Claimant, a German company, entered into an agreement with Defendant, an Indian company, to supply the latter with industrial equipment. The parties subsequently signed a further contract for a related automation system. 15% of the price of this contract was to be paid immediately and the balance in successive instalments by way of promissory notes. Disputes arose between the parties following the loss of the promissory notes, delayed delivery of the equipment and malfunctions. Defendant stated its wish to return the automation system, upon which Claimant filed its Request for Arbitration. The first issue dealt with by the Arbitral Tribunal in its majority award was that of the applicable law. The parties' contract contained a section S, entitled 'Law and Arbitration', worded as follows:

In interpreting this clause, the Arbitral Tribunal referred to articles 1.7, 2.15, 3.8, 3.9, 4.1 and 4.2 of the Unidroit Principles.