(13) In this case, Respondent 2 was aware of the loan agreement and the arbitration clause contained there in it. This is apparent from the following: (i) Respondent 2 signed the third amendment to the loan agreement three years after the signing of the guarantee. (ii) The third amendment expressly stipulates that the dispute settlement mechanism of the loan agreement (i.e. the faI arbitration procedure, which has its seat in Finland) is to apply. (iii) The parties agree that Respondent 2 has provided security for the loan granted to Respondent 1. Without prejudice to any findings of the individual arbitrator on the merits, Respondent 2 was de facto involved in the performance of the loan agreement. Once you participate in an arbitration, read everything the forum or collector sends. Contact the forum or a lawyer for anything you don`t understand. Keep a copy of everything you send to the forum or collector. Send your documents by registered letter and ask for a pass: this is proof of what the forum or collector received and when. (iii) The fact that the guarantee contained a jurisdiction clause – with reference to the Finnish courts – did not remove the claimant`s right to invoke the arbitration clause of the loan agreement against the respondent.2 The jurisdiction clause of the guarantee did not provide for exclusive jurisdiction for the settlement of disputes, but only a unilateral right in favour of the claimant, in addition to the arbitration clause provided for in the loan agreement. The debate about the use of arbitration (instead of litigation) in borrowers` documents is gaining ground and lenders are more sensitive to the application of arbitration. In addition to ensuring confidentiality in the event that the borrower has a right against a lender that may make the lender uncomfortable in the market, there are other advantages to incentivize a lender to insist on arbitration.
Its arbitration clause, if properly worded, may provide for a speedy resolution of the dispute, minimize discovery, which too often increases the cost of conducting a dispute, and allow the parties to the dispute to choose their own neutrals who would determine their fate. In addition, a few years ago, the LSTA began to work on expanding its existing document suite so that it could be used in certain cross-border transactions. The project was launched in response to requests from LSTA members to standardize certain languages in credit agreements subject to New York law to standardize loans to borrowers outside the United States (especially in Latin America) and to produce commercial documents suitable for trading in these credits. In response to these requests, LSTA has published model rules for Latin American cross-border transactions, a company by/Near Par Trade Confirm for cross-border transactions (the „LatAm Confirm“) and a participation agreement for border operations by/Near Par. These publications addressed the issues that arose when borrowers were in Chile, Colombia, Mexico or Peru. Due to uncertainty about how and how quickly disputes would be handled in these jurisdictions, the LSTA added arbitration provisions in commercial documents. Unlike the LSTA confirmation for domestic borrowers, the LatAm confirmation contains a „Check the Box“ option on the front of the confirmation to allow the parties to choose Arbitration Applicable. If you select, all controversies or claims arising out of or related to the transaction or confirmation will be decided by arbitration administered by ICDR in accordance with its International Arbitration Rules.
The confirmation provides that the parties may choose either NYC or Miami as the place of arbitration, the standard site being NYC. (12) Finally, it is necessary to examine the role of respondent 2 as guarantor of the loan agreement in order to determine whether the respondent is a party to the arbitration agreement. According to Born, is it essential to examine the intentions of the parties in order to determine whether the guarantor should be bound by the arbitration clause of an underlying contract, and such a question will, in most cases, be subject to the national law applicable to the underlying collateral relationship (BORN, International Commercial Arbitration, 2nd ed., 2014, p. . . .