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 AT&T v. Saudi Cable is an
interesting illustration of both
“independence” and “impartiality”.
 At beginning of 1990, the Gov of Saudi Arabia
tendered for bids for improvement of the
country’s telecommunication system
 The project was worth around US$4.5 billion.
 Among the bidders was a Canadian company
called NORTAL as well as AT&T jointly with Saudi
Cable Company and several other
telecommunication companies
 AT&T and Saudi Cable Company won the contract
 In their pre bid agreement they had agreed to
negotiate a final Commercial Contract if and
when project was awarded to them
 However once AT&T obtained the contract but he
partners fell out because they could not agree on
the terms of final contract.
 In 1995 AT&T filed an arbitration claim under ICC
Rules against Saudi Cable Company demanding
pre bid agreement be declared terminated and
that it had no further obligations towards Saudi
Cable
Saudi Cable counter claimed
alleging that AT&T had violated
its duty to negotiate in ‘good
faith’
 Tribunal was constituted and chairman appointed
by agreement between parties. The chairman a
highly respected arbitrator and lawyer filed a
statement of independence as well as a CV, in
which he listed his past and present achievement,
directorships and other personal information he
believed to be relevant
 Two years after the arbitration had commenced
and the tribunal had issued two partial awards
 First award on applicable laws
 Second AT&T had violated its duty to negotiate in
good faith.
 First challenge against the Chairman of the
arbitral tribunal of the ICC before the ICC
International Court of arbitration for lacking
independence
 Then an application before English court to
remove the chairman and to set aside an award for
apparent bias and misconduct under section 23 of
the English Arbitration Act,1950
 As the issue arose out of an ICC arbitration and
under the ICC Rules, the ICC's decision on the
challenge was “final”.
 The High Court had, thus, first to decide whether
it had jurisdiction to review the matter.
 The court found that, since the ICC was
concerned only with “independence”, it could
review the facts to determine whether there was
“apparent bias” or misconduct on the part of the
arbitrator
 The Court of Appeal did not agree that English
courts had to defer to the decisions made by an
arbitral institution
 And held that they could freely review whether
the arbitrator was impartial or had misconduct
himself in such a manner as to warrant
replacement and setting aside of the awards.
 However, on the substance of the matter, both
courts agreed that there were no grounds for a
finding of “apparent bias” or misconduct on the
part of the Chairman.

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At&t v saudi cable case

  • 1.
  • 2.  AT&T v. Saudi Cable is an interesting illustration of both “independence” and “impartiality”.
  • 3.  At beginning of 1990, the Gov of Saudi Arabia tendered for bids for improvement of the country’s telecommunication system  The project was worth around US$4.5 billion.  Among the bidders was a Canadian company called NORTAL as well as AT&T jointly with Saudi Cable Company and several other telecommunication companies  AT&T and Saudi Cable Company won the contract
  • 4.  In their pre bid agreement they had agreed to negotiate a final Commercial Contract if and when project was awarded to them  However once AT&T obtained the contract but he partners fell out because they could not agree on the terms of final contract.
  • 5.  In 1995 AT&T filed an arbitration claim under ICC Rules against Saudi Cable Company demanding pre bid agreement be declared terminated and that it had no further obligations towards Saudi Cable
  • 6. Saudi Cable counter claimed alleging that AT&T had violated its duty to negotiate in ‘good faith’
  • 7.  Tribunal was constituted and chairman appointed by agreement between parties. The chairman a highly respected arbitrator and lawyer filed a statement of independence as well as a CV, in which he listed his past and present achievement, directorships and other personal information he believed to be relevant
  • 8.  Two years after the arbitration had commenced and the tribunal had issued two partial awards  First award on applicable laws  Second AT&T had violated its duty to negotiate in good faith.
  • 9.  First challenge against the Chairman of the arbitral tribunal of the ICC before the ICC International Court of arbitration for lacking independence  Then an application before English court to remove the chairman and to set aside an award for apparent bias and misconduct under section 23 of the English Arbitration Act,1950
  • 10.  As the issue arose out of an ICC arbitration and under the ICC Rules, the ICC's decision on the challenge was “final”.
  • 11.  The High Court had, thus, first to decide whether it had jurisdiction to review the matter.  The court found that, since the ICC was concerned only with “independence”, it could review the facts to determine whether there was “apparent bias” or misconduct on the part of the arbitrator
  • 12.  The Court of Appeal did not agree that English courts had to defer to the decisions made by an arbitral institution  And held that they could freely review whether the arbitrator was impartial or had misconduct himself in such a manner as to warrant replacement and setting aside of the awards.  However, on the substance of the matter, both courts agreed that there were no grounds for a finding of “apparent bias” or misconduct on the part of the Chairman.