Interest on delayed payment / Determination of rate of interest / Insufficiency of the general principles and normal usages of international trade / Necessity to refer to a national law / Law of the country of the currency in which the debt was specified / Starting point of interest: date of request for arbitration.

'The Claimant, in his request for arbitration, demanded interest at the applicable legal rate in France on the amount lost following the cancellation of his purchase order of the merchandise.

In his submission... Claimant demands interest at the basic bank rate in Mauritius, which was at the time 12%.

The Defendant did not respond to this inconsistency.

Though the parties have decided in favour of the application of the general principles and normal usages of international trade, it is nevertheless necessary [to select the law] ruling the interest rates since the lex mercatoria evidently contains no detailed rules with regards to interest rates.

An argument in favour of applying the Mauritius rate is the fact that the Claimant and creditor has his principal place of business there, and that the damage was suffered in Mauritius.

The Arbitrator considers however that the French rate is more relevant. It is logical that the law of the country in whose currency the claim was specified should govern the interest rates which are, theoretically, related to the position of that currency in financial markets.

The Claimant demanded interest on

FF ... until June 1987, at which date the greatest part of the goods, according to Claimant, was sold;

FF ... as from June 1987.

Since the Claimant did not prove that he had goods in stock for FF ... between ... November 1986 and June 1987, he is not entitled to interest on that amount.

His proven damage amounts to FF ... It is therefore on that amount that he is entitled to interest at the applicable legal rate in France, from the date of introduction of his Request for Arbitration...'