The competence-competence principle in commercial arbitration: a comparative analysis

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Purpose – the purpose of this paper is two - fold: first, to analyse the application of the c ompetence - competence principle in three jurisdictions (France, Sweden and England) and, second, to evaluate the application of the competence - competence principle in these jurisdictions vis - à - vis the aim to balance the need to give effect to arbitration ag reement and legitimacy of arbitration proceedings. Design/methodology/approach – comparative and systematic analysis as well as linguistic and teleological methods were used in this research. Finding – the principle of competence - competence is defined a s the cornerstone of commercial arbitration, however, its application varies substantially depending on the jurisdiction. Comparative analysis shows that the extreme applications of a negative effect of the competence - competence principle do not balance, b ut rather favour either giving an effect to an arbitration agreement or to the legitimacy of arbitral proceedings, and these approaches have considerable downsides. The intermediate approach, which attempts to balance these two objectives depending on a nu mber of particular circumstances, appears to be the most preferred one. For that purpose, legislators, while balancing the effect of the negative competence - competence effect, use a number of useful tools, such as: (i) court’s prima facie review of arbitra l jurisdiction (ii) different standards of review depending on the nature of challenge (e.g. whether the existence or only the scope of the arbitration agreement is challenged); (iii) different standard of review depending on whether arbitral proceedings h ave been commenced or not.