Sunday, 30 January 2011

Bahrain: a Forum for the Resolution of IP and Technology Disputes?

According to "Our Vision", from regional pioneer to global contender the economic vision 2030 for Bahrain", the government of Bahrain plans substantial investment in advanced manufacturing particularly in the motor and food production industries, information and communications technology and financial services over the next 20 years. There will inevitably be disputes and differences between researchers and developers, their investors and distributors. The Bahrain Chamber for Dispute Resolution ("BCDR") is already a forum for the resolution of commercial disputes with the emphasis on arbitration of construction, financial services, insurance and energy cases. This article examines the legislative decree establishing the BCDR and the BCDR Rules and considers their appropriateness for intellectual property and other technology-related disputes.

Legislative Decree number 30 of 2009 was promulgated by the King of Bahrain on 29 June 2009. Art 2 establishes an independent chamber for the settlement of economic, financial and investment disputes to be known as the "Bahrain Chamber for Dispute Resolution". The chamber consists of a board of trustees who oversee the BCDR which includes making its procedural rules and administrative and technical personnel. Art 9 provides:
"The Chamber shall have jurisdiction to settle the following disputes originally within the jurisdiction of Bahrain courts or other entities having judicial jurisdiction, for cases in which the value of the claim exceeds Five Hundred Thousand Dinars:
1. Disputes among financial institutions licensed according to the provisions of the Law of Central Bank of Bahrain or between these institutions and other institutions, companies, and individuals.
2. International Commercial Disputes. The dispute shall be deemed international if the location of one of the disputant parties or the place where a substantial part of the obligations of the commercial relationship is to be performed, or the location most closely connected with the dispute is outside the Kingdom.
A dispute shall be deemed commercial if its subject matter, contractual or non-contractual, concerns relationships of a commercial nature including any transaction of supplying goods or services or the exchange thereof, distribution agreements, commercial representation or commercial agency, managing rights before others, hiring to purchase, construction of factories, consultation services, engineering works, issuing licenses, investment and financing, banking transactions, insurance, franchising agreements, joint ventures, any other forms of industrial or commercial cooperation, and transporting commodities or passengers by air, sea or land."

The definition of "commercial dispute" provided by that article would clearly cover computer supply, licensing, joint venture and similar disputes. There is no reason why it should not include infringement disputes though perhaps not those in which the validity of an intellectual property right is an issue. Art 11 (1) allows the parties to agree upon the applicable law and in the absence of such agreement the law of Bahrain is to prevail. There is limited right of recourse to the Cour de Cassation (Bahrain's highest civil court) under art 13.

Arbitrations are commenced by service of a notice of arbitration which must contain a statement of claim that includes the following:
"(a) a demand that the dispute be referred to arbitration;
(b) the names, addresses and telephone numbers of the parties;
(c) a reference to the arbitration clause or agreement that is invoked;
(d) a reference to any contract out of or in relation to which the dispute arises;
(e) a description of the claim and an indication of the facts supporting it;
(f) the relief or remedy sought and the amount claimed; and
(g) may include proposals as to the means of designating and the number of arbitrators, the place of arbitration."
(Art 2 of the BCDR Rules). The defendant must respond with a defence or defence and counterclaim within 30 days. Most importantly for intellectual property disputes, art 21 confers on the arbitrator an extensive range of powers including injunctive relief and measures for the protection or conservation of property. That would seem to include interim injunctions, search orders and freezing injunctions.

As in all arbitrations and other forms of alternative dispute resolution, the parties must agree to refer their disputes to the BCDR. The words that the BCDR suggests are as follows:
"Any controversy or claim arising out of or relating to this contract, or the breach thereof, shall be determined by arbitration administered by the Bahrain Chamber for Dispute Resolution (BCDR-AAA) in accordance with its Arbitration Rules."
The BCDR also suggests that parties should consider adding provisions as to the number of arbitrators, the city and country in which the arbitration will take place and the language or languages of the arbitration.

If anyone wants to discuss representation before the BCDR, dispute resolution of future disputes before the chambers or any other matter relation to arbitration or mediation in general, he or she should contact me through my contact form.

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