LEBANON Law and Practice Contributed by: Mohamed Alem, Mazen Ghosn and Rana Kahwagi, Alem & Associates
5. Jurisdiction 5.1 Challenges to Jurisdiction
pursuant to Article 787 (2) of the NCPC, the parties may not challenge the arbitrator(s) after the closing of the proceedings. Moreover, if a party has grounds to challenge an arbitrator and fails to do so within the time limit set by the arbitral institution in the case of institutional arbitration or by the NCPC in the case of ad hoc arbitration, that party is deemed to have waived its right to challenge the arbitrator at a later stage of the proceedings, including in the annulment proceedings (Court of Appeal of Beirut, 21 February 1994). If the competent court of first instance decides to recuse the challenged arbitrator(s), it is well estab - lished in Lebanese case law that such decision does not lead to the annulment of the arbitration agree - ment (Lebanese Court of Cassation, 28 February 2002, Decision 29/2002). However, such a decision to disqualify the arbitrator(s) would have the effect of retroactively revoking the arbitrator’s mandate and annulling any award that was rendered by the chal - lenged arbitrator in a related case (Lebanese Court of Cassation, 1 April 2004, Decision 60/2004). Finally, pursuant to Article 770 (3) of the NCPC, there is no remedy (whether by way of appeal or otherwise) available against the decision of the competent court of first instance regarding the challenge of arbitrators. 4.5 Arbitrator Requirements Arbitrators must be impartial and independent, or they may be challenged and removed (Court of Appeal of Beirut, 27 December 1993, Decision 766/93). As explained in 4.4 Challenge and Removal of Arbitra- tors , the standards developed by Lebanese case law to assess the independence and impartiality of an arbitrator are similar to those allowed for the chal - lenge of judges, and are enacted on an exhaustive basis with no possibility of extension (Court of First Instance of Beirut, 5 April 2006, Decision 12/48). It is in the light of these standards that Article 769 (2) of the NCPC obliges arbitrators to disclose any informa - tion that might lead a party to doubt the impartiality or independence of the arbitral tribunal.
Article 785 of the NCPC expressly recognises the principle of competence-competence, which applies only to domestic arbitration but is generally extended to international arbitration in Lebanon. This has been increasingly confirmed by Lebanese courts (see, for example, Lebanese Court of Cassation, 25 January 2014, Decision 14/2014). It follows that arbitral tribu - nals have exclusive jurisdiction to hear challenges to their jurisdiction. 5.2 Circumstances for Court Intervention As mentioned in 5.1 Challenges to Jurisdiction , the Lebanese Arbitration Law recognises the principle of competence-competence. However, the NCPC does not specify the scope of competence-competence, nor does it contain any provisions regarding state courts dealing with jurisdictional issues before arbi - tral tribunals. Domestic Arbitration With regard to domestic arbitration, Article 764 of the NCPC limits the review of arbitration matters by state courts to the assessment of arbitration agree - ments that are manifestly null and void or incapable of authorising the appointment of the arbitrator(s). International Arbitration In matters of international arbitration, Lebanese courts almost always rule on the validity of arbitration agree - ments, regardless of any prior jurisdiction granted to arbitrators or limitations on the scope of review of state courts (Court of Appeal of Beirut, 2 February 1999; Court of First Instance of Beirut, 27 March 1997, Decision 117/97). In light of the shortcomings of the Lebanese Arbitra - tion Law, particularly in relation to international arbi - tration, it has been suggested that Lebanese courts refer to Article II(3) of the New York Convention (rati - fied by Lebanon in 1998), which requires state courts seised of matters governed by an arbitration agree - ment to decline their jurisdiction unless they find that the arbitration agreement is null and void, inoperative or incapable of being performed.
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