, 15, 19 and 22 of this Agreement, without prejudice to the place of the proceedings of the court;

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(j) arbitration clause: an organ consisting of one or more arbitrators.

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Article 3

Material and space scope of application

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This Agreement shall apply to arbitration, organization and proceedings, and to arbitral awards or awards, if any of the following circumstances arise:

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(a) The arbitral convention shall be held between natural or legal persons who, at the time of its conclusion, have either their habitual residence, the main centre of their business, the headquarters, branches, establishments or agencies, in more than one State Party of MERCOSUR.

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(b) The base contract has some objective .legal or economical contact with more a State Party of MERCOSUR.

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(c) The parties do not express their will on the contrary and the base contract has any objective .legal or economical contact with a State Party, provided that the court is based in one of the States Parties of MERCOSUR.

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(d) The base contract has any objective económicolegal or economic contact with a State Party and the arbitral tribunal does not have its seat in any State Party of MERCOSUR, provided that the parties expressly declare their intention to submit to this Agreement.

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(e) The base contract does not have any objective económicolegal or economic contact with a State Party and the parties have chosen an arbitral tribunal based in a State Party of MERCOSUR, provided that the parties expressly declare their intention to submit to this Agreement.

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Article 4

Equitable treatment and good faith

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1. The arbitration convention shall give fair and non-abusive treatment to the contracting parties, especially in the accession contracts, and shall be agreed in good faith.

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2. The arbitration convention inserted in a contract should be clearly readable and placed in a reasonably prominent place.

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Article 5

Autonomy of the arbitration convention

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The arbitration convention is autonomous with respect to the base contract. The absence or invalidity of the arbitration does not imply the invalidity of the arbitration convention.

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Article 6

Form and law applicable to formal validity

of the arbitration convention

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1. The arbitration convention shall be in writing.

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2. The formal validity of the arbitral convention shall be governed by the right of the venue.

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3. The arbitral convention between absent persons may be implemented by the exchange of letters or telegrams with confirmed reception. Communications made by telefax, e-mail or equivalent medium shall be confirmed by original document, without prejudice to the provisions of numeral 5.

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4. The arbitral convention between absent persons is perfected at the time and in the State in which acceptance is received by the chosen means, confirmed by the original document.

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5. If the requirements of formal validity required by the right of the place of conduct have not been met, the arbitral convention shall be deemed valid if it meets the formal requirements of the right of any of the States with which the base contract has objective contacts in accordance with the provisions of article. 3 (b).

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Article 7

Right to intrinsic validity

the arbitration convention

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1. The capacity of the parties to the arbitral convention shall be governed by the right of their respective homes.

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2. The validity of the arbitration agreement, object and case shall be governed by the law of the host State of the arbitral tribunal.

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Article 8

Competition to know about existence

and validity of the arbitration convention

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Issues relating to the existence and validity of the arbitral convention shall be resolved by the arbitral tribunal, on its own motion or at the request of parties.

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Article 9

Arbitration of law or equity

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By provision of the parties, arbitration may be of law or equity. In the absence of a provision it shall be lawful.

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Article 10

Right to dispute

arbitral tribunal

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The parties may choose the right to settle the dispute on the basis of private international law and its principles, as well as the law of international trade. If the parties do not dispose of this matter, the arbitrators shall decide according to the same sources.

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Article 11

Types of arbitration

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The parties may freely submit themselves to institutional arbitration or mulad hoc.

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The principles of the contradictory, the equality of the parties, the impartiality of the arbitrator and his free conviction shall be respected in the arbitral proceedings.

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Article 12

General rules of procedure

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1. In institutional arbitration:

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(a) The procedure before arbitral institutions shall be governed by its own rules of procedure;

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(b) without prejudice to the provisions of the preceding paragraph, States shall encourage arbitral entities in their territories to adopt a common regulation;

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(c) Arbitral institutions may publish for their knowledge and dissemination the lists of arbitrators, payroll and composition of the tribunals and organizational regulations.

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2. In the arbitration, the following:

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(a) The parties may establish the arbitral proceedings. At the time of the arbitral convention, the parties may preferably agree on the designation of the arbitrators and, where appropriate, the substitute arbitrators, or establish the manner by which they shall be appointed.

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(b) If the parties or the present Agreement had not provided for, the rules of procedure of the Inter-American Commission on Commercial Arbitration (CIAC) . shall be applied in accordance with the provisions of art. 3 of the Inter-American Convention on International Commercial Arbitration of Panama of 1975 vigentes in force at the time of the arbitral convention.

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(c) All things not provided by the parties, by the Agreement and by the rules of procedure of the CIAC shall be resolved by the arbitral tribunal in accordance with the principles set out in article 11.

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Article 13

Headquarters and language

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1. The parties may designate a State Party as the seat of the arbitral tribunal. If they do not, the arbitral tribunal shall determine the place of arbitration in any of those States, in accordance with the circumstances of the case and the convenience of the parties.

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2. In the absence of express provision by the parties, the language shall be that of the seat of the arbitral tribunal.

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Article 14

Communications and notifications

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1. The communications and notifications made to comply with the rules of this Agreement shall be deemed duly carried out, unless otherwise provided by the parties:

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(a) where they have been personally delivered to the addressee, or received by certified letter, collated telegram or equivalent means addressed to their declared home;

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(b) If the parties have not established a special domicile and if the domicile is not known after a reasonable inquiry, any written communication and notification that has been referred to the last habitual residence or to the last known domicile of their business shall be deemed to have been received.

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2. The communication and notification shall be deemed to have been received on the day of delivery as set out in subparagraph (a) of the previous numeral.

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3. A special address other than the domicile of natural or legal persons may be established in the arbitral convention for the purpose of receiving communications and notifications. A person may also be designated for such purposes.

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Article 15

Beginning of arbitration proceedings

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1. In institutional arbitration, the procedure shall be initiated in accordance with the rules of procedure to which the parties have submitted. In arbitration, the party intending to initiate the arbitral proceedings shall institute the other party in the manner established by the arbitral convention.

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2. Intimation will necessarily consist of:

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(a) the name and address of the parties;

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(b) the reference to the base contract and the arbitral convention;

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(c) The decision to submit the matter to arbitration and to designate the arbitrators;

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(d) the object of the dispute and the indication of the amount, value or amount committed.

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3. There is no express stipulation as to the means to give effect to the intimation, it shall be practiced in accordance with article 14.

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4. The intimation to initiate an arbitration or the equivalent procedural act in the institutional arbitration shall be valid, even for the purposes of the recognition or enforcement of foreign arbitral awards or judgments, when they have been made in accordance with the provisions of the arbitration convention, or, where appropriate, in the law of the host State of the arbitral tribunal. In all cases the injured party shall be guaranteed a reasonable time to exercise the right of defence.

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5. An intimation in the 000OD hoc arbitration or the procedural act equivalent in institutional arbitration as provided for in this article may not be invoked as a violation of public order to question its validity, either in institutional arbitration or in the mulad hoc.

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Article 16

Arbitros

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1. Any person legally capable and enjoying the confidence of the parties may be arbitrator.

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2. The capacity to be an arbitrator is governed by the right of his home.

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3. In the performance of its function, the arbitrator shall proceed with probity, impartiality, independence, competence, diligence and discretion.

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4. The nationality of a person shall not be an impediment to acting as an arbitrator, unless otherwise agreed by the parties. Consideration shall be given to the desirability of appointing persons of nationality other than the parties to the conflict. In arbitration with more than one arbitrator, the court may not be composed solely of arbitrators of the nationality of one of the parties, except for express agreement of the parties, in which the reasons for such selection are expressed, which may be included in the arbitral convention or in another document.

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Article 17

Appointment, challenge and replacement

the arbitrators

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The rules of procedure of the Inter-American Commission on Commercial Arbitration (CIAC), which are in force at the time of the appointment of arbitrators, will govern their appointment, recussion and replacement.

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Article 18

Competition of the arbitral tribunal

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1. The arbitral tribunal is empowered to decide on its own jurisdiction and, as provided for in article 8, on exceptions relating to the existence and validity of the arbitral convention.

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2. The exception of incompetence of the tribunal based on the absence of arbitrary matter or the absence, nullity or expiry of the arbitral convention in arbitral institutions is governed by its own rules of procedure.

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3. The exception of incompetence for the previous cases should be opposed until the time of filing the answer to the claim or in the case of the reconvention, until the reply to it. The parties are not prevented from opposing this exception by the fact that they have appointed an arbitrator or participated in its designation.

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4. The arbitral tribunal may decide the exceptions relating to its jurisdiction as a matter of priority; however, it may also proceed with its proceedings and reserve the decision of the exceptions for the award or final judgment.

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Article 19

Preventive measures

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The precautionary measures may be issued by the arbitral tribunal or by the competent judicial authority.

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The request of any party to the judicial authority shall not be deemed incompatible with the arbitration convention or imply a waiver of arbitration.

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1. In any state of the proceedings, at the request of a party, the arbitral tribunal may, by itself, dispose of such precautionary measures as it deems relevant, in its case ruling on the dispute.

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2. Such measures shall be implemented by means of an interim or interlocutory award when they are issued by the arbitral tribunal.

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3. The arbitral tribunal may request, on its own motion or at the request of a party, the competent judicial authority to adopt a precautionary measure.

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4. Applications for international precautionary cooperation by the arbitral tribunal of a State Party shall be forwarded to the judge of the State of the seat of the arbitral tribunal for the purpose of the transfer of the judge for his or her trial to the competent judge of the requested State, by the channels provided for in the MERCOSUR Protocol of Caution, approved by the Decision of the Common Market Council No. 27/94. In this case, States may declare at the time of ratification of this Agreement or thereafter that, where such measures are required in another State, the arbitral tribunal may request the assistance of the competent judicial authority of the State in which the measure should be executed, through the respective central authorities or, where appropriate, the authorities responsible for the diligence of international judicial cooperation.

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Article 20

Award or arbitral award

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1. The award or arbitral award shall be written, substantiated, and shall fully decide the dispute. The award or judgement shall be final and binding on the parties and shall not admit remedies, except those set forth in articles 21 and 22.

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2. When the arbitrators are several, the decision will be made by a majority. If there is no majority agreement, the President shall decide.

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3. The arbitrator who disagrees with the majority may issue and cast his vote separately.

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4. The award or judgment shall be signed by the arbitrators and shall contain:

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(a) The date and place of delivery;

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(b) the basis on which it is based, even if it is for equity;

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(c) The decision on all matters under arbitration;

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(d) the costs of arbitration.

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5. In the event that one of the arbitrators does not sign the award or judgment, the reason for which he has not signed shall be indicated, the president of the arbitral tribunal must certify such a case.

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6. The award or judgement shall be duly notified to the parties by the arbitral tribunal.

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7. If in the course of the arbitration the parties agree on the dispute, the arbitral tribunal, at the request of the parties, shall approve such an act by an award or judgement containing the requirements of paragraph 4 of this article.

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Article 21

Request for rectification and expansion

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1. Within thirty (30) days after the notice of the award or arbitral award, unless the parties have agreed on another period, any of them may request the court to:

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(a) rectify any material error;

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(b) specify the scope of one or more specific points;

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(c) Proceed on any of the issues of the dispute that have not been resolved.

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2. The request for rectification shall be duly notified to the other party by the arbitral tribunal.

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3. Except as provided by the parties, the arbitral tribunal shall decide on the request within twenty (20) days and notify them of its resolution.

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Article 22

Request for invalidity of the award or

arbitral award

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1. The award or arbitral award may be challenged only to the judicial authority of the State Headquarters of the arbitral tribunal through a request for nullity.

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2. The award or judgement may be challenged in invalidity when:

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(a) The arbitral convention shall be null and void;

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(b) The court has been constituted irregularly;

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(c) The arbitral proceedings have not been in conformity with the rules of this Agreement, the rules of procedure of the arbitral institution or the arbitral convention, as appropriate;

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(d) The principles of due process have not been respected;

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(e) A person incapable of arbitrating;

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(f) refers to a dispute not provided for in the arbitral convention;

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(g) contain decisions that exceed the terms of the arbitral convention.

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3. In the cases provided for in subparagraphs (a), (b), (d) and (e) of paragraph 2 the court ruling shall declare the absolute nullity of the award or arbitral award.

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In cases provided for in subparagraphs (c), (f) and (g) the court ruling shall determine the relative invalidity of the award or arbitral award.

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In the case provided for in subparagraph (c), the court ruling may declare the validity and continuation of the proceedings in the non-violent party and shall provide that the arbitral tribunal renders the award or supplementary judgment.

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In cases of subparagraphs (f) and (g) a new award or arbitral award shall be issued.

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4. The petition, duly substantiated, shall be deducted within 90 days from the notice of the award or arbitral award or, where appropriate, from the notification of the decision referred to in article. 21.

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5. The party invoking nullity shall establish the facts on which the request is based.

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Rule 23

Execution of award or sentence

foreigner

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The provisions of the Inter-American Convention on International Commercial Arbitration of Panama of 1975; the Protocol on Cooperation and Jurisdictional Assistance in Civil, Commercial, Labour and Administrative Matters of MERCOSUR, adopted by the Decision of the Council of the Common Market No. 5/92, and the Inter-American Convention on Extraterritorial Effectiveness of the Judgments and Extraordinary Awards of Montevideo shall be applied to the enforcement of the foreign arbitral award.

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Article 24

Termination of arbitration

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The arbitration shall terminate when the final award or judgment is rendered, or when the termination of the arbitration by the arbitral tribunal is ordered:

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(a) The parties agree to terminate the arbitration;

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(b) The arbitral tribunal finds that the arbitral proceedings have become, for any reason, unnecessary or impossible.

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Article 25

General provisions

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1. The application of the rules of procedure of the Inter-American Commission on Commercial Arbitration (CIAC) for the arbitration, as provided for in article 12, paragraph 2, (b), shall not imply that arbitration is considered institutional.

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2. Unless otherwise provided by the parties or by the arbitral tribunal, the costs resulting from the arbitration shall be equally settled between the parties.

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3. For situations not foreseen by the parties, by this Agreement, by the rules of procedure of the Inter-American Commission on International Commercial Arbitration, or by the conventions and rules to which this Agreement is referred, the principles and rules of the Model Law on International Commercial Arbitration of the United Nations Commission on International Trade Law of 21 June 1985 shall apply.

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Article 26

Final provisions

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1. This Agreement shall enter into force with respect to the first two States Parties ratifying it, thirty days after the second country proceeds to deposit its instrument of ratification.

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For other ratifying States, the thirtieth day after the deposit of their respective instrument of ratification shall enter into force.

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2. This Agreement shall not restrict the provisions of existing conventions on the same subject among States Parties, unless they contradict them.

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3. The Republic of Paraguay shall deposit the present Agreement and the instruments of ratification and shall send duly authenticated copies to the other States Parties.

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4. Similarly, the Republic of Paraguay shall notify other States Parties of the date of entry into force of this Agreement and the date of deposit of instruments of ratification.

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Made in Buenos Aires, Argentina, on 23 days of July 1998, in an original in the Spanish and Portuguese languages, both texts being equally authentic.

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AGREEMENT ON ARBITRAJE

INTERNATIONAL TRADE

MERCOSUR, THE REPUBLIC OF BOLIVIA AND

THE CHILE REPUBLIC

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The Argentine Republic, the Federal Republic of Brazil, the Republic of Paraguay and the Eastern Republic of Uruguay, States Parties to the Common Mer of the South (MERCOSUR), the Republic of Bolivia and the Republic of Chile will be called Signatory Parties.

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The Contracting Parties to this Agreement are MERCOSUR, the Republic of Bolivia and the Republic of Chile.

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CONSIDERING the Treaty of Asunción signed on 26 March 1991 between the Argentine Republic, the Federal Republic of Brazil, the Republic of Paraguay and the Eastern Republic of Uruguay, and the Protocol of Ouro Preto signed on 17 December 1994 among the same States;

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CONSIDERING the Economic Complementation Agreement No. 36 signed between MERCOSUR and the Republic of Bolivia; the Economic Complementation Agreement No. 35 signed between MERCOSUR and the Republic of Chile and the Decisions of the Common Market Council of MERCOSUR No. 14/96 ”Participation of Third Associated Countries at MERCOSUR Meetings and No. 12/97”MeRCOSUR Meetings in Chile

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RECALLING the will of Contracting Parties to agree on common legal solutions for the strengthening of the regional integration process;

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SUBSTANING the need to provide the private sector with alternative methods for the resolution of disputes arising from international commercial contracts concluded between natural or legal persons of private law;

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CONVENTED with the need to standardize the organization and operation of international arbitration to contribute to the expansion of regional and international trade;

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DESEOSS to promote and encourage the extrajudicial settlement of private disputes through arbitration between the Signatory Parties, a practice consistent with the peculiarities of international transactions;

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NOTING the Inter-American Convention on International Commercial Arbitration of 30 January 1975, concluded in the city of Panama; the Inter-American Convention on Extraterritorial Effectiveness of Foreign Arbitral Awards of 8 May 1979, concluded in Montevideo and the Model Law on International Commercial Arbitration of the United Nations Commission on International Trade Law of 21 June 1985;

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ACUERDAN:

Article 1

Object

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The purpose of this Agreement is to regulate arbitration as a private alternative means of dispute settlement, arising from international trade contracts between natural or legal persons of private law.

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Article 2

Definitions

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For the purposes of the implementation of this Agreement, it is understood that:

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(a) Liarbitrage: private medioinstitutional means or ̄ddle snouts for dispute settlement;

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(b) International arbitration: private means for the settlement of contract disputes international trade between individuals, individuals or legal entities;

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(c) Judicial self-authority: organ of the State judicial system;

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(d) Boundary basis: agreement originating disputes submitted to arbitration;

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(e) arbitration agreement: agreement by which the parties decide to submit to arbitration all or some disputes that have arisen or may arise between them regarding contractual relations. It may take the form of a arbitration clause included in a contract or an independent agreement;

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(f) Bitness of physical persons: their habitual and subsidiary residence is the main centre of their business;

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(g) lysicillium of legal persons or social headquarters: principal place of administration or seat of branches, establishments or agencies;

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(h) Foreign arbitral award or judgment: final settlement of the dispute by the arbitral tribunal based abroad;

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(i) rogance from the arbitral tribunal: State chosen by the contracting parties or in its default by the arbitrators for the purposes of the articles. 3, 7, 13, 15, 19 and 22 of this Agreement, without prejudice to the place of the proceedings of the court;

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(j) arbitration clause: an organ consisting of one or more arbitrators.

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Article 3

Material and space scope of application

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This Agreement shall apply to arbitration, organization and proceedings, and to arbitral awards or awards, if any of the following circumstances arise:

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(a) The arbitral convention shall be held between natural or legal persons who, at the time of their holding, have either their habitual residence, the main centre of their business, the headquarters, branches, establishments or agencies, in more than one Signatory Party;

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(b) The base contract has any objective económicolegal or economical contact with more than one Signatory Party;

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(c) The parties do not express their will on the contrary and the base contract has any objective económicolegal or economical contact with a signatory Party, provided that the court is based in one of the signatory Parties;

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(d) The base contract has any objective económicolegal or economic contact with a signatory Party and the arbitral tribunal does not have its seat in any signatory Party, provided that the parties expressly declare their intention to submit to this Agreement;

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(e) The base contract does not have any objective económicolegal or economic contact with a signatory Party and the parties have chosen an arbitral tribunal based on a signatory Party, provided that the parties expressly declare their intention to submit to this Agreement.

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Article 4

Equitable treatment and good faith

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1. La The arbitration convention will give fair and non-abuse treatment to the contracting parties, especially in the accession contracts, and will be agreed in good faith.

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2. La The arbitration convention inserted in a contract should be clearly readable and placed in a reasonably prominent place.

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Article 5

Autonomy of the arbitration convention

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The arbitration convention is autonomous with respect to the base contract. The absence or invalidity of the arbitration does not imply the invalidity of the arbitration convention.

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Article 6

Form and law applicable to validity

of the arbitration convention

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1. The arbitration convention shall be in writing.

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2. The formal validity of the arbitral convention shall be governed by the right of the venue.

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3. The arbitral convention between absent persons may be implemented by the exchange of letters or telegrams with confirmed reception. Communications made by telefax, e-mail or equivalent medium shall be confirmed by original document without prejudice to the provisions of numeral 5.

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4. The arbitral convention between absent persons is perfected at the time and in the Signatory Party where acceptance is received by the chosen means, confirmed by the original document.

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5. If the requirements of formal validity required by the right of the place of conduct have not been met, the arbitral convention shall be deemed valid if it meets the formal requirements of the right of any of the Signatory Parties with which the base contract has objective contacts in accordance with the provisions of article. 3 (b).

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Article 7

Right to intrinsic validity

the arbitration convention

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1. The capacity of the parties to the arbitral convention shall be governed by the right of their respective homes.

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2. The validity of the arbitration agreement, object and case shall be governed by the right of the Signatory Party to the arbitral tribunal.

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Article 8

Competition to know about

the existence and validity of the arbitration convention

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Issues relating to the existence and validity of the arbitral convention shall be resolved by the arbitral tribunal, on its own motion or at the request of parties.

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Article 9

Arbitration of law or equity

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By provision of the parties, arbitration may be of law or equity. In the absence of a provision it shall be lawful.

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Article 10

Right to dispute

arbitral tribunal

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The parties may choose the right to settle the dispute on the basis of private international law and its principles, as well as the law of international trade. If the parties do not dispose of this matter, the arbitrators shall decide according to the same sources.

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Article 11

Types of arbitration

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The parties may freely submit themselves to institutional arbitration or mulad hoc. The principles of the contradictory, the equality of the parties, the impartiality of the arbitrator and his free conviction shall be respected in the arbitral proceedings.

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Article 12

General rules of procedure

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1. In institutional arbitration:

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(a) The procedure before arbitral institutions shall be governed by its own rules of procedure;

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(b) without prejudice to the provisions of the previous paragraph, the signatory Parties shall encourage arbitral entities in their territories to adopt a common regulation;

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(c) Arbitral institutions may publish for their knowledge and dissemination the lists of arbitrators, payroll and composition of the tribunals and organizational regulations.

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2. In the arbitration, the following:

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(a) The parties may establish the arbitral proceedings. At the time of the arbitral convention, the parties may preferably agree on the designation of the arbitrators and, where appropriate, the substitute arbitrators, or establish the manner by which they shall be appointed;

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(b) If the parties or the present Agreement had not provided for, the rules of procedure of the Inter-American Commission on Commercial Arbitration (CIAC) . shall be applied in accordance with the provisions of art. 3 of the Inter-American Convention on International Commercial Arbitration of Panama of 1975 vigentes in force at the time of the arbitral convention.

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(c) any unforeseen by the parties, by the Agreement and by the rules of procedure of the CIAC, shall be decided by the arbitral tribunal in accordance with the principles set out in article 1. 11.

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Article 13

Headquarters and language

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1. The parties may designate a Signatory Party as the seat of the arbitral tribunal. If they do not, the arbitral tribunal shall determine the place of arbitration in any of those Signatory Parties, in accordance with the circumstances of the case and the convenience of the parties.

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2. In the absence of express provision by the parties, the language shall be that of the seat of the arbitral tribunal.

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Article 14

Communications and notifications

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1. The communications and notifications made to comply with the rules of this Agreement shall be deemed duly carried out, unless otherwise provided by the parties:

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(a) where they have been personally delivered to the addressee, or received by certified letter, collated telegram or equivalent means addressed to their declared home;

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(b) If the parties have not established a special domicile and if the domicile is not known after a reasonable inquiry, any written communication and notification that has been referred to the last habitual residence or to the last known domicile of their business shall be deemed to have been received.

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2. The communication and notification shall be deemed to have been received on the day of delivery as set out in subparagraph (a) of the previous numeral.

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3. A special address other than the domicile of natural or legal persons may be established in the arbitral convention for the purpose of receiving communications and notifications. A person may also be designated for such purposes.

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Article 15

Beginning of arbitration proceedings

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1. In institutional arbitration, the procedure shall be initiated in accordance with the rules of procedure to which the parties have submitted. In arbitration, the party intending to initiate the arbitral proceedings shall institute the other party in the manner established by the arbitral convention.

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2. Intimation will necessarily consist of:

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(a) the name and address of the parties;

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(b) the reference to the base contract and the arbitral convention;

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(c) The decision to submit the matter to arbitration and to designate the arbitrators;

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(d) the object of the dispute and the indication of the amount, value or amount committed.

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3. There is no express stipulation as to the means to give effect to the intimation, it shall be practiced in accordance with article 14.

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4. The intimation to initiate an arbitration or the equivalent procedural act in the institutional arbitration shall be valid, even for the purposes of the recognition or enforcement of foreign arbitral awards or judgments, when they have been made in accordance with the provisions of the arbitration convention, or, where appropriate, in the law of the Signatory Party seat of the arbitral tribunal. In all cases the injured party shall be guaranteed a reasonable time to exercise the right of defence.

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5. An intimation in the 000OD hoc arbitration or the procedural act equivalent in institutional arbitration as provided for in this article may not be invoked as a violation of public order to question its validity, either in institutional arbitration or in the mulad hoc.

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Article 16

Arbitros

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1. Any person legally capable and enjoying the confidence of the parties may be arbitrator.

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2. The capacity to be an arbitrator is governed by the right of his home.

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3. In the performance of its function, the arbitrator shall proceed with probity, impartiality, independence, competence, diligence and discretion.

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4. The nationality of a person shall not be an impediment to acting as an arbitrator, unless otherwise agreed by the parties. Consideration shall be given to the desirability of appointing persons of nationality other than the parties to the conflict.

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In arbitration with more than one arbitrator, the court may not be composed solely of arbitrators of the nationality of one of the parties, except for express agreement of the parties, in which the reasons for such selection are expressed, which may be included in the arbitral convention or in another document.

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Article 17

Appointment, challenge and replacement

of the arbitrators

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The rules of procedure of the Inter-American Commission on Commercial Arbitration (CIAC), which are in force at the time of the appointment of arbitrators, will govern their appointment, recussion and replacement.

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Article 18

Competition of the arbitral tribunal

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1. The arbitral tribunal is empowered to decide on its own jurisdiction and, as provided for in article 8, on exceptions relating to the existence and validity of the arbitral convention.

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2. The exception of incompetence of the tribunal based on the absence of arbitrary matter or the absence, nullity or expiry of the arbitral convention in arbitral institutions is governed by its own rules of procedure.

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3. The exception of incompetence for the previous cases should be opposed until the time of filing the answer to the claim or in the case of the reconvention, until the reply to it. The parties are not prevented from opposing this exception by the fact that they have appointed an arbitrator or participated in its designation.

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4. The arbitral tribunal may decide the exceptions relating to its jurisdiction as a matter of priority; however, it may also proceed with its proceedings and reserve the decision of the exceptions for the award or final judgment.

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Article 19

Preventive measures

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The precautionary measures may be issued by the arbitral tribunal or by the competent judicial authority.

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The request of any party to the judicial authority shall not be deemed incompatible with the arbitration convention or imply a waiver of arbitration.

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1. In any state of the proceedings, to a party ' s request, the arbitral tribunal may, in the event that it deems appropriate, decide in its case on the dispute.

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2. Such measures shall be implemented by means of an interim or interlocutory award when they are issued by the arbitral tribunal.

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3. The arbitral tribunal may, on its own motion or at the request of a party to the competent judicial authority, request the adoption of a precautionary measure.

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4. Applications for international precautionary cooperation by the arbitral tribunal of a Signatory Party shall be forwarded to the judge of the Signatory Party seat of the arbitral tribunal for the purpose of which such judges transmit it to the competent judge of the requested State. In this case, the Signatory Parties may, at the time of ratifying this Agreement or thereafter, declare that when such measures are required in another Signatory Party, the arbitral tribunal may request the assistance of the competent judicial authority of the Signatory Party in which the measure should be executed, through the respective central authorities or, where appropriate, by the authorities responsible for the diligence of international jurisdictional cooperation.

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Applications for international precautionary cooperation shall be governed by the provisions of the Protocol of Cautionary Measures adopted by the Decision of the Common Market Council of MERCOSUR No. 27/94. For the Signatory Parties not bound by the above-mentioned Protocol, the Inter-American Convention on the Compliance of Cautionary Measures of 1979 shall govern. Failure to apply the right of the Signatory Party where the measure must be made effective.

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Article 20

Award or arbitral award

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1. The award or judgment shall be written, substantiated, and shall fully decide the dispute. The award or judgement shall be final and binding on the parties and shall not admit remedies except those provided for in articles 21 and 22.

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2. When the arbitrators are several, the decision will be made by a majority. If there is no majority agreement, the President shall decide.

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3. The arbitrator who disagrees with the majority may issue and cast his vote separately.

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4. The award or judgment shall be signed by the arbitrators and shall contain:

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(a) The date and place of delivery;

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(b) the basis on which it is based, even if it is for equity;

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(c) The decision on all matters under arbitration;

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(d) the costs of arbitration.

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5. In the event that one of the arbitrators does not sign the award or judgment, the reason for which he has not signed shall be indicated, the president of the arbitral tribunal must certify such a case.

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6. The award or judgement shall be duly notified to the parties by the arbitral tribunal.

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7. If in the course of the arbitration the parties agree on the dispute, the arbitral tribunal, at the request of the parties, shall approve such an act by an award or judgement containing the requirements of paragraph 4 of this article.

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Article 21

Request for rectification and expansion

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1. Within thirty (30) days after the notice of the award or arbitral award, unless the parties have agreed on another period, any of them may request the court to:

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(a) rectify any material error;

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(b) specify the scope of one or more specific points;

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(c) To decide on any of the issues relating to the dispute that have not been resolved;

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2. The request for rectification shall be duly notified to the other party by the arbitral tribunal.

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3. Except as provided by the parties, the arbitral tribunal shall decide on the request within twenty (20) days and notify them of its resolution.

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Article 22

Request for invalidity of the award or sentence

arbitral tribunal

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1. The award or arbitral award may be challenged only to the judicial authority of the Signatory Party seat of the arbitral tribunal through a request for nullity.

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2. The award or judgement may be challenged in invalidity when:

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(a) The arbitral convention shall be null and void;

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(b) The court has been constituted irregularly;

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(c) The arbitral proceedings have not been in conformity with the rules of this Agreement, the rules of procedure of the arbitral institution or the arbitral convention, as appropriate;

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(d) The principles of due process have not been respected;

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(e) A person incapable of arbitrating;

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(f) refers to a dispute not provided for in the arbitral convention;

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(g) contain decisions that exceed the terms of the arbitral convention.

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3. In the cases provided for in subparagraphs (a), (b), (d) and (e) of paragraph 2 the court ruling shall declare the absolute nullity of the award or arbitral award. In cases provided for in subparagraphs (c), (f) and (g) the court ruling shall determine the relative invalidity of the award or arbitral award.

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In the case provided for in subparagraph (c), the court ruling may declare the validity and continuation of the proceedings in the non-violent party and shall provide that the arbitral tribunal renders the award or supplementary judgment.

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In cases of subparagraphs (f) and (g) a new award or arbitral award shall be issued.

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4. The petition, duly substantiated, shall be deducted within 90 days from the notice of the award or arbitral award or, where appropriate, from the notification of the decision referred to in article. 21.

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5. The party invoking nullity shall establish the facts on which the request is based.

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Rule 23

Execution of award or arbitral award

foreign

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1. For the execution of the foreign arbitral award or judgment, the provisions of the Protocol on Cooperation and Jurisdictional Assistance in Civil, Commercial, Labour and Administrative Matters of MERCOSUR, approved by the Decision of the Council of the Common Market No. 5/92, the Inter-American Convention on International Commercial Arbitration of Panama of 1975, and the Inter-American Convention on Extraordinary Effectiveness of Montevideo shall be applied to the signatory Parties of MERCOSUR.

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2. The inter-American conventions referred to in the preceding paragraph shall apply to the signatory Parties not bound by the said Protocol, or in their absence the right of the State where the foreign arbitral award or judgment is to be executed.

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Article 24

Termination of arbitration

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The arbitration shall terminate when the final award or judgment is rendered, or when the termination of the arbitration by the arbitral tribunal is ordered:

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(a) The parties agree to terminate the arbitration;

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(b) The arbitral tribunal finds that the arbitral proceedings have become, for any reason, unnecessary or impossible.

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Article 25

General provisions

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1. The application of the rules of procedure of the Inter-American Commission on Commercial Arbitration (CIAC) for the arbitration, as provided for in article 12, paragraph 2, (b), shall not imply that arbitration is considered institutional.

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2. Unless otherwise provided by the parties or the arbitral tribunal, the costs resulting from the arbitration shall be equally settled between the countries.

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3. For situations not foreseen by the parties, by this Agreement, by the rules of procedure of the Inter-American Commission on International Commercial Arbitration, or by the conventions and rules to which this Agreement is referred, the principles and rules of the Model Law on International Commercial Arbitration of the United Nations Commission on International Trade Law of 21 June 1985 shall apply.

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Article 26

Final provisions

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1. This Agreement shall enter into force when instruments of ratification have been deposited by two States Parties of MERCOSUR and the Republic of Bolivia or the Republic of Chile.

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For the other ratifiers, the thirtieth day after the deposit of their respective instrument of ratification shall enter into force.

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2. This Agreement shall not restrict the provisions of existing conventions on the same subject between the Signatory Parties, unless they contradict it.

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3. The Republic of Paraguay shall deposit the present Agreement and the instruments of ratification and shall send duly authenticated copies thereof to the Signatory Parties.

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4. As the depositary of this Agreement, the Republic of Paraguay shall notify the Signatory Parties of the date of its entry into force and the date of deposit of the instruments of ratification.

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Made in Buenos Aires, Argentina, on the twenty-third day of the month of July, nine hundred and ninety-eight, in an original in Spanish and Portuguese languages, both texts being equally authentic.