DOMINICAN REPUBLIC Trends and Developments Contributed by: César Joel Linares Rodríguez, LMV Advisors – Central Law Dominican Republic
Conclusion and final reflection Given the aforementioned elements, it is evident that commercial arbitration, being eminently contractual, is affected by the validity requirements applicable to obligations in general and that the arbitration clause would not be protected by the principle of separability; however, the opposite would occur when this princi - ple is applied to the arbitration agreement because, as previously stated, it would arise at a different time and independently from the contract from which the dispute derives. It should be noted that investment arbitration requires a distinct and particular analysis from that applicable to commercial arbitration.
is considered that these allegations by the state are common and foreseeable in transnational trade. In fact, the Dominican Republic introduced this due dili - gence practice in 2021 through guidelines aimed at strengthening transparency and regulatory compli - ance in these processes, which are now incorporated into Law 47-25 on Public Procurement and its imple - menting regulations. In this regard, it should be emphasised that the eco - nomic values involved in contracts with states are gen - erally significant. This requires a good businessperson intending to contract with the state to act with greater diligence and foresight in order to safeguard the legal validity of the agreement about to be entered into. Acting imprudently, negligently, or fraudulently by encouraging or participating in questionable practices places the contract and the economic values involved therein at risk. When consent is obtained through fraud or the deploy - ment of fraudulent manoeuvres, the principle of sepa - rability falls away. If the private counterparty partici - pated in the fraud or manoeuvres, or acted negligently in the face of a foreseeable risk, there would be no basis for invoking good faith, legitimate expectations, or the doctrine of one’s own acts in its defence. The purported autonomy of the arbitration clause would become invalid as a consequence of the defect in consent affecting the contract containing it. As a corollary of the foregoing, the arbitral jurisdic - tion would lack jurisdiction to hear the dispute, and jurisdiction would be restored to the ordinary courts of justice, which, by their constitutional nature, are called upon to judge the validity of consent, protect morality and safeguard public policy.
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