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DEPARTMENT CIRCULAR NO. 98 IMPLEMENTING RULES AND REGULATIONS OF THE ALTERNATIVE DISPUTE RESOLUTION ACT OF 2004. Whereas pursuant to Section 52 of Republic Act No. 9285, otherwise known as the "Alternative Dispute Resolution Act of 2 !" "ADR Act"#, the Secretar$ of %ustice is &irecte& to convene a 'o((ittee for the for(ulation of the appropriate rules an& re)ulations necessar$ for the i(ple(entation of the ADR Act* Whereas the co((ittee was co(pose& of representatives fro( the Depart(ent of %ustice, the Depart(ent of +ra&e an& ,n&ustr$, the Depart(ent of the ,nterior an& -ocal .overn(ent, the /resi&ent of the ,nte)rate& 0ar of the /hilippines, a representative fro( the ADR or)ani1ations. Where!"re the followin) rules an& re)ulations are hereb$ a&opte& as the ,(ple(entin) Rules an& Re)ulations of Republic Act no.9285. IMPLEMENTING RULES AND REGULATIONS OF THE ALTERNATIVE DISPUTE RESOLUTION ACT OF 2004 #R.A N". 928$% /ursuant to Section 52 of republic Act No. 9285, otherwise known as the alternative Dispute Resolution Act of 2 !" ""ADR Act"#, the followin) Rules an& Re)ulations "these "Rules"# are hereb$ pro(ul)ate& to i(ple(ent the provisions of the ADR Act2 Cha&'er ( GENERAL PROVISIONS RULE ( ) P"*+,- a./ A&&*+,a'+".

Ar'+,*e (.2 Declaration of policy. ,t is the polic$ of the State2 "a# +o pro(ote part$ autono($ in the resolution of &isputes or the free&o( of the parties to (ake their own arran)e(ents to resolve their &isputes* "b# +o encoura)e an& activel$ pro(ote the use of Alternative Dispute Resolution ""ADR"# as an i(portant (eans to achieve spee&$ an& i(partial 3ustice an& &eclo) court &ockets* "c# +o provi&e (eans for the use of ADR as an efficient tool an& an alternative proce&ure for the resolution of appropriate cases* an& "&# +o enlist active private sector participation in the settle(ent of &isputes throu)h ADR Ar'+,*e (.0 Exception to the Application of the ADR Act. +he provisions of the ADR Act shall not appl$ to the resolution or settle(ent of the followin)2 "a# labor &isputes covere& b$ /resi&ential Decree No. !!2, otherwise known as the "-abor 'o&e of the /hilippines, as a a(en&e&", an& its ,(ple(entin) Rules an& Re)ulations* "b# the civil status of persons* "c# the vali&it$ of (arria)e* "&# an$ )roun& for le)al separation* "e# the 3uris&iction of courts* "f# future le)iti(ate*

Ar'+,*e (.( Purpose. +hese Rules are pro(ul)ate& to prescribe the proce&ures an& )ui&elines for the i(ple(entation of the ADR Act.

")# cri(inal liabilit$*

"h# those &isputes which b$ law cannot be co(pro(ise&* an& "i# &isputes referre& to court4anne5e& (e&iation. Ar'+,*e (.4. Electronic Signature and E-Commerce Act. +he provisions of the 6lectronic Si)nature an& 64'o((erce Act, an& its i(ple(entin) Rules an& Re)ulations shall appl$ to procee&in)s conte(plate& in the ADR Act. Ar'+,*e (.$. Liability of ADR Pro iders!Practitioners. +he ADR provi&es 7practitioners shall have the sa(e civil liabilit$ for acts &one in the perfor(ance of their official &uties as that of public officers as provi&e& in Section 88 "9#, 'hapter 9, 0ook 9 of the A&(inistrative 'o&e of 998:, upon a clear showin) of ba& faith, (alice or )ross ne)li)ence. RULE 21 De!+.+'+". "! Ter2s Ar'+,*e (.3 Definition of "erms. ;or purposes of these Rules, the ter(s shall be &efine& as follows2 A. Ter2s A&&*+,a4*e '" A** Cha&'ers (. ADR Pr"5+/er (eans the ,nstitutions or persons accre&ite& as (e&iators, conciliators, arbitrators, neutral evaluators or an$ person e5ercisin) si(ilar functions in an$ Alternative &ispute resolution s$ste(. +his is without pre3u&ice to the ri)hts of the parties to choose non4accre&ite& in&ivi&uals to act as (e&iator, conciliator, arbitrator or neutral evaluator of their &ispute. 2. A*'er.a'+5e D+s&6'e Res"*6'+". S$ste( (eans an$ process or proce&ures use& to resolve a &ispute or controvers$, other than b$ a&3u&ication of a presi&in) 3u&)e of a court or an officer of a )overn(ent a)enc$, as &efine& in the ADR Act, in which neutral thir& person participates to assist in the resolution of issues, ,nclu&in) arbitration, (e&iation, conciliation, earl$ neutral evaluation, (ini4trial or an$ co(bination thereof.

0. Ar4+'ra'+". (eans a voluntar$ &ispute resolution process in which one or (ore arbitrators, appointe& in accor&ance with the a)ree(ent of the parties or these Rules, resolve a &ispute b$ ren&erin) an awar&. 4. Ar4+'ra'+". A7ree2e.' (eans a)ree(ent b$ the parties to sub(it to arbitration all or certain &isputes which have arisen or which (a$ arise between the( in respect of a &efine& le)al relationship, whether contractual or not. An arbitration a)ree(ent (a$ be in the for( of an arbitration clause in a contract or in the for( of a separate a)ree(ent. $. A6'he.'+,a'e (eans to si)n, e5ecute, a&opt a s$(bol or encr$pt a recor& or establish the authenticit$ of a recor& or ter(. 3. A8ar/ (eans an$ partial or final &ecision b$ an arbitrator in resolvin) the issue or controvers$. 9. C".!+/e.'+a* I.!"r2a'+". (eans an$ infor(ation, relative to the sub3ect of (e&iation or arbitration, e5pressl$ inten&e& b$ the source not to &isclose&, or obtaine& un&er circu(stances that woul& create reasonable e5pectation on behalf of the source that the infor(ation shall not be &isclose&. ,t shall inclu&e2 "a# co((unication, oral or written, (a&e in a &ispute resolution procee&in), inclu&in) an$ (e(oran&a, notes or work pro&uct of the neutral part$ or non4part$ participant* "b# an oral or written state(ent (a&e or which occurs &urin) (e&iation or for purposes of consi&erin), con&uctin), participatin), initiatin), continuin) or reconvenin) (e&iation or retainin) a (e&iator* an& "c# plea&in)s, (otions, (anifestations, witness state(ents, reports file& or sub(itte& in arbitration or for e5pert evaluation.

8. C"6.se* (eans a law$er &ul$ a&(itte& to the practice of law in the /hilippines an& in )oo& stan&in) who represents a part$ in an$ ADR process. 9. C"6r' (eans Re)ional +rial 'ourt 65cept insofar as otherwise &efine& un&er <o&el -aw. (0. G"5er.2e.' A7e.,- (eans an$ )overn(ental entit$, office or officer, other than a court that is veste& b$ law with =uasi4 3u&icial power or the power to resolve or a&3u&icate &isputes involvin) the )overn(ent, its a)encies an& instru(entalities or private persons. ((. M"/e* La8 (eans the <o&el on ,nternational 'o((ercial Arbitration a&opte& b$ the >nite& Nations 'o((ission on ,nternational +ra&e -aw on 29 %une 9985. (2. Pr",ee/+.7s (eans 3u&icial, a&(inistrative or other a&3u&icative process, inclu&in) relate& pre4hearin) or post hearin) (otions, conferences an& &iscover$. (0. Re,"r/ (eans infor(ation written on a tan)ible (e&iu( or store& in an electronic or other si(ilar (e&iu(, retrievable in a perceivable for(. (4. R"s'er (eans a list of persons =ualifie& to provi&e ADR services as neutrals or to serve as arbitrators. ($. S&e,+a* ADR R6*es (eans the Special Rules of 'ourt on Alternative Dispute Resolution issue& b$ the Supre(e 'ourt on Septe(ber 9, 2 9. :. Ter2s a./ A&&*+,a4*e '" 'he Cha&'er Me/+a'+". (. Ad hoc Me/+a'+". (eans an$ (e&iation other than institutional or court4anne5e&.

2. I.s'+'6'+".a* Me/+a'+". (eans an$ (e&iation process con&ucte& un&er the rules of a (e&iation institution. 0. C"6r'1A..e;e/ Me/+a'+". (eans (e&iation process con&ucte& un&er the auspices of the court an& in accor&ance with Supre(e 'ourt approve& )ui&elines, after such court has ac=uire& 3uris&iction of the &ispute. 4. C"6r'1Re!erre/ Me/+a'+". (eans (e&iation or&ere& b$ a court to be con&ucte& in accor&ance with the a)ree(ent of the parties when an action is pre(aturel$ co((ence& in violation of such a)ree(ent. $. Cer'+!+e/ Me/+a'"r (eans a (e&iator certifie& b$ the ?ffice for ADR as havin) successfull$ co(plete& its re)ular professional trainin) pro)ra(. 3. Me/+a'+". (eans a voluntar$ process in which a (e&iator, selecte& b$ the &isputin) part$ voluntar$ a)ree(ent re)ar&in) a &ispute. 9. Me/+a'+". Par'- (eans a person who participates in a (e&iation an& whose consent is necessar$ to resolve the &ispute. 8. Me/+a'"r (eans a person who con&ucts (e&iation. 9. N".1Par'- Par'+,+&a.' (eans a person, other than a part$ or (e&iator, who participates in a (e&iation procee&in) as a witness, resource person or e5pert. C. Ter2s A&&*+,a4*e '" 'he Cha&'er ". I.'er.a'+".a* C"22er,+a* Ar4+'ra'+". (. A&&"+.'+.7 A6'h"r+'- as use& in the <o&el -aw shall (ean the person or institution na(e& in the arbitration a)ree(ent as the appointin) authorit$* or the re)ular arbitration institution un&er

whose rules the arbitration is a)ree& to be con&ucte&. @here the parties have a)ree& to sub(it their &ispute to institutional arbitration rules an& unless the$ have a)ree& to a &ifferent proce&ure, the$ shall be &ee(e& to have a)ree& to the proce&ure un&er such arbitration rules for the selection an& appoint(ent of arbitrators. ,n a& hoc arbitration, the &efault appoint(ent of an arbitrator shall be (a&e b$ the National /resi&ent of the ,nte)rate& 0ar of the /hilippines ",0/# or his 7her &ul$ authori1e& representative. 2. Ar4+'ra* Tr+46.a* #6./er 'he M"/e* La8% (eans a sole arbitrator or a panel of arbitrators. 0. Ar4+'ra'+". (eans an$ arbitration whether or not a&(inistere& b$ a per(anent arbitration institution. 4. C"22er,+a* Ar4+'ra'+". (eans an arbitration that covers (atters arisin) fro( all relationships of a co((ercial nature, whether contractual or not. Relationships of a co((ercial nature inclu&e, but are not li(ite& to, the followin) co((ercial transactions2 an$ tra&e transaction for the suppl$ or e5chan)e of )oo&s or services* &istribution a)ree(ents* construction of works* co((ercial representation or a)enc$* factorin)* leasin)* consultin)* en)ineerin)* licensin)* invest(ent* financin)* bankin)* insurance* 3oint venture an& other for(s of in&ustrial or business cooperation* carria)e of )oo&s or passen)ers b$ air, sea rail or roa&. $. C".5e.'+". A8ar/ (eans a forei)n arbitral awar& in a 'onvention State. 3. C".5e.'+". S'a'e (eans a state that is a (e(ber of the New Aork 'onvention.

9. C"6r' "un&er the <o&el -aw# (eans a bo&$ or or)an of the 3u&icial s$ste( of the /hilippines "i.e., the Re)ional +rial 'ourt, 'ourt of Appeals an& Supre(e 'ourt#. 8. I.'er.a'+".a* Ar4+'ra'+". (eans an arbitration where2 "a# the parties to an arbitration a)ree(ent have, at the ti(e of the conclusion of that a)ree(ent, their places of business in &ifferent states* or "b# one of the followin) places is situate& outsi&e the /hilippines in which the parties have their places of business2 "i# the place of arbitration if &eter(ine& in, or pursuant to , the arbitration a)ree(ent* "ii# an$ place where a substantial part of the obli)ations of the co((ercial relationship is to be perfor(e& or the place with the sub3ect (atter of the &ispute is (ost closel$ connecte&* or "c# the parties have e5pressl$ a)ree& that the sub3ect (atter of the arbitration a)ree(ent relates to (ore than one countr$. ;or this purpose2 "a# if a part$ has (ore than one place of business, the place of business is that which has the closest relationship to the arbitration a)ree(ent* "b# if a part$ &oes not have a place of business, reference is to be (a&e to his7her habitual resi&ence.

9. Ne8 <"r= C".5e.'+". (eans the >nite& Nations 'onvention of the Reco)nition an& 6nforce(ent of ;orei)n Arbitral Awar&s approve& in 9958 an& ratifie& b$ the /hilippine Senate un&er Senate Resolution No.:9. (0. N".1C".5e.'+". A8ar/ (eans a forei)n arbitral war& (a&e in a state, which is not a 'onvention State. ((. N".1C".5e.'+". S'a'e (eans a state that is not a (e(ber of the New Aork 'onvention. D. Ter2s A&&*+,a4*e '" 'he Cha&'er ". D"2es'+, Ar4+'ra'+". (. Ad hoc Ar4+'ra'+". (eans arbitration a&(inistere& b$ an arbitrator an&7or the parties the(selves. An arbitration a&(inistere& b$ an institution shall be re)ar&e& as a& hoc arbitration if such institution is not a per(anent or re)ular arbitration institution in the /hilippines. 2. A&&"+.'+.7 A6'h"r+'- +. Ad Hoc Ar4+'ra'+". (eans, in the absence of an a)ree(ent, the National /resi&ent of the ,0/ or his7her &ul$ authori1e& representative. 0. A&&"+.'+.7 A6'h"r+'- G6+/e*+.es (eans the set of rules approve& or a&opte& b$ an appointin) authorit$ for the (akin) of a Re=uest for Appoint(ent, 'hallen)e, ter(ination of the <an&ate of Arbitrator7s an& for takin) action thereon. 4. Ar4+'ra'+". (eans a voluntar$ &ispute resolution process in which one or (ore arbitrators, Appointe& in accor&ance with the a)ree(ent of the parties or these Rules, resolve a &ispute b$ ren&erin) an awar&. $. Ar4+'ra* Tr+46.a* (eans a sole arbitrator or a panel, boar& or co((ittee of arbitrators.

3. C*a+2a.' (eans a person7s with a clai( a)ainst another an& who co((ence7s arbitration a)ainst the latter. 9. C"6r' (eans, unless otherwise specifie& in these Rules, a Re)ional +rial 'ourt. 8. Da- (eans calen&ar &a$. 9. D"2es'+, Ar4+'ra'+". (eans arbitration that is not international as &efine& in Article 9"8# of the <o&e -aw. (0. I.s'+'6'+".a* Ar4+'ra'+". (eans arbitration a&(inistere& b$ an entit$, which is re)istere& as a &o(estic corporation with the Securities an& 65chan)e 'o((ission "S6'# an& en)a)e& in. a(on) others, arbitration of &isputes in the /hilippines on a re)ular an& per(anent basis. ((. Re>6es' !"r A&&"+.'2e.' (eans the letter4re=uest to the appointin) authorit$ of either or both parties for the appoint(ent of arbitrator7s or of the two arbitrators first appointe& b$ the parties for the appoint(ent of the thir& (e(ber of an arbitral tribunal. (2. Re&rese.'a'+5e is a person &ul$ authori1e& in writin) b$ a part$ to a &ispute, who coul& be a counsel, a person in his7her e(plo$ or an$ other person of his7her choice, &ul$ authori1e& to represent sai& part$ in the arbitration procee&in)s. (0. Res&"./e.' (eans the person7s a)ainst who( the clai(ant co((ence7s arbitration. (4. Wr+''e. ,"226.+,a'+". (eans the plea&in), (otion, (anifestation, notice, or&er, awar& an& an$ other &ocu(ent or paper sub(itte& or file& with the arbitral tribunal or &elivere& to a part$.

E. Ter2s A&&*+,a4*e '" 'he Cha&'er ". O'her ADR F"r2s (. Ear*- Ne6'ra* E5a*6a'+". (eans an ADR process wherein parties an& their law$ers are brou)ht to)ether earl$ in the pre4trial phase to present su((aries of their cases an& to receive a non4 bin&in) assess(ent b$ an e5perience& neutral person, with e5pertise in the sub3ect (atter or substance of the &ispute. 2. Me/+a'+".1Ar4+'ra'+". "r Me/1Ar4 is a two4step &ispute resolution process involvin) (e&iation an& then followe& b$ arbitration. 0. M+.+1'r+a* (eans a structure& &ispute resolution (etho& in which the (erits of a case are ar)ue& before a panel co(prisin) of senior &ecision4(akers, with or without the presence of a neutral thir& person, before which the parties seek a ne)otiate& settle(ent. CHAPTER 2 THE OFFICE FOR ALTERNATIVE DISPUTE RESOLUTION RULE (1 O!!+,e !"r A*'er.a'+5e D+s&6'e Res"*6'+". #OADR% Ar'+,*e 2.(. Establishment of the #ffice for Alternati e Dispute Resolution. +here is hereb$ establishe& the ?ADR as an a)enc$ attache& to the Depart(ent of %ustice. ,t shall have a Secretariat an& shall be hea&e& b$ an 65ecutive Director, who shall be appointe& b$ the /resi&ent of the /hilippines, takin) into consi&eration the reco((en&ation of the Secretar$ of %ustice. Ar'+,*e 2.2. Po$ers of the #ADR. +he ?ADR shall have the followin) powers* "a# +o act as appointin) authorit$ of (e&iators an& arbitrators when the parties a)ree in writin) that it shall be e(powere& to &o so*

"b# +o con&uct se(inars, s$(posia, conferences an& other public fora an& publish procee&in)s of sai& activities an& relevant (aterials7infor(ation that woul& pro(ote, &evelop an& e5pan& the use of ADR* "c# +o establish an ADR librar$ or resource center where ADR laws, rules an& re)ulation, 3urispru&ence, books, articles an& other infor(ation about ADR in the /hilippines an& elsewhere (a$ be store& an& accesse&* "&# +o establish trainin) pro)ra(s for ADR provi&ers7practitioners, both in the public an& private sectors* an& to un&ertake perio&ic an& continuin) trainin) pro)ra(s for arbitration an& (e&iation an& char)e fees on participants. ,t (a$ &o so in con3unction with or in cooperation with the ,0/, private ADR or)ani1ations, an& local an& forei)n )overn(ent offices an& a)encies an& international or)ani1ations* "e# +o certif$ those who have successfull$ co(plete& the re)ular professional trainin) pro)ra(s provi&e& b$ the ?ADR* "f# +o char)e for services ren&ere& such as, a(on) others, for trainin) an& certifications of ADR provi&ers* ")# +o accept &onations, )rants an& other assistance fro( local an& forei)n sources* an& "h# +o e5ercise such other powers as (a$ be necessar$ an& proper to carr$ into effect the provisions of the ADR Act. Ar'+,*e 2.0. %unctions of the #ADR. +he ?ADR shall have the followin) functions* "a# +o pro(ote, &evelop an& e5pan& the use of ADR in the private an& public sectors throu)h infor(ation, e&ucation an& co((unication*

"b# +o (onitor, stu&$ an& evaluate the use of ADR b$ the private an& public sectors for purposes of, a(on) others, polic$ for(ulation* "c# +o reco((en& to 'on)ress nee&ful statutor$ chan)es to &evelop, stren)then an& i(prove ADR practices in accor&ance with international professional stan&ar&s* "&# +o (ake stu&ies on an& provi&e linka)es for the &evelop(ent, i(ple(entation, (onitorin) an& evaluation of )overn(ent an& private ADR pro)ra(s an& secure infor(ation about their respective a&(inistrative rules7proce&ures, proble(s encountere& an& how the$ were resolve&* "e# +o co(pile an& publish a list or roster of ADR provi&ers7practitioners, who have un&er)one trainin) b$ the ?ADR, or b$ such trainin) provi&ers7institutions reco)ni1e& or certifie& b$ the ?ADR as perfor(in) functions in an$ ADR s$ste(. +he list or roster shall inclu&e the a&&resses, contact nu(bers, e4(ail a&&resses, ADR service7s ren&ere& "e.). arbitration, (e&iation# an& e5perience in ADR of the ADR provi&ers7practitioners* "f# +o co(pile a list or roster of forei)n or international ADR provi&ers7practitioners. +he list or roster shall inclu&e the a&&resses, contact nu(bers, e4(ail a&&resses, ADR service7s ren&ere& "e.). arbitration, (e&iation# an& e5perience in ADR of the ADR provi&ers7practitioners* an& ")# +o perfor( such other functions as (a$ be assi)ne& to it. Ar'+,*e 2.4. Di isions of the #ADR. +he ?ADR shall have the followin) staff an& service &ivisions, a(on) others2

"a# Se,re'ar+a' B shall provi&e necessar$ support an& &ischar)e such other functions an& &uties as (a$ be &irecte& b$ the 65ecutive Director. "b# P64*+, +.!"r2a'+". a./ Pr"2"'+". D+5+s+". B shall be char)e& with the &isse(ination of infor(ation, the pro(otion of the i(portance an& public acceptance of (e&iation, conciliation, arbitration or an$ co(bination thereof an& other ADR for(s as a (eans of achievin) spee&$ an& efficient (eans of resolvin) all &isputes an& to help in the pro(otion, &evelop(ent an& e5pansion of the use of ADR. "c# Tra+.+.7 D+5+s+". B shall be char)e& with the for(ulation of effective stan&ar&s for the trainin) of ADR practitioners* con&uct of trainin) in accor&ance with such stan&ar&s* issuance of certifications of trainin) to ADR practitioners an& ADR service provi&ers who have un&er)one the professional trainin) provi&e& b$ the ?ADR* an& the coor&ination of the &evelop(ent, i(ple(entation, (onitorin) an& evaluation of )overn(ent an& private sector ADR pro)ra(s. "&# Re,"r/s a./ L+4rar- D+5+s+". B shall be char)e& with the establish(ent an& (aintenance of a central repositor$ of ADR laws, rules an& re)ulations, 3urispru&ence, books, articles, an& other infor(ation about ADR in the /hilippines an& elsewhere. RULE 2 ) The A/5+s"r- C"6.,+* Ar'+,*e 2.$. Composition of the Ad isory Council. +here is also create& an A&visor$ 'ouncil co(pose& of a representative fro( each of the followin)2 "a# <e&iation profession* "b# Arbitration profession*

"c# ADR or)ani1ations* "&# ,0/* an& "e# Aca&e(e. +he (e(bers of the 'ouncil, who shall be appointe& b$ the Secretar$ of %ustice upon the reco((en&ation of the ?ADR 65ecutive Director, shall choose a 'hair(an fro( a(on) the(selves. Ar'+,*e 2.3. Role of the Ad isory Council. +he A&visor$ 'ouncil shall a&vise the 65ecutive Director on polic$, operational an& other relevant (atters. +he 'ouncil shall (eet re)ularl$, at least once ever$ two "2# (onths, or upon call b$ the 65ecutive Director. CHAPTER 0 MEDIATION RULE ( ) Ge.era* Pr"5+s+".s Ar'+,*e 0.(. Scope of Application. +hese Rules appl$ to voluntar$ (e&iation, whether ad hoc or institutional, other than court4anne5e& (e&iation an& onl$ in &efault of an a)ree(ent of the parties on the applicable rules. +hese Rules shall also appl$ to all cases pen&in) before an a&(inistrative or =uasi43u&icial a)enc$ that are subse=uentl$ a)ree& upon b$ the parties to be referre& to (e&iation. Ar'+,*e 0.2. Statement of Policy. ,n appl$in) an& construin) the provisions of these Rules, consi&eration (ust be )iven to the nee& to pro(ote can&or of parties an& (e&iators throu)h confi&entialit$ of the (e&iation process, the polic$ of fosterin) pro(pt, econo(ical an& a(icable resolution of &isputes in accor&ance with principles of inte)rit$ of &eter(ination b$ the parties an& the polic$ that the &ecision4(akin) authorit$ in the (e&iation process rests with the parties.

A part$ (a$ petition a court before which an action is pre(aturel$ brou)ht in a (atter which is the sub3ect of a (e&iation a)ree(ent, if at least one part$ so re=uests, not later than the pre4trial conference or upon the re=uest of both parties thereafter, to refer the parties to (e&iation in accor&ance with the a)ree(ent of the parties. RULE 21 Se*e,'+". "! a Me/+a'"r Ar'+,*e 0.0. %reedom to Select mediator. +he parties have the free&o( to select (e&iator. +he parties (a$ re=uest the ?ADR to provi&e the( with a list or roster or the resu(es of its certifie& (e&iators. +he ?ADR (a$ be re=ueste& to infor( the (e&iator of his7her selection. Ar'+,*e 0.4. Replacement of &ediator. ,f the (e&iator selecte& is unable to act as such for an$ reason, the parties (a$, upon bein) infor(e& of such fact, select another (e&iator. Ar'+,*e 0.$. Refusal or 'ithdra$al of &ediator. A (e&iator (a$ refuse fro( actin) as such, with&raw or (a$ be co(pelle& to with&raw fro( (e&iator procee&in)s un&er the followin) circu(stances2 "a# ,f an$ of the parties so re=uests the (e&iator to with&raw* "b# +he (e&iator &oes not have the =ualifications, trainin) an& e5perience to enable hi(7her to (eet the reasonable e5pectations of the parties* "c# @here the (e&iatorCs i(partiall$ is in =uestion* "&# ,f continuation of the process woul& violate an$ ethical stan&ar&s* "e# ,f the safet$ of an$ of the parties woul& be 3eopar&i1e&* "f# ,f the (e&iator is unable to provi&e effective services*

")# ,n case of conflict of interest* an& "h# ,n an$ of the followin) instances, if the (e&iator is satisfie& that2 "i# one or (ore of the parties is7are not actin) in )oo& faith* "ii# the partiesC a)ree(ent woul& be ille)al or involve the co((ission of a cri(e* "iii# continuin) the &ispute resolution woul& )ive rise to an appearance of i(propriet$* "iv# continuin) with the process woul& cause si)nificant har( to a non4participatin) person or to the public* or "v# continuin) &iscussion woul& not be in the best interest of the parties, their (inor chil&ren or the &ispute resolution process. RULE 0 ) E'h+,a* C"./6,' "! a Me/+a'"r Ar'+,*e 0.3 Competence. ,t is not re=uire& that a (e&iator shall have special =ualifications b$ back)roun& or profession unless the special =ualifications of a (e&iator shall 2 "a# (aintain the continuall$ up)ra&e his7her professional co(petence in (e&iation skills* "b# ensure that his7her =ualifications, trainin) an& e5perience are known to an& accepte& b$ the parties* an& "c# serve onl$ when his7her =ualifications, trainin) an& e5perience enable hi(7her to (eet the reasonable e5pectations of the parties

an& shall not hol& hi(self7herself out or )ive the i(pression that he7she &oes not have. >pon the re=uest of a (e&iation part$, an in&ivi&ual who is re=ueste& to serve as (e&iator shall &isclose his7her =ualifications to (e&iate a &ispute. Ar'+,*e 0.9 (mpartially. A (e&iator shall (aintain i(partialit$. "a# 0efore acceptin) a (e&iation, an in&ivi&ual who is re=ueste& to serve as a (e&iator shall2 "i# (ake an in=uir$ that is reasonable un&er the circu(stances to &eter(ine whether there are known facts that a reasonable in&ivi&ual woul& consi&er likel$ to affect the i(partialit$ of the (e&iator, inclu&in) a financial or personal interest in the outco(e of the (e&iation an& an$ e5istin) or past relationship with a part$ of foreseeable participant in the (e&iation* an& "ii# &isclose to the (e&iation parties an$ such fact known or learne& as soon as practical before acceptin) a (e&iation. "b# ,f a (e&iator learns an$ fact &escribe& in para)raph "a# of this Article after acceptin) a (e&iation, the (e&iator shall &isclose it as soon as practicable to the (e&iation parties. Ar'+,*e 0.8. Confidentiality. A (e&iator shall keep in ut(ost confi&ence all confi&ential infor(ation obtaine& in the course of the (e&iation process. A (e&iator shall &iscuss issues of confi&entialit$ an& the e5tent of confi&entialit$ provi&e& in an$ private sessions or caucuses that the (e&iator hol&s with a part$.

10

Ar'+,*e 0.9. Consent and Self-Determination. "a# A (e&iator shall (ake reasonable efforts to ensure that each part$ un&erstan&s the nature an& character of the (e&iation procee&in) inclu&in) private caucuses, the issues, the available options, the alternatives to non4settle(ent, an& that each part$ is free an& able to (ake whatever choices he7she &esires re)ar&in) participation in (e&iation )enerall$ an& re)ar&in) specific settle(ent options. ,f a (e&iator believes that a part$, who is not represente& b$ counsel, is unable to un&erstan&, or full$ participate, the (e&iation procee&in)s for an$ reason, a (e&iator (a$ either2 "i# li(it the scope of the (e&iation procee&in)s in a (anner consistent with the part$Cs abilit$ to participate, an&7or reco((en& that the part$ obtain appropriate assistance in or&er to continue with the process* or "ii# ter(inate the (e&iation procee&in)s. "b# A (e&iator shall reco)ni1e an& put in (in& that the pri(ar$ responsibilit$ of resolvin) a &ispute an& the shapin) of a voluntar$ an& uncoerce& settle(ent rests with the parties. Ar'+,*e 0.(0. Separation of &ediation from Counseling and Legal Ad ice. "a# 65cept in evaluative (e&iation or when the parties so re=uest, a (e&iator shall2 "i# refrain fro( )ivin) le)al or technical a&vice an& otherwise en)a)in) in counselin) or a&vocac$* an& "ii# abstain fro( e5pressin) his7her personal opinion on the ri)hts an& &uties of the parties an& the (erits of an$ proposal (a&e. "b# @here appropriate an& where either or both parties are not represente& b$ counsel, a (e&iator shall*

"i# reco((en& that the parties seek outsi&e professional a&vice to help the( (ake infor(e& &ecision an& to un&erstan& the i(plication of an$ proposal* an& "ii# su))est that the parties seek in&epen&ent le)al an&7or technical a&vice before a settle(ent a)ree(ent is si)ne&. "c# without the consent of al parties, an& for a reasonable ti(e un&er the particular circu(stance, a (e&iator who also practices another profession shall not establish a professional relationship in that other profession with one of the parties, or an$ person or entit$, in a substantiall$ an& factuall$ relate& (atter. Ar'+,*e 0.((. Charging of %ees. "a# A (e&iator shall full$ &isclose an& e5plain to the parties the basis of cost, fees an& char)es. "b# +he (e&iator who with&raws fro( the (e&iation shall return to the parties an$ unearne& fee an& unuse& &eposit. "c# A (e&iator shall not enter into a fee a)ree(ent, which is contin)ent upon the results of the (e&iation or the a(ount of the settle(ent. Ar'+,*e 0.(2 Promotion of Respect and Control of Abuse of Process. +he (e&iatorcle 8.92 /ro(otion of Respect an& 'ontrol of Abuse of /rocess. of the settle (entcost ablish a professional relationship , shall encoura)e (utual respect between the parties, an& shall take reasonable steps, sub3ect to the principle of self4&eter(ination, to li(it abuses of the (e&iation process. Ar'+,*e 0.(0. Solicitation or Acceptance of any )ift. No (e&iator or an$ (e(ber of a (e&iatorDs i((e&iate fa(il$ or his7her a)ent shall re=uest, solicit, receive or accept an$ )ift or an$ t$pe of co(pensation other than the a)ree& fee an& e5penses in connection with an$ (atter co(in) before the (e&iator.

11

RULE 4 ) R"*e "! Par'+es a./ 'he+r C"6.se*s Ar'+,*e 0.(4. Designation of Counsel or Any Person to Assist &ediation. 65cept as otherwise provi&e& b$ the ADR Act or b$ these Rules, a part$ (a$ &esi)nate a law$er or an$ other person to provi&e assistance in the (e&iation. A waiver of this ri)ht shall be (a&e in writin) b$ the part$ waivin) it. A waiver of participation or le)al representation (a$ be rescin&e& at an$ ti(e. Ar'+,*e 0.($. Role of Counsel. "a# +he law$er shall view his7her role in the (e&iation as a collaborator with the other law$er in workin) to)ether towar& the co((on )oal of helpin) their clients resolve their &ifferences to their (utual a&vanta)e. "b# +he law$er shall encoura)e an& assist his7her client to activel$ participate in positive &iscussions an& cooperate in craftin) an a)ree(ent to resolve their &ispute. "c# +he law$er (ust assist his7her client to co(prehen& an& appreciate the (e&iation process an& its benefits, as well as the clientDs )reater personal responsibilit$ for the success of (e&iation in resolvin) the &ispute. "&# ,n preparin) for participation in (e&iation, the law$er shall confer an& &iscuss with his7her client the followin)2 "i# +he (e&iation process as essentiall$ a ne)otiation between the parties assiste& b$ their respective law$ers, an& facilitate& b$ a (e&iator, stressin) it its &ifference fro( liti)ation, its a&vanta)es an& benefits, the clients hei)htene& role in (e&iation an& responsibilit$ for its success an& e5plainin) the role of the law$er in (e&iation procee&in)s, "ii# +he substance of the upco(in) (e&iation such as*

"aa# +he substantive issues involve& in the &ispute an& their prioriti1ation in ter(s of i(portance to his7her clientDs real interests an& nee&s. "bb# +he stu&$ of other part$Ds position in relation to the issues with a view to un&erstan&in) the un&erl$in) interests, fears, concerns an& nee&s* "cc# +he infor(ation or facts to be )athere& or sou)ht fro( the other si&e or to be e5chan)e& that are necessar$ for infor(e& &ecision4(akin)* "&&# +he possible options for settle(ent but stressin) the nee& to be open4(in&e& about other possibilities* an& "ee# +he best, worst an& (ost likel$ alternative to a non4ne)otiate& settle(ent. Ar'+,*e 0.(3. #ther &atters $hich the Counsel shall do to Assist &ediation. +he law$er* "a# shall )ive support to the (e&iator so that his7her client will full$ un&erstan& the rules an& processes of (e&iation* "b# shall i(press upon his7her client the i(portance of speakin) for hi(self7herself an& takin) responsibilit$ for (akin) &ecisions &urin) the ne)otiations within the (e&iation process.* "c# (a$ ask for a recess in or&er to )ive a&vice or su))estions to his7her client in private, if he7she perceives that his7her client is unable to bar)ain effectivel$* "&# shall assist his7her client an& the (e&iator put in writin) the ter(s of the settle(ent a)ree(ent that the parties have entere& into. +hat law$ers shall see to it that the ter(s of the settle(ent

12

a)ree(ent are not contrar$ to law, (orals, )oo& custo(s, public or&er or public polic$. RULE $ ) C"./6,' "! Me/+a'+".

"e# +he (e&iation procee&in) shall be hel& in private. /erson, other than the parties, their representatives an& (e&iator, (a$ atten& onl$ with the consent of all the parties, "f# the (e&iation shall be close&2

Ar'+,*e 0.(9. Articles to be Considered in the Conduct of &ediation. "a# +he (e&iator shall not (ake untruthful or e5a))erate& clai(s about the &ispute resolution process, its costs an& benefits, its outco(e or the (e&iatorDs =ualifications an& abilities &urin) the entire (e&iation process. "b# +he (e&iator shall hel& the parties reach a satisfactor$ resolution to their &ispute but has no authorit$ to i(pose a settle(ent on the parties. "c# +he parties shall personall$ appear for (e&iation an& (a$ be assiste& b$ a law$er. A part$ (a$be represente& b$ an a)ent who (ust have full authorit$ to ne)otiate an& settle the &ispute. "&# +he (e&iation process shall, in )eneral, consists of the followin) sta)es2 "i# openin) state(ent of the (e&iator "ii# in&ivi&ual narration b$ the parties* "iii# e5chan)e b$ the parties* "iv# su((ar$ of issues* "v# )eneration an& evaluation of options* an& "vi# closure

"i# b$ the e5ecution of a settle(ent a)ree(ent b$ the parties* "ii# b$ the with&rawal of an$ part$ fro( (e&iation* an& "iii# b$ the written &eclaration of the (e&iator that an$ further effort at (e&iation woul& not be helpful RULE 3 ) P*a,e "! Me/+a'+". Ar'+,*e 0.(8. Agreement of Parties on the Place of &ediation. +he parties are free to a)ree on the place of (e&iation. ;ailin) such a)ree(ent, the place of (e&iation shall be an$ place convenient an& appropriate to all parties. RULE 9 ) E!!e,' "! A7ree2e.' '" S642+' D+s&6'e '" Me/+a'+". U./er I.s'+'6'+".a* R6*es Ar'+,*e 0.(9 Agreement to Submit a Dispute to &ediation by an (nstitution. An a)ree(ent to sub(it a &ispute to (e&iation b$ an institution shall inclu&e an a)ree(ent to be boun& b$ the internal (e&iation an& a&(inistrative policies of such institution. ;urther, an a)ree(ent to sub(it a &ispute to (e&iation un&er institutional (e&iation rules shall be &ee(e& to inclu&e an a)ree(ent to have such rules )overn the (e&iation of the &ispute an& for the (e&iator, the parties, their respective counsels an& non4part$ participants to abi&e b$ such rules. RULE 8 ) E.!"r,e2e.' "! Me/+a'e/ Se''*e2e.' A7ree2e.'

13

Ar'+,*e 0.20. #perati e Principles to )uide &ediation. +he (e&iation shall be )ui&e& b$ the followin) operative principles2 "a# A settle(ent a)ree(ent followin) successful (e&iation shall be prepare& b$ the parties with the assistance of their respective counsels. ,f an$, an& b$ the (e&iator. +he parties an& their respective counsels shall en&eavor to (ake the ter(s an& con&ition of the settle(ent a)ree(ent co(plete an& to (ake a&e=uate provision for the contin)enc$ of breach to avoi& conflictin) interpretations of the a)ree(ent. "b# +he parties an& their respective counsels, if an$, shall si)n the settle(ent a)ree(ent. +he (e&iator shall certif$ that he7she e5plaine& the contents of the settle(ent a)ree(ent to the parties in a lan)ua)e known to the(. "c# ,f the parties a)ree, the settle(ent a)ree(ent (a$ be 3ointl$ &eposite& b$ the parties or &eposite& b$ one part$ with prior notice to the other part$7ties with the 'lerk of 'ourt of the Re)ional +rial 'ourt "a# where the principal place of business in the /hilippines of an$ of the parties is locate&* "b# if an$ of the parties is an in&ivi&ual, where an$ of those in&ivi&uals resi&es* or "c# in the National 'apital %u&icial Re)ion. @here there is a nee& to enforce the settle(ent a)ree(ent, a petition (a$ be file& b$ an$ of the parties with the sa(e court in which case, the court shall procee& su((aril$ to hear the petition, in accor&ance with the Special ADR Rules. "&# +he parties (a$ a)ree in the settle(ent a)ree(ent that the (e&iator shall beco(e a sole arbitrator for the &ispute an& shall treat the settle(ent a)ree(ent as an arbitral awar& which shall be sub3ect to enforce(ent un&er Republic Act No. 8:E, otherwise know as "+he Arbitration -aw", notwithstan&in) the provisions of 65ecutive ?r&er No. 9 8, s. 9985, other wise known as the "'onstruction ,n&ustr$ Arbitration -aw" for (e&iate& &isputes outsi&e the 'onstruction ,n&ustr$ Arbitration 'o((ission.

RULE 9 ) C".!+/e.'+a*+'- "! I.!"r2a'+". Ar'+,*e 0.2(. Confidentiality of (nformation. ,nfor(ation obtaine& throu)h (e&iation procee&in)s shall be sub3ect to the followin) principles an& )ui&elines2 "a# ,nfor(ation obtaine& throu)h (e&iation shall be privile)e& an& confi&ential "b# A part$, (e&iator, or non4part$ participant (a$ refuse to &isclose an& (a$ prevent an$ other person fro( &isclosin) a confi&ential infor(ation. "c# 'onfi&ential infor(ation shall not be sub3ect to &iscover$ an& shall be ina&(issible in an$ a&versarial procee&in), whether 3u&icial or =uasi43u&icial. Fowever, evi&ence or infor(ation that is otherwise a&(issible or sub3ect to &iscover$ &oes not beco(e ina&(issible or protecte& fro( &iscover$ solel$ b$ reason of its use in a (e&iation. "&# ,n such an a&versarial procee&in), the followin) persons involve& or previousl$ involve& in a (e&iation (a$ not be co(pelle& to &isclose& confi&ential infor(ation obtaine& &urin) the (e&iation2 "i# the parties to the &ispute* "ii# the (e&iator or (e&iators* "iii# the counsel for the parties* "iv# the non4part$ participants "v# an$ person hire& or en)a)e& in connection with the (e&iation as secretar$, steno)rapher, clerk or assistant* an&

14

"vi# an$ other person who obtains or possesses confi&ential infor(ation b$ reason of his7her profession. "e# +he protections of the ADR Act shall continue to appl$ even if a (e&iator is foun& to have faile& to act i(partiall$. "f# A (e&iator (a$ not be calle& to testif$ to provi&e confi&ential infor(ation )athere& in (e&iation. A (e&iator who is wron)full$ subpoenae& shall be rei(burse& the full cost of his7her attorne$Ds fees an& relate& e5penses. Ar'+,*e 0.22. 'ai er of Confidentiality. "a# A privile)e arisin) fro( the confi&entialit$ of infor(ation (a$ be waive& in a recor& or orall$ &urin) a procee&in) b$ the (e&iator an& the (e&iation parties. "b# @ith the consent of the (e&iation parties, a privile)e arisin) fro( the confi&entialit$ of infor(ation (a$ likewise be waive& b$ a non4part$ participant if the infor(ation is provi&e& b$ such non4part$ participant. "c# A person who &iscloses confi&ential infor(ation shall be preclu&e& fro( assertin) the privile)e un&er Article 8.29 "'onfi&entialit$ of ,nfor(ation# to bar &isclosure of the rest of the infor(ation necessar$ to a co(plete un&erstan&in) of the previousl$ &isclose& infor(ation. ,f a person suffers loss or &a(a)e as a result of the &isclosure of the confi&ential infor(ation, he7she shall be entitle& to &a(a)es in a 3u&icial procee&in) a)ainst the person who (a&e the &isclosure. "&# A person who &iscloses or (akes a representation about a (e&iation is preclu&e& fro( assertin) the privile)e (entione& in Article 8.29 to the e5tent that the co((unication pre3u&ices another person in the procee&in) an& it is necessar$ for the person pre3u&ice& to respon& to the representation or &isclosure.

Ar'+,*e 0.20. Exceptions to the Pri ilege of Confidentiality of information. "a# +here is no privile)e a)ainst &isclosure un&er Article 8.29 in the followin) instances2 "i# in an a)ree(ent evi&ence& b$ a recor& authenticate& b$ all parties to the a)ree(ent* "ii# available to the public or (a&e &urin) a session of a (e&iation which is open, or is re=uire& b$ law to be open, to the public* "iii# a threat or state(ent of a plan to inflict bo&il$ in3ur$ or co((it a cri(e of violence* "iv# intentionall$ use& to plan a cri(e, atte(pt to co((it, or co((it a cri(e, or conceal an on)oin) cri(e or cri(inal activit$. "v# sou)ht or offere& to prove or &isprove abuse, ne)lect, aban&on(ent or e5ploitation in a procee&in) in which a public a)enc$ is protectin) the interest of an in&ivi&ual protecte& b$ law* but this e5ception &oes not appl$ where a chil& protection (atter is referre& to (e&iation b$ a court or where a public a)enc$ participates in the chil& protection (e&iation* "vi# sou)ht or offere& to prove or &isapprove a clai( or co(plaint of professional (iscon&uct or (alpractice file& a)ainst a part$, non4part$ participant, or representative of a part$ base& on con&uct occurrin) &urin) a (e&iation. "b# ,f a court or a&(inistrative a)enc$ fin&s, after a hearin) in ca(era, that the part$ seekin) &iscover$ of the proponent of the evi&ence has shown that the evi&ence is not otherwise available, that there is a nee& for the evi&ence that substantiall$ outwei)hs

15

the interest in protectin) confi&entiall$, an& the (e&iation co((unication is sou)ht or offere& in2 "i# a court procee&in) involvin) a cri(e or felon$* or "ii# a procee&in) to prove a clai( or &efense that un&er the law is sufficient to refor( or avoi& a liabilit$ on a contract arisin) out of the (e&iation. "c# A (e&iator (a$ not be co(pelle& to provi&e evi&ence of a (e&iation co((unication or testif$ in such procee&in). "&# ,f a (e&iation co((unication is not privile)e& un&er an e5ception in sub4section "a# or "b# hereof, onl$ the portion of the co((unication necessar$ for the application of the e5ception for non4&isclosure (a$ be a&(itte&. +he a&(ission of a particular evi&ence for the li(ite& purpose of an e5ception &oes not ren&er that evi&ence, or an$ other (e&iation co((unication, a&(issible for an$ other purpose. Ar'+,*e 0.24. *on-Reporting or Communication by &ediator. A (e&iator (a$ not (ake a report, assess(ent, evaluation, reco((en&ation, fin&in) or other co((unication re)ar&in) a (e&iation to a court or a)enc$ or other authorit$ that (a$ (ake a rulin) on a &ispute that is the sub3ect of a (e&iation, e5cept2 "a# to state that the (e&iation occurre& or has ter(inate&, or where a settle(ent was reache&* or "b# as per(itte& to be &isclose& un&er Article 8.28 "65ception to the /rivile)e of 'onfi&entialit$ of ,nfor(ation#. +he parties (a$, b$ an a)ree(ent in writin), stipulate that the settle(ent a)ree(ent shall be seale& an& not &isclose& to an$ thir& part$ inclu&in) the court. Such stipulation, however, shall not appl$ to a procee&in) to enforce or set asi&e the settle(ent a)ree(ent.

RULE (0 ) Fees a./ C"s' "! Me/+a'+". Ar'+,*e 0.2$. %ees and Cost of Ad hoc &ediation. ,n a& hoc (e&iation, the parties are free to (ake their own arran)e(ent as to (e&iation cost an& fees. ,n &efault thereof, the sche&ule of cost an& fees to be approve& b$ the ?ADR shall be followe&. Ar'+,*e 0.23. %ees and Cost of (nstitutional &ediation. "a# ,n institutional (e&iation, (e&iation cost shall inclu&e the a&(inistrative char)es of the (e&iation institution un&er which the parties have a)ree& to be boun&, (e&iatorDs fees an& associate& e5penses, if an$. ,n &efault of a)ree(ent of the parties as to the a(ount an& (anner of pa$(ent of (e&iationDs cost an& fees, the sa(e shall be &eter(ine& in accor&ance with the applicable internal rules of the (e&iation service provi&ers un&er whose rules the (e&iation is con&ucte&. "b# A (e&iation service provi&er (a$ &eter(ine such (e&iation fee as is reasonable takin) into consi&eration the followin) factors, a(on) others2 "i# the co(ple5it$ of the case* "ii# the nu(ber of hours spent in (e&iation* an& "iii# the trainin), e5perience an& stature of (e&iators. CHAPTER 4 INTERNATIONAL COMMERCIAL AR:ITRATION RULE ( ) Ge.era* Pr"5+s+".s Ar'+,*e 4.(. Scope of Application. "a# +his 'hapter applies to international co((ercial arbitration, sub3ect to an$ a)ree(ent in force between the /hilippines an& other state or states.

16

"b# +his 'hapter applies onl$ if the place or seat of arbitration is the /hilippines an& in &efault of an$ a)ree(ent of the parties on the applicable rules. "c# +his 'hapter shall not affect an$ other law of the /hilippines b$ virtue of which certain &isputes (a$ not be sub(itte& to arbitration or (a$ be sub(itte& to arbitration onl$ accor&in) to provisions other than those of the ADR Act. Ar'+,*e 4.2. Rules of (nterpretation. "a# ,nternational co((ercial arbitration shall be )overne& b$ the <o&el -aw on ,nternational 'o((ercial Arbitration. "b# ,n interpretin) this 'hapter, re)ar& shall be ha& to the international ori)in of the <o&el -aw an& to the nee& for unifor(it$ in its interpretation. Resort (a$ be (a&e to the tra aux preparatoires an& the Report of the Secretar$4.eneral of the >nite& Nations 'o((ission on ,nternational +ra&e -aw &ate& <arch 9985 entitle&, ",nternational 'o((ercial Arbitration2 Anal$tical 'o((entar$ on Draft +e5t i&entifie& b$ reference nu(ber A7'N. 972E!". "c# <oreover, in interpretin) this 'hapter, the court shall have &ue re)ar& to the polic$ of the law in favor of arbitration an& the polic$ of the /hilippines to activel$ pro(ote part$ autono($ in the resolution of &isputes or the free&o( of the parties to (ake their own arran)e(ent to resolve their &ispute. "&# @here a provision of this 'hapter, e5cept the Rules applicable to the substance of the &ispute, leaves the parties free to &eter(ine a certain issue, such free&o( inclu&es the ri)ht of the parties to authori1e a thir& part$, inclu&in) an institution, to (ake that &eter(ination. "e# @here a provision of this 'hapter refers to the fact that the parties have a)ree& or that the$ (a$ a)ree or in an$ other wa$

refers to an a)ree(ent of the parties, such a)ree(ent inclu&es an$ arbitration rules referre& to in that a)ree(ent. "f# @here a provision of this 'hapter, other than in para)raph "a# of Article !.25 "Default of a /art$# an& para)raphs "b# "i# of Article !.82 "+er(ination of /rocee&in)s#, refers to a clai(, it also applies to a counter4clai(, an& where it refers to a &efense, it also applies to a &efense to such counter4clai(. Ar'+,*e 4.0. Receipt of 'ritten Communications. "a# >nless otherwise a)ree& b$ the parties2 "i# an$ written co((unication is &ee(e& to have been receive& if it is &elivere& to the a&&ressee personall$ or at his7her place of business, habitual resi&ence or (ailin) a&&ress* if none of these can be foun& after (akin) a reasonable in=uir$, a written co((unication is &ee(e& to have been receive& if it is sent to the a&&resseeDs last known place of business, habitual resi&ence or (ailin) a&&ress b$ re)istere& letter or an$ other (eans which provi&es a recor& of the atte(pt to &eliver it* "ii# the co((unication is &ee(e& to have been receive& on the &a$ it is so &elivere&. "b# +he provisions of this Article &o not appl$ to co((unications in court procee&in)s, which shall be )overne& b$ the Rules of 'ourt. Ar'+,*e 4.4. 'ai er of Right to #b+ect. An$ part$ who knows that an$ provision of this 'hapter fro( which the parties (a$ &ero)ate or an$ re=uire(ent un&er the arbitration a)ree(ent has not been co(plie& with an& $et procee&s with the arbitration without statin) the ob3ections for such non4co(pliance without un&ue &ela$ or if a ti(e li(it is provi&e& therefor, within such perio& of ti(e, shall be &ee(e& to have waive& the ri)ht to ob3ect.

17

Ar'+,*e 4.$. Extent of Court (nter ention. ,n (atters )overne& b$ this 'hapter, no court shall intervene e5cept where so provi&e& in the ADR Act. Resort to /hilippine courts for (atters within the scope of the ADR Act shall be )overne& b$ the Special ADR Rules. Ar'+,*e 4.3. Court or #ther Authority for Certain %unctions of Arbitration Assistance and Super ision. "a# +he functions referre& to in para)raphs "c# an& "&# of Article !.99 "Appoint(ent of Arbitrators# an& para)raph "c# of Article !.98 "'hallen)e /roce&ure# an& para)raph "a# of Article !.9! ";ailure or ,(possibilit$ to Act# shall be perfor(e& b$ the appointin) authorit$ as &efine& in Article 9.E '9, unless the latter shall fail or refuse to act within thirt$ "8 # &a$s fro( receipt of the re=uest in which case the applicant (a$ renew the application with the court. +he appoint(ent of an arbitrator is not sub3ect to appeal or (otion for reconsi&eration. "b# +he functions referre& to in para)raph "c# of Article !.9E "c# "'o(petence of Arbitral +ribunal to Rule on its %uris&iction#, secon& para)raph of Article !.8! "Application for Settin) Asi&e an 65clusive Recourse A)ainst Arbitral Awar&#, Article !.85 "Reco)nition an& 6nforce(ent#, Article !.88 "Genue an& %uris&iction#, shall be perfor(e& b$ the appropriate Re)ional +rial 'ourt. "c# A 'ourt (a$ not refuse to )rant, i(ple(ent or enforce a petition for an interi( (easure, inclu&in) those provi&e& for in Article !.9 "Arbitration A)ree(ent an& ,nteri( <easures b$ 'ourt#, Article !. 99 "Appoint(ent of Arbitrators#, Article !.98 "'hallen)e /roce&ure#, Article !,2: "'ourt Assistance in +akin) 6vi&ence#, on the sole )roun& that the /etition is (erel$ an ancillar$ relief an& the principal action is pen&in) with the arbitral tribunal. RULE 21 Ar4+'ra'+". A7ree2e.'

Ar'+,*e 4.9 Definition and %orm of Arbitration Agreement. +he Arbitration a)ree(ent, as &efine& in Articles 9.E A!, shall be in writin). An a)ree(ent is in writin) if it is containe& in a &ocu(ent si)ne& b$ the parties or in an e5chan)e of letters, tele5, tele)ra(s or other (eans of teleco((unication which provi&e a recor& of the a)ree(ent, or in an e5chan)e of state(ents of clai( an& &efense in which the e5istence of an a)ree(ent, or in an e5chan)e of state(ents of clai( an& &efense in which the e5istence of an a)ree(ent is alle)e& b$ one part$ an& not &enie& b$ another. +he reference in a contract to a &ocu(ent containin) an arbitration clause constitutes an arbitration a)ree(ent provi&e& that the contracts is writin) an& the reference is such as to (ake that clause part of the contract. Ar'+,*e 4.8 Arbitration Agreement and Substanti e Claim ,efore Court. "a# A court before which an action is brou)ht in a (atter which is the sub3ect of an arbitration a)ree(ent shall, if at least one part$ so re=uests of both parties thereafter, refer the parties to arbitration unless it fin&s that the arbitration a)ree(ent is null an& voi&, inoperative or incapable of bein) perfor(e&. "b# @here an action referre& to in the previous para)raph has been brou)ht , arbitral procee&in)s (a$ nevertheless be co((ence& or continue&, an& an awar& (a$ be (a&e, while the issue is pen&in) before the court. "c# @here the action is co((ence& b$ or a)ainst (ultiple parties, one or (ore of who( are parties to an arbitration a)ree(ent, the court shall refer to arbitration those parties who are boun& b$ the arbitration a)ree(ent althou)h the civil action (a$ continue as to those who are not boun& b$ such arbitration a)ree(ent. Ar'+,*e 4.9 Arbitration Agreement and (nterim &easures by Court. "a# ,t is not inco(patible with an arbitration a)ree(ent for a part$ to re=uest fro( a court, before the constitution of the arbitral tribunal or &urin) arbitral procee&in)s, an interi( (easure of protection an& for a court to )rant such (easure.

18

"b# +o the e5tent that the arbitral tribunal has no power to act or is unable to act effectivel$, a re=uest for interi( (easure of protection, or (o&ification thereof as provi&e& for, an& in the (anner in&icate& in , Article !.9: "/ower of +ribunal to ?r&er ,nteri( <easures #, (a$ be (a&e with the court. +he rules of interi( or provisional relief provi&e& for in para)raph " c # of Article !.9: of these Rules shall be observe&. A part$ (a$ brin) a petition un&er this Article before the court in accor&ance with the Rules of 'ourt or the Special ADR Rules. RULE 0 ) C"2&"s+'+". "! Ar4+'ra* Tr+46.a* Ar'+,*e 4.(0 *umber of Arbitrators. +he parties are free to &eter(ine the nu(ber of arbitrators ;ailin) such &eter(ination, the nu(ber of arbitrators shall be three "8#. Ar'+,*e 4.((. Appointment of Arbitrators. "a# No person shall be pro&uce& b$ reason of his7her nationalit$ fro( actin) as an arbitrator, unless otherwise a)ree& b$ the parties. "b# +he parties are free to a)ree on a proce&ure of appointin) the arbitrator or arbitrators, sub3ect to provisions of para)raphs "&# an& "e# of this Article. "c# ;ailin) such a)ree(ent2 "i# in an arbitration with three "8 # arbitrators, each part$ shall appoint one arbitrator, an& the two "2# arbitrators thus appointe& shall appoint the thir& arbitrator* if an$ part$ fails to appoint the arbitrator within thirt$ "8 # &a$s of receipt of a re=uest to &o so fro( the other part$, or if the two "2# arbitrators fail to a)ree on the thir& arbitrator within thirt$ &a$s "8 # &a$s of their appoint(ent shall be (a&e, upon re=uest of a part$, b$ the appointin) authorit$*

"ii# in an arbitration with a sole arbitrator, if the parties are unable to a)ree on the arbitrator, he7she shall be appointe&, upon re=uest of a part$, b$ the appointin) authorit$. "&# @here, un&er an appoint(ent proce&ure a)ree& upon the parties, "i# a part$ fails to act as re=uire& un&er such proce&ure, or "ii# the parties , or two arbitrators, are unable to reach an a)ree(ent e5pecte& of the( un&er such proce&ure, or "iii# a thir& part$, inclu&in) an institution, fails to perfor( an$ function entruste& to it un&er such proce&ure, An$ part$ (a$ re=uest the appointin) authorit$ to take the necessar$ (easure to appoint an arbitrator, unless the a)ree(ent on the appoint(ent proce&ure provi&es other (eans for securin) the appoint(ent. "e# A &ecision on a (atter entruste& b$ para)raphs "c# an& "&# of this to the appointin) authorit$ shall be i((e&iate e5ecutor$ an& not be sub3ect to a (otion for reconsi&eration or appeal. +he appointin) authorit$ shall have in appointin) an arbitrator, &ue re)ar& to an$ =ualifications re=uire& of the arbitrator b$ the a)ree(ent of the parties an& to such consi&erations as are likel$ to secure the appoint(ent of an in&epen&ent an& i(partial arbitrator an&, in the case of a sole or thir& arbitrator , shall take into account as well the a&visabilit$ of appointin) an arbitrator of a nationalit$ other than the Rules of 'ourt of the Special ADR Rules. Ar'+,*e 4.(2 )rounds for Challenge. "a# @hen a person is approache& in connection with his7her possible appoint(ent as an arbitrator, he7she i(partialit$ or in&epen&ence. An arbitrator, fro( the ti(e of his7her

19

appoint(ent an& throu)hout the arbitral procee&in)s shall, without &ela$, &isclose an$ such circu(stance to the parties unless the$ have alrea&$ been infor(e& of the( hi(7her. "b# An arbitrator (a$ be challen)e& onl$ if circu(stances e5ist that )ive rise to 3ustifiable &oubts as to his7her i(partialit$ or in&epen&ence, or if he7she &oes not possess =ualifications a)ree& to b$ the parties. A part$ (a$ challen)e an arbitrator appointe& b$ hi(7her, or in whose appoint(ent he7she has participate&, onl$ for reasons of which he7she beco(es aware after the appoint(ent has been (a&e. Ar'+,*e 4.(0. Challenge Procedure. "a# +he parties are free to a)ree on a proce&ure for challen)in) an arbitrator, sub3ect to the provisions of this Article. "b# ;ailin) such a)ree(ent, a part$ who inten&s to challen)e an arbitrator shall, within fifteen "95# &a$s after beco(in) aware of the constitution of the arbitral tribunal or after beco(in) aware of an$ circu(stances referre& to in para)raph "b# of Article !.92 ".roun&s for 'hallen)e,# sen& a written state(ent of the reasons for the challen)e to the arbitral tribunal. >nless the challen)e& arbitrator with&raws fro( his7her office or the other part$ a)rees to the challen)e& arbitrator with&raws fro( his7her office or the part$ a)rees to the challen)e, the arbitral tribunal shall &eci&e on the challen)e. "c# ,f a challen)e un&er an$ proce&ure a)ree& upon b$ the parties or un&er the proce&ure of para)raph "b# of this Article is not successful, the challen)in) part$ (a$ re=uest the appointin) authorit$, within thirt$ "8 # &a$s after havin) receive& notice of the &ecision re3ectin) the challen)e, to &eci&e on the challen)e, which &ecision shall be i((e&iatel$ e5ecutor$ an& not sub3ect to (otion for reconsi&eration or appeal. @hile such a re=uest is pen&in), the arbitral tribunal, inclu&in) the challen)e& arbitrator, (a$ continue the arbitral procee&in)s an& (ake an awar&.

A part$ (a$ brin) a petition un&er this Article before the court in accor&ance with the Rules of 'ourt or the Special ADR Rules. Ar'+,*e 4.(4. Fa+*6re "r I2&"ss+4+*+'- '" A,'. "a# ,f an arbitrator beco(es de +ure or de facto unable to perfor( his7her functions or for other reasons fails to act without un&ue &ela$, his7her (an&ate ter(inates if he7she with&raws fro( his7her office or if the parties a)ree on the ter(ination. ?therwise, if the controvers$ re(ains concernin) an$ of these )roun&s, an$ part$ (a$ re=uest the appointin) authorit$ to &eci&e on the ter(ination of the (an&ate, which &ecision shall be i((e&iatel$ e5ecutor$ an& not sub3ect for (otion for reconsi&eration or appeal. "b# ,f, un&er this Article or para)raph "b# of Article !.98 "'hallen)e /roce&ure#, an arbitrator with&raws fro( his7her office or a part$ a)rees for ter(ination of the (an&ate of an arbitrator, this &oes not i(pl$ acceptance of the vali&it$ of an$ )roun& referre& to in this Article or in para)raph "b# of Article !.92 ")rounds for Challenge#. Ar'+,*e 4.($. A&&"+.'2e.' "! S64s'+'6'e Ar4+'ra'"r. @here the (an&ate of an arbitrator ter(inates un&er Articles !.98 "'hallen)e /roce&ure# an& !.9! ";ailure or ,(possibilit$ to Act# or because of his7her with&rawal fro( office for an$ other reason or because of the revocation of his7her (an&ate, a substitute arbitrator shall be appointe& accor&in) to the rules that were applicable to the appoint(ent of the arbitrator bein) replace&. RULE 4 ) ?6r+s/+,'+". "! Ar4+'ra* Tr+46.a* Ar'+,*e 4.(3. C"2&e'e.,e "! Ar4+'ra* Tr+46.a* '" R6*e ". +'s ?6r+s/+,'+".. "a# +he arbitral tribunal (a$ rule on its own 3uris&iction, inclu&in) an$ ob3ections with respect to the e5istence or vali&it$ of the arbitration a)ree(ent or an$ con&ition prece&ent to the filin) of the re=uest for arbitration. ;or that purpose, an arbitration clause, which for(s part of a contract shall be treate& as an a)ree(ent in&epen&ent of the other ter(s of the contract. A &ecision b$ the arbitral tribunal that the

20

contract is null an& voi& shall not entail ipso +ure the invali&it$ of the arbitration clause. "b# A plea that the arbitral tribunal &oes not have 3uris&iction shall be raise& not later than the sub(ission of the state(ent of &efense ",.e., in an Answer or <otion to Dis(iss#. A part$ is not preclu&e& fro( raisin) such plea b$ the fact that he7she has appointe&, or participate& in the appoint(ent of, an arbitrator. A plea that the arbitral tribunal is e5cee&in) the scope of its authorit$ shall be raise& as soon as the (atter alle)e& to be be$on& the scope of its authorit$ is raise& &urin) the arbitral procee&in)s. +he arbitral tribunal (a$, in either case, a&(it a later plea if it consi&ers the &ela$ 3ustifie&. "c# +he arbitral tribunal (a$ rule on a plea referre& to in para)raph "b# of this Article either as a preli(inar$ =uestion or in an awar& on the (erits. ,f the arbitral tribunal rules as a preli(inar$ =uestion that it has 3uris&iction, an$ part$ (a$ re=uest, within thirt$ "8 # &a$s after havin) receive& notice of that rulin), the Re)ional +rial 'ourt to &eci&e the (atter, which &ecision shall be i((e&iatel$ e5ecutor$ an& not sub3ect to (otion for reconsi&eration or appeal. @hile such a re=uest is pen&in), the arbitral tribunal (a$ contribute the arbitral procee&in)s an& (ake an awar&. Ar'+,*e 4.(9. P"8er "! Ar4+'ra* Tr+46.a* '" Or/er I.'er+2 Meas6res. "a# >nless otherwise a)ree& b$ the parties, the arbitral tribunal (a$, at the re=uest of the part$, or&er an$ part$ to take such interi( (easures of protection as the arbitral tribunal (a$ consi&er necessar$ in respect of the sub3ect to (atter of the &ispute followin) para)raph "c# of this Article. Such interi( (easures (a$ inclu&e, but shall not be li(ite& to, preli(inar$ in3unction &irecte& a)ainst a part$, appoint(ent of receivers, or &etention, preservation, inspection of propert$ that is the sub3ect of the &ispute in arbitration.

"b# After constitution of the arbitral tribunal, an& &urin) arbitral procee&in), a re=uest for interi( (easures of protection, or (o&ification thereof shall be (a&e with the arbitral tribunal. +he arbitral tribunal is &ee(e& constitute& when the sole arbitrator or the thir& arbitrator, who has been no(inate&, has accepte& the no(ination an& written co((unication of sai& no(ination an& acceptance has been receive& b$ the part$ (akin) the re=uest. "c# +he followin) rules on interi( or provisional relief shall be observe&2 "i# An$ part$ (a$ re=uest that the interi( or provisional relief shall be observe&2 "ii# Such relief (a$ be )rante&2 "aa# +o prevent irreparable loss or in3ur$* "bb# +o provi&e securit$ for the perfor(ance of an obli)ation* "cc# +o pro&uce or preserve evi&ence "&&# +o co(pel an$ other appropriate acts or o(issions. "iii# +he or&er )rantin) provisional relief (a$ be con&itione& upon the provision of securit$ or an$ act or o(ission specifie& in or&er. "iv# ,nteri( or provisional relief is re=ueste& b$ written application trans(itte& b$ reasonable (eans to the arbitral tribunal an& the part$ a)ainst who( relief is sou)ht, &escribin) in appropriate &etails of the precise relief, the part$ a)ainst who( the relief is re=ueste&, the )roun& for the relief, an& the evi&ence, supportin) the re=uest.

21

"v# +he or&er )rantin) or &en$in) an application for the interi( relief shall be bin&in) upon the parties. "vi# 6ither part$ (a$ appl$ with the court for assistance in i(ple(entin) or enforcin) an interi( (easure or&ere& b$ an arbitral tribunal. "vii# A part$ who &oes not co(pl$ with the or&er shall be liable for all &a(a)es, resultin) fro( nonco(pliance, inclu&in) all e5penses, an& reasonable attorne$Cs fees, pai& in obtainin) the or&erCs 3u&icial enforce(ent. RULE $ ) C"./6,' "! Ar4+'ra* Pr",ee/+.7s Ar'+,*e 4.(8. E-ual "reatment of Parties. +he parties shall be treate& with e=ualit$ an& each shall be )iven a full opportunit$ of presentin) his7her case. Ar'+,*e 4.(9. Determination of the Rules of Procedure. "a# Sub3ect to the provisions of this 'hapter, the parties are free to a)ree on the proce&ure to be followe& b$ the arbitral tribunal in con&uctin) the procee&in)s. "b# ;allin) such a)ree(ent, the arbitral tribunal (a$, sub3ect to this 'hapter, con&uct the arbitration in such (anner as it consi&ers appropriate. >nless the arbitral tribunal consi&ers it inappropriate, the >N',+RA- Arbitration Rules a&opte& b$ the >N',+RA- on 28 April 99:E an& the >N .eneral Asse(ble on 95 Dece(ber 99:E shall appl$ sub3ect to the followin) clarification2 All references to the "Secretar$4.eneral of the /er(anent 'ourt of Arbitration at the Fa)ue" shall be &ee(e& to refer to the appointin) authorit$. "c# +he power conferre& upon the arbitral tribunal inclu&es the power to &eter(ine the a&(issibilit$, relevance, (aterialit$ an& wei)ht of an$ evi&ence.

Ar'+,*e 4.20. P*a,e "! Ar4+'ra'+".. #a# +he parties are free to a)ree on the place of arbitration. ;ailin) such a)ree(ent, the place of arbitration shall be in <etro <anila unless the arbitral tribunal, havin) re)ar& to the circu(stances of the case, inclu&in) the convenience of the parties, shall &eci&e on a &ifferent place of arbitration. "b# Notwithstan&in) the rule state& in para)raph "a# of this provision, the arbitral tribunal (a$, unless otherwise a)ree& b$ the parties, (eet at an$ place it consi&ers appropriate for consultation a(on) its (e(bers, for hearin) witnesses, e5perts or the parties, or for inspection of )oo&s, other propert$ or &ocu(ents. Ar'+,*e 4.2(. C"22e.,e2e.' "! Ar4+'ra* Pr",ee/+.7s. >nless otherwise a)ree& b$ the parties, the arbitral procee&in)s in respect of a particular &ispute co((ence on the &ate on which a re=uest for that &ispute to be referre& to arbitration is receive& b$ the respon&ent. Ar'+,*e 4.22. La.76a7e. "a# +he parties are free to a)ree on the lan)ua)e or lan)ua)es to be use& in the arbitral procee&in)s. ;ailin) such a)ree(ent, the lan)ua)e to be use& shall be 6n)lish. +his a)ree(ent, unless otherwise specifie& therein, shall appl$ to an$ written state(ent b$ a part$, an$ hearin) an& an$ awar&, &ecision or other co((unication b$ the arbitral tribunal. "b# +he arbitral tribunal (a$ or&er that an$ &ocu(entar$ evi&ence shall be acco(panie& b$ a translation into the lan)ua)e or lan)ua)es a)ree& upon b$ the parties or &eter(ine& b$ the arbitral tribunal in accor&ance with para)raph "a# of this Article. Ar'+,*e 4.20 S'a'e2e.'s "! C*a+2 a./ De!e.se. "a# @ithin the perio& of ti(e a)ree& b$ the parties or &eter(ine& b$ the arbitral tribunal, the clai(ant shall state the facts supportin) his7her7its clai(, the points at issue an& the relief or re(e&$ sou)ht, an& the respon&ent shall state his7her7its &efense in respect of these particulars, unless the parties have otherwise a)ree& as to the re=uire& ele(ents of such state(ents. +he

22

parties (a$ sub(it with their state(ents, all &ocu(ents the$ consi&er to be relevant or (a$ a&& a reference to the &ocu(ents or other evi&ence the$ will sub(it. "b# >nless otherwise a)ree& b$ the parties, either part$ (a$ a(en& or supple(ent his7her clai( or &efense &urin) the course of the arbitral procee&in)s, unless the arbitral tribunal consi&ers it inappropriate to allow such a(en&(ent havin) re)ar& to the &ela$ in (akin) it. Ar'+,*e 4.24 Hear+.7 a./ Wr+''e. Pr",ee/+.7s. "a# Sub3ect to an$ contrar$ a)ree(ent b$ the parties, the arbitral tribunal shall &eci&e whether to hol& oral hearin)s for the presentation of evi&ence or for oral ar)u(ent, or whether the procee&in)s shall be con&ucte& on the basis of &ocu(ents an& other (aterials. Fowever, unless the parties have a)ree& that no hearin)s at an appropriate sta)e of the procee&in)s, if so re=ueste& b$ a part$. "b# +he parties shall be )iven sufficient a&vance notice of an$ hearin) an& of an$ (eetin) of the arbitral tribunal for the purposes of inspection )oo&s, other propert$ or &ocu(ents. "c# All state(ents, &ocu(ents or other infor(ation supplie& to the arbitral b$ one part$ shall be co((unicate& to the other part$. Also, an e5pert report or evi&entiar$ &ocu(ent on which the arbitral tribunal (a$ rel$ in (akin) its &ecision shall be co((unicate& to the parties. Ar'+,*e 4.2$ De!a6*' "! a Par'-. >nless otherwise a)ree& b$ the parties, if, without, showin) sufficient cause, "a# the clai(ant fails to co((unicate his state(ent of clai( in accor&ance with para)raph "a# Article !.28 "Statement of Claim and Defense#, the arbitral tribunal shall ter(inate the procee&in)s*

"b# the respon&ent fails to co((unicate his7her7its state(ent of &efense in accor&ance with para)raph "a# Article !.28 "Statement of Claim and Defense#, the arbitral tribunal shall continue the procee&in)s without treatin) such failure in itself as an a&(ission of the clai(antDs alle)ations. "c# an$ part$Ds fails to appear at a hearin) or to pro&uce &ocu(entar$ evi&ence, the arbitral tribunal (a$ continue the procee&in)s an& (ake the awar& on the evi&ence before it. Ar'+,*e 4.23. E;&er' A&&"+.'e/ 4- 'he Ar4+'ra* Tr+46.a*. >nless otherwise a)ree& b$ the parties, the arbitral tribunal, "a# (a$ appoint one or (ore e5perts to report to it on specific issues to be &eter(ine& b$ the arbitral tribunal* or "b# (a$ re=uire a part$ to )ive the e5pert an$ relevant infor(ation or to pro&uce, or to provi&e access to, an$ relevant &ocu(ents, )oo&s or other propert$ for his7her inspection. >nless otherwise a)ree& b$ the parties, if a part$ so re=uests or if the arbitral tribunal consi&ers it necessar$, the e5pert shall, after &eliver$ of his7her written or oral report, participate in a hearin) where the parties have the opportunit$ to put =uestions to hi( an& to present e5pert witnesses in or&er to testif$ on the points at issue. Ar'+,*e 4.29. C"6r' Ass+s'a.,e +. Ta=+.7 E5+/e.,e. +he arbitral tribunal or a part$ with the approval of the arbitral tribunal (a$ re=uest fro( a court of the /hilippines assistance in takin) evi&ence. +he court (a$ e5ecute the re=uest within its co(petence an& accor&in) to its rules on takin) evi&ence. +he arbitral tribunal shall have the power to re=uire an$ person to atten& a hearin) as a witness. +he arbitral tribunal shall have the power to subpoena witnesses an& &ocu(ents when the relevanc$ of the testi(on$ an& the (aterialit$ thereof has been &e(onstrate& to it. +he arbitral

23

tribunal (a$ also re=uire the retire(ent of an$ witness &urin) the testi(on$ of an$ other witness. A part$ (a$ brin) a petition un&er this Section before the court in accor&ance with the Rules of 'ourt or the Special ADR Rules. Ar'+,*e 4.28. R6*es A&&*+,a4*e '" 'he S64s'a.,e "! D+s&6'e. "a# +he arbitral tribunal shall &eci&e the &ispute in accor&ance with such rules of law as are chosen b$ the parties as applicable to the substance of the &ispute. An$ &esi)nation of the law or le)al s$ste( of a )iven state shall be construe&, unless otherwise e5presse&, as &irectl$ referrin) to the substantive law of that state an& not its conflict of laws rules. "b# ;ailin) an$ &esi)nation b$ the parties, the arbitral tribunal shall appl$ the law &eter(ine& b$ the conflict of laws rules, which it consi&ers applicable. "c# +he arbitral tribunal shall &eci&e ex ae-uo et bono or as amiable compositeur onl$ if the parties have e5pressl$ authori1e& it to &o so. "&# ,n all cases, the arbitral tribunal shall &eci&e in accor&ance with the ter(s of the contract an& shall take into account the usa)es of the tra&e applicable to the transaction. Ar'+,*e 4.29. De,+s+".1Ma=+.7 4- Pa.e* "! Ar4+'ra'"rs. ,n arbitral procee&in)s with (ore than one arbitrator, an$ &ecision of the arbitral tribunal shall be (a&e, unless otherwise a)ree& b$ other parties, b$ a (a3orit$ of all its (e(bers. Fowever, =uestions of proce&ure (a$ be &eci&e& b$ a presi&in) arbitrator , if so authori1e& b$ the parties or all (e(bers of the arbitral tribunal. Ar'+,*e 4.00. Se''*e2e.'. ,f, &urin) arbitral procee&in)s, the parties settle the &ispute, the arbitral tribunal shall ter(inate the procee&in)s an&, if re=ueste& b$ the parties an& not ob3ecte& to b$ the arbitral tribunal, recor& the settle(ent in the for( of an arbitral awar& on a)ree& ter(s.

An awar& on a)ree& ter(s shall be (a&e in accor&ance with the provisions of Article !.89 "%orm and Contents of A$ard#, an& shall state that it is an awar&. Such an awar& has the sa(e status an& effect as an$ other awar& on the (erits of the case. Ar'+,*e 4.0(. F"r2 a./ C".'e.'s "! A8ar/. "a# +he awar& shall be (a&e in writin) an& shall be si)ne& b$ the arbitrator or arbitrators. ,n arbitral procee&in)s with (ore than one arbitrator, the si)natures of the (a3orit$ of all (e(bers of the arbitral tribunal shall suffice, provi&e& that the reason for an$ o(itte& si)nature is state&. "b# +he awar& shall state the reasons upon which it is base&, unless the parties have a)ree& that no reasons are to be )iven or the awar& is an awar& on a)ree& ter(s un&er para)raph "a# of Article !.2 "/lace of Arbitration#. "c# +he awar& shall state its &ate an& the place of arbitration as &eter(ine& in accor&ance with para)raph "a# of this Article. +he awar& shall be &ee(e& to have been (a&e at that place. "&# After the awar& is (a&e, a cop$ si)ne& b$ the arbitrators in accor&ance with para)raph "a# of this Article shall be &elivere&. to each part$. Ar'+,*e 4.02. "ermination of Proceedings. "a# +he arbitral procee&in)s are ter(inate& b$ the final awar& or b$ an or&er of the arbitral tribunal in accor&ance with para)raph "b# of this Article. "b# +he arbitral tribunal shall issue an or&er for the ter(ination of the arbitral procee&in)s when2 "i# +he clai(ant with&raws his7her7its clai(, unless the respon&ent ob3ects thereto an& the arbitral tribunal reco)ni1e& a le)iti(ate interest on his7her7its part in obtainin) a final settle(ent of the &ispute* "ii# +he parties a)ree the ter(ination of the procee&in)s*

24

"iii# +he arbitral tribunal fin&s that the continuation of the procee&in)s has for an$ other reason beco(e unnecessar$ or i(possible. "c# +he (an&ate of the arbitral tribunal en&s with ter(ination of the arbitral procee&in)s sub3ect to the provisions of Articles !.88 "'orrection an& ,nterpretation of Awar&, A&&itional Awar&# an& para)raph "&# of Articles !.8! "Application for Settin) Asi&e an 65clusive Recourse a)ainst Arbitral Awar&#. "&# Notwithstan&in) the fore)oin), the arbitral tribunal (a$, for special reasons, reserve in the final awar& or or&er, a hearin) to =uantit$ costs an& &eter(ine which part$ shall bear the costs or the &ivision thereof as (a$ be &eter(ine& to be e=uitable. /en&in) &eter(ination of this issue, the awar& shall not be &ee(e& final for purposes of appeal ,vacation, correction, or an$ post4awar& procee&in)s. Ar'+,*e 4.00. Correction and (nterpretation of A$ard. Additional A$ard. "a# @ithin thirt$ "8 # &a$s fro( receipt of the awar&, unless another perio& of ti(e has been a)ree& upon b$ the parties2 "i# A part$ (a$, with notice to the other part$, re=uest the arbitral tribunal to correct in the awar& an$ errors in co(putation, an$ clerical or t$po)raphical errors or an$ errors of si(ilar nature* "ii# A part$ (a$, it so a)ree& b$ the parties an& with notice to the other part$, re=uest the arbitral tribunal to )ive an interpretation of a specific point or part of the awar&. "b# ,f the arbitral tribunal consi&ers the re=uest to be 3ustifie&, ,t shall (ake the correction or )ive the interpretation within thirt$ "8 # &a$s fro( receipt of the re=uest. +he interpretation shall for( part of the awar&.

"c# +he arbitral tribunal (a$ correct an$ error of the t$pe referre& to in para)raph "a# of this Article on its own initiative within thirt$ "8 # &a$ fro( the &ate of the awar& "&# >nless otherwise a)ree& b$ the parties, a part$ (a$, with notice to the other part$, re=uest, within thirt$ "8 # &a$s receipt of the awar&, the arbitral tribunal to (ake an a&&itional awar& as to clai(s presente& in the arbitral procee&in)s but o(itte& fro( the awar&. ,f the arbitral tribunal consi&ers the re=uest to be 3ustifie&, it shall (ake the a&&itional awar& within si5t$ "E # &a$s "e# +he arbitral tribunal (a$ e5ten&, if necessar$, the perio& of ti(e within which it shall (ake a correction interpretation or an a&&itional awar& un&er para)raphs "a# an& "b# of this Article. "f# +he provisions of Article !.89 ";or( an& 'ontents of Awar&# shall appl$ to a correction or interpretation of the awar& or to an a&&itional awar&. Ar'+,*e 4.04. Aplication for Setting Aside an Exclusi e Recourse against Arbitral A$ard. "a# Recourse to a court a)ainst an arbitral awar& (a$ be (a&e onl$ b$ application for settin) asi&e in accor&ance with secon& an& thir& para)raphs of this Article. "b# An arbitral awar& (a$ be set asi&e b$ the Re)ional +rial 'ourt onl$ ,f2 "i# the part$ (akin) the application furnishes proof that2 "aa# a part$ to the arbitration a)ree(ent was un&er so(e incapacit$ * or the sai& a)ree(ent is not vali& un&er the law to which the parties have sub3ecte& it or, failin) an$ in&ication thereon, un&er the law of the /hilippines* or

25

"bb# the part$ (akin) the application was not )iven proper notice of the appoint(ent of an arbitrator or of the arbitral procee&in)s or was otherwise unable to present his case* or "cc# the awar& &eals with a &ispute not conte(plate& b$ or not failin) within the ter(s of the sub(ission to arbitration, or contains, &ecisions on (atters be$on& the scope of the sub(ission to arbitration, provi&e& that, if the &ecisions on (atters sub(itte& to arbitration can be separate& fro( those not so sub(itte&, onl$ the part of the awar& which contains &ecisions on (atters not sub(itte& to arbitration (a$ be set asi&e* or "&&# the co(position of the arbitral tribunal or the arbitral proce&ure was not in accor&ance with the a)ree(ent of the parties, unless such a)ree(ent was in conflict with a provision of ADR Act fro( which the parties cannot &ero)ate, or, fallin) such a)ree(ent, was not in accor&ance with ADR Act* or "ii# the 'ourt fin&s that2 "aa# the sub3ect4(atter of the &ispute is not capable of settle(ent b$ arbitration un&er the law of the /hilippines* or "bb# the awar& is in conflict with the public polic$ of the /hilippines. "c# An application for settin) asi&e (a$ not be (a&e after three (onths have elapse& fro( the &ate on which the part$ (akin) that application ha& receive& the awar& or, ,f a re=uest ha& been (a&e un&er Article !.88 "'orrection an& ,nterpretation of Awar&,

A&&itional Awar&# fro( the &ate on which that re=uest has been &ispose& of b$ the Arbitral tribunal "&# +he court, when aske& to set asi&e an awar&, (a$, where appropriate an& so re=ueste& b$ a part$, suspen& the settin) asi&e procee&in)s for a perio& of ti(e &eter(ine& b$ it in or&er to )ive the arbitral tribunal an opportunit$ resu(e the arbitral procee&in)s or take such other action as in the arbitral tribunalCs opinion will eli(inate the )roun&s for settin) asi&e. "e# A part$ (a$ brin) a petition un&er this Article before the court in accor&ance with the Special ADR Rules. RULE 3 ) Re,"7.+'+". a./ E.!"r,e2e.' "! A8ar/s Ar'+,*e 4.0$. Recognition and Enforcement. "a# A forei)n arbitral awar& shall be reco)ni1e& as bin&in) an&, upon petition in writin) to the re)ional trial 'ourt, shall be enforce& sub3ect to the provisions of this Article an& of Article !.8E ".roun&s for Refusin) Reco)nition or 6nforce(ent#. "b# +he petition for reco)nition an& enforce(ent of such arbitral awar&s shall be fille& with the Re)ional trial 'ourt ,n accor&ance with Special ADR Rules. "i# 'onvention Awar& 4 +he New Aork 'onvention shall )overn the reco)nition an& enforce(ent of arbitral awar&s covere& b$ sai& 'onvention. +he petitioner shall establish that the countr$ in which the forei)n arbitration awar& was (a&e is a part$ to the New Aork 'onvention "ii# Non4'onvention Awar& B +he reco)nition an& enforce(ent of forei)n arbitral awar&s not covere& b$ the New Aork 'onvention shall be &one in accor&ance with proce&ural rules to be pro(ul)ate& b$ the Supre(e 'ourt. +he court (a$, on )roun&s of co(it$ an& reciprocit$,

26

reco)ni1e an& enforce a non4convention awar& as a convention awar&. "c# +he part$ rel$in) on an awar& or appl$in) for its enforce(ent shall file with the Re)ional +rial 'ourt the ori)inal or &ul$ authenticate& cop$ of the awar& an& the ori)inal arbitration a)ree(ent or a &ul$ authenticate& cop$ thereof. ,f the awar& or a)ree(ent is not (a&e in an official lan)ua)e of the /hilippines, the part$ shall suppl$ a &ul$ certifie& translation thereof into such lan)ua)e. "&# A forei)n arbitral awar& when confir(e& b$ a court of a forei)n countr$, shall be reco)ni1e& an& enforce& as a forei)n arbitral awar& an& not as a 3u&)(ent of a forei)n court. "e# A forei)n arbitral awar& when confir(e& b$ the Re)ional +rial 'ourt, shall be enforce& in the sa(e (anner as final an& e5ecutor$ &ecisions of courts of law of the /hilippines. "f# ,f the Re)ional +rial 'ourt has reco)ni1e& the arbitral awar& but an application for re3ection an&7or# suspension of enforce(ent of that awar& is subse=uentl$ (a&e, the Re)ional +rial 'ourt (a$, if it consi&ers the application to be proper, vacate or suspen& the &ecision to enforce that awar& an& (a$ also, on the application of the part$ clai(in) reco)nition or enforce(ent of that awar&, or&er the other part$ seekin) re3ection or suspension to provi&e appropriate securit$. Ar'+,*e 4.03. )rounds for Refusing Recognition or Enforcement. A CONVENTION AWARD. Reco)nition or enforce(ent of an arbitral awar&, (a&e in a state, which is a part$ to the New Aork 'onvention, (a$ be refuse&, at the re=uest of the part$ a)ainst who( it is provoke&, onl$ if the part$ furnishes to the Re)ional +rial 'ourt proof that2

"a# +he parties to the arbitration a)ree(ent are, un&er the law applicable to the(, un&er so(e incapacit$* or the sai& a)ree(ent is not vali& un&er the law to which the parties have sub3ecte& it or* failin) an$ in&ication thereon, un&er the law of the countr$ where the awar& was (a&e* or "b# the part$ a)ainst who( the awar& is invoke& was not )iven proper notice of the appoint(ent of an arbitrator or of the arbitral procee&in)s or was otherwise in able to present his case* or "c# the awar& &eals with &ispute not conte(plate& b$ or not failin) within the ter(s of the sub(ission to arbitration, or it contains &ecisions on (atters be$on& the scope of the sub(ission to arbitration* provi&e& that, if the &ecisions on (atters sub(itte& to arbitration can be separate& fro( those not so sub(itte&, that part of the awar& which contains &ecisions on (atters sub(itte& to arbitration (a$ be reco)ni1e& an& enforce&* or "&# the co(position of the arbitral tribunal or the arbitral proce&ure was not in accor&ance with the a)ree(ent of the parties or, failin) such a)ree(ent, was not in accor&ance with the law of the countr$ where the arbitration too place* or "e# the awar& has not beco(e bin&in) on the parties or has been set asi&e or suspen&e& b$ a court of the countr$ in which, or un&er the law of which, that awar& was (a&e. Reco)nition an& enforce(ent of an arbitral awar& (a$ also be refuse& if the Re)ional +rial 'ourt where reco)nition an& enforce(ent is sou)ht fin&s that2 "a# the sub3ect4(atter of the &ispute is not capable of settle(ent b$ arbitration un&er the law of /hilippines* or "b# the reco)nition or enforce(ent of the awar& woul& be contrar$ to the public polic$ of the /hilippines.

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A part$ to a forei)n arbitration procee&in) (a$ oppose an application for reco)nition an& enforce(ent of the arbitral awar& in accor&ance with the Special ADR Rules onl$ on the )roun&s enu(erate& un&er para)raph "a# an& "c# of Article !.85 "Recognition and Enforcement#. An$ other )roun& raise& shall be &isre)ar&e& b$ the Re)ional +rial 'ourt. :. NON1CONVENTION AWARD. "a# A forei)n arbitral awar& ren&ere& in a state which is not a part$ to the New Aork 'onvention will be reco)ni1e& upon proof of the e5istence of co(it$ an& reciprocit$ an& (a$ be treate& as a convention awar&. ,f not so treate& an& if no co(it$ or reciprocit$ e5ists, the non4convention awar& cannot be reco)ni1e& an&7or enforce& but (a$ be &ee(e& as presu(ptive evi&ence of a ri)ht as between the parties in accor&ance with Section !8 of the Rules of 'ourt. "b# ,f the Re)ional +rial 'ourt has reco)ni1e& the arbitral awar& but a petition for suspension of enforce(ent of that awar& is subse=uentl$ (a&e, the Re)ional +rial 'ourt (a$, if it consi&ers the petition to be proper, suspen& the procee&in)s to enforce the awar&, an& (a$ also, on the application of the part$ clai(in) reco)nition or enforce(ent of that awar&, or&er the other part$ seekin) suspension to provi&e appropriate securit$. "c# ,f the petition for reco)nition or enforce(ent of the arbitral awar& is file& b$ a part$ an& a counter4petition for the re3ection of the arbitral awar& is file& b$ the other part$, the Re)ional +rial 'ourt (a$, if it consi&ers the counter4petition to be proper but the ob3ections thereto (a$ be rectifie& or cure&, re(it the awar& to the arbitral tribunal for appropriate action an& in the (eanti(e suspen& the reco)nition an& enforce(ent procee&in)s an& (a$ also on the application of the petitioner or&er the counter4 petitioner to provi&e appropriate securit$.

Ar'+,*e 4.09. Appeal from Court Decision on Arbitral A$ards. A &ecision of the Re)ional +rial 'ourt reco)ni1in), enforcin), vacatin) or settin) asi&e an arbitral awar& (a$ be appeale& to the 'ourt of Appeals in accor&ance with the rules of proce&ure to be pro(ul)ate& b$ the Supre(e 'ourt. +he losin) part$ who appeals fro( the 3u&)(ent of the court reco)ni1in) an& enforcin) an arbitral awar& shall be re=uire& b$ the 'ourt of Appeals to post a counter4bon& e5ecute& if favor of the prevailin) part$ e=ual to the a(ount of the awar& in accor&ance with the Special ADR Rules. An$ stipulation b$ the parties that the arbitral tribunalDs awar& or &ecision shall be final, an& therefore not appealable, is vali&. Such stipulation carries with it a waiver of the ri)ht to appeal fro( an arbitral awar& but without pre3u&ice to 3u&icial review b$ wa$ of certiorari un&er Rule E5 of the Rules of 'ourt. Ar'+,*e 4.08. /enue and 0urisdiction. /rocee&in)s for reco)nition an& enforce(ent of an arbitration a)ree(ent or for vacation or settin) asi&e of an arbitral awar&, an& an$ application with a court for arbitration assistance an& supervision, e5cept appeal, shall be &ee(e& as special procee&in)s an& shall be file& with the Re)ional +rial 'ourt where2 "a# the arbitration procee&in)s are con&ucte&* "b# where the asset to be attache& or levie& upon, or the act to be en3oine& is locate&* "c# where an$ of the parties to the &ispute resi&es or has its place of business* or "&# in the National 'apital %u&icial Re)ion at the option of the applicant. Ar'+,*e 4.09. *otice of Proceedings to Parties. ,n a special procee&in) for reco)nition an& enforce(ent of an arbitral awar&, the court shall sen&

28

notice to the parties at their a&&ress of recor& in the arbitration, or if an$ part$ cannot be serve& notice at such a&&ress, at such part$Ds last known a&&ress. +he notice shall be sent at least fifteen "95# &a$s before the &ate set for the initial hearin) of the application. Ar'+,*e 4.40. Legal Representation in (nternational Commercial Arbitration. ,n international co((ercial arbitration con&ucte& in the /hilippines, a part$ (a$ be represente& b$ an$ person of his7her choice2 /rovi&e&, that such representative, unless a&(itte& to the practice of law in the /hilippines, shall not be authori1e& to appear as counsel in an$ /hilippine court or an$ other =uasi43u&icial bo&$ whether or not such appearance is in relation to the arbitration in which he7she appears. Ar'+,*e 4.4(. Confidentially of Arbitration Proceedings. +he arbitration procee&in)s, inclu&in) the recor&s, evi&ence an& the arbitral awar&, shall be consi&ere& confi&ential an& shall not be poolsi&e e5cept2 "a# with the consent of the parties* or "b# for the li(ite& purpose of &isclosin) to the court relevant &ocu(ents in cases where resort to the court is allowe& herein. /rovi&e&, however, that the court in which the action or the appeal is pen&in) (a$ issue a protective or&er to prevent or prohibit &isclosure of &ocu(ents or infor(ation containin) secret processes, &evelop(ents, research an& other infor(ation where it is shown that the applicant shall be (ateriall$ pre3u&ice& b$ an authori1e& &isclosure thereof. Ar'+,*e 4.42. Summary nature of proceedings before the court. A petition for reco)nition an& enforce(ent of awar&s brou)ht before the court shall be hear& an& &ealt with su((aril$ in accor&ance with the Special ADR Rules. Ar'+,*e 4.40. Death of a Party. @here a part$ &ies after (akin) a sub(ission or a contract to arbitrate as prescribe& in these Rules, the procee&in)s (a$ be be)un or continue& upon the application of, or notice

to, his7her e5ecutor or a&(inistrator, or te(porar$ a&(inistrator of his7her estate. ,n an$ such case, the court (a$ issue an or&er e5ten&in) the ti(e within which notice of a (otion to reco)ni1e or vacate an awar& (ust be serve&. >pon reco)ni1in) an awar&, where a part$ has &ie& since it was file& or &elivere&, the court (ust enter 3u&)e(ent in the na(e of the ori)inal part$* an& the procee&in)s thereupon are the sa(e as where a part$ &ies after a ver&ict. Ar'+,*e 4.44. &ulti-Party Arbitration. @hen a sin)le arbitration involves (ore than two parties, the fore)oin) rules, to the e5tent possible, shall be use&, sub3ect to such (o&ifications consistent with this 'hapter as the arbitral tribunal shall &ee( appropriate to a&&ress possible co(ple5ities of a (ulti4part$ arbitration. Ar'+,*e 4.4$. Consolidation of Proceedings and Concurrent 1earings. B +he parties an& the arbitral tribunal (a$ a)ree B "a# that the arbitration procee&in)s shall be consoli&ate& with other arbitration procee&in)s* or "b# that concurrent hearin)s shall be hel&, on such ter(s as (a$ be a)ree&. >nless the parties a)ree to confer such power on the arbitral tribunal, the tribunal has no power to or&er consoli&ation of arbitration procee&in)s or concurrent hearin)s. Ar'+,*e 4.43. Costs. "a# +he arbitral tribunal shall fi5 the costs of arbitration in its awar&. +he ter( "costs" inclu&e onl$2 "i# +he fees of the arbitral tribunal to be state& separatel$ as to each arbitrator an& to be fi5e& b$ the tribunal itself in accor&ance with the para)raph "b# of this Article* "ii# +he travel an& other e5penses incurre& b$ the arbitrators*

29

"iii# +he costs of e5pert a&vice an& of other assistance re=uire& b$ the arbitral tribunal* "iv# +he travel an& other e5penses of witnesses to the e5tent such e5penses are approve& b$ the arbitral tribunal* "v# +he costs for le)al representation an& assistance of the successful part$ if such costs were clai(e& &urin) the arbitral procee&in)s, an& onl$ to the e5tent that the arbitral tribunal &eter(ines that the a(ount of such costs is reasonable* "v9# An$ fees an& e5penses of the appointin) authorit$. "b# +he fees of the arbitral tribunal shall be reasonable in a(ount, takin) into account the a(ount in &ispute, the co(ple5it$ of the sub3ect (atter, the ti(e spent b$ the arbitrators an& an$ other relevant circu(stances of the case. ,f an appointin) authorit$ has been a)ree& upon b$ the parties an& if such authorit$ has issue& a sche&ule of fees for arbitrators in international cases which it a&(inisters, the arbitral tribunal in fi5in) its fees shall take that sche&ule of fees into account to the e5tent that it consi&ers appropriate in the circu(stances of the case. ,f such appointin) authorit$ has not issue& a sche&ule of fees for arbitrators in international cases, an$ part$ (a$, at an$ ti(e re=uest the appointin) authorit$ to furnish a state(ent settin) forth the basis for establishin) fees which is custo(aril$ followe& in international cases in which the authorit$ appoints arbitrators. ,f the appointin) authorit$ consents to provi&e such a state(ent, the arbitral tribunal, in fi5in) its fees, shall take such infor(ation into account to the e5tent that it consi&ers appropriate in the circu(stances of the case. "c# ,n cases referre& to in the secon& an& thir& sub4para)raphs of para)raph "b# of this Article, when a part$ so re=uests an& the

appointin) authorit$ consents to perfor( the function, the arbitral tribunal shall fi5 its fees onl$ after consultation with the appointin) authorit$ which (a$ (ake an$ co((ent it &ee(s appropriate to the arbitral tribunal concernin) the fees. "&# 65cept as provi&e& in the ne5t sub4para)raph of this para)raph, the costs of arbitration shall, in principle, be borne b$ the unsuccessful part$. Fowever, the arbitral tribunal (a$ apportion each of such costs between the parties if it &eter(ines that apportion(ent is reasonable, takin) into account the circu(stances of the case. @ith respect to the costs of le)al representation an& assistance referre& to in para)raph "c# of para)raph "a# "iii# of this Article, the arbitral tribunal, takin) into account the circu(stances of the case, shall be free to &eter(ine which part$ shall bear such costs or (a$ apportion such costs between the parties if it &eter(ines that appoint(ent is reasonable. @hen the arbitral tribunal issues an or&er for the ter(ination of the arbitral procee&in)s or (akes an awar& on a)ree& ter(s, it shall fi5 the costs of arbitration referre& to in para)raphs "b#, "c# an& "&# of this Article in the conte5t of that or&er or awar&. "e# +he arbitral tribunal, on its establish(ent, (a$ re=uest each part$ to &eposit an e=ual a(ount as an a&vance for the costs referre& to in para)raphs "i#, "ii# an& "iii# of para)raph "a# of this Article. Durin) the course of the arbitral procee&in)s, the arbitral tribunal (a$ re=uest supple(entar$ &eposits fro( the parties. ,f an appointin) authorit$ has been a)ree& upon b$ the parties an& when a part$ so re=uests an& the appointin) authorit$ consents to perfor( the function, the arbitral tribunal shall fi5 the a(ounts of an$ &eposits or supple(entar$ &eposits onl$ after consultation with the appointin) authorit$ which (a$ (ake an$ co((ents to the arbitral tribunal which it

30

&ee(s appropriate concernin) the a(ount of such &eposits an& supple(entar$ &eposits. ,f the re=uire& &eposits are not pai& in full within thirt$ "8 # &a$s after receipt of the re=uest, the arbitral tribunal shall so infor( the parties in or&er that the re=uire& pa$(ent (a$ be (a&e. ,f such pa$(ent is not (a&e, the arbitral tribunal (a$ or&er the suspension or ter(ination of the arbitral procee&in)s. After the awar& has been (a&e, the arbitral tribunal shall ren&er an accountin) to the parties of the &eposits receive& an& return an$ une5pen&e& balance to the parties. CHAPTER $ DOMESTIC AR:ITRATION RULE ( ) Ge.era* Pr"5+s+".s Ar'+,*e $.(. Scope of Application. "a# Do(estic arbitration, which is not international as &efine& in para)raph '8 of Article 9.E shall continue to be )overne& b$ Republic Act No. 8:E, otherwise known as "+he Arbitration -aw", as a(en&e& b$ the ADR Act. Articles 8, 9 , 99, 92, 98, 9!, 98 an& 99 an& 29 to 82 of the <o&el -aw an& Sections 22 to 89 of the ADR Act are specificall$ applicable to &o(estic arbitration. ,n the absence of a specific applicable provision, all other rules applicable to international co((ercial arbitration (a$ be applie& in a suppletor$ (anner to &o(estic arbitration. "b# +his 'hapter shall appl$ to &o(estic arbitration whether the &ispute is co((ercial, as &efine& in Section 29 of the ADR Act, or non4co((ercial, b$ an arbitrator who is a private in&ivi&ual appointe& b$ the parties to hear an& resolve their &ispute b$ ren&erin) an awar&* /rovi&e& that, althou)h a construction &ispute (a$ be co((ercial, it shall continue to be )overne& b$

6.?. No. 9 8, s.9985 an& the rules pro(ul)ate& b$ the 'onstruction ,n&ustr$ Arbitration 'o((ission. "c# +wo or (ore persons or parties (a$ sub(it to arbitration b$ one or (ore arbitrators an$ controvers$ e5istin) between the( at the ti(e of the sub(ission an& which (a$ be the sub3ect of an action* or the parties to an$ contract (a$ in such contract a)ree to settle b$ arbitration a controvers$ thereafter arisin) between the(. Such sub(ission or contract shall be vali&, enforceable an& irrevocable, save upon such )roun&s as e5ist at law for the revocation of an$ contract. Such sub(ission or contract (a$ inclu&e =uestions arisin) out of valuations, appraisals or other controversies which (a$ be collateral, inci&ental, prece&ent or subse=uent to an$ &ispute between the parties. A controvers$ cannot be arbitrate& where one of the parties to the controvers$ is an infant, or a person 3u&iciall$ &eclare& to be inco(petent, unless the appropriate court havin) 3uris&iction approve& a petition for per(ission to sub(it such controvers$ to arbitration (a&e b$ the )eneral )uar&ian or )uar&ian ad litem of the infant or of the inco(petent. 0ut where a person capable of enterin) into a sub(ission or contract has knowin)l$ entere& into the sa(e with a person incapable of so &oin), the ob3ection on the )roun& of incapacit$ can be taken onl$ in behalf of the person so incapacitate&. Ar'+,*e $.2. Deli ery and Receipt of 'ritten Communications. "a# 65cept as otherwise a)ree& b$ the parties, a written co((unication fro( one part$ to the other or to the arbitrator or to an arbitration institution or fro( the arbitrator or arbitration institution to the parties shall be &elivere& to the a&&ressee personall$, b$ re)istere& (ail or b$ courier service. Such co((unication shall be &ee(e& to have been receive& on the &ate it is &elivere& at the a&&resseeDs a&&ress of recor&, place of business, resi&ence or last known a&&ress. +he co((unication, as

31

appropriate, shall be &elivere& to each part$ to the arbitration an& to each arbitrator, an&, in institutional arbitration, one cop$ to the a&(inisterin) institution. "b# Durin) the arbitration procee&in)s, the arbitrator (a$ or&er a (o&e of &eliver$ an& a rule for receipt of written co((unications &ifferent fro( that provi&e& in para)raph "a# of this Article. "c# ,f a part$ is represente& b$ counsel or a representative, written co((unications for that part$ shall be &elivere& to the a&&ress of recor& of such counsel or representative. "&# 65cept as the parties (a$ a)ree or the arbitrator (a$ &irect otherwise, a written co((unication (a$ be &elivere& b$ electronic (ail or facsi(ile trans(ission or b$ such other (eans that will provi&e a recor& of the sen&in) an& receipt thereof at the recipientDs (ailbo5 "electronic inbo5#. Such co((unication shall be &ee(e& to have been receive& on the sa(e &ate of its trans(ittal an& receipt in the (ailbo5 "electronic inbo5#. Ar'+,*e $.0. 'ai er of Right to #b+ect. "a# A part$ shall be &ee(e& to have waive& his ri)ht to ob3ect to non4co(pliance with an$ non4 (an&ator$ provision of these Rules "fro( which the parties (a$ &ero)ate# or an$ re=uire(ent un&er the arbitration a)ree(ent when2 "i# he7she7it knows of such non4co(pliance* an& "ii# procee&s with the arbitration without statin) his7her7its ob3ections to such non4co(pliance without un&ue &ela$ or if a ti(e4li(it is provi&e& therefor, within such perio& of ti(e. "b# ,f an act is re=uire& or allowe& to be &one un&er this 'hapter, unless the applicable rule or the a)ree(ent of the parties provi&es a &ifferent perio& for the act to be &one, it shall be &one within a

perio& of thirt$ "8 # &a$s fro( the &ate when such act coul& have been &one with le)al effect. Ar'+,*e $.4. Extent of Court (nter ention. ,n (atters )overne& b$ this 'hapter, no court shall intervene e5cept in accor&ance with the Special ADR Rules. Ar'+,*e $.$. Court or #ther Authority for Certain %unctions of Arbitration Assistance and Super ision. +he functions referre& to in para)raphs "c# an& "&# of Article 5.9 "Appoint(ent of Arbitrators#, para)raph "a# of Article 5.99 ".roun&s for 'hallen)e#, an& para)raph "a# of Article 5.98 ";ailure or ,(possibilit$ to Act#, shall be perfor(e& b$ the appointin) authorit$, unless the latter shall fail or refuse to act within thirt$ "8 # &a$s fro( receipt of the re=uest in which case, the applicant (a$ renew the application with the court. RULE 2 ) Ar4+'ra'+". A7ree2e.' Ar'+,*e $.3. %orm of Arbitration Agreement. An arbitration a)ree(ent shall be in writin). An a)ree(ent is in writin) if it is containe& in a &ocu(ent si)ne& b$ the parties or in an e5chan)e of letters, tele5, tele)ra(s or other (eans of teleco((unication which provi&e a recor& of the a)ree(ent, or in an e5chan)e of state(ents of clai( an& &efense in which the e5istence of an a)ree(ent is alle)e& b$ one part$ an& not &enie& b$ the other. +he reference in a contract to a &ocu(ent containin) an arbitration clause constitutes an arbitration a)ree(ent provi&e& that the contract is in writin) an& the reference is such as to (ake that clause part of the contract. Ar'+,*e $.9. Arbitration Agreement and Substanti e Claim ,efore Court. "a# A part$ to an action (a$ re=uest the court before which it is pen&in) to sta$ the action an& to refer the &ispute to arbitration in accor&ance with their arbitration a)ree(ent not later than the pre4trial conference. +hereafter, both parties (a$ (ake a si(ilar re=uest with the court. +he parties shall be referre& to arbitration unless the court fin&s that the

32

arbitration a)ree(ent is null an& voi&, inoperative or incapable of bein) perfor(e&. "b# @here an action referre& to in para)raph "a# of this Article has been brou)ht, arbitral procee&in)s (a$ nevertheless be co((ence& or continue&, an& an awar& (a$ be (a&e, while the issue is pen&in) before the court. "c# @here the action is co((ence& b$ or a)ainst (ultiple parties, one or (ore of who( are parties to an arbitration a)ree(ent, the court shall refer to arbitration those parties who are boun& b$ the arbitration a)ree(ent althou)h the civil action (a$ continue as to those who are not boun& b$ such arbitration a)ree(ent. Ar'+,*e $.8. Arbitration Agreement and (nterim &easures by Court. "a# ,t is not inco(patible with an arbitration a)ree(ent for a part$ to re=uest fro( a court, before the constitution of the arbitral tribunal or &urin) arbitral procee&in)s, an interi( (easure of protection an& for a court to )rant such (easure. "b# After the constitution of the arbitral tribunal an& &urin) arbitral procee&in)s, a re=uest for an interi( (easure of protection, or (o&ification thereof, (a$ be (a&e with the arbitral tribunal or to the e5tent that the arbitral tribunal has no power to act or is unable to act effectivel$, the re=uest (a$ be (a&e with the court. "c# +he followin) rules on interi( or provisional relief shall be observe&2 "i# An$ part$ (a$ re=uest that interi( or provisional relief be )rante& a)ainst the a&verse part$. "ii# Such relief (a$ be )rante&2 "aa# +o prevent irreparable loss or in3ur$*

"bb# +o provi&e securit$ for the perfor(ance of an obli)ation* "cc# +o pro&uce or preserve evi&ence* or "&&# +o co(pel an$ other appropriate act or o(issions. "iii# +he or&er )rantin) provisional relief (a$ be con&itione& upon the provision of securit$ or an$ act or o(ission specifie& in the or&er. "iv# ,nteri( or provisional relief is re=ueste& b$ written application trans(itte& b$ reasonable (eans to the arbitral tribunal an& the part$ a)ainst who( relief is sou)ht, &escribin) in appropriate &etail of the precise relief, the part$ a)ainst who( the relief is re=ueste&, the )roun& for the relief, an& the evi&ence supportin) the re=uest. "v# +he or&er either )ratin) or &en$in) an application for interi( relief shall be bin&in) upon the parties. "vi# 6ither part$ (a$ appl$ with the court for assistance in i(ple(entin) or enforcin) an interi( (easure or&ere& b$ an arbitral tribunal. "vii# A part$ who &oes not co(pl$ with the or&er shall be liable for all &a(a)es, resultin) fro( nonco(pliance, inclu&in) all e5penses, an& reasonable attorne$Ds fees, pai& in obtainin) the or&erDs 3u&icial enforce(ent. "&# >nless otherwise a)ree& b$ the parties, the arbitral tribunal (a$, at the re=uest of a part$, or&er an$ part$ to take such interi( (easures of protection as the arbitral tribunal (a$ consi&er necessar$ in respect of the sub3ect (atter of the &ispute followin) the Rules in this Article. Such interi( (easures (a$ inclu&e but

33

shall not be li(ite& to preli(inar$ in3unction &irecte& a)ainst a part$, appoint(ent of receivers or &etention, preservation, inspection of propert$ that is the sub3ect of the &ispute in arbitration. 6ither part$ (a$ appl$ with the court for assistance in i(ple(entin) or enforcin) an interi( (easure or&ere& b$ an arbitral tribunal. RULE 0. C"2&"s+'+". "! Ar4+'ra* Tr+46.a* Ar'+,*e $.9. *umber of Arbitrators. +he parties are free to &eter(ine the nu(ber of arbitrators. ;ailin) such &eter(ination, the nu(ber of arbitrators shall be three "8#. Ar'+,*e $.(0. Appointment of Arbitrators. "a# An$ person appointe& to serve as an arbitrator (ust be of le)al a)e, in full en3o$(ent of his7her civil ri)hts an& knows how to rea& an& write. No person appointe& to serve as an arbitrator shall be relate& b$ bloo& or (arria)e within the si5th &e)ree to either part$ to the controvers$. No person shall serve as an arbitrator in an$ procee&in) if he7she has or has ha& financial, fi&uciar$ or other interest in the controvers$ or cause to be &eci&e& or in the result of the procee&in), or has an$ personal bias, which (i)ht pre3u&ice the ri)ht of an$ part$ to a fair an& i(partial awar&. No part$ shall select as an arbitrator an$ person to act as his7her cha(pion or to a&vocate his7her cause. "b# +he parties are free to a)ree on a proce&ure of appointin) the arbitrator or arbitrators. ,f, in the contract for arbitration or in the sub(ission, a provision is (a&e for a (etho& of appointin) an arbitrator or arbitrators, such (etho& shall be followe&. "c# ;ailin) such a)ree(ent, "i# in an arbitration with three "8# arbitrators, each part$ shall appoint one "9# arbitrator, an& the two "2# arbitrators thus appointe& shall appoint the thir& arbitrator* if a part$

fails to appoint the arbitrator within thirt$ "8 # &a$s of receipt of a re=uest to &o so fro( the other part$, or if the two arbitrators fail to a)ree on the thir& arbitrator within thirt$ "8 # &a$s of their appoint(ent, the appoint(ent shall be (a&e, upon re=uest of a part$, b$ the appointin) authorit$* "ii# in an arbitration with a sole arbitrator, if the parties are unable to a)ree on the arbitrator, he7she shall be appointe&, upon re=uest of a part$, b$ the appointin) authorit$. "&# @here, un&er an appoint(ent proce&ure a)ree& upon b$ the parties, "i# a part$ fails to act or appoint an arbitrator as re=uire& un&er such proce&ure, or "ii# the parties, or two "2# arbitrators, are unable to appoint an arbitrator or reach an a)ree(ent e5pecte& of the( un&er such proce&ure, or "iii# a thir& part$, inclu&in) an institution, fails to appoint an arbitrator or to perfor( an$ function entruste& to it un&er such proce&ure, or "iv# +he (ultiple clai(ants or the (ultiple respon&ents is7are unable to appoint its7their respective arbitrator, an$ part$ (a$ re=uest the appointin) authorit$ to appoint an arbitrator. ,n (akin) the appoint(ent, the appointin) authorit$ shall su((on the parties an& their respective counsel to appear before sai& authorit$ on the &ate, ti(e an& place set b$ it, for the purpose of selectin) an& appointin) a sole arbitrator. ,f a sole arbitrator is not appointe& in such (eetin), or the (eetin) &oes not take place

34

because of the absence of either or both parties &espite &ue notice, the appointin) authorit$ shall appoint the sole arbitrator. "e# ,f the &efault appoint(ent of an arbitrator is ob3ecte& to b$ a part$ on whose behalf the &efault appoint(ent is to be (a&e, an& the &efaultin) part$ re=uests the appointin) authorit$ for a&&itional ti(e to appoint his7her arbitrator, the appointin) authorit$, havin) re)ar& to the circu(stances, (a$ )ive the re=uestin) part$ not (ore than thirt$ "8 # &a$s to (ake the appoint(ent. ,f the ob3ection of a part$ is base& on the )roun& that the part$ &i& not fail to choose an& appoint an arbitrator for the arbitral tribunal, there shall be attache& to the ob3ection the appoint(ent of an arbitrator to)ether with the latterDs acceptance thereof an& curriculu( vitae. ?therwise, the appointin) authorit$ shall appoint the arbitrator for that part$. "f# ,n (akin) a &efault appoint(ent, the appointin) authorit$ shall have re)ar& to such consi&erations as are likel$ to secure the appoint(ent of an in&epen&ent an& i(partial arbitrator. ,n or&er to achieve spee&$ an& i(partial 3ustice an& to (o&erate the cost of arbitration, in choosin) an arbitrator, the appointin) authorit$ shall )ive preference to a =ualifie& person who has a place of resi&ence or business in the sa(e )eneral localit$ as the a)ree& venue of the arbitration an& who is likel$ to accept the arbitratorDs fees a)ree& upon b$ the parties, or as fi5e& in accor&ance either with the internal )ui&elines or the Sche&ule of ;ees approve& b$ the a&(inisterin) institution or b$ the appointin) authorit$. ")# +he appointin) authorit$ shall )ive notice in writin) to the parties of the appoint(ent (a&e or its inabilit$ to co(pl$ with the Re=uest for Appoint(ent an& the reasons wh$ it is unable to &o so, in which later case, the proce&ure &escribe& un&er Article 5.5 "'ourt or ?ther Authorit$ for 'ertain ;unctions of arbitration Assistance an& Supervision# shall appl$.

"h# A &ecision on a (atter entruste& b$ this Article to the appointin) authorit$ shall be i((e&iatel$ e5ecutor$ an& not sub3ect to appeal or (otion for reconsi&eration. +he appointin) authorit$ shall be &ee(e& to have been )iven b$ the parties &iscretionar$ authorit$ in (akin) the appoint(ent but in &oin) so, the appointin) authorit$ shall have &ue re)ar& to an$ =ualification or &is=ualification of an arbitrator7s un&er para)raph "a# of Article 5.9 "Appoint(ent of Arbitrators# as well as an$ =ualifications re=uire& of the arbitrator7s b$ the a)ree(ent of the parties an& to such consi&erations as are likel$ to secure the appoint(ent of an in&epen&ent an& i(partial arbitrator. "i# +he chair(an of the arbitral tribunal shall be selecte& in accor&ance with the a)ree(ent of the parties an&7or the rules a)ree& upon or, in &efault thereof, b$ the arbitrators appointe&. "3# An$ clause )ivin) one of the a)ree(ent, if otherwise vali&, shall be construe& as per(ittin) the appoint(ent of one "9# arbitrator b$ all clai(ants an& one "9# arbitrator b$ all respon&ents. +he thir& arbitrator shall be appointe& as provi&e& above. ,f all the clai(ants or all the respon&ents cannot &eci&e a(on) the(selves on an arbitrator, the appoint(ent shall be (a&e for the( b$ the appointin) authorit$. "k# +he appointin) authorit$ (a$ a&opt .ui&elines for the (akin) of a Re=uest for Appoint(ent. "l# 65cept as otherwise provi&e& in the .ui&elines of the appointin) authorit$, if an$, a Re=uest for Appoint(ent shall inclu&e, as applicable, the followin)2 "i# the &e(an& for arbitration*

35

"ii# the na(e7s an& curricula vitae of the appointe& arbitrator7s* "iii# the acceptance of his7her7its appoint(ent of the appointe& arbitrator7s* "iv# an$ =ualification or &is=ualification of the arbitrator as provi&e& in the arbitration a)ree(ent* "v# an e5ecutive su((ar$ of the &ispute which shoul& in&icate the nature of the &ispute an& the parties thereto* "vi# principal office an& officers of a corporate part$* "vii# the person7s appearin) as counsel for the part$7ies* an& "viii# infor(ation about arbitratorDs fees where there is an a)ree(ent between the parties with respect thereto. ,n institutional arbitration, the re=uest shall inclu&e such further infor(ation or particulars as the a&(inisterin) institution shall re=uire. "(# A cop$ of the Re=uest for Appoint(ent shall be &elivere& to the a&verse part$. /roof of such &eliver$ shall be inclu&e& in, an& shall for( part of, the Re=uest for Appoint(ent file& with the appointin) authorit$. "n# A part$ upon who( a cop$ of the Re=uest for Appoint(ent is co((unicate& (a$, within seven ":# &a$s of its receipt, file with the appointin) authorit$ his7her7its ob3ection7s to the Re=uest or ask for an e5tension of ti(e, not e5cee&in) thirt$ "8 # &a$s fro( receipt of the re=uest, to appoint an arbitrator or act in accor&ance with the proce&ure a)ree& upon or provi&e& b$ these Rules.

@ithin the afore(entione& perio&s, the part$ seekin) the e5tension shall provi&e the appointin) authorit$ an& the a&verse part$ with a cop$ of the appoint(ent of his7her arbitrator, the latterDs curriculu( vitae, an& the latterDs acceptance of the appoint(ent. ,n the event that the sai& part$ fails to appoint an arbitrator within sai& perio&, the appointin) authorit$ shall (ake the &efault appoint(ent. "o# An arbitrator, in acceptin) an appoint(ent, shall inclu&e, in his7her acceptance letter, a state(ent that2 "i# he7she a)rees to co(pl$ with the applicable law, the arbitration rules a)ree& upon b$ the parties, or in &efault thereof, these Rules, an& the 'o&e of 6thics for Arbitrators in Do(estic Arbitration, if an$* "ii# he7she accepts as co(pensation the arbitratorDs fees a)ree& upon b$ the parties or as &eter(ine& in accor&ance with the rules a)ree& upon b$ the parties, or in &efault thereof, these Rules* an& "iii# he a)rees to &evote as (uch ti(e an& attention to the arbitration as the circu(stances (a$ re=uire in or&er to achieve the ob3ective of a spee&$, effective an& fair resolution of the &ispute. Ar'+,*e $.((. )rounds for Challenge. "a# @hen a person is approache& in connection with his7her possible appoint(ent as an arbitrator, he7she shall &isclose an$ circu(stance likel$ to )ive rise to 3ustifiable &oubts as to his7her i(partialit$, in&epen&ence, =ualifications an& &is=ualifications. An arbitrator, fro( the ti(e of his7her appoint(ent an& throu)hout the arbitral procee&in)s, shall without &ela$, &isclose an$ such circu(stances to the parties unless the$ have alrea&$ been infor(e& of the( b$ hi(7her. A person, who is appointe& as an arbitrator notwithstan&in) the &isclosure (a&e in accor&ance with this Article, shall re&uce the

36

&isclosure to writin) an& provi&e a cop$ of such written &isclosure to all parties in the arbitration. "b# An arbitrator (a$ be challen)e& onl$ if2 "i# circu(stances e5ist that )ive rise to 3ustifiable &oubts as to his7her i(partialit$ or in&epen&ence* "ii# he7she &oes not possess =ualifications as provi&e& for in this 'hapter or those a)ree& to b$ the parties* "iii# he7she is &is=ualifie& to act as arbitration un&er these Rules* "iv# he refuses to respon& to =uestions b$ a part$ re)ar&in) the nature an& e5tent of his professional &ealin)s with a part$ or its counsel. "c# ,f, after appoint(ent but before or &urin) hearin), a person appointe& to serve as an arbitrator shall &iscover an$ circu(stances likel$ to create a presu(ption of bias, or which he7she believes (i)ht &is=ualif$ hi(7her as an i(partial arbitrator, the arbitrator shall i((e&iatel$ &isclose such infor(ation to the parties. +hereafter, the parties (a$ a)ree in writin)2 "i# to waive the presu(ptive &is=ualif$in) circu(stances* or "ii# to &eclare the office of such arbitrator vacant. An$ such vacanc$ shall be file& in the sa(e (anner the ori)inal appoint(ent was (a&e. "&# After initial &isclosure is (a&e an& in the course of the arbitration procee&in)s, when the arbitrator &iscovers circu(stances that are likel$ to create a presu(ption of bias,

he7she shall i((e&iatel$ &isclose those circu(stances to the parties. A written &isclosure is not re=uire& where it is (a&e &urin) the arbitration an& it appears in a written recor& of the arbitration procee&in)s. "e# An arbitrator who has or has ha& financial or professional &ealin)s with a part$ to the arbitration or to the counsel of either part$ shall &isclose in writin) such fact to the parties, an& shall, in )oo& faith, pro(ptl$ respon& to =uestions fro( a part$ re)ar&in) the nature, e5tent an& a)e of such financial or professional &ealin)s. Ar'+,*e $.(2. Challenge Procedure. "a# +he parties are free to a)ree on a proce&ure for challen)in) an arbitrator, sub3ect to the provisions of para)raph "c# of this Article. "b# ;ailin) such a)ree(ent, a part$ who inten&s to challen)e an arbitrator shall, within fifteen "95# &a$s after beco(in) aware of the constitution of the arbitral tribunal or after beco(in) aware of an$ circu(stance referre& to in para)raph "b# of Article 5.99 ".roun&s for 'hallen)e#, sen& a written state(ent of the reasons for the challen)e to the arbitral tribunal. >nless the challen)e& arbitrator with&raws fro( his7her office or the other part$ a)rees to the challen)e, the arbitral tribunal shall &eci&e on the challen)e. "c# ,f a challen)e un&er an$ proce&ure a)ree& upon b$ the parties or un&er the proce&ure of para)raph "b# of this Article in not successful, the challen)in) part$ (a$ re=uest the appointin) authorit$, within thirt$ "8 # &a$s after havin) receive& notice of the &ecision re3ectin) the challen)e, to &eci&e on the challen)e, which &ecision shall be i((e&iatel$ e5ecutor$ an& not sub3ect to appeal or (otion for reconsi&eration. @hile such a re=uest is pen&in), the arbitral tribunal, inclu&in) the challen)e& arbitrator, (a$ continue the arbitral procee&in)s an& (ake an awar&.

37

"&# ,f a re=uest for inhibition is (a&e, it shall be &ee(e& as a challen)e. "e# A part$ (a$ challen)e an arbitrator appointe& b$ hi(7her7it, or in whose appoint(ent he7she7it has participate&, onl$ for reasons of which he7she7it beco(es aware after the appoint(ent has been (a&e. "f# +he challen)e shall be in writin) an& it shall state specific facts that provi&e the basis for the )roun& relie& upon for the challen)e. A challen)e shall be (a&e within fifteen "95# &a$s fro( knowle&)e b$ a part$ of the e5istence of a )roun& for a challen)e or within fifteen "95# &a$s fro( the re3ection b$ an arbitrator of a part$Ds re=uest for his7her inhibition. ")# @ithin fifteen "95# &a$s of receipt of the challen)e, the challen)e& arbitrator shall &eci&e whether he7she shall accept the challen)e or re3ect it. ,f he7she accepts the challen)e, he7she shall voluntaril$ with&raw as arbitrator. ,f he7she re3ects it, he7she shall co((unicate, within the sa(e perio& of ti(e, his7her re3ection of the challen)e an& state the facts an& ar)u(ents relie& upon for such re3ection. "h# An arbitrator who &oes not accept the challen)e shall be )iven an opportunit$ to be hear&. "i# Notwithstan&in) the re3ection of the challen)e b$ the arbitrator, the parties (a$, within the sa(e fifteen "95# &a$ perio&, a)ree to the challen)e. "3# ,n &efault of an a)ree(ent of the parties to a)ree on the challen)e thereb$ replacin) the arbitrator, the arbitral tribunal shall &eci&e on the challen)e within thirt$ "8 # &a$s fro( receipt of the challen)e.

"k# ,f the challen)e proce&ure as a)ree& upon b$ the parties or as provi&e& in this Article is not successful, or a part$ or the arbitral tribunal shall &ecline to act, the challen)in) part$ (a$ re=uest the appointin) authorit$ in writin) to &eci&e on the challen)e within thirt$ "8 # &a$s after havin) receive& notice of the &ecision re3ectin) the challen)e. +he appointin) authorit$ shall &eci&e on the challen)e within fifteen "95# &a$s fro( receipt of the re=uest. ,f the appointin) authorit$ shall fail to act on the challen)e within thirt$ "8 # &a$s fro( the &ate of its receipt or within such further ti(e as it (a$ fi5, with notice to the parties, the re=uestin) part$ (a$ renew the re=uest with the court. +he re=uest (a&e un&er this Article shall inclu&e the challen)e, the repl$ or e5planation of the challen)e& arbitrator an& relevant co((unication, if an$, fro( either part$, or fro( the arbitral tribunal. "n# 6ver$ co((unication re=uire& or a)ree(ent (a&e un&er this Article in respect of a challen)e shall be &elivere&, as appropriate, to the challen)e& arbitrator, to the parties, to the re(ainin) (e(bers of the arbitral tribunal an& to the institution a&(inisterin) the arbitration, if an$. "(# A challen)e& arbitrator shall be replace& if2 "i# he7she with&raws as arbitrator, or "ii# the parties a)ree in writin) to &eclare the office of arbitrator vacant, or "iii# the arbitral tribunal &eci&es the challen)e an& &eclares the office of the challen)e& arbitrator vacant, or "iv# the appointin) authorit$ &eci&es the challen)e an& &eclares the office of the challen)e& arbitrator vacant, or

38

"v# in &efault of the appointin) authorit$, the court &eci&es the challen)e an& &eclares the office of the challen)e& arbitrator vacant. "n# +he &ecision of the parties, the arbitral tribunal, the appointin) authorit$, or in proper cases, the court, to accept or re3ect a challen)e is not sub3ect to appeal or (otion for reconsi&eration. "o# >ntil a &ecision is (a&e to replace the arbitrator un&er this Article, the arbitration procee&in) shall continue notwithstan&in) the challen)e, an& the challen)e& arbitrator shall continue to participate therein as an arbitrator. Fowever, if the challen)e inci&ent is raise& before the court, because the parties, the arbitral tribunal or appointin) authorit$ faile& or refuse& to act within the perio& provi&e& in para)raphs "3# an& "k# of this Article, the arbitration procee&in) shall be suspen&e& until after the court shall have &eci&e& the inci&ent. +he arbitration shall be continue& i((e&iatel$ after the court has &elivere& an or&er on the challen)in) inci&ent. ,f the court a)rees that the challen)e& arbitrator shall be replace&, the parties shall i((e&iatel$ replace the arbitrator concerne&. "p# +he appoint(ent of a substitute arbitrator shall be (a&e pursuant to the proce&ure applicable to the appoint(ent of the arbitrator bein) replace&. Ar'+,*e $.(0. %ailure or (mpossibility to Act. "a# ,f an arbitrator beco(es de +ure or de facto unable to perfor( his7her functions or for other reasons fails to act without un&ue &ela$, his7her (an&ate ter(inates if he7she with&raws fro( his7her office or if the parties a)ree on the ter(ination. ?therwise, if a controvers$ re(ains concernin) an$ of these )roun&s, an$ part$ (a$ re=uest the appointin) authorit$ to &eci&e on the ter(ination of the (an&ate, which &ecision shall be i((e&iatel$ e5ecutor$ an& not sub3ect to appeal or (otion for reconsi&eration.

"b# ,f, un&er this Article or Article 5.92 "'hallen)e /roce&ure#, an arbitrator with&raws fro( his7her office or a part$ a)rees to the ter(ination of the (an&ate of an arbitrator, this &oes not i(pl$ acceptance ?f the vali&it$ of an$ )roun& referre& to in this Article 5.92. Ar'+,*e $.(4. Appointment of Substitute Arbitrator. @here the (an&ate of an arbitrator ter(inates un&er Articles 5.92 "'hallen)e /roce&ure# or 5.98 ";ailure or ,(possibilit$# or because of his with&rawal fro( office for an$ other reason or because of the revocation of his (an&ate b$ a)ree(ent of the parties or in an$ other case of ter(ination of his7her (an&ate, a substitute arbitrator shall be appointe& accor&in) to the rules applicable to the arbitrator bein) replace&. RULE 4 ) ?6r+s/+,'+". "! Ar4+'ra* Tr+46.a* Ar'+,*e $.($ Competence of Arbitral "ribunal to Rule on its 0urisdiction. "a# @hen a &e(an& for arbitration (a&e b$ a part$ to a &ispute is ob3ecte& to b$ the a&verse part$, the arbitral tribunal shall, in the first instance, resolve the ob3ection when (a&e on an$ of the followin) )roun&s2 "i# the arbitration a)ree(ent is in e5istent, voi&, unenforceable or not bin&in) upon a person for an$ reason, inclu&in) the fact that the a&verse part$ is not priv$ to sai& a)ree(ent* or "ii# the &ispute is not arbitrable or is outsi&e the scope of the arbitration a)ree(ent* or "iii# the &ispute is un&er the ori)inal an& e5clusive 3uris&iction of a court or =uasi43u&icial bo&$, "b# ,f a part$ raises an$ of the )roun&s for ob3ection, the sa(e shall not preclu&e the appoint(ent of the arbitrator7s as such issue is for the arbitral tribunal to &eci&e.

39

+he participation of a part$ in the selection an& appoint(ent of an arbitrator an& the fillin) of appropriate plea&in)s before the arbitral tribunal to =uestion its 3uris&iction shall not be construe& as a sub(ission to the 3uris&iction of the arbitral tribunal or of a waiver of his7her7its ri)ht to assert such )roun&s to challen)e the 3uris&iction of the arbitral tribunal or the vali&it$ of the resultin) awar&. "c# +he respon&ent in the arbitration (a$ invoke an$ such )roun&s to =uestion before the court the e5istence, vali&it$, or enforceabilit$ of the arbitration a)ree(ent, or the propriet$ of the arbitration, or the 3uris&iction of the arbitrator an& invoke the pen&enc$ of such action as )roun& for suspension of the arbitration procee&in). +he arbitral tribunal, havin) re)ar& to the circu(stances of the case, an& the nee& for the earl$ an& e5pe&itious settle(ent of the &ispute, in li)ht of the facts an& ar)u(ents raise& to =uestion its 3uris&iction, (a$ &eci&e either to suspen& the arbitration until the court has (a&e a &ecision on the issue or continue with arbitration. "&# ,f a &ispute is, un&er an arbitration a)ree(ent, to be sub(itte& to arbitration, but before arbitration is co((ence& or while it is pen&in), a part$ files an action before the court which e(bo&ies or inclu&es as a cause of action the &ispute that is to be sub(itte& to arbitration the fillin) of such action shall not prevent the co((ence(ent of the arbitration or the continuation of the arbitration until the awar& is issue&. Ar'+,*e $.(3 Po$er of Arbitral "ribunal to #rder (nterim &easures. "a# >nless otherwise a)ree& b$ the parties, the arbitral tribunal (a$, at the re=uest of a part$, or&er an$ part$ to take such interi( (easures of protection as the arbitral tribunal (a$ consi&er necessar$ in respect of the sub3ect (atter of the &ispute followin) the rules in this Article. Such interi( (easures (a$ inclu&e, but shall not be li(ite& to preli(inar$ in3unction &irecte& a)ainst a part$, appoint(ent of receivers or &etention

preservation, inspection of propert$ that is the sub3ect of the &ispute in arbitration. "b# After the constitution of the arbitral tribunal, an& &urin) arbitral procee&in)s, a re=uest for interi( (easures of protection, or (o&ification thereof, shall be (a&e with the arbitral tribunal. +he arbitral tribunal is &ee(e& constitute& when the sole arbitrator or the thir& arbitrator, who has been no(inate&, has accepte& the no(ination an& written co((unication of sai& no(ination an& acceptance has been receive& b$ the part$ (akin) the re=uest. "c# +he followin) rules on interi( or provisional relief shall be observe&2 "i# An$ part$ (a$ re=uest that the provisional or interi( relief be )rante& a)ainst the a&verse part$. "ii# Such relief (a$ be )rante&2 "aa# +o prevent irreparable loss or in3ur$* "bb# +o provi&e securit$ for the perfor(ance of an obli)ation* "cc# +o pro&uce or preserve evi&ence* or "&&# +o co(pel an$ other appropriate act or o(issions. "iii# +he or&er )rantin) provisional relief (a$ be con&itione& upon the provision of securit$ or an$ act or o(ission specifie& in the or&er. "iv# ,nteri( or provisional relief is re=ueste& b$ written application trans(itte& b$ reasonable (eans to the arbitral

40

tribunal an& the part$ a)ainst who( relief is sou)ht, &escribin) in appropriate &etail the precise relief, the part$ a)ainst who( the relief is re=ueste&, the )roun& for the relief an& the evi&ence supportin) the re=uest. "v# +he or&er either )rantin) or &en$in) an application for interi( relief shall be bin&in) upon the parties. "vi# 6ither part$ (a$ appl$ with the court for assistance in i(ple(entin) or enforcin) an interi( (easure or&ere& b$ an arbitral tribunal. "vii# A part$ who &oes not co(pl$ with the or&er shall be liable for all &a(a)es, resultin) fro( nonco(pliance, inclu&in) all e5penses, an& reasonable attorne$Ds fee pai& in obtainin) the or&erDs 3u&icial enforce(ent. RULE $ ) C"./6,' "! Ar4+'ra* Pr",ee/+.7s Ar'+,*e $.(9. E-ual "reatment of Parties. +he parties shall be treate& with e=uall$ an& each part$ shall be )iven a full opportunit$ of presentin) his7her7its case. Ar'+,*e $.(8 Determination of Rules of Procedure. "a# Sub3ecte& to the provisions of these Rules, the parties are free to a)ree on the proce&ure to be followe& b$ the arbitral tribunal in con&uctin) the procee&in)s. "b# ;ailin) such a)ree(ent, the arbitral tribunal (a$ sub3ect to the provision of the ADR Act, con&uct the arbitration in such (anner as it consi&ers appropriate. +he power conferre& upon the arbitral tribunal inclu&es the power to &eter(ine a&(issibilit$, relevance, (ateriall$ an& wei)ht of evi&ence. Ar'+,*e $.(9 Place of Arbitration. "a# +he parties are free to a)ree on the place of arbitration. ;ailin) such a)ree(ent, the place of arbitration shall be in <etro <anila unless the arbitral tribunal, havin) re)ar& to the

circu(stances of the case, inclu&in) the convenience of the parties, shall &eci&e on a &ifferent place of arbitration. "b# +he arbitral tribunal (a$, unless otherwise a)ree& b$ the parties, (eet at an$ place it consi&ers appropriate for consultation a(on) its (e(bers, for hearin) witnesses, e5perts or the parties, or for inspection of )oo&s, other propert$ or &ocu(ents. Ar'+,*e $.20 Commencement of Arbitral Proceedings "a# @here there is a prior arbitration a)ree(ent between the parties, arbitration is &ee(e& co((ence& as follows2 "i# ,n institutional arbitration is co((ence& in accor&ance with the arbitration rules of the institution a)ree& upon b$ the parties. "ii# ,n a& hoc arbitration, arbitration is co((ence& b$ the clai(ant upon &eliverin) to the respon&ent a &e(an& for arbitration. A &e(an& (a$ be in an$ for( statin)2 "aa# the na(e, a&&ress an& &escription of each of the parties* "bb# a &escription of the nature an& circu(stances of the &ispute )ivin) rise to the clai(* "cc# a state(ent of the relief sou)ht, inclu&in) the a(ount of the clai(* "&&# the relevant a)ree(ents, if an$, inclu&in) the arbitration a)ree(ent, a cop$ of which shall be attache&* an& "ee# appoint(ent of arbitrators an& 7 or &e(an& to appoint.

41

"b# ,f the arbitration a)ree(ent provi&es for the appoint(ent of a sole arbitrator, the &e(an& shall inclu&e an invitation of the clai(ant to the respon&ent to (eet an& a)ree upon such arbitrator, the place, ti(e an& &ate state& therein which shall not be less than thirt$ "8 # &a$s fro( receipt of the &e(an&. "c# ,f the arbitration a)ree(ent provi&es for the establish(ent of an arbitral tribunal of three "8# arbitrators, the &e(an& shall na(e the arbitrator appointe& b$ the clai(ant. ,t shall inclu&e the curriculu( vitae of the arbitrator appointe& b$ the clai(ant an& the latterDs acceptance of the appoint(ent. "&# @here there is no prior arbitration a)ree(ent, arbitration (a$ be initiate& b$ one part$ throu)h a &e(an& upon the other to sub(it their &ispute to arbitration. Arbitration shall be &ee(e& co((ence& upon the a)ree(ent b$ the other part$ to sub(it the &ispute to arbitration. "e# +he &e(an& shall re=uire& the respon&ent to na(e his7her7its7 arbitrator within a perio& which shall not be less than fifteen "95# &a$s fro( receipt of the &e(an&. +his perio& (a$ be e5ten&e& b$ a)ree(ent of the parties. @ithin sai& perio&, the respon&ent shall )ive a written notice to the clai(ant of the appoint(ent of the respon&entDs arbitrator an& attach to the notice the arbitratorDs curriculu( vitae an& the latterDs acceptance of the appoint(ent. Ar'+,*e $.2( Language "a# +he parties are free to a)ree on the lan)ua)e or lan)ua)es to be use& in the arbitral procee&in)s. ;ailin) such a)ree(ent, the lan)ua)e to be use& shall be 6n)lish or ;ilipino. +he lan)ua)e7s a)ree&, unless otherwise specifie& therein, shall be in all hearin)s an& all written state(ents, or&ers or other co((unication b$ the parties an& the arbitral tribunal. "b# +he arbitral tribunal (a$ or&er that an$ &ocu(entar$ evi&ence shall be acco(panie& b$ a translation into the lan)ua)e or

lan)ua)es a)ree& upon b$ the parties in accor&ance with para)raph "a# of this Article. Ar'+,*e $.22 Statement of Claim and Defense "a# @ithin the perio& of ti(e a)ree& b$ the parties or &eter(ine& b$ the arbitral tribunal, the clai(ant shall state the facts supportin) his7her7its clai(, the points at issue an& the relief or re(e&$ sou)ht, an& the respon&ent shall state his7her &efense in respect of these particulars, unless the parties (a$ have otherwise a)ree& as to the re=uire& ele(ents of such state(ents. +he parties (a$ sub(it with their state(ents all &ocu(ents the$ consi&er to be relevant or (a$ a&& a reference to the &ocu(ents or other evi&ence the$ will sub(it. "b# >nless otherwise a)ree& b$ the parties, either part$ (a$ a(en& or supple(ent his7her7its clai( or &efense &urin) the course of the arbitral procee&in)s, unless the arbitral tribunal consi&ers it inappropriate to allow such a(en&(ents havin) re)ar& to the &ela$ in (akin) it. Ar'+,*e $.20 1earing and 'ritten Proceedings "a# ,n a& hoc arbitration, the proce&ure &eter(ine& b$ the arbitrator, with the a)ree(ent of the parties, shall be followe&. ,n institutional arbitration, the applicable rules of proce&ure of the arbitration institution shall be followe&. ,n &efault of a)ree(ent of the parties, the arbitration proce&ure shall be as provi&e& in this 'hapter. "b# @ithin thirt$ "8 # &a$s fro( the appoint(ent of the arbitrator or the constitution of an arbitral tribunal, the arbitral tribunal shall call the parties an& their respective counsels to a pre4hearin) conference to &iscuss the followin) (atters2 "i# +he venue or place7s where the arbitration procee&in) (a$ be con&ucte& in an office space, a business center, a function roo( or an$ suitable place a)ree& upon b$ the parties an& the arbitral tribunal, which (a$ var$ per session7hearin)7conference*

42

"ii# +he (anner of recor&in) the procee&in)s* "iii# +he perio&s for the co((unication of the state(ent of clai(s with or without counterclai(s, an& answer to the counterclai(7s an& the for( an& contents of such plea&in)s. "iv# +he &efinition of the issues sub(itte& to the arbitral tribunal for &eter(ination an& the su((ar$ of the clai(s an& counterclai(s of the parties* "v# +he (anner b$ which evi&ence (a$ be offere& if an oral hearin) is re=uire&, the sub(ission of sworn written state(ents in lieu of oral testi(on$, the cross4e5a(ination an& further e5a(ination of witnesses* "vi# +he &eliver$ of certain t$pes of co((unications such as plea&in)s, ter(s of reference, or&er )rantin) interi( relief, final awar& an& the like that, if (a&e b$ electronic or si(ilar (eans, shall re=uire further confir(ation in the for( of a har& cop$ or har& copies &elivere& personall$ or b$ re)istere& post. "vii# +he issuance of subpoena or subpoena duces tecum b$ the arbitral tribunal to co(pel the pro&uction of evi&ence if either part$ shall or is likel$ to re=uest it* "viii# +he (anner b$ which e5pert testi(on$ will be receive& if a part$ will or is likel$ to re=uest the arbitral tribunal to appoint one or (ore e5perts, an& in such case, the perio& for the sub(ission to the arbitrator b$ the re=uestin) part$ of the propose& ter(s of reference for the e5pert, the fees to be pai&, the (anner of pa$(ent to the e5pert an& the &eposit b$ the parties or the re=uestin) part$ of such a(ount necessar$ to cover all e5penses

associate& with the referral of such issues to the e5pert before the e5pert is appointe&* "i5# +he possibilit$ of either part$ appl$in) for an or&er )rantin) interi( relief either with arbitral tribunal or with the court, an&, in such case, the nature of the relief to be applie& for* "5# +he possibilit$ of a site or ocular inspection, the purpose of such inspection, an& in such case, the &ate, place an& ti(e of the inspection an& the (anner of con&uctin) it, an& the sharin) an& &eposit of an$ associate& fees an& e5penses* "5i# +he a(ount to be pai& to the arbitral tribunal as fees an& the associate& costs, char)es an& e5penses of arbitration an& the (anner an& ti(in) of such pa$(ents* an& "5ii# Such other relevant (atters as the parties an& the arbitral tribunal (a$ consi&er necessar$ to provi&e for a spee&$ an& efficient arbitration of the &ispute. "c# +o the e5tent possible, the arbitral tribunal an& the parties shall a)ree upon an$ such (atters an& in &efault of a)ree(ent, the arbitral tribunal shall have the &iscretion an& authorit$ to (ake the &ecision, althou)h in (akin) &ecision, re)ar& shall be )iven to the views e5presse& b$ both parties. "&# +he arbitral tribunal shall, in consultation with the parties, fi5 the &ate7s an& the ti(e of hearin), re)ar& bein) )iven to the &esirabilit$ of con&uctin) an& conclu&in) an arbitration without un&ue &ela$. "e# +he hearin) set shall not be postpone& e5cept with the confor(it$ of the arbitrator an& the parties an& onl$ for a )oo&

43

an& sufficient cause. +he arbitral tribunal (a$ &en$ a re=uest to postpone or to cancel a sche&ule& hearin) on the )roun& that a part$ has re=ueste& or is inten&in) to re=uest fro( the court or fro( the arbitrator an or&er )rantin) interi( relief. "f# A part$ (a$, &urin) the procee&in)s, represent hi(self7herself7itself or throu)h a representative, at such hearin). ")# +he hearin) (a$ procee& in the absence of a part$ who fails to obtain an a&3ourn(ent thereof or who, &espite &ue notice, fails to be present, b$ hi(self7herself7itself or throu)h a representative, at such hearin). "h# ?nl$ parties, their respective representatives, the witnesses an& the a&(inistrative staff of the arbitral tribunal shall have the ri)ht to be present if the parties, upon bein) infor(e& of the presence of such person an& the reason for his7her presence, interpose no ob3ection thereto. "i# ,ssues raise& &urin) the arbitration procee&in) relatin) to "a# the 3uris&iction of the arbitral tribunal over one or (ore of the clai(s or counter clai(s, or "b# the arbitrabilit$ of a particular clai( or counter clai(, shall be resolve& b$ the arbitral tribunal as threshol& issues, if the parties so re=uest, unless the$ are intertwine& with factual issues that the$ cannot be resolve& ahea& of the hearin) on the (erits of the &ispute. "3# 6ach witness shall, before )ivin) testi(on$, be re=uire& to take an oath7 affir(ation before the arbitral tribunal, to tell the whole truth an& nothin) but the truth &urin) the hearin). "k# +he arbitral tribunal shall arran)e for the transcription of the recor&e& testi(on$ of each witness an& re=uire each part$ to share the cost of recor&in) an& transcription of the testi(on$ of each witness.

"l# 6ach part$ shall provi&e the other part$ with a cop$ of each state(ent or &ocu(ent sub(itte& to the arbitral tribunal an& shall have an opportunit$ to repl$ in writin) to the other part$Cs state(ents an& proofs. "(# +he arbitral tribunal (a$ re=uire the parties to pro&uce such other &ocu(ents or provi&e such infor(ation as in its 3u&)(ent woul& be necessar$ for it to ren&er a co(plete, fair an& i(partial awar&. "n# +he arbitral tribunal shall receive as evi&ence all e5hibits sub(itte& b$ a part$ properl$ (arke& an& i&entifie& at the ti(e of sub(ission. "o# At the close of the hearin), the arbitral tribunal shall specificall$ in=uire of all parties whether the$ have further proof or witnesses to present* upon receivin) a ne)ative repl$, the arbitral tribunal shall &eclare the hearin) close&. "p# After a hearin) is &eclare& close&, no further (otion or (anifestation or sub(ission (a$ be allowe& e5cept for post4 hearin) briefs an& repl$ briefs that the parties have a)ree& to sub(it within a fi5e& perio& after the hearin) is &eclare& close&, or when the arbitral tribunal. motu proprio or upon re=uest of a part$, allows the reopenin) of the hearin). "=# Decisions on interlocutor$ (atters shall be (a&e b$ the sole arbitrator or b$ the (a3orit$ of the arbitral tribunal. +he arbitral tribunal (a$ authori1e& its chair(an to issue or release, on behalf of the arbitral tribunal, its &ecision on interlocutor$ (atters. "r# 65cept as provi&e in section 9: "&# of the ADR Act. No arbitrator shall act as a (e&iator in a an$ procee&in) in which he7she is actin) as arbitrator even if re=ueste& b$ the parties* an& all ne)otiations.

44

"s# 0efore assu(in) the &uties of his7her office, an arbitrator (ust be sworn b$ an$ officer authori1e& b$ law to a&(inister an oath or be re=uire& to (ake an affir(ation to faithfull$ an& fairl$ hear an& e5a(ine the (atters in controvers$ an& (ake a 3ust awar& accor&in) to the best his7her abilit$ an& un&erstan&in). A cop$ of the arbitratorCs oath or affir(ation shall be furnishe& each part$ to the arbitration. "t# 6ither part$ (a$ ob3ect to the co((ence(ent or continuation of an arbitration procee&in) unless the arbitrator takes an oath or affir(ation as re=uire& in this chapter. ,f the arbitrator shall refuse to take an oath or affir(ation as re=uire& b$ law an& this rule, he7she shall be replace&. +he failure to ob3ect to the absence of an oath or affir(ation shall be &ee(e& a waiver of such ob3ection an& the procee&in)s shall continue in &ue course an& (a$ not later be use& as a )roun& to invali&ate the procee&in)s. "u# the arbitral tribunal shall have the power to a&(inister oaths to, or re=uire affir(ation fro(, all witnesses &irectin) the( to tell the truth, the whole truth an& nothin) but the truth in an$ testi(on$, oral or written, which the$ (a$ )ive or offer in an$ arbitration hearin). +he oath or affir(ation shall be re=uire& of ever$ witness before his7her testi(on$, oral or written, is hear& or consi&ere&. "v# the arbitral tribunal shall have the power to re=uire& an$ person to atten& a hearin) as a witness. ,t shall have the power to subpoena witnesses, to testif$ an&7or pro&uce &ocu(ents when the relevanc$ an& (aterialit$ thereof has been shown to the arbitral tribunal. +he arbitral tribunal (a$ also re=uire the e5clusion of an$ witness &urin) the testi(on$ of an$ other witness. >nless the parties otherwise a)ree, all the arbitrators in an$ controvers$ (ust atten& all the hearin)s an& hear the evi&ence of the parties.

Ar'+,*e $.24 Po$er of Arbitral "ribunal to #rder (nterim &uslim. " a # unless otherwise a)ree& b$ the parties, the arbitral tribunal (a$, at the re=uest of a part$ an& in accor&ance with the this Article, or&er an$ part$ to take such interi( (easures of protection as the arbitral tribunal (a$ consi&er necessar$ in respect of the sub3ect (atter of the &ispute of the proce&ure, Such interi( (easures (a$ inclu&e, but shall not be li(ite&, to preli(inar$ in3unction &irecte& a)ainst a part$, appoint(ent of receivers or &etention of propert$ that is the sub3ect of the &ispute in arbitration or its preservation or inspection. "b# After the constitution of the arbitral tribunal, an& &urin) the arbitration procee&in)s, a re=uest for interi( (easures of protection, or (o&ification thereof, (a$ be (a&e with the arbitral tribunal. +he arbitral tribunal is &ee(e& constitute& when the sole arbitrator or the thir& arbitrator, who has been no(inate&, has accepte& the no(ination an& written co((unication of sai& no(ination an& acceptance has been receive& b$ the part$ (akin) the re=uest. "c# +he followin) rules on interi( or provisional relief shall be observe&2 "i# An$ part$ (a$ re=uest that provisional or interi( relief be )rante& a)ainst the a&verse part$. "ii# Such relief (a$ be )rante&2 "aa# +o prevent irreparable loss or in3ur$* "bb# +o provi&e securit$ for the perfor(ance of an obli)ation* "cc# +o pro&uce or preserve evi&ence* or "&&# +o co(pel an$ other appropriate act or o(issions.

45

"iii# +he or&er )rantin) provisional relief (a$ be con&itione& upon the provision of securit$ or an$ act or o(ission specifie& in the or&er. "iv# ,nteri( provisional relief is re=ueste& b$ written application trans(itte& b$ reasonable (eans to the arbitral tribunal an& the part$ a)ainst who( relief is sou)ht, &escribin) in appropriate &etail of the precise relief, the part$ a)ainst who( relief is re=ueste& the )roun& for the relief, an& the evi&ence supportin) the re=uest. "v# +he or&er either )rantin) or &en$in) an application for interi( relief shall be bin&in) upon the parties. "vi# 6ither part$ (a$ appl$ with the court for assistance in i(ple(entin) or enforcin) an interi( (easure or&ere& b$ an arbitral tribunal. "vii# A part$ who &oes not co(pl$ with the or&er shall be liable for all &a(a)es, resultin) fro( nonco(pliance, inclu&in) all e5penses, an& reasonabl$ attorne$Ds fees, pai& in obtainin) the or&erDs 3u&icial enforce(ent. "&# +he arbitral tribunal shall be have the power at an$ ti(e, before ren&erin) the awar&, without pre3u&ice to the ri)hts of an$ part$ to petition the court to take (easures to safe)uar& an7or conserve an$ (atter which is the sub3ect of the &ispute in arbitration. Ar'+,*e $.2$. Default of a Part$. >nless otherwise a)ree& b$ the parties, if, without showin) sufficient causes. "a# the clai(ant fails to co((unicate his7her7its state(ent of clai( in accor&ance with para)raph "a# of Article 5.22"State(ent of 'lai( an& Defense#, the arbitral tribunal shall ter(inate the procee&in)s*

"b# Hthe respon&ent fails to co((unicate his7her7its state(ent of &efense in accor&ance with para)raph "a# of Article 5.22 "State(ents of 'lai( an& Defense#, the arbitral tribunal shall continue the procee&in)s without treatin) such failure in itself as an a&(ission of the clai(antDs alle)ations* "c# an$ part$ fails to appear at a hearin) or to pro&uce &ocu(entar$ evi&ence, the arbitral tribunal (a$ continue the procee&in)s an& (ake the awar& base& on the evi&ence before it. Ar'+,*e $.23. Expert Appointed by the Arbitral "ribunal. "a# >nless otherwise a)ree& b$ the parties, the arbitral tribunal, "i# (a$ appoint one or (ore e5perts to report to it on specific issues to be &eter(ine& b$ the arbitral tribunal* or "ii# (a$ re=uire a part$ to )ive the e5pert an$ relevant infor(ation or to pro&uce, or to provi&e access to, an$ relevant &ocu(ents, )oo&s or other propert$ for his7her inspection. "b# >nless otherwise a)ree& b$ the parties, if a part$ so re=uest or if the arbitral tribunal consi&ers it necessar$, the e5pert shall, after &eliver$ of his7her written or oral report, participate in a hearin) where the parties have the opportunit$ to put =uestions to hi(7her an& to present e5pert witnesses in or&er to testif$ on the points at issue. "c# upon a)ree(ent of the parties, the fin&in) of the e5pert en)a)e& b$ the arbitral tribunal on the (atter7s referre& to hi( shall be bin&in) upon the parties an& the arbitral tribunal. Ar'+,*e $.29. Court Assistance in "a2ing E idence and #ther &atters. "a# +he arbitral tribunal or a part$, with the approval of the arbitral tribunal (a$ re=uest fro( a court, assistance in takin) evi&ence such as the issuance of subpoena ad testificandum an& subpoena duces tecum,

46

&eposition takin), site or ocular inspection, an& ph$sical e5a(ination of properties. +he court (a$ )rant the re=uest within its co(petence an& accor&in) to its rules on takin) evi&ence. "b# +he arbitral tribunal or a part$ to the &ispute intereste& in enforcin) an or&er of the arbitral tribunal (a$ re=uest fro( a co(petent court, assistance in enforcin) or&ers of the arbitral tribunal, inclu&in) but not li(ite&, to the followin)2 "i# ,nteri( or provision relief* "ii# /rotective or&ers with respect to confi&entialit$* "iii# ?r&ers of the arbitral tribunal pertainin) to the sub3ect (atter of the &ispute that (a$ affect thir& persons an&7or their properties* an&7or "iv# 65a(ination of &ebtors. Ar'+,*e $.28 Rules Applicable to the Substance of Dispute. "a# +he arbitral tribunal shall &eci&e the &ispute in accor&ance with such law as is chosen b$ the parties, ,n the absence of such a)ree(ent, /hilippine law shall appl$. "b# +he arbitral tribunal (a$ )rant an$ re(e&$ or relief which it &ee(s 3ust an& e=uitable an& within the scope of the a)ree(ent of the parties, which shall inclu&e, but not be li(ite& to, the specific perfor(ance of a contract. "c# ,n all cases, the arbitral tribunal shall &eci&e in accor&ance with the ter(s of the contract an& shall take into account the usa)es of the tra&e applicable to the transaction. Ar'+,*e $.29. Decision &a2ing by the Arbitral "ribunal. "a# +he arbitration procee&in)s with (ore than one arbitrator, an$ &ecision of the arbitral tribunal shall be (a&e, unless otherwise a)ree& b$ the parties, b$

a (a3orit$ of all its (e(bers, Fowever =uestions of proce&ure (a$ be &eci&e& b$ the chair(an of the arbitral tribunal, if so authori1e& b$ the parties or all (e(bers of the arbitral tribunal. "b# >nless otherwise a)ree& upon b$ the parties, the arbitral tribunal shall ren&er its written awar& within thirt$ "8 # &a$s after the closin) of all hearin)s an&7or sub(ission of the partiesD respective briefs or if the oral hearin)s shall have been waive&, within thirt$"8 # &a$s after the arbitral tribunal shall have &eclare& such procee&in)s in lieu of hearin) close&. +his perio& (a$ be further e5ten&e& b$ (utual consent of the parties. Ar'+,*e $.00 Settlement. "a# if, &urin) arbitral procee&in)s, the parties settle the &ispute, the arbitral tribunal, recor& the settle(ent in the for( of an arbitral awar& on a)ree& ter(s, consent awar& or awar& base& on co(pro(ise. "b# An awar& as ren&ere& above shall be (a&e in accor&ance with the provisions of Article 5.89 ";or( an& 'ontents of Awar&# an& shall state that it is an awar&. Such an awar& has the sa(e status an& effect as an$ other awar& on the (erits of the case. Ar'+,*e $.0(. %orm and Contents of A$ard. "a# +he awar& shall be (a&e in writin) an& shall be si)ne& b$ the arbitral tribunal. ,n arbitration procee&in)s with (ore than one arbitrator, the si)natures of the (a3orit$ of all (e(bers of the arbitral tribunal shall suffice, provi&e& that the reason for an$ o(itte& si)nature us state&. "b# +he awar& shall state the reasons upon which is base&, unless the parties have a)ree& that no reasons are to be )iven or the awar& on a)ree& ter(s, consent awar& base& on co(pro(ise un&er Article 5.8 "Settle(ent#. "c# +he awar& shall state its &ate an& the place& of arbitration as &eter(ine& in accor&ance with the para)raph "a# of Article 5.99

47

"/lace of Arbitration#. +he awar& shall be &ee(e& to have (a&e at that place. "&# After the awar& is (a&e, a cop$ si)ne& b$ the arbitrators in accor&ance with the para)raph "a# of this Article shall be &elivere& to each part$. "e# +he awar& of the arbitral tribunal nee& not be acknowle&)e&, sworn to un&er oath, or affir(e& b$ the arbitral tribunal unless so re=uire& on writin) b$ the parties. ,f &espite such re=uire(ent, the arbitral tribunal shall fail to &o as re=uire&, the parties (a$, within thirt$ &a$s fro( the receipt of sai& awar&, re=uest the arbitral tribunal to suppl$ the o(ission. +he failure of the parties to (ake an ob3ection or (ake such re=uest within the sai& perio& shall be &ee(e& a waiver or such re=uire(ent an& (a$ no lon)er be raise& as a )roun& to invali&ate the awar&. Ar'+,*e $.02. "ermination of Proceedings. "a# +he arbitration procee&in)s are ter(inate& b$ the final awar& or b$ an or&er of the arbitral tribunal in accor&ance with para)raph "b# of this Article. "b# +he arbitral tribunal shall issue an or&er for the ter(ination of the arbitration procee&in)s when2 "i# +he clai(ant with&raws his clai(, unless the respon&ents ob3ects thereto for the purpose of prosecutin) his counterclai(s in the sa(e procee&in)s of the arbitral tribunal reco)ni1es a le)iti(ate interest on his part in obtainin) a final settle(ent of the &ispute* or "ii# +he parties a)ree on the ter(ination of the procee&in)s* or "iii# +he arbitral tribunal fin&s that the continuation of the procee&in)s has for an$ other reason before unnecessar$ or i(possible* or

"iv# +he re=uire& &eposits are not pai& in full in accor&ance with para)raph "&# of Article 5.!E ";ees an& 'osts#. "c# +he (an&ate of the arbitral tribunal en&s with the ter(ination of the arbitration procee&in)s, sub3ect to the provisions of Article 5.88 "Correction and (nterpretation of A$ard# an& Article 5.8! "Application for Settings Aside in Exclusi e Recourse Against the Arbitral A$ard#. "&# 65cept as otherwise provi&e& in the arbitration a)ree(ent, no (otion for reconsi&eration correction an& interpretation of awar& or a&&itional awar& shall be with the arbitral tribunal. +he arbitral tribunal, b$ releasin) its final awar&, loses 3uris&iction over the &ispute an& the parties to the arbitral tribunal, b$ releasin) its final awar&, loses 3uris&iction over the &ispute an& the parties to the arbitration. Fowever, where is shown that the arbitral tribunal faile& to resolve& an issue. Sub(itte& to hi( or &eter(ination a verifie& (otion to co(plete a final awar& (a$ be (a&e within thirt$"8 # &a$s fro( its receipt. "e# Notwithstan&in) the fore)oin), the arbitral tribunal (a$ for special reason, reserve& in the final awar& in or&er a hearin) to =uantit$ costs an& &eter(ine which part$ shall bear the costs or apportion(ent thereof as (a$ be &eter(ine& to be a e=uitable. /en&in) &eter(ination of this issue, the awar& shall not be &ee(e& final for purposes of appeal, vacations, correction, or an$ post4awar& procee&in)s. Ar'+,*e $.00. Correction and (nterpretation of A$ard. Additional A$ard. "a# @ithin thirt$ "8 # &a$s fro( receipt of the awar&, unless another perio& of ti(e has been a)ree& upon b$ the parties. "i# A part$ (a$, with notice to the other part$, the arbitral tribunal to correct in the awar&s an$ errors in co(putation,

48

an$ clerical or t$po)raphical errors or an$ errors si(ilar nature "ii# ,f so a)ree& b$ the parties, with notice to the other part$, (a$ re=uest the arbitral tribunal to )ive an interpretation of a specific point or part of the awar&. ,f the arbitral tribunal consi&ers the re=uest to be 3ustifie&, it shall (ake the connection or )ive the interpretation within thirt$ "8 # &a$s fro( receipt of the re=uest. +he interpretation shall for( part of the awar&. "b# +he arbitral tribunal (a$ correct an$ errors of the t$pe referre& to in para)raph "a# of this Article on its own initiative within thirt$ "8 # &a$s of the &ate of the awar&. "c# >nless otherwise a)ree& b$ the parties, a part$ (a$, with notice to the other part$, (a$ re=uest within thirt$ "8 # &a$s of receipt of the awar&, the arbitral tribunal to (ake an a&&itional awar& as to clai(s presente& in the arbitral procee&in)s but o(itte& fro( the awar&., ,f the arbitral tribunal consi&ers the re=uest to be 3ustifie&, it shall (ake the a&&itional awar& within si5t$ "E # &a$s. "&# +he arbitral tribunal (a$ e5ten&, if necessar$, the perio& of ti(e within which it shall (ake a correction, interpretation or an a&&itional awar& un&er para)raphs "a# an& "c# of this Article. "e# +he provisions of Article 5.89 "%orm and Contents of A$ard# shall appl$ to a correction or interpretation of the awar& to an a&&itional awar&. Ar'+,*e $.04. Application for Setting Aside an Exclusi e Recourse against Arbitral A$ard. +he court when aske& to set asi&e an awar&, (a$, where appropriate an& so re=ueste& b$ a part$, suspen& the settin) asi&e procee&in)s for a perio& of ti(e &eter(ine& b$ it in or&er to )ive the

arbitral tribunal an opportunit$ to resu(e the arbitral procee&in)s or to take such other action as in the arbitral tribunalDs opinion will eli(inate the )roun&s for settin) asi&e an awar&. Ar'+,*e $.0$. )rounds to /acate an Arbitral A$ard. "a# +he arbitral awar& (a$ be =uestione&, vacate& or set asi&e b$ the appropriate court in accor&ance with the Special ADR Rules onl$ on the followin) )roun&s2 "i# +he arbitral awar& was procure& b$ corruption, frau& or other un&ue (eans* or "ii# +here was evi&ent partiall$ or corruption in the arbitral tribunal or an$ of its (e(bers* or "iii# +he arbitral tribunal was )uilt$ of (iscon&uct or an$ for( of (isbehavior that has (ateriall$ pre3u&ice& the ri)hts of an$ part$ such as refusin) to postpone the hearin) upon sufficient cause shown or to hear evi&ence pertinent an& (aterial to the controvers$* or "iv# ?ne or (ore of the arbitrators was &is=ualifie& to act as such un&er this 'hapter an& willfull$ refraine& fro( &isclosin) such &is=ualification * or "v# +he arbitral tribunal e5cee&e& its powers, or so i(perfectl$ e5ecute& the(, such that a co(plete, final an& &efinite awar& upon the sub3ect (atter sub(itte& to it was not (a&e. An$ other )roun& raise& to =uestion, vacate or set asi&e the arbitral awar& shall be &isre)ar&e& b$ the court. "b# @here a petition to vacate or set asi&e an awar& is file&, the petitioner (a$ si(ultaneousl$, or the oppositor (a$ in the alternative, petition the court to re(it the case to the sa(e arbitral tribunal for the purpose of (akin) a new or revise& final an&

49

&efinite awar& or to &irect a new hearin) before the sa(e or new arbitral tribunal, the (e(bers of which shall be chosen in the (anner ori)inall$ provi&e& in the arbitration a)ree(ent or sub(ission. ,n the latter case, an$ provision li(itin) the ti(e ,n which the arbitral tribunal (a$ (ake a &ecision shall be &ee(e& applicable to the new arbitral tribunal an& to co((ence fro( the &ate of the courtDs or&er. "c# @here a part$ files a petition with the court to vacate or set asi&e an awar& b$ reason of o(ission7s that &o not affect the (erits of the case an& (a$ be cure& or re(e&ie&, the a&verse part$ (a$ oppose that petition an& instea& re=uest the court to suspen& the vacation or settin) asi&e the procee&in)s for a perio& of ti(e to )ive the arbitral tribunal an opportunit$ to cure or re(e&$ the awar& or resu(e the arbitration procee&in)s or take such other action as will eli(inate the )roun&s for vacation or settin) asi&e. RULE 3 ) Re,"7.+'+". a./ E.!"r,e2e.' "! A8ar/s Ar'+,*e $.03. Confirmation of A$ard. +he part$ (ovin) for an or&er confir(in), (o&if$in), correctin), or vacatin) an awar&, shall, at the ti(e that such (otion is fille& with the court for the entr$ of 3u&)(ent thereon, also file the ori)inal or verifie& cop$ of the awar&, the arbitration or settle(ent a)ree(ent, an& such papers as (a$ be re=uire& b$ the Special ADR Rules. Ar'+,*e $.09. 0udgment. >pon the )rant of an or&er confir(in), (o&if$in) or correctin) an awar&, 3u&)(ent (a$ be entere& in confor(it$ therewith in the court where sai& application is file&. 'osts of the application an& the procee&in)s subse=uent thereto (a$ be awar&e& b$ the court ,n its &iscretion. ,f awar&e&, the a(ount thereof (ust be inclu&e& in the 3u&)(ent. %u&)(ent will be enforce& like court 3u&)(ents.

Ar'+,*e $.08. Appeal. A &ecision of the court confir(in), vacatin), settin) asi&e, (o&if$in) or correctin) an arbitral awar& (a$ be appeale& to the 'ourt of Appeals in accor&ance with Special ADR Rules. +he losin) part$ who appeals fro( the 3u&)(ent of the 'ourt confir(in) an arbitral awar& shall be re=uire& b$ the 'ourt of Appeals to post a counter4bon& e5ecute& in favor of the prevailin) part$ e=ual to the a(ount of the awar& in accor&ance with the Special ADR Rules. Ar'+,*e $.09. /enue and 0urisdiction. /rocee&in)s for reco)nition an& enforce(ent of an arbitration a)ree(ent or for vacation or settin) asi&e of an arbitral awar&, an& an$ application with a court for arbitration assistance an& supervision, e5cept appeal, shall be &ee(e& as special procee&in)s an& shall be file& with the court "a# where the arbitration procee&in)s are con&ucte&* "b# where the asset to be attache& or levie& upon, or the act to be en3oine& is locate&* "c# where an$ of the parties to the &ispute resi&es or has its place of business* or "&# in the National 'apital %u&icial Re)ion at the option of the applicant. Ar'+,*e $.40. *otice of Proceedings to Parties. ,n a special procee&in) for reco)nition an& enforce(ent of an arbitral awar&, the court shall sen& notice to the parties at their a&&ress of recor& in the arbitration, or if an$ part$ cannot be serve& notice at such a&&ress, at such part$Ds last known a&&ress. +he notice shall be sent in at least fifteen "95# &a$s before the &ate set for the initial hearin) of the application. Ar'+,*e $.4(. Legal Representation in Domestic Arbitration. "a# ,n &o(estic arbitration con&ucte& in the /hilippines, a part$ (a$ be represente& b$ an$ person of his7her7its choice2 /rovi&e&, that such

50

representative, unless a&(itte& to the practice of law in the /hilippines, shall not be authori1e& to appear as counsel in an$ /hilippine 'ourt, or an$ other =uasi43u&icial bo&$ whether or such appearance is in relation to the arbitration in which he7she appears. "b# No arbitrator shall act as (e&iator in an$ procee&in) in which he7she is actin) as arbitrator an& all ne)otiations towar&s settle(ent of the &ispute (ust take without the presence of the arbitrators. Ar'+,*e $.42. Confidentially of Arbitration Proceedings. +he arbitration procee&in)s, inclu&in) the recor&s, evi&ence an& the arbitral awar& an& other confi&ential infor(ation, shall be consi&ere& privile)e& an& confi&ential an& shall not be publishe& e5cept B "9# with consent of the parties* or "2# for the li(ite& purpose of &isclosin) to the court relevant &ocu(ents in cases where resort to the court is allowe& herein2 /rovi&e&, however, that the court in which the action or the appeal is pen&in) (a$ issue a protective or&er to prevent or prohibit &isclosure of &ocu(ents or infor(ation containin) secret processes, &evelop(ents, research an& other infor(ation where it is shown that the applicant shall be (ateriall$ pre3u&ice& b$ an authori1e& &isclosure thereof. Ar'+,*e $.40. Death of a Party. @here a part$ &ies after (akin) a sub(ission or a contact to arbitrate as prescribe& in these Rules, the procee&in) (a$ be be)un or continue& upon the application of, or notice to, his7her e5ecutor or a&(inistrator, or to te(porar$ a&(inistrator of his7her estate. ,n an$ such case, the court (a$ issue an or&er e5ten&in) the ti(e within which notice of a (otion to reco)ni1e or vacate an awar& (ust be serve&. >pon reco)ni1in) an awar&, where a part$ has &ie& since it was file& or &elivere&, the court (ust enter 3u&)(ent in the na(e of the ori)inal part$* an& the procee&in)s thereupon are the sa(e as where a part$ &ies after a ver&ict.

Ar'+,*e $.44. &ulti-Party Arbitration. "a#@hen a sin)le arbitration involves (ore than two parties, these Rules, to the e5tent possible, shall be use& sub3ect to such (o&ifications consistent with Articles 5.9: "6=ual +reat(ent of /arties# an& 5.98 "Deter(ination of Rules of /roce&ure# as the arbitral tribunal shall &ee( appropriate to a&&ress possible co(ple5ities of a (ulti4part$ arbitration. "b# @hen a clai(ant inclu&es persons who are not parties to or otherwise boun& b$ the arbitration a)ree(ent , &irectl$ or b$ reference, between hi(7her an& the respon&ent as a&&itional clai(ants or the a&&itional respon&ents unless not later than the &ate co((unicatin) his7her answer to the re=uest for arbitration, either b$ (otion or b$ a special &efense in his answer, he ob3ects, on 3uris&ictional )roun&s, to the inclusion of such a&&itional respon&ents. +he a&&itional respon&ents shall be &ee(e& to have consente& to their inclusion in the arbitration unless, not later than the &ate of co((unicatin) their answer to the re=uest for arbitration, wither b$ (otion or a special &efense in their answer, the$ ob3ect, on 3uris&ictional )roun&s, to their inclusion. Ar'+,*e $.4$. Consolidation of Proceedings and Concurrent 1earings. +he parties (a$ a)ree that4 "a# the arbitration procee&in)s shall be consoli&ate& with other arbitration procee&in)s* or "b# that concurrent hearin)s shall be hel&, on such ter(s as (a$ be a)ree&. >nless the parties a)ree to confer such power on the arbitral tribunal, the tribunal has no power to or&er consoli&ation of arbitration procee&in)s or concurrent hearin)s. Ar'+,*e $.43. %ees and Costs. "a# +he fees of the arbitrators shall be a)ree& upon b$ the parties an& the arbitrator7s in writin) prior to the arbitration.

51

,n &efault of a)ree(ent of the parties as to the a(ount an& (anner of pa$(ent of arbitratorDs fees, the arbitratorDs fees shall be &eter(ine& in accor&ance with the applicable internal rules of the re)ular arbitration institution un&er whose rules he arbitration is con&ucte&* or in a& hoc arbitration, the Sche&ule of ;ees approve& b$ the ,0/, ,f an$, or in &efault thereof, the Sche&ule of ;ees that (a$ be approve& b$ the ?ADR. "b# ,n a&&ition to arbitratorDs fees, the parties shall be responsible for the pa$(ent of the a&(inistrative fees of an arbitration institution a&(inisterin) an arbitration an& cost of arbitration. +he latter shall inclu&e, as appropriate, the fees of an e5pert appointe& b$ the arbitral tribunal, the e5penses for con&uctin) a site inspection, the use of a roo( where arbitration procee&in)s shall be or have been con&ucte&, the e5penses for the recor&in) an& transcription of the arbitration procee&in)s. "c# +he arbitral tribunal shall fi5 the costs of arbitration in its awar&. +he ter( "costs" inclu&e onl$2 "i# +he fees of the arbitral tribunal to be state& separatel$ as to each arbitrator an& to be fi5e& b$ the arbitral tribunal itself in accor&ance with this Article* "ii# +he travel an& other e5penses incurre& b$ the arbitrators* "iii# +he costs of e5pert a&vice an& of other assistance re=uire& b$ the arbitral tribunal, such as site inspection an& e5penses for the recor&in) an& transcription of the arbitration procee&in)s* "iv# +he travel an& other e5penses of witnesses to the e5tent such e5penses are provi&e& b$ the arbitral tribunal* "v# +he costs for le)al representation an& assistance of the successful part$ if such costs were clai(e& &urin) the

arbitral procee&in)s, an& onl$ to the e5tent that the arbitral tribunal &eter(ines that the a(ount of such costs is reasonable* "vi# An$ fees an& e5penses of the appointin) authorit$. "&# +he fees of the arbitral tribunal shall be reasonable in a(ount, takin) into account the a(ount in &ispute, the co(ple5it$ of the sub3ect (atter, the ti(e spent b$ the arbitrators an& an$ other relevant circu(stances of the case. ,f an appointin) authorit$ has been a)ree& upon b$ the parties an& if such appointin) authorit$ has issue& a sche&ule of fees for arbitrators in &o(estic cases which it a&(inisters, the arbitral tribunal, in fi5in) its fees shall take that sche&ule of fees into account to the e5tent that it consi&ers appropriate in the circu(stances of the case. ,f such appointin) authorit$ has not issue& a sche&ule of fees for arbitrators in international cases, an$ part$ (a$, at an$ ti(e re=uest the appointin) authorit$ to furnish a state(ent settin) forth the basis for establishin) fees which is custo(aril$ followe& in international cases in which the authorit$ appoints arbitrators. ,f the appointin) authorit$ consents to provi&e such a state(ent, the arbitral tribunal, in fi5in) its fees shall take such infor(ation into account to the e5tent that it consi&ers appropriate in the circu(stances of the case. ,n cases referre& to in para)raph "&# of this Article, when a part$ so re=uests an& the appointin) authorit$ consents to perfor( the function, the arbitral tribunal shall fi5 its fees onl$ after consultation with the appointin) authorit$ which (a$ (ake an$ co((ent it &ee(s appropriate to the arbitral tribunal concernin) the fees.

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"e# 65cept as provi&e& in the ne5t para)raph, the costs of arbitration shall, in principle, be borne b$ the unsuccessful part$. Fowever, the arbitral tribunal (a$ apportion each of such costs between the parties if it &eter(ines that apportion(ent is reasonable, takin) into account the circu(stances of the case. @ith respect to the costs of le)al representation an& assistance referre& to in para)raph "c# "iii# of this Article, the arbitral tribunal, takin) into account the circu(stances of the case, shall be free to &eter(ine which part$ shall bear such costs or (a$ apportion such costs between the parties if it &eter(ines that appoint(ent is reasonable. @hen the arbitral tribunal issues an or&er for the ter(ination of the arbitral procee&in)s or (akes an awar& on a)ree& ter(s, it shall fi5 the costs of arbitration referre& to in para)raph "a# of this Article in the conte5t of that or&er or awar&. "e# 65cept as otherwise a)ree& b$ the parties, no a&&itional fees (a$ be char)e& b$ the arbitral tribunal for interpretation or correction or co(pletion of its awar& un&er these Rules. "f# +he arbitral tribunal, on its establish(ent, (a$ re=uest each part$ to &eposit an e=ual a(ount as an a&vance for the costs referre& to in para)raphs "i#, "ii# an& "iii# of para)raph "c# of this Article. Durin) the course of the arbitral procee&in)s, the arbitral tribunal (a$ re=uest supple(entar$ &eposits fro( the parties. ,f an appointin) authorit$ has been a)ree& upon b$ the parties, an& when a part$ so re=uests an& the appointin) authorit$ consents to perfor( the function, the arbitral tribunal shall fi5 the a(ounts of an$ &eposits or supple(entar$ &eposits onl$ after consultation with the appointin) authorit$ which (a$ (ake an$ co((ents to the arbitral tribunal which it

&ee(s appropriate concernin) the a(ount of such &eposits an& supple(entar$ &eposits. ,f the re=uire& &eposits are not pai& in full within thirt$ "8 # &a$s after receipt of the re=uest, the arbitral tribunal shall so infor( the parties in or&er that one of the( (a$ (ake the re=uire& pa$(ent within such a perio& or reasonable e5tension thereof as (a$ be &eter(ine& b$ the arbitral tribunal. ,f such pa$(ent is not (a&e, the arbitral tribunal (a$ or&er the ter(ination of the arbitral procee&in)s. After the awar& has been (a&e, the arbitral tribunal shall ren&er an accountin) to the parties of the &eposits receive& an& return an$ une5pen&e& balance to the parties. CHAPTER 3 AR:ITRATION OF CONSTRUCTION DISPUTES +he 'onstruction ,n&ustr$ Arbitration 'o((ission "',A'#, which has ori)inal an& e5clusive 3uris&iction over arbitration of construction &isputes pursuant to 65ecutive ?r&er No. 9 8, s. 9985, otherwise known as the "'onstruction ,n&ustr$ Arbitration -aw", shall pro(ul)ate the ,(ple(entin) Rules an& Re)ulations )overnin) arbitration of construction &isputes, incorporatin) therein the pertinent provisions of the ADR Act. CHAPTER 9 OTHER ADR FORMS RULE ( ) Ge.era* Pr"5+s+".s Ar'+,*e 9.(. Scope of Application and )eneral Principles. 65cept as otherwise a)ree&, this 'hapter shall appl$ an& suppl$ the &eficienc$ in the a)ree(ent of the parties for (atters involvin) the followin) for(s of ADR2 "a# earl$ neutral evaluation*

53

"b# neutral evaluation* "c# (ini4trial* "&# (e&iation4arbitration*

Ar'+,*e 9.3. *eutral or Early *eutral E aluation. "a# +he neutral or earl$ neutral evaluation shall be )overne& b$ the rules an& proce&ure a)ree& upon b$ the parties. ,n the absence of sai& a)ree(ent, this Rule shall appl$. "b# ,f the parties cannot a)ree on, or fail to provi&e for2

"e# a co(bination thereof* or "i# +he &esire& =ualification of the neutral thir& person* "f# an$ other ADR for(. "ii# +he (anner of his7her selection* Ar'+,*e 9.2. Applicability of the Rules on &ediation. ,f the other ADR for(7process is (ore akin to arbitration "i.e., the neutral thir&4person (erel$ assists the parties in reachin) a voluntar$ a)ree(ent#, 'hapter 8 )overnin) <e&iation shall have suppletor$ application to the e5tent that it is not in conflict with the a)ree(ent of the parties or this 'hapter. Ar'+,*e 9.0. Applicability of the Rules on Arbitration. ,f the other ADR for(7process is (ore akin to arbitration "i.e., the neutral thir&4person has the power to (ake a bin&in) resolution of the &ispute#, 'hapter 5 )overnin) Do(estic Arbitration shall have suppletor$ application to the e5tent that it is not in conflict with the a)ree(ent of the parties or this 'hapter. Ar'+,*e 9.4. Referral. ,f a &ispute is alrea&$ before a court, either part$ (a$, before an& &urin) pre4trial, file a (otion for the court to refer the parties to other ADR for(s7processes. Fowever, at an$ ti(e &urin) court procee&in)s, even after pre4trial, the parties (a$ 3ointl$ (ove for suspension7&is(issal of the action pursuant to Article 2 8 of the 'ivil 'o&e of the /hilippines. Ar'+,*e 9.$. Submission of Settlement Agreement. 6ither part$ (a$ sub(it to the court before which the case is pen&in) an$ settle(ent a)ree(ent followin) a neutral or an earl$ neutral evaluation, (ini4trial or (e&iation4arbitration. RULE 2 ) Ne6'ra* "r Ear*- Ne6'ra* E5a*6a'+". "iii# +he appointin) authorit$ "not ,0/# who shall have the authorit$ to (ake the appoint(ent of a neutral thir& person* or "iv# ,f &espite a)ree(ent on the fore)oin) an& the lapse of the perio& of ti(e stipulate& for the appoint(ent, the parties are unable to select a neutral thir& person or appointin) authorit$, then, either part$ (a$ re=uest the &efault appointin) authorit$, as &efine& un&er para)raph '9 of Article "Definition of +er(s#, to (ake the appoint(ent takin) into consi&eration the nature of the &ispute an& the e5perience an& e5pertise of the neutral thir& person. "c# +he parties shall sub(it an& e5chan)e position papers containin) the issues an& state(ent of the relevant facts an& appen&in) supportin) &ocu(ents an& affi&avits of witnesses to assist the neutral thir& person in evaluatin) or assessin) the &ispute. "&# +he neutral thir& person (a$ re=uest either part$ to a&&ress a&&itional issues that he7she (a$ consi&er necessar$ for a co(plete evaluation7assess(ent of the &ispute.

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"e# +he neutral thir& person (a$ structure the evaluation process in an$ (anner he7she &ee(s appropriate. ,n the course thereof, the neutral thir& person (a$ i&entif$ areas of a)ree(ent, clarif$ the issues, &efine those that are contentious, an& encoura)e the parties to a)ree on a &efinition of issues an& stipulate on facts or a&(it the )enuineness an& &ue e5ecution of &ocu(ents. "f# +he neutral thir& person shall issue a written evaluation or assess(ent within thirt$ "8 # &a$s fro( the conclusion of the evaluation process. +he opinion shall be non4bin&in) an& shall set forth how the neutral thir& person woul& have rule& ha& the (atter been sub3ect to a bin&in) process. +he evaluation or assess(ent shall in&icate the relative stren)ths an& weakness of the positions of the parties, the basis for the evaluation or assess(ent, an& an esti(ate, when feasible, of the a(ount for which a part$ (a$ be liable to the other if the &ispute were (a&e sub3ect to a bin&in) process. ")# +here shall be no ex-parte co((unication between the neutral thir& person an& an$ part$ to &ispute without the consent of all parties. "h# All papers an& written presentations co((unicate& to the neutral thir& person, inclu&in) an$ paper prepare& b$ a part$ to be co((unicate& to the neutral thir& person or to the other part$ as part of the &ispute resolution process, an& the neutral thir& personDs written non4bin&in) assess(ent or evaluation, shall be treate& as confi&ential. RULE 0 ) M+.+1Tr+a* Ar'+,*e 9.9. &ini-"rial. "a# A (ini4trial shall be )overne& b$ the rules an& proce&ure a)ree& upon b$ the parties. ,n the absence of sai& a)ree(ent, this Rule shall appl$.

"b# A (ini4trial shall be con&ucte& either as2 "i# a separate &ispute resolution process* or "ii# a continuation of (e&iation, neutral or earl$ neutral evaluation or an$ other ADR process. "c# +he parties (a$ a)ree that a (ini4trial be con&ucte& with or without the presence an& participation of a neutral thir& person. ,f a neutral thir& person is a)ree& upon an& chosen, he7she shall presi&e over the (ini4trial. +he parties (a$ a)ree to appoint one or (ore "but e=ual in nu(ber per part$# senior e5ecutive7s, on its behalf, to sit as (ini4trial panel (e(bers. "&# +he senior e5ecutive7s chosen to sit as (ini4trial panel (e(bers (ust be &ul$ authori1e& to ne)otiate an& settle the &ispute with the other part$. +he appoint(ent of a (ini4trial panel (e(ber7s shall be co((unicate& to the other part$. +his appoint(ent shall constitute a representation to the other part$ that the (ini4trial panel (e(ber7s has7have the authorit$ to enter into a settle(ent a)ree(ent bin&in) upon the principal without an$ further action or ratification b$ the latter. "e# 6ach part$ shall sub(it a brief e5ecutive su((ar$ of the &ispute in sufficient copies as to provi&e one cop$ to each (ini4 trial panel (e(ber an& to the a&verse part$. +he su((ar$ shall i&entif$ the specific factual or le)al issue or issues. 6ach part$ (a$ attach to the su((ar$ a (ore e5haustive recital of the facts of the &ispute an& the applicable law an& 3urispru&ence. "f# At the &ate ti(e an& place a)ree& upon, the parties shall appear before the (ini4trial panel (e(bers. +he law$er of each part$ an&7or authori1e& representative shall present his7her case startin) with the clai(ant followe& b$ the respon&ent. +he law$er an&7or representative of each part$ (a$ thereafter offer rebuttal or sur4 rebuttal ar)u(ents.

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>nless the parties a)ree on a shorter or lon)er perio&, the presentation4in4 chief shall be (a&e, without interruption, for one hour an& the rebuttal or sur4rebuttal shall be thirt$ "8 # (inutes. At the en& of each presentation, rebuttal or sur4rebuttal, the (ini4trial panel (e(ber7s (a$ ask clarificator$ =uestions fro( an$ of the presentors. ")# After the (ini4trial, the (ini4trial panel (e(bers shall ne)otiate a settle(ent of the &ispute b$ the(selves. ,n cases where a neutral thir& person is appointe&, the neutral thir& person shall assist the procee&in)s shall be )overne& b$ 'hapter 8 of <e&iation. RULE 4 ) Me/+a'+".1Ar4+'ra'+". Ar'+,*e 9.8. &ediation3Arbitration "a# A <e&iation4Arbitration shall be )overne& b$ the rules an& proce&ure a)ree& upon b$ the parties, ,n the absence of sai& a)ree(ent, 'hapter 5 on <e&iation shall first appl$ an& thereafter, 'hapter 5 on Do(estic Arbitration. "b# No /erson shall havin) been en)a)e an& havin) acte& as (e&iator of a &ispute between the parties, followin) a faile& (e&iation, act as arbitrator of the sa(e &ispute, unless the parties, in a written a)ree(ent, e5pressl$ authori1e the (e&iator to hear an& &eci&e the case as an arbitrator "c# +he (e&iator who beco(es an arbitrator pursuant to this Rule shall (ake an appropriate &isclosure to the parties as if the arbitration procee&in) ha& co((ence& an& will procee& as a new &ispute resolution process, an& shall, before enterin) upon his7her &uties, e5ecutive the appropriate oath or affir(ation of office as arbitrator in accor&ance with these Rules. RULE $1 C"s's a./ Fees

Ar'+,*e 9.9 Costs and %ees. "a# 0efore enterin) his7her &uties as ADR /rovi&er , he7she shall a)ree with the parties on the cost of the ADR proce&ure, the fees to be pai& an& (anner of pa$(ent for his her services. "b# n the absence of such a)ree(ent, the fees for the services of the ADR provi&er7practitioner shall be &eter(ine& as follows2 "i# ,f the ADR proce&ure is con&ucte& un&er the rules an&7or a&(inistere& b$ an institution re)ularl$ provi&in) ADR services to the )eneral public, the fees of the ADR professional shall be &eter(ine& in accor&ance with sche&ule of fees approve& b$ such institution, if an$* "ii# ,n a& hoc ADR, the fees shall be &eter(ine& in accor&ance with the sche&ule of fees approve& b$ the ?ADR* "iii# ,n the absence of a sche&ule of fees approve& b$ the ADR institution or b$ the ?ADR, the fees shall be &eter(ine& b$ the ADR institution or b$ the ?ADR, as the case (a$ be, an& co(ple5it$ of the process, the a(ount in &ispute an& the professional stan&in) of the ADR professional. "c# A contin)enc$ fee arran)e(ent shall not be allowe&. +he a(ount that (a$ be allowe& to an ADR professional (a$ not be (a&e &epen&ent upon the success of his7her effort in helpin) the parties to settle their &ispute. CHAPTER 8 MISCELLANEOUS PROVISION Ar'+,*e 8.(. Amendments. +hese Rules or an$ portion hereof (a$ be a(en&e& b$ the Secretar$ of %ustice.

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Ar'+,*e 8.2 Separability Clause. ,f an$ part, article or provision of these Rules are &eclare& invali& or unconstitutional, the other parts hereof not affecte& thereb$ shall re(ain vali&. Ar'+,*e 8.0 %unding. +he hea&s of &epart(ent an& a)encies concerne&, especiall$ the Depart(ent of %ustice, insofar as the fun&in) re=uire(ents of the ?ADR is concerne&, shall i((e&iatel$ inclu&e in their annual appropriation the fun&in) necessar$ to i(ple(ent pro)ra(s an& e5ten& services re=uire& b$ the ADR Act an& these Rules. Ar'+,*e 8.4 "ransitory Pro isions. 'onsi&erin) the proce&ural character of the ADR Act an& these Rules, the provisions of these Rules shall be applicable to all pen&in) arbitration, (e&iation or other ADR for(s covere& b$ the ADR Act if the parties a)ree. Ar'+,*e. 8.$ Effecti ity Clause. +hese Rules shall take effect fifteen "95# &a$s after the co(pletion of its publication in at least two "2# national newspapers of )eneral circulation. A//R?G6D. Dece(ber !, 2 9

D+re,'"r Ne*/a D. Le/a Depart(ent of ,nterior an& -ocal .overn(ent A''-. V+,'"r P. La@a'+. Representative of the /resi&ent of the ,nte)rate& 0ar of the /hilippines A''-. C6s'"/+" O. Par*a/e Arbitration /rofession A''-. A*!re/" F. Ta/+ar /rofessor A..a4e**e T. A4a-a <e&iation /rofession A''-. Mar+" E. Va*/era2a ADR ?r)ani1ation OTHER PARTICIPANTS IN THE FORMULATION OF THE IMPLEMENTING RULES AND REGULATIONSB DEPARTMENT OF ?USTICE 'hief State 'ounsel Ricar&o G. /aras, ,,, Assistant 'hief State 'ounsel Ruben ;. ;on&evilla Retire& Assistant 'hief State /rosecutor Nilo '. <ariano Senior State 'ounsel <arl$n -. An)eles State 'ounsel 0erna&ette '. ?n)oco State 'ounsel -eilani R. ;a3ar&o <s. Suerte +. .a(iao <r. %ose <ario 0. >$ DEPARTMENT OF TRADE AND INDUSTR< Director Gictorio <ario A. Di(a)iba

AGNES VST DEVANADERA Actin) Secretar$ 'o((ittee for the ;or(ulation of the ,(ple(entin) Rules an& Re)ulations of the Alternative Dispute Resolution Act of 2 !2 U./erse,re'ar- ?"se V+,e.'e :. Sa*a@ar Depart(ent of %ustice U./erse,re'ar- Ae.a+/a N. Ma7*a-a Depart(ent of +ra&e an& ,n&ustr$

OFFICE OF THE PRESIDENT OF THE INTEGRATED :AR OF THE PHILIPPINES

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Att$. /atricia +$s(an4'le(ente MEDIATION PROFESSION ;or(er /rosecutor Do(ina&or 0or(asal, %r.