Culmination of Law

Culmination of Law

Arbitrability of Contractual Disputes Being Affected by Trade Sanctions

Document Type : Original Article

Authors
Esmat Golshani 1
Seyed Mahdi Hosseini Modarres 2
1 Assistant Professor, Department of Law, Sisters Campus of Imam Sadeq University, Tehran, Iran
2 Assistant Professor, Department of Economic Law, Faculty of Law, Shahid Beheshti University, Tehran, Iran
10.22034/thdad.2024.2009136.2549
Abstract
situation are being referred to arbitration as the agreed disputed resolution method, the arbitrator(s) shall rule on their own competence. To rule on their own competence, the arbitrator(s) have to answer this question, which is also the main question of this research, whether this dispute or claims related to or arising out of the sanctions can be referred to arbitration and be resolved through it? i.e. do sanctions affect the arbitrability of the dispute?
None of the laws relating to arbitrability in the pioneer legal systems in field of arbitration in the world depends arbitrability of a dispute on the 1) The nature of laws that might be necessary to be considered to resolve a dispute (i.e., whether the law is an overriding mandatory rule or not) or 2) the issue whether the law serves public or private interests. Currently, in the legal literature and doctrine, the prevailing approach is that the arbitrators are not deprived of the competence to arbitrate issues involving the overriding mandatory rules which serve the public interests like sanctions. Even if the seat of arbitration was located in the sanctioning state, the arbitrator would not give effect to the public policy of the state of the seat in the stage of deciding on arbitrability. Rather, the public policy of the state of the seat must be taken into account at the “challenging arbitration award” stage.
Keywords
Trade Sanctions
Arbitrability
Overriding Mandatory Rules
the Governing Law of Arbitration Agreement

Subjects

6- References
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Culmination of Law
Volume 11, Issue 2
Autumn 2025
Pages 189-229