1. Legislation and arbitration rules frequently contain provisions allowing arbitrators to rule as amiable compositeurs, provided this is what the parties intend. ICC has had such a provision in its Rules of Arbitration ever since they were first published in 1922.1 In the 1988 version of the Rules, Article 13(4) read as follows: 'The arbitrator shall assume the powers of an amiable compositeur if the parties are agreed to give him such powers.' In the most recent version of the Rules, in force since 1998, the expression 'ex aequo et bono' has been added. Article 17(3) of the current version of the Rules thus reads: 'The Arbitral Tribunal shall assume the powers of an amiable compositeur or decide ex aequo et bono only if the parties have agreed to give it such powers.'

2. The difficulty in arriving at a clear definition of amiable composition and the unpredictability of the decisions rendered by arbitrators ruling as amiable compositeurs are often said to explain the reluctance to resort to amiable composition. In the present article, we look at amiable composition through arbitral awards rendered under the auspices of ICC between 1992 and 2004-extracts from which will be found on the following pages 2-and through awards previously published and analysed in the Yearbook Commercial Arbitration and the Journal du droit international and assembled in the Collection of ICC Arbitral Awards, which currently runs to four volumes.3

3. Terminology has been a source of ambiguity. More often than not, the power to act as amiable compositeur is conferred on the arbitrator(s) in the arbitration clause. If this is not the case, however, then those powers will need to be mentioned in the Terms of Reference, as provided in Article 18(1)(g) of the ICC Rules of Arbitration. This is what happened in case 7770.4 Several awards state that the power to act as amiable compositeur was confirmed in the Terms of Reference.

The arbitration clauses, on the basis of which the awards we have studied were rendered, well illustrate the variety of terms used. They refer, for instance, to the appointment of 'arbitrators having the status of amiable compositeur' (case 7913), to an arbitrator 'who has the powers of an amiable compositeur and is to decide the case according to the principles of equity' (case 9483) or 'shall act as "amiable compositeur" [Page52:] and decide the case "according to the principles of equity"' (case 9704), to the fact that 'the arbitrators will have the power to decide as amiable compositeurs' (case 11934) or 'will have the powers of amiable compositeur deciding ex aequo et bono' (case 7986), to disputes to be 'decided by the arbitrator ex aequo et bono' (case 12772) or 'decided according to equity' (case 4467).

These examples raise the question of whether the expressions rule or decide 'as amiable compositeur', 'ex aequo et bono' and 'in equity' amount to one and the same thing. As regards the expressions 'assume the powers of an amiable compositeur' and 'decide ex aequo et bono', both of which appear in Article 17(3) of the ICC Rules of Arbitration, it has been stated in a commentary on the Rules 5 that: 'Historically, both terms are products of the civil law and have to do with an arbitrator deciding a case on the basis of fairness and equitable considerations.' This issue is discussed in several awards.

4. In the award rendered in 2004 in case 12772,6 the arbitrator enquired into the expressions 'ex aequo et bono' and 'amiable compositeur':

Article 17(3) of the Rules makes a distinction between those two concepts since it states:

'The Arbitral Tribunal shall assume the powers of an amiable compositeur or decide ex aequo et bono only if the parties have agreed to give it such powers.' (Emphasis added)

What is then the difference, if any?

A vast majority of leading authors in this field expects the amiable compositeur to still apply rules of law, however, with the authority to correct the outcome, according to his conveyed discretion. An arbitrator applying "ex aequo et bono" enjoys a wider area of authority, limited only by the principles of public policy, which need to be respected in any case (Karrer, Basle Commentary, N 191 to Article 187 PILA; Blessing, The New International Arbitration Law in Switzerland: A Significant Step towards Liberalism, Journal of International Arbitration, 1988, page 64; Andreas Bucher, Die neue internationale Schiedsgerichtsbarkeit in der Schweiz, 1989, page 120, N 318; and, most recently and in detail, Poudret/Besson, Droit comparé de l'arbitrage international, 2002, page 652 et seq, in particular page 654/55, N 711/12). But it should also be noted that there are authors who do not see significant differences between those two types of authority conveyed to an arbitrator (particularly Craig/Park/Paulsson, International Chamber of Commerce Arbitration, 2000, § 8.05/06, page 76/77).

5. In the award rendered in 1984 in case 4467,7 the arbitrator considered that in giving him the power to decide the dispute in equity, the parties had in fact empowered him to act as an amiable compositeur. In his commentary on the award, Yves Derains states that although there has never been any problem in equating the power to rule in equity with that of ruling as an amiable compositeur, this has not always been the case when parties provide for the arbitrators to rule ex aequo et bono. However, in international commercial arbitration practice a distinction is no longer made between the power to act as amiable compositeur and the power to act ex aequo et bono.[Page53:]

6. The award rendered in 2001 in case 10728 8 firstly recalls that: 'In Chapter VII of the Terms of Reference entitled "Powers of the Arbitrator", it is stated that "the parties agree to vest in the Sole Arbitrator the power to decide ex aequo et bono, in accordance with Article 17(3) of the ICC Rules of Arbitration".' The award then goes on to remove any ambiguity by pointing out that: 'It is unanimously accepted that to decide ex aequo et bono is to decide in equity. Scholars overwhelmingly consider that when arbitrators are empowered to rule in equity, they rule as amiable compositeurs (Ph. Fouchard, E. Gaillard, B. Goldman: Traité de l'arbitrage commercial international, para. 1502). For J. Robert (L'arbitrage, droit interne, droit international privé, 1993, para. 182), the ex aequo et bono clause expresses the parties' intention to give the arbitrator the powers of an amiable compositeur. Arbitral case law does not make any distinction between the powers of an amiable compositeur and the power to judge ex aequo et bono (S. Jarvin - Y. Derains, Collection of ICC Arbitral Awards 1974-1985, page 502).'

The synonymity of the two expressions was also recognized in the award rendered in 2002 in case 7986,9 where any attempt to distinguish between them is said to be artificial.

7. Some arbitration clauses have elaborated to some extent on the effects of the amiable compositeur powers vested in the arbitrators. In case 7913, for instance, it is stated that 'the dispute will be referred to three arbitrators acting as "amiable compositeurs, that is to say that they will not be required to apply the provisions of any law whatsoever, whether relating to procedure or to the merits of the case, but may render a decision based on equity"'. In case 6749, the arbitration clause gave the arbitrators the power to rule as amiable compositeurs, 'exempt from procedural formalities and deadlines'. In case 7986, the arbitration clause indicated that the arbitral tribunal 'shall have the powers of an amiable compositeur ruling ex aequo et bono, without being bound to comply with the deadlines and ordinary rules of procedure'.

8. As illustrated by the award rendered in 1999 in case 7986, 10 amiable composition is defined in relation to the arbitrator's powers:

The parties discussed the extent of the powers of amiable composition from the time of the rejoinder.

For [the Respondent], the powers of amiable composition require the arbitrators to decide the dispute in equity. Amiable composition empowers arbitrators, if not to depart, to the extent required by equity, from the legal or contractual provisions in principle applicable to the dispute, at least to attenuate the over-strict consequences to which such provisions might lead. [The Respondent] points out the limits of amiable composition with respect to public policy.

[Claimant 1], for its part, stresses the fact that the claims are not inequitable. It further recognizes that the question of the extent of the powers of amiable composition is covered only cursorily by legal writers in Luxembourg. It consequently concludes that the powers of amiable composition are as defined in the book International Commercial Arbitration by Craig, Park and Paulsson (Oceana, vol. 1, para. 18.02). The arbitrators must therefore evaluate the facts of the case on the basis of an overall view of the [Page54:] relations between the parties, both from an economic perspective and with an equitable solution in mind.

This notwithstanding, the parties nonetheless discussed in their written exchanges the question of the law applicable to the merits of the case.

In particular, on the basis of certain connecting factors, the Respondent considers that the applicable law should be the law [of the country from which it originates], but the solution resulting from the application of this law should be tempered through the principles of equity.

Until very recently, the question of the extent of the powers held by arbitrators acting as amiable compositeurs was controversial. Some scholars attempted to distinguish between amiable composition and arbitration in equity. Recent thinking has regarded such a distinction as artificial, as in either case 'arbitrators could choose to have their sense of what justice requires prevail over any other considerations' (cf. P. Fouchard/E. Gaillard/B. Goldman: Traité de l'arbitrage commercial international, Paris 1996, No. 1502, p. 849).

According to the same thinking:

'Amiable composition can thus be defined in an essentially negative fashion as the arbitrators' power not to restrict themselves to applying rules of law altogether, but also to depart from them to the extent that their conception of equity requires' (cf. Fouchard/Gaillard/Goldman, op. cit. ad § 1502, p. 849).

Yves Derains and Eric Schwartz confirm 11 that: 'The related issues that typically arise are whether and, if so, to what extent, an arbitrator who is authorized can disregard either the provisions of law that would otherwise apply or the terms of the parties' contract.'

9. For Professor Eric Loquin, 'an amiable compositeur is vested with a true mission, not just powers. To rule as an amiable compositeur implies both a possibility (ruling contra legem) and a duty (eliminating inequity)'.12

10. An analysis of the arbitral awards rendered by arbitrators endowed with the powers of an amiable compositeur shows that the pursuit of equity does not rule out the application of national law (I), and it also illustrates the extent of and the limitations upon the powers held by such arbitrators (II).

I. When an arbitrator empowered to act as amiable compositeur rules in equity, this does not exclude the application of national law

11. The arbitral awards rendered over the years show how arbitrators acting as amiable compositeurs reconcile their pursuit of equity with the application of national law. They invariably recall that they are not bound by the application of national law. Sometimes, they mention that references to national law cannot be ruled out and, more often than not, do indeed make such references. A distinction needs to be made between those situations in which the arbitration clause gave the arbitrators the powers of an amiable [Page55:] compositeur while also stipulating a law applicable to the merits, from those situations in which no applicable law was stipulated in the arbitration clause. The first situation has led arbitrators to enquire into the compatibility between an applicable law clause and an amiable composition clause.

12. In the award rendered in case 2216,13 the arbitral tribunal reflected on the respective roles of law and equity in resolving the dispute. It held as follows:

Whereas according to Article 19 of the contract of . . . it is stipulated, on the one hand, that the law in force in (the producer's country) is applicable to the resolution of any dispute and, on the other hand, that the arbitrators shall have the power of amiable compositeurs. Whereas the law of (the producer's country) does not exclude amiable composition; Accordingly, the use of amiable composition, to the extent that the arbitrators do not disregard the mandatory rules of the law (of the producer's country), implies the freedom to override non-mandatory rules and to rule in equity.

The same question arose in case 1677,14 where the arbitral tribunal decided as follows:

According to the valid agreement concluded between the parties, the legal problem should be settled in accordance with the rules of Swiss law. The arbitral tribunal was however authorized with the consent of both parties, to rule, under the terms of Art.19, para 3 of the Rules of Conciliation and Arbitration, according to the principle of 'amiables compositeurs', that is on the basis of equity or, as expressed in the German text of Art.19, 'nach billigem Ermessen'. However, according to general principles, the arbitral tribunal is not authorized to take a decision contrary to an absolutely constraining law, particularly the rules concerning public order or morals.

A similar stance was taken in case 10728:15

Whereas the parties have on the one hand chosen the applicable law and, on the other hand, given the Sole Arbitrator the power to rule ex aequo et bono;

Whereas the time bar objection should be examined on the one hand in light of the provisions of French law, which is the applicable law intended by the parties, and on the other hand according to the powers given to the Sole Arbitrator to rule ex aequo et bono;

Whereas the Sole Arbitrator must start from the application of the law chosen by the parties, but has the possibility of departing from that law by ruling in equity, if need be.

A slightly different approach was taken in case 7913,16 where the arbitral tribunal considered that: 'The clause in fact combines amiable composition and the choice of French law, without this giving rise to any contradiction as French law allows for amiable composition'.

13. These extracts show that where an amiable composition clause exists side by side with a choice-of-law clause, the latter is subordinate to the amiable composition clause, as equity prevails over law. The consequence is that any distinction one might try to make between this situation and that in which the parties have not chosen the applicable law becomes moot. In the second situation, arbitrators faced with no choice-of-law have enquired whether it was necessary to determine an applicable law and have [Page56:] generally decided that it was not. In case 3267,17 for example, it is stated that: 'The Arbitral Tribunal needs not to decide which specific law governs the contractual relationship between the parties.' In case 9669,18 the arbitral tribunal expanded upon this position, stating that 'it is generally accepted that an arbitrator acting as amiable compositeur does not have to apply a specific legal system, but enjoys greater flexibility and may resort to other criteria, such as the factual circumstances of the case as well as the terms of the relevant contract, in order to reach an equitable result'. In case 12070, 19 it is likewise stated that 'the Arbitral Tribunal, when deciding ex aequo et bono, is not bound by any national law or rules of law'.

14. However, some arbitrators-although fewer in number-have felt the need to determine the applicable law, even if they then decided that they were not bound by that law. An illustration can be found in case 10049:20

5.3 In par. 6.1. of the Interim Award, the Tribunal has decided as follows: 'The next issue is what law does apply to the merits of this dispute. [Claimant] has argued that [State A] law should apply while [Respondent] has argued that [State B] law should apply. The answer to the issue is not of paramount importance since the arbitration clause gives the arbitrators the power to act as "amiables compositeurs" with the consequence that the Arbitral Tribunal does not have the obligation to decide the case according to the rules of law.'

5.4 On the other hand, the Tribunal, in par. 6.2. of the interim award, also found that [State A] law is applicable, which was further confirmed in par. 13.2 thereof. These findings which have been made after long deliberations between the parties in connection with issue b of the Terms of Reference, are not contradictory. [State A] Law governs the contractual relationship between the parties. When requested to act as 'amiable compositeurs', the arbitrators must take into account the equities of the case, in order to reach a decision which is 'equitable'. In doing so, they may take into consideration-in whole or in part-or not take into consideration, the applicable law (subject only to application of its rules of public policy).

15. It should, however, be added that, although equity prevails in the various situations mentioned above (coexistence of amiable composition and choice of law, no determination of the applicable law, or determination of the applicable law when not chosen by the parties), it is more often than not supported by law. The awards rendered by arbitrators acting as amiable compositeurs indeed show that there is frequently a desire to consolidate the solution in equity with a solution at law. The tribunal in case 3267, for instance, stated that 'it is worth mentioning here that this method of compensation for damages is also acceptable under Belgian law'.21 Cases 3540, 5118 and 11934 provide further variations on this approach:

That, however, the arbitral tribunal, holding it appropriate not to avoid all references to a national law, will examine whether the solution contained in its award based on the lex mercatoria and the application of the maxim pacta sunt servanda-leaving aside the international public policy-would be fundamentally different from that resulting from national law. 22[Page57:]

It should be noted that the power of amiable composition conferred upon the Arbitral Tribunal in no way rules out an assessment of the parties' respective rights with regard to a given system of law. Starting from this assessment of the parties' respective rights, the Arbitral Tribunal, as amiable compositeur, will decide whether it intends to use this power conferred upon it by the parties so as to adopt in its award a solution more in keeping with equity than with the strict application of rules of law. 23

In its foregoing reasoning, the Arbitral Tribunal has on several occasions been led to justify its decisions on particular points through considerations of equity. It wishes to add . . . that where it has not expressly departed from the rule of law, the reason is that it found that rule equitable as applied to the circumstances of the case. 24

16. The report on amiable composition commissioned by ICC France, and currently the subject of discussions at an international level, identified two approaches taken by amiable compositeurs with a view to reaching an equitable solution:

The first involves launching straight into equity: in this case the amiable compositeur directly applies to the dispute the principles of equity that he judges most appropriate. He does this without concerning himself with the applicable rule of law. In the second approach, the amiable compositeur first evaluates the claims from each of the parties, in accordance with the applicable law. If the resulting solution seems unjust to him, he then adapts the solution in order to satisfy equity.25

The report expressed the Working Group's preference for the second approach. This preference is shared by the arbitrators acting as amiable compositeurs in the cases studied for the purpose of this commentary.

17. The comparison made by arbitrators between solutions at law and solutions in equity is consistent with French law.26 Current French case law requires arbitrators acting as amiable compositeurs to explain in their awards how the decisions they have reached are consistent with equity, even if their solutions are based on a strict application of national law. It is therefore not an option, but an obligation, for arbitrators to justify the equity of their decisions.

The position of French law on this question is not without importance, for most of the awards studied for the purpose of this article were rendered in Paris. This is hardly surprising as ICC statistics27 show Paris to be consistently the most frequent place of arbitration in ICC proceedings. When an arbitration is seated in Paris, this means that the award will be rendered there and, if need be, submitted to the French courts for review.[Page58:]

II. The extent of and limitations upon the powers of arbitrators acting as amiable compositeurs in their pursuit of equity

18. Arbitrators acting as amiable compositeurs, who do not have an obligation to apply national law when seeking a just and equitable solution, will above all refer to the contract. Although their powers of amiable composition do not give them unbridled freedom, they are entitled to override to some extent the consequences of contractual provisions. The difficulty lies in defining the extent of their powers in applying the contract and the limitations upon those powers.

Whilst it is true that arbitrators must in principle stick to the terms of the contract,28 they can nonetheless depart from the contract for the sake of equity. Arbitral awards have limited their power to do so by insisting on the need to maintain the contractual balance sought by the parties when making their contract,29 'unless it is shown that the provisions relied on are clearly against the true intent of the parties, or violate a basic commonly accepted principle of public policy'.30

19. Within the limits of this requirement to respect the economics of the contract, which means that the contract cannot be rewritten, an arbitrator acting as amiable compositeur nonetheless has the power, when interpreting or applying the provisions of the contract, to moderate the effects of those provisions and reduce their stringency.31

Thus, arbitrators acting as amiable compositeurs can, by virtue of this moderating power, 'reduce or remove the effects of a contractual provision that would appear to be excessive for one of the parties or that would be unfair, given the nature of the contract and the circumstances'.32

20. The case law of the French courts, to which reference is made in the arbitral awards, consistently recognizes that arbitrators whom the parties have vested with the mission of ruling as amiable compositeurs have the power to attenuate contractual obligations, and thus 'moderate the rights deriving from the contract and depart from a strict application of the contractual clauses without, however, modifying the economics of the contract'.33

Professor Eric Loquin 34 maintains that the arbitrator's moderating power results from the legal nature of the amiable composition clause. This clause amounts to a deliberate waiver by the parties of the strict sanctioning of the subjective rights they hold at the [Page59:] time of the dispute, whether those rights derive from the law or their contract.35 The Paris Court of Appeal applied the same analysis in a ruling handed down on 18 November 1996.36

21. The arbitral awards rendered over the years offer illustrations of the way in which arbitrators acting as amiable compositeurs have exercised their powers of moderation with respect to contracts.

In case 7986,37 for example, which involved a dispute over a share transfer agreement, two of the issues on which the arbitrators ruled were the repurchase of doubtful assets and the warranties given for liabilities.

22. As far as the repurchase of the doubtful assets were concerned, the arbitrators first noted that the contractual balance initially sought in the memorandum of understanding lay above all in the fact that the security given by the respondent was a sufficient guarantee. The arbitrators then found that this contractual balance no longer existed since the economic situation of the respondent group was no longer the same as when the memorandum of understanding was made. They consequently sought to restore this balance:

If the contractual balance sought in the memorandum of understanding is to be restored . . ., [Claimant 1] must of course provide the respondent with the funding that will allow it or one of its companies to acquire the capital . . ., but [Claimant 1] must also be assured that such funding will actually be repaid as scheduled. Any other solution would be inequitable.

. . . . . . . .

Again, in order to respect the contractual balance of the agreement . . ., it is for [Claimant 1] to bear the cost of such security up to a maximum of 2%, for had Article 2 of the Memorandum of Understanding . . . been performed, the security provided by the respondent would not have generated any cost for the [respondent] group.

The solution adopted by the Arbitral Tribunal thus puts the parties in the situation in which they would have been if the contractual stipulations set out in Article 2 of the said agreement had been acted upon . . .

23. With respect to a claim made on the basis of a contractual clause guaranteeing the purchaser that the balance sheets, profit and loss accounts and net position were true and fair, covering all of the company's liabilities and assets and all operations and profits, and that all necessary provisions have been made, the arbitral tribunal applied that clause after first analysing it from a legal perspective. It found that a solution offering 100% indemnification would be unfair. Accordingly, using its powers of amiable composition, the tribunal decided 'that it was necessary to award not the full damage resulting from increased liability or a shrinkage of assets, but a percentage of the amounts recognized in this regard determined on the basis of [Claimant 1]'s share in the capital of [X]. This is indeed the solution commonly applied in practice.[Page60:] Accordingly, on all the amounts that will be granted to [Claimant 1], the respondent will be ordered to pay 79.31% of the amount which the Arbitral Tribunal records as a deficiency in the assets or an increase in the liabilities.'

The arbitral tribunal also took account of the information the purchaser already had or was likely to obtain at the date of the transaction, notably through the documentation attached to the memorandum of understanding and, in particular, an initial report from firm V, which would have allowed Claimant 1 to contract on terms less onerous for it than those contained in the said agreement. The Arbitral Tribunal concluded that 'if pertinent information could be obtained from the initial report [V], it would be unfair not to take this into account, as it would have allowed Claimant 1 to renegotiate certain clauses before signing the contract at issue. Furthermore, although it may be true that guarantees of liability and valuation are to be interpreted strictly, the Arbitral Tribunal may, by virtue of its powers of amiable composition, moderate their stringency'.

24. In case 7913,38 where the dispute concerned the remuneration of a consultant (claimant) for information and assistance to be provided to the respondent for the purpose of selling equipment and services in the claimant's country, the arbitrators acting as amiable compositeurs first enquired into the economics of the parties' relationship. They observed that the remuneration provided for in the contract involved an element of risk, of which the claimant was fully aware, as its attention had necessarily been drawn to this aspect of the economics of the contract. The clause relating to commission indeed expressly stated that in the event of a sale, the agreed commission would represent the consultant's entire remuneration (that is to say, the costs incurred in securing the sale would not be refunded). The arbitrators further noted that the claimant had not accomplished any operation giving rise to commission, with the result that if the claimant had suffered any loss, it could not be considered as 'inequitable'.

Applying their powers of amiable composition, the arbitrators ruled, amongst other things, on the question of the 'payment of commission on supplies made by [Claimant] to the [Ministry of State X]'. The arbitral tribunal's sought to ensure that '[Claimant] was not deprived of just remuneration on the transactions that can be assumed to have been concluded after the term had elapsed, but as a result of efforts made during the contractual period'. It accordingly '"tempered" the stringency of the rule actor incumbit probatio by agreeing to the investigatory measure requested by [Claimant], whereas [Claimant] itself admitted that it had not provided the evidence required of it. Through the investigatory measure, the Tribunal indeed covered a period going far beyond the term of the agreement . . .'

The arbitral tribunal decided against the claimant's request, however, as neither the aforementioned investigatory measure nor even the statements made to the tribunal by the parties' witnesses and representatives, the written statement received from the engineer after the hearing, or the response to another investigatory measure ordered by the arbitral tribunal at the claimant's request showed that any remuneration was due to the claimant.

25. Arbitrators acting as amiable compositeurs more often than not apply their powers of moderation to the assessment of damages and the rate of interest.[Page61:]

26. In a dispute39 over the compensation of the claimant for the loss it had suffered as a result of the fraudulent disappearance of goods under the respondent's custody and control, the arbitrator empowered to act as amiable compositeur considered that it was fair and equitable, in light of the circumstances, to reduce by half the amount of the damages to which the claimant was entitled under the set-off agreement.

27. When it comes to applying an arbitrator's moderating powers as amiable compositeur to rates of interest, the award rendered in case 674940 states that it is at the stage of fixing the damages due by the respondent that attention must be given both to the factors of reduction provided for by law, where equity will come into consideration, and the amiable composition clause agreed by the parties.

28. In case 12099,41 concerning failure to pay the price of a press advertisement, the arbitral tribunal recalled that it had the power to modify the price due under the contract but found that the respondent had not alleged any facts that would have justified reducing the price.42 The arbitral tribunal's moderating power was in the end applied to the rate of contractual interest. After noting that this rate was excessive, the arbitral tribunal considered that its powers of amiable composition allowed it to reduce the amount due on the basis of the formula for calculating interest applicable in the event of a breach of contract, if this amount was inequitable, or to interpret or apply a formula for calculating interest that would lead to an equitable result, especially where, as here, the party that owed the interest appeared not to have negotiated, or had the opportunity to negotiate, the contractual terms and conditions, but to have merely signed the standard form presented by the co-contractor.

29. Arbitral tribunals vested with powers of amiable composition were also led to override contractual clauses providing for excessive rates of interest in cases 9483, 9655, 9704 and 12099.43

30. Case 10728 44 illustrates the limitations on the moderating powers of an arbitrator acting as amiable compositeur. In this case, which concerned the abrupt termination of a contract for technical and commercial assistance, the sole arbitrator ruled on a claim that the action was time-barred due to the fact that it had been brought more than ten years after the termination of the contract. To override this time bar, the arbitrator recalled that he could set aside only those rules which the parties could agree to waive. He noted that the time bar that had elapsed could be analysed as a right of which the parties could freely dispose. However, looking at the circumstances of the case, the arbitrator considered that the claimant's inaction during ten years was linked to the political situation in the State in question during the 1980s and 1990s and the political, economic and social complexity of the matter, which was probably the very reason why the parties gave the arbitrator the powers of amiable composition. In seeking the most just and equitable solution, the arbitrator thus rejected the time bar objection despite the fact that it was justified at law and admissible.[Page62:]

In doing so, the arbitrator was not breaking new ground since-as mentioned in the award-the French Court of Cassation has implicitly acknowledged that arbitrators are entitled to override the consequences of a time bar when they rule in equity.45

31. The awards analysed here also illustrate the impact of arbitrators' powers of amiable composition on the decisions they make in relation to the costs of the arbitration.46 These decisions are made at the arbitrators' discretion and do not necessarily reflect the decisions made on the merits of the parties' respective claims.47 Some awards apply equity specifically in relation to the costs incurred by the parties for their defence.48

Conclusion

32. This commentary has drawn attention to the special features of an arbitrator's role as amiable compositeur. As was pointed out in ICC France's report on amiable composition,49 it is important that, throughout the proceedings, the parties should accompany the arbitrators in their search for a just and equitable solution. It thus seems indispensable that the parties should be conscious of the implications of their decision to opt for amiable composition. Their attention should be drawn to the nature of the powers they have given to the arbitral tribunal, so that they are aware of the need to consider the dispute and their respective claims from the perspective of equity.

This point is expressly emphasized by the arbitrator in case 12099.50 He indeed points out that the respondent was not represented by a lawyer in the arbitration proceedings, which probably did not allow it to be fully aware of the implications of the contractual clause providing for amiable composition and, with respect to the interest clause in particular, may have led it to accept the claimant's reading of this clause without realizing that it could be challenged.

Thus, the success of arbitration based on amiable composition will depend on both the arbitrators and the parties who have given them the power to act as amiable compositeurs. The search for a fair and equitable solution is one which parties and arbitrators must pursue together.

1
Y. Derains & E.A. Schwartz, A Guide to the ICC Rules of Arbitration, 2d ed. (Kluwer Law International, 2005) 245ff.

2
Extracts from the awards rendered in ICC cases 6749, 7770, 7913, 7986, 9262, 9483, 9655, 9669, 9704, 10049, 10504, 10728, 11409, 11934, 12070, 12099 and 12772 are reproduced below at 63ff.

3
S. Jarvin & Y. Derains, Collection of ICC Arbitral Awards 1974-1985 ( Kluwer Law & Taxation/ICC Publishing, 1990); S. Jarvin, Y. Derains & J-.J. Arnaldez, Collection of ICC Arbitral Awards 1986-1990, (Kluwer Law & Taxation/ICC Publishing, 1994); J.-J. Arnaldez, Y. Derains & D. Hascher, Collection of ICC Arbitral Awards 1991-1995 (Kluwer Law International/ICC Publishing, 1997); J.-J. Arnaldez, Y. Derains, & D. Hascher, Collection of ICC Arbitral Awards 1996-2000 (Kluwer Law International/ICC Publishing, 2003).

4
See p. 64, below.

5
Y. Derains & E.A. Schwartz, supra note 1 at 245.

6
See p. 112, below.

7
See Journal du droit international, 1984.924 (Annot. Y. Derains); S. Jarvin & Y. Derains, Collection of ICC Arbitral Awards 1974-1985 (Kluwer Law & Taxation/ICC Publishing, 1990) 501.

8
See p. 98, below.

9
See p. 72, below.

10
Ibid. The quotations from Fouchard/Gaillard/Goldman, Traité de l'arbitrage commercial international have been taken from the English version of this book: E. Gaillard & J. Savage, eds., Fouchard, Gaillard, Goldman on International Commercial Arbitration (Kluwer Law International, 1999) at 836ff.

11
Y. Derains & E.A. Schwartz, supra note 1 at 245.

12
E. Loquin, 'Pouvoirs et devoirs de l'amiable compositeur. A propos de trois arrêts de la Cour d'Appel de Paris' Rev. arb. 1985.199 at 224.

13
S. Jarvin & Y. Derains, Collection of ICC Arbitral Awards 1974-1985 (Kluwer Law & Taxation/ICC Publishing, 1990) 224.

14
Ibid. at 20.

15
See p. 98, below.

16
See p. 67, below.

17
(1982) VII Y.B. Comm. Arb. 96 at 98; S. Jarvin & Y. Derains, Collection of ICC Arbitral Awards 1974-1985 (Kluwer Law & Taxation/ICC Publishing, 1990) 76 at 78.

18
See p. 85, below.

19
See p. 108, below.

20
See p. 89, below.

21
See supra note 17.

22
Award rendered in 1980 in case 3540: (1982) VII Y.B. Comm. Arb. 124 at 129 ; S. Jarvin & Y. Derains, Collection of ICC Arbitral Awards 1974-1985 (Kluwer Law & Taxation/ICC Publishing, 1990) 105 at 110.

23
Award rendered in 1986 in case 5118: Journal du droit international 1987.1027 at 1028; S. Jarvin, Y. Derains & J.J. Arnaldez, Collection of ICC Arbitral Awards 1986-1990, (Kluwer Law & Taxation/ICC Publishing, 1994) 318.

24
Award rendered in 2004 in case 11934, see p. 104, below.

25
E. Bertrand, Amiable Composition: Report of the ICC France Working Group, RDAI/IBLJ 6/2005.753 at 756.

26
Paris (1re ch. C), 15 January 2005, Rev. arb. 2004.912 (Annot. J.-G. Betto).

27
See the 2006 Statistical Report published in this issue, 5 at 12.

28
See cases 7986 and 9669, respectively pp. 72 and 85, below.

29
See cases 7913, 7986, 9483 and 9704, respectively pp. 67, 72, 82 and 87, below. The Paris Court of Appeal has on several occasions held that an amiable composition clause does not allow arbitrators to 'modify the economics of the agreement' (6 May 1988, Rev. arb. 1989.63; 19 April 1991, Rev. arb. 1991.673 (Annot. E. Loquin); 6 May 1993, unpublished: 'provided the economics of the contract are not modified by replacing the contractual obligations with new obligations that were not intended by the parties'.

30
Case 3267, (1982) VII Y.B. Comm. Arb. 96; S. Jarvin & Y. Derains, Collection of ICC Arbitral Awards 1974-1985 (Kluwer Law & Taxation/ICC Publishing, 1990) 76.

31
See case 7913, p. 67, below.

32
Ibid.

33
Paris, 6 March 1988, Rev. arb. 1989. 83 (Annot. E. Loquin); also 14 November 1977, Rev. arb. 1977.281 (Annot. J. Robert); 10 March 1981, Rev. arb. 1982.214 (Annot. E. Mezger); 6 January 1984, Rev. arb. 1985.279; 12 March 1985, Rev. arb. 1985.299; 19 April 1991, Rev. arb. 1991.673 (Annot. E. Loquin); RTD com. 1992.164 (Annot. Dubarry & Loquin); 31 March 1991, Rev. arb., 1992.669 (Annot. L. Matray); Cass. civ. 2e, 29 November 1995, Rev. arb. 1996.234 (Annot. E. Loquin); Paris, 28 November 1996, Rev. arb. 1997.380 (Annot. E. Loquin); 4 November 1997, Rev. arb. 1998.704 (Annot. Y. Derains).

34
Comment on Cass. civ. 2e, 15 February 2001, Grenoble, 15 December 1999 (2 cases), Rev. arb. 2001.135.

35
E. Loquin, supra note 12 at para. 467ff.; 'Pouvoirs et devoirs de l'amiable compositeur', J.-cl. proc. civ., fasc. 1038, para. 104ff.; P. Level, 'L'amiable composition dans le décret du 14 mars 1980 relatif à l'arbitrage', Rev. arb. 1980.651; for a different view of amiable composition powers see J.D. Bredin, 'L'amiable composition et le contrat', Rev. arb. 1984.259.

36
Rev. arb. 1997.380 (Annot. E. Loquin).

37
See p. 72, below.

38
See p. 67, below.

39
Case 10504, see p. 95, below

40
See p. 63, below.

41
See p. 111, below.

42
The French courts have accepted that an arbitrator acting as amiable compositeur may award to a creditor only part of the debt owed to it under the contract (Paris, 14 January 1977, 10 March 1981 and 6 March 1988, Rev. arb. 1989.83 (Annot. E. Loquin)). Conversely, the arbitrator may award to a creditor an amount in excess of that resulting from a strict application of the contract.

43
See, respectively pp. 82, 83, 87 and 111, below.

44
See p. 98, below.

45
Cass. civ., 15 February 2001, Rev. arb. 2001.136 (Annot. E. Loquin) and, more recently, Rev. arb. 2003.1360 (Annot. J.-G. Betto).

46
See cases 7913, 7986 and 9655, respectively pp. 67, 72 and 83, below.

47
See case 7913, p. 67, below.

48
See e.g. case 11409, p. 100, below.

49
See supra note 25.

50
See p. 111, below.