On 11 January 2017, the Swiss government released its long-awaited draft bill on the revision of Chapter 12 of the Swiss Private International Law Act for public consultation. It governs international arbitration proceedings in Switzerland. The draft bill is intended to adapt the existing law to align it with case law developed by the Swiss Supreme Court over the last three decades. The consultation will end on 31 May 2017. The draft bill will then be submitted to the Swiss parliament.
Amongst the proposed amendments that are likely to spark debate is one concerning the language of setting-aside proceedings.
Switzerland is one of the few jurisdictions where any application to set aside an award must be brought directly before the country’s highest court, that is, the Swiss Supreme Court. The Swiss Supreme Court drafts its decisions in one of the country’s official languages (those being German, French, Italian or Rumantsch). Similarly, the parties are required to submit their briefs in one of those languages. That said, in the current practice of the Swiss Supreme Court, the parties are generally not required to translate the challenged award and other exhibits if these are in English (and the Swiss Supreme Court has also accepted documents in Spanish, if they are not too voluminous).
The proposed amendment authorises the parties to file memorials, including the setting-aside application, in English. The Supreme Court’s decisions and correspondence, for their part, will still be issued in one of Switzerland’s official languages.
Switzerland would not be the first non-English speaking country to consider the possibility of allowing submissions to be filed in English. For instance, as one of the potential amendments to the Swedish Arbitration Act (which is currently under review), Sweden is contemplating the possibility of conducting setting aside proceedings before the Svea Court of Appeal in English, if a party so requests. Written submissions, written evidence, and witness examinations would also be presented and conducted (as the case may be) in English. However, the Court of Appeal’s decisions would still be rendered in Swedish (with a simultaneous English translation if requested).
However, is it really beneficial to the arbitration process to establish English as an accepted language for submissions in the context of setting-aside proceedings before the Swiss Supreme Court? The question may appear provocative, but, upon closer examination, it is not unreasonable. Let us consider the pros and cons of the proposal.
It is beyond doubt that the main advantage of the proposed amendment is its user-friendliness:
- First, it will make it easier for foreign parties who have tried their case before an arbitral tribunal in English to be authorised to continue to use the same language in the context of setting-aside proceedings.
- Second, one should not forget that an application to challenge an award must be filed within the very short period of 30 days from the notification of the award. With that in mind, offering counsel the possibility of drafting their memorials in English and, by way of consequence, exchanging any preliminary drafts with their clients in that language presents the significant advantage of (i) saving time and minimising any translation costs that could have been incurred otherwise, and (ii) making sure that no ideas or issues get lost in translation. In other words, the proposed amendment helps better serve the client’s interests and, more generally, the dynamic between counsel and their clients.
Having said that, introducing the possibility of filing written submissions in English is not without its disadvantages. For example:
- Whilst Swiss practitioners do not have a monopoly on well-crafted submissions, allowing parties to file submissions in English increases the likelihood of setting-aside motions being prepared by lawyers who lack experience in Swiss Supreme Court procedure. This, in turn, entails the risk of opening the floodgates to poorly motivated challenges, which are likely to be rejected for failing to satisfy the threshold for admissibility set out under Swiss law. As most arbitration practitioners can already attest, the Swiss Supreme Court Act is very strict with regard to both the substantive reasoning for challenges (knowledge of case law is a must) and formal requirements (including the requirement to motivate and substantiate the setting-aside application).
- There is also the potential risk of increased competition with foreign counsel, although we do not necessarily share that concern since the monopoly of lawyers admitted to the Swiss Bar will stay in place, and because sophisticated international firms generally engage local counsel anyway when proceeding before the highest court in any jurisdiction (including Switzerland).
- The Swiss Supreme Court will continue to issue its decisions in one of Switzerland’s official languages. In other words, the parties (or one of them) will plead their case in English whereas the decision-maker will develop its reasoning in another language. As part of the exercise, which consists of the Swiss Supreme Court considering arguments made in English and articulating its reasoning in an official language, one cannot exclude the possibility that the Swiss Supreme Court may lose sight of some of the nuances developed by counsel in their pleadings (or, worse, mischaracterises some of the terms used in the setting-aside application). That is likely to arise, for instance, when the Swiss Supreme Court is expected to give meaning to complex treaty provisions in the context of a particular case or fact pattern (as would be the case, for instance, in the field of investment treaty arbitration).
Finally, one may legitimately wonder about the (narrow) scope of application of the proposed amendment. It might have made sense to introduce English as a language in all other arbitration-related judicial proceedings as well, that is, before state courts assisting the arbitral tribunal during the arbitration (juge d’appui), or in the context of enforcement proceedings. The draft bill did not opt to take that route; therefore, in proceedings before state courts for assistance regarding interim measures, the taking of evidence, other state court assistance, or in enforcement proceedings, the official language of that state court still applies.