DETERMINATION OF A LAW APPLICABLE TO THE SUBSTANCE OF A DISPUTE BY THE ARBITRATION TRIBUNAL IN THE PROCESS OF RESOLUTION OF INTERNATIONAL COMMERCIAL DISPUTES

The article examines the main approaches to the determination by the arbitral tribunal, in the absence of a choice of parties, of a substantive law applicable to the merits of a dispute, when resolving disputes in international commercial arbitration. It is noted that the three fundamental approaches to the establishment by the arbitral tribunal of the law applicable to the merits of the dispute include: 1) the application by the arbitrators of the principle of the closest connection; 2) recourse to conflict-of-laws rules that the arbitral tribunal considers applicable (indirect approach, voie indirecte) 3) granting arbitrators the right to directly establish and apply substantive law without resorting to any conflict-of-laws or rules (the so-called voie directe or direct approach). It is summarized that all of the above approaches are aimed at ensuring the compliance of the applicable substantive law established by the arbitral tribunal with the substance of the dispute and the subject of the contract, especially the first two related to conflict of laws – both with a specific reference to law, which has the closest connections with legal relations, and with the ability of the arbitrators to refer to other conflict-of-laws rules that it deems applicable. The difference concerning the third of the approaches, voie directe or direct choice of the applicable law, lies in the greater degree of freedom of the arbitrators in this matter, since the obligation of the arbitral tribunal to refer to the conflict of laws rules of a certain national system of private international law or transnational conflict of laws is generally eliminated. The author claims that the arbitral tribunal, depending on the approach adopted in the country of place of arbitration, whose mandatory provisions determine the procedure for the arbitrators to establish the applicable substantive law in the absence of a choice of parties, and the rules enshrined in the arbitration rules of the relevant institution, can either independently establish such a right (direct approach) or turn first to the definition of applicable conflict of laws rules, according to which the choice of substantive law will be made (indirect approach). Such conflict-of-laws links, as a rule, include: the principle of the closest connection, the country of the place of performance of the contract, the country of location of the party that must carry out significant performance, etc.