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NEWSLETTER 2013
188
Extension of the Arbitration Clause to Group Companies
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Att. Ezgi Babur
The extension of the arbitration agreement to third parties has become
a subject of interest in recent years. The extension of the arbitration
agreement, which is signed by a company taking part in the same group
of companies as the parent company, which is economically stronger, is
preferable. Additionally, the extension is favorable for the claimant in
recognition and enforcement proceedings, since it gives the opportunity
to initiate recognition and enforcement proceedings against the parent
company taking part in the same group of companies.
The acceptance of the extension in arbitration proceedings and arbitral
awards given as a result of such proceedings may cause issues, especially
in recognition and enforcement proceedings. Similarly, for arbitration
proceedings during which the extension of the arbitration agreement
was not granted but which are subject to recognition and enforcement
proceedings, the extension of the arbitration agreement may be subject to
debate. At this point, the extension of the arbitration agreement, signed
by a member of a group of companies, to another company within the
same group of companies is a topic worth analyzing.
In General
As is known, the declaration of intent concerning the resolution of
disputes through arbitration is the essential element of the arbitration
agreement. For a valid arbitration agreement, the parties should declare
their intent concerning the resolution of disputes through arbitration
in a clear manner and without giving rise to confusion
1
. The fact that
arbitration has both contractual and judicial characteristics emphasizes
that the arbitration intent should be clarified without giving rise to any
confusion. Also, the exceptional character of arbitration as a dispute
resolution mechanism indicates the importance of the arbitration intent.
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Article of September 2013
1
Ziya AKINCI
, Milletlerarası Tahkim, Ankara 2007, p. 82.