ISSUE: WHETHER ARBITRATION PROCEEDING CAN BE INITIATED AGAINST GAMMA?

1. It is submitted before the arbitral tribunal that Beta cannot initiate arbitration proceeding under bill of
lading against Gamma because only the original party to the time charter party agreement can be
bound to arbitrate [A] and such arbitration agreement cannot be extended to include non-signatory
party.[B]

[A] THE PARTIES TO THE TIME CHARTER AGREEMENT CAN ARBITRATE.

2. It is submitted that only the original parties to the time charter party agreement can be bound to
arbitrate. The holder of a bill of lading is not a signatory to the charterparty, an arbitration agreement
can become binding on the parties only by their intention. Art. II § 2 the New York Convention
prescribes that “The term agreement in writing shall include an arbitral clause in a contract or an
arbitration agreement, signed by the parties or contained in an exchange of letters or telegrams.”.1
3. Article 7 of UNICTRAL states that “Arbitration agreement” is an agreement by the parties to
submit to arbitration all or certain disputes which have arisen or which may arise between them in
respect of a defi ned legal relationship, whether contractual or not.”.2
4. Arbitration is a matter of consent parties should express their intent to refer any dispute that may
arise to arbitration in a clear way by drafting a proper arbitration agreement.3

1
Art II § 2 of the New York Convention.
2
Art 7 of the UNICTRAL.
3
Moses Margaret, (2012) The Principles and Practice of International Commercial Arbitration, 2 nd edn, Cambridge University
Press, New York, p 18.