FINLAND Law and Practice Contributed by: Julia Pekkala, Mikko Leppä, Risto Sandvik and Nuutti Kortelainen, HPP Attorneys Ltd
proceedings, except in situations where a court finds the arbitral tribunal lacks jurisdiction on the issue and the decision has become final. 5.2 Circumstances for Court Intervention Court Review of Arbitral Tribunal Jurisdiction in Finland As described in 5.1 Challenges to Jurisdiction , Finn- ish courts have jurisdiction to review claims regarding the validity or scope of an arbitration agreement. The jurisdiction of an arbitral tribunal may also be tried in court where a party to court proceedings in a civil dispute objects to the court’s jurisdiction and invokes an arbitration agreement before addressing the merits of the matter. As described in 3.3 National Courts’ Approach , Finn- ish courts are generally regarded as being friendly towards arbitration, and arbitration is a common way of settling business disputes in Finland. Provided that an arbitration agreement is invoked in time, courts will not take a matter that falls within the scope of the agreement into further consideration, but will refer the matter to arbitration. In addition, a court can set aside an arbitration award upon the request of a party, if the arbitrators have exceeded their authority. Review of Negative Rulings on Jurisdiction Finnish courts are not bound by either positive or neg - ative jurisdictional rulings made by arbitral tribunals. However, a negative ruling on jurisdiction by an arbi - tral tribunal cannot, in itself, be directly challenged in court. The Arbitration Act is silent on the treatment of negative jurisdictional rulings, but a party to the arbi - tration may bring a declaratory action before a court to confirm that the matter is subject to arbitration. If the court finds that the tribunal did have jurisdiction, the arbitration proceedings must be commenced anew. 5.3 Timing of Challenge A party may challenge the arbitral tribunal’s compe - tence in court as soon as a case has been filed for arbitration, during the arbitral proceedings and after an arbitral award has been rendered. Despite this, an arbitral tribunal may proceed with the case while
a challenge concerning its jurisdiction is pending in court. As regards an arbitral award that has already been rendered, the Arbitration Act provides that an action for setting aside an arbitration award (based on lack of jurisdiction, for example) shall be brought within three months of the date on which a party to the arbitration received a copy of the award. 5.4 Standard of Judicial Review for Jurisdiction/Admissibility Questions concerning admissibility and jurisdiction are reviewed by the courts de novo. For judicial review of the merits of arbitral awards, see 11.3 Standard of Judicial Review . 5.5 Breach of Arbitration Agreement As noted in 5.2 Circumstances for Court Interven- tion and 5.3 Timing of Challenge , Finnish courts are arbitration-friendly and, under the Arbitration Act, are obliged to favour arbitration over regular court pro - ceedings where an arbitration agreement has been invoked in a timely manner. However, courts cannot decline jurisdiction merely due to the existence of an arbitration agreement (ex officio); the arbitration agreement must be explicitly invoked by a party. 5.6 Jurisdiction Over Third Parties As a general rule, an arbitral tribunal does not have jurisdiction over non-signatory parties to an arbitra - tion agreement. The personal scope of an arbitration agreement must be assessed in accordance with the general principles of Finnish contract law, and in cer - tain circumstances third parties (both domestic and foreign) may also invoke an arbitration agreement. For example, arbitration agreements are generally binding on successors and assignees, including, among oth - ers, bankruptcy estates. The Supreme Court of Finland has ruled that, in certain situations, an arbitration agreement may be extended to a non-signatory third party based on its conduct de facto and a non-signatory guarantor.
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