5. What are the advantages of arbitration over court litigation?

Arbitration is considered more advantageous than court litigation in the Philippines for the following reasons:
 Confidentiality.
 Shorter time-scale.
 Parties can appoint arbitrators based on their special knowledge, skill or experience.
 Parties have more flexibility in the conduct of and in selecting the rules that govern the proceedings.
 The finality of the award. The modification or reversal of arbitral awards is legally possible only on very stringent
and specified grounds unlike decisions rendered in court litigation.
 The guarantee of the impartiality, fairness and independence of arbitrator(s).

6. What are the kinds of arbitration?

 Voluntary Arbitration
 Compulsory Arbitration
 Foreign/International Arbitration
 Domestic Arbitration
 Commercial Arbitration
 Institutional Arbitration
 Ad Hoc Arbitration
7. What are the advantage of institutional arbitration over ad hoc arbitration?

Institutional arbitration is more advantageous than ad hoc arbitration because of reputation, experience,
reasonable costs and fees besides with the convenience of the process are the reason.

8. Are there mandatory provisions providing for the vacation of domestic awards? What are its effect?

Regardless of the agreement of the parties, domestic awards can be vacated on the following grounds (rule 11.4, Special
Rules of Court on Alternative Dispute Resolution):
 The arbitral award was procured through corruption, fraud or other undue means.
 There is evidence of partiality or corruption in the arbitral tribunal or any of its members.
 The arbitral tribunal was guilty of misconduct or any form of misbehaviour that has materially prejudiced the
rights of any party.
 One or more of the arbitrators was disqualified to act as such under the law and deliberately refrained from
disclosing this disqualification.
 The arbitral tribunal exceeded its powers, or imperfectly executed them, so that a complete, final and definite
award on the subject matter submitted to them was not made.
 The arbitration agreement did not exist, is invalid or is otherwise unenforceable.
 A party to arbitration is a minor or a person judicially declared to be incompetent.

9. What are the matters/issues not be subject to arbitration?

The following matters cannot be the subject of arbitration (section 6, Republic Act 9285 otherwise known as the
Alternative Dispute Resolution Act of 2004 and Article 2035, Civil Code of the Philippines):
 Labour disputes covered by the Labour Code.
 Civil status of persons.
 Validity of marriage.
 Any grounds for legal separation.
 Jurisdiction of courts.
 Future legitime (that is, the future right of an heir to the portion of the deceased's property which he is entitled
under the law regardless of the provisions in the predecessor's will).
 Criminal liability.
 Future support (that is, the right to the support of spouses, descendants, ascendants and siblings at some future
time).
10. Does the law of limitation apply to arbitration proceeding? How?

There is no specific Philippine legal provision that governs limitation periods in arbitration proceedings.
However, as the right to arbitrate arises from a written contract between the parties, the general law of limitation may
apply, which states that proceedings must be commenced within ten years from the date the right to institute arises under
the written contract of the parties (Article 1144, Civil Code of the Philippines (Civil Code)).

However, nothing prohibits the parties, from agreeing on a different period of limitation as well as the grounds for
suspension of the time limits. The usual causes like force majeure are applicable and contracting parties can establish such
stipulations, clauses, terms and conditions as they deem convenient, provided they are not contrary to law, morals, good
customs, public order, or public policy (Article 1306, Civil Code).

However, the Philippine Supreme Court recognises the equitable defence of laches (that is, the failure or neglect,
for an unreasonable and unexplained length of time, to do that which, by exercising due diligence could or should have
been done earlier). It is negligence or omission not to assert a right within a reasonable time, warranting the presumption
that the party entitled to assert his right has either abandoned or declined to assert it (Heirs of Nieto vs. Municipality of
Meycauayan, 540 SCRA 100 (2007)).

11. Which arbitration organization are commonly used to resolve large commercial disputes?

The Construction Industry Arbitration Commission (CIAC) and the Philippine Dispute Resolution Center Inc
(PDRCI) are commonly used to resolve large commercial disputes in the Philippines. The subject matter of arbitration
proceedings conducted by the CIAC is limited to disputes arising out of construction contracts. Arbitration proceedings in
the CIAC have been considered by the Philippine Supreme Court as part of traditional judicial proceedings. Therefore, the
decisions of CIAC may be appealed to the Court of Appeals and subsequently, to the Supreme Court, but only on
questions of law (rule 43, Revised Rules of Court in the Philippines).

The ICC International Court of Arbitration, the Singapore International Arbitration Centre and the Hong Kong
International Arbitration Centre are the arbitration institutions that are commonly specified in contracts in the Philippines
that have an international component.

PDRCI is the arbitral organisation that most commonly administers arbitration proceedings, involving all kinds of
subject matter (with the exception of construction contracts).
See box, Main arbitration organisations.

12. What are the remedies when one party denies that the tribunal has jurisdiction to determine the disputes?

A party questioning the jurisdiction of an arbitral tribunal can apply to the local courts for judicial relief in
determining the issue of the existence, validity and enforceability of the arbitration agreement. However, when a court is
asked to rule on issues affecting the competence or jurisdiction of an arbitral tribunal in a dispute brought before it, the
court must exercise judicial restraint and defer to the competence or jurisdiction of the arbitral tribunal by allowing the
arbitral tribunal the first opportunity to rule on such issues (rule 2.4, Special Rules of Court on Alternative Dispute
Resolution) (Special ADR Rules)).

13. May the court determine issues of jurisdiction of the arbitral tribunal? Does our jurisdiction recognize the
concept of kompetenz-kompetenz?

However, the Special ADR Rules also recognise the principle of kompetenz-kompetenz, which means that the
arbitral tribunal can initially rule on its own jurisdiction, including any objections with respect to the existence or validity
of the arbitration agreement (rule 2.2, Special ADR Rules).
14. What are the requirements for an arbitration agreement be enforceable?

Substantive/formal requirements
An arbitration agreement can arise in the following ways:
 Two more persons can agree to submit to an arbitration of one or more arbitrators, any controversy existing between
them at the time of the submission, which may be the subject of an action.
 The parties to any contract can agree to settle by arbitration a controversy thereafter arising between them.
Such submission or contract will be valid, enforceable, and irrevocable, save on such grounds that exist under the law for
revocation of any contract (section 2, Republic Act 9876 otherwise known as the Arbitration Law) (Arbitration Law).
A contract or a submission to arbitrate, must be in writing and signed by the parties or their lawful agents (section 4,
Arbitration Law).

15. Are unilateral or optional clauses, where one party has the right to choose arbitration enforceable?

There is no express prohibition on unilateral or optional clauses. Therefore, an arbitration agreement giving one
party the right to choose arbitration is likely to be enforceable under the principle of party autonomy (section 2, Republic
Act 9285 otherwise known as the Alternative Dispute Resolution Act of 2004).

16. In what circumstances a third party that did not sign the contract incorporation the arbitral clause in question
be compelled to arbitrate disputes relating to contract?

As a general rule, an arbitration agreement is consensual and therefore only binding on the contracting parties.
Therefore, parties that did not sign the contract cannot be compelled to arbitrate disputes relating to the contract, except
when the contract contains a reference to a document containing an arbitration clause to which the third party is a
signatory.

17. In what circumstances a third party that did not sign the contract incorporation the arbitral clause in question
be entitle to compel a party that sign the contract to arbitrate disputes relating to the contract?

A third party that did not sign a contract incorporating an arbitral clause may compel a party that did sign the
contract to arbitrate, if the contract contains a reference to a document containing an arbitral clause and the reference is
such as to make that arbitration clause part of the contract (section 7(2), UNCITRAL Model Law).

18. Does the applicable law recognize the separability of arbitration agreement?

The Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules) recognise the principle of
separability of the arbitration clause. An arbitration clause must be treated as an agreement independent of the other terms
of the contract of which it forms part. Therefore, a decision that the contract is null and void will not necessarily lead to
the invalidity of the arbitration clause (rule 2.2, Special ADR Rules).

19. What are the remedies when a party starts court proceedings in breach of the arbitral clause or initiates
arbitration in breach of a valid jurisdiction clause?

Court proceedings in breach of an arbitration agreement

Where parties have agreed to submit their dispute to arbitration, the local courts must refer the parties to
arbitration, bearing in mind that the arbitration agreement is the law between the parties and they are expected to abide by
it in good faith (rule 2.2 (A), Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules).

Arbitration in breach of a valid jurisdiction clause

A party who initiates arbitration in breach of a valid jurisdiction clause (whether contained in an arbitration clause
or in a submission agreement), can file a motion requesting the local court to refer the parties to arbitration in accordance
with the jurisdiction clause (rule 4.1, Special ADR Rules).
20. Will the local courts grant an injunction to restrain proceedings started overseas in breach of an arbitration
agreement?

Assuming that a valid application for an injunction has been filed in the local court with jurisdiction over matter,
the court can grant an injunction to restrain the parties to continue proceedings started overseas in breach of an arbitration
agreement.

21. In what circumstances can a third party be joined to an arbitration or otherwise be bound by an arbitration
award?

As a general rule, an arbitration agreement is consensual and therefore only binding on the contracting parties.
However, a third party can be joined to an arbitration or be bound by an arbitration award, if the contract between the
main parties contains a reference to a document containing a arbitration clause to which the third party is a signatory and
the reference is such as to make that arbitration clause part of the contract (section 7(2), UNCITRAL Model Law).

Specific rules apply to third party securing loans between a lender and a borrower. Unless otherwise expressly
agreed on by the third-party securing the loan, his agreement to be bound by an arbitration agreement in a loan agreement
will be limited to disputes arising from or in connection with the relationship between the lender and the borrower, as well
as the relationship between the lender and such third-party (including the right of the lender to proceed against the
collateral securing the loan) However, it will exclude disputes arising out of the exclusive relationship between the
borrower and the provider of security, such as a claim by the provider of security for indemnification against the borrower
(rule A.6, Special Rules of Court on Alternative Dispute Resolution).

22. Are there legal requirements relating to the number and qualification of arbitrator? Must an arbitrator be a
national of, or licensed to practice in the Philippines in order to serve as arbitrator here?

The parties are free to determine the number of arbitrators. However, if this is not expressly agreed, the default
position is three (Article 10, UNCITRAL Model Law (Model Law), section 19, Republic Act 9285 otherwise known as the
Alternative Dispute Resolution Act of 2004.

A person appointed as an arbitrator must be of legal age, have full civil rights and must know how to read and write. The
person appointed as an arbitrator must not (section 10, Republic Act 9876 otherwise known as the Arbitration Law)
(Arbitration Law):
 Be related by blood or marriage up to the sixth degree to either party to the arbitration agreement.
 Have or have had any financial, fiduciary or other interest in the dispute.
 Have any personal bias that might prejudice the right of any party to a fair and impartial award.
No person shall be precluded by reason of his nationality from acting as an arbitrator, unless otherwise agreed by the
parties (Article 11(1), Model Law, section 19, Arbitration Law)

23. Are there any requirements to arbitrator’s independence or impartiality?

If after appointment but before or during hearing, the appointed person discourse any circumstances likely to
create a presumption of bias or which he believe might disqualify him as an impartial arbitrator, he shall immediately
disclose such information to the parties.

Thereafter, the parties may agree in writing:

1. To waive the presumption disqualifying circumstances; or
2. To declare the office of such arbitrator vacant. Any such vacancy shall be filed in the same manner as the
original appointment was made.
24. Does the law contain default provisions relating to the appointment or removal of arbitrators?

Appointment of arbitrators
The court must act as the appointing authority (the person or institution named as such in an arbitration agreement) to
appoint arbitrators in the following instances (rule 6.1, Special Rules of Court on Alternative Dispute Resolution (Special
ADR Rules)):
 Where any of the parties in an institutional arbitration:
 Fail or refuse to appoint an arbitrator; or
 Fail to reach an agreement on the sole arbitrator (in an arbitration before a sole arbitrator).
 When the two designated arbitrators fail to reach an agreement on the third or presiding arbitrator (in an arbitration
to be conducted by three arbitrators), and the institution under whose rules arbitration is to be conducted fails or is
unable to perform its duty as appointing authority within a reasonable time from receipt of the request for
appointment.
 In all instances where arbitration is ad hoc and:
 The parties failed to provide a method for appointing or replacing an arbitrator, or substitute arbitrator; or
 The method agreed on is ineffective; and
 The National President of the Integrated Bar of the Philippines or his duly authorized representative fails or
refuses to appoint an arbitrator.
 If the appointing authority fails or refuses to act or appoint an arbitrator within a reasonable time from receipt of the
request to do so, any party or the appointed arbitrator(s) can request the court to appoint an arbitrator or the third
arbitrator as the case may be.

Removal of arbitrators
An arbitrator can be removed in accordance with the procedure agreed by the parties or as provided for in Article 13(2) of
the UNCITRAL Model Law. If challenged, an arbitrator can be removed by an appointing authority or the court, on
application, if the appointing authority fail or refuses to act on the challenge (rule 7.2, Special ADR Rules). The
disqualification can occur if the arbitrator (section 10, Republic Act 9876 otherwise known as the Arbitration Law ):
 Is related by blood or marriage within the sixth degree to either party to the controversy.
 Has or had financial, fiduciary or other interest in the controversy or cause to be decided or in the result of the
proceeding.
 Has any personal bias which might prejudice the right of any party to a fair and impartial award.

25. Does the law provide default rules governing the commencement of arbitral proceedings?

Philippine law does not provide for default rules governing the commencement of arbitral proceedings. The
parties are free to agree on the rules governing the commencement of arbitral proceedings. However, arbitration must
commence by service to the other party of a demand for arbitration (section 5, Republic Act 9876 otherwise known as the
Arbitration Law and Article 21, UNCITRAL Model Law).

26. What procedural rules are arbitrators likely to follow? Can the parties determine the procedural rules
governing the arbitration? Is there a default rules governing the proceeding?

Applicable procedural rules

Arbitrators are likely to follow the UNCITRAL Rules of Procedure, International Chamber of Commerce Rules of
Procedure and the Philippine Dispute Resolution Center Inc Rules of Procedure. The parties are also free to agree on the
procedure to be followed in the conduct of arbitral proceedings, including the adoption of procedural rules of institutional
arbitration (rule 2.3, Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules)).

Default rules
If parties fail to agree on the procedure to be followed, the arbitral tribunal can conduct arbitration in the manner it
considers appropriate (rule 2.3, Special ADR Rules), taking into account the provisions of the Republic Act 9876
otherwise known as the Arbitration Law and the Alternative Dispute Resolution Act 2004.
27. What are the procedural powers of arbitrators in the Philippines? Can the arbitrator order the disclosure of
documents?

Regardless of any agreement between the parties, the arbitrators have the power to (section 14, Republic Act 9876
otherwise known as the Arbitration Law) (Arbitration Law):
 Require any person to attend a hearing as a witness.
 Subpoena witnesses and order the disclosure of documents when relevant to the case.
 Take measures to safeguard and/or conserve any matter that is the subject of the dispute in arbitration (at any time
before rendering the award).

An arbitrator can also require the parties to produce additional evidence that it deems necessary for the
understanding and determination of the dispute (section 15, Arbitration Law).

However, that the arbitral tribunal has no inherent contempt powers; accordingly, the arbitral tribunal must apply to
the proper court to enforce such orders and request sanctions in instances of non-compliance.
The parties can also request the court for assistance in taking evidence and the disclosure of documents (rule 9.5, Special
Rules of Court on Alternative Dispute Resolution).

28. What are the documents that the parties must disclose to the arbitrators? Compare the scope of disclosure in
arbitration and court litigation.

Scope of disclosure
Much like court litigation in the Philippines, the parties are not required by law to make any disclosures to the other party
or the arbitrator, unless directed by the arbitral tribunal in circumstances of necessity, relevance and materiality. However,
the parties are not precluded from making any voluntary disclosures.

Parties' choice
In accordance with the principle of party autonomy contained in the Civil Code and section 2 of the Alternative Dispute
Resolution Act 2004, nothing prohibits the parties in agreeing to set the rules on disclosure, including an agreement to
require both parties to disclose all relevant, material and necessary facts and documents.

29. Is arbitration confidential? What is the scope of the confidentiality? Who are the subjects?

The arbitration proceedings, including the records, evidence and the arbitral award, are confidential and must not
be published (section 23, Republic Act 9285 otherwise known as the Alternative Dispute Resolution Act of
2004 )(Alternative Dispute Resolution Act of 2004).

Information is deemed confidential if it is intended by the source not to be disclosed, or obtained under
circumstances that would create a reasonable expectation on behalf of the source that the information must not be
disclosed. This includes (section 3 (h),Alternative Dispute Resolution Act of 2004):
 Communications (oral or written) made in a dispute resolution proceedings, including memoranda, notes or work
products of the neutral party or non-party participant.
 Pleadings, motions manifestations, witness statements, reports filed or submitted in arbitration.

The restriction on confidentiality applies to all the participants in the arbitration proceedings, including parties,
arbitrators and non-party participants such as witnesses, resource persons or experts and institutions.
30. What is the risk of local court intervening to frustrate domestic arbitration? Can a party delay proceedings by
frequent court application?

Risk of court intervention

The Supreme Court has laid down a policy of judicial restraint when courts are asked to rule on issues affecting
the competence or jurisdiction of an arbitral tribunal, by allowing the tribunal to have the first opportunity to rule on such
issues (rule 2.4, Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules)). Further, unless the
courts conclude that the arbitration agreement is null and void, inoperative or incapable of being performed; courts must
suspend court proceedings and refer the parties to arbitration under the arbitration agreement. Only in very specific
instances, as expressly stated in the Special ADR Rules are the courts allowed to intervene in arbitration proceedings,
therefore, the risk of local court intervention to frustrate the arbitration proceedings seated in its jurisdiction is minimal.

Delaying proceedings

A party cannot delay proceedings by frequent court applications and as a general rule, court applications during
arbitration proceedings must not suspend or postpone the arbitration proceedings.

31. What interim remedies are available from the tribunal?

Interim measures

Unless otherwise agreed by the parties, the arbitral tribunal can, at the request of a party, order any party to take such
interim measures of protection as the arbitral tribunal may consider necessary. The interim measures include but are not
limited to:
 Preliminary injunctions directed against a party.
 Appointment of receivers.
 Detention, preservation or inspection of property that is the subject of the dispute in arbitration.

Either party can apply to the court for assistance in implementing or enforcing interim measures ordered by an
arbitral tribunal (section 29, Republic Act 9285 otherwise known as the Alternative Dispute Resolution Act of 2004).

The court can only issue interim remedies in the following instances (rule 5.2, Special Rules of Court on Alternative
Dispute Resolution (Special ADR Rules)):
 Before arbitration has commenced.
 After arbitration has commenced, but before the constitution of the arbitral tribunal.
 After the constitution of the arbitral tribunal and at any time during arbitral proceedings but, at this stage, only to the
extent that the arbitral tribunal has no power to act or is unable to act effectively.

Ex parte

As a general rule, only courts can grant ex parte interim reliefs when the applicant alleges that there is an urgent need
to (rule 5.7, Special ADR Rules):
 Preserve property.
 Prevent the respondent from disposing of, or concealing, the property.
 Prevent the relief applied for from becoming defunct.

The court must also find that the reasons given by the applicant have merit.

Security

The order issued by the arbitral tribunal, granting an interim measure of protection, may be conditioned on the
provision of security, the
32. What final remedies are available from the tribunal?

Arbitrators have the power to award the expenses of any party against another party, when such assessment is
deemed necessary (section 20, Republic Act 9876 otherwise known as the Arbitration Law ).

The arbitral tribunal only has the power to decide and give a final award on matters which have been submitted to
them by the parties. Therefore, if the parties have raised the issue of damages, injunction, costs, interest or any other relief
relating to the subject matter, then the same may be awarded by the arbitral tribunal. If the parties have not raised these
issues before the arbitral tribunal, then it has no power to rule on them. As a general rule, the arbitral tribunal has the
power to grant any award or final remedy if these are submitted by the parties for resolution.

Appeals.

33. Can an award be challenged in the court? What are the grounds and procedure? Can parties waive the right to
appeal before the dispute arises?

Rights of appeal/challenge
There is no right of appeal for an arbitral award. An arbitral award is final and binding (rule 19.7, Special Rules of
Court on Alternative Dispute Resolution (Special ADR Rules)). Consequently, a party to an arbitration proceeding is
precluded from filing an appeal or a petition for certiorari (a writ seeking judicial review) questioning the merits of an
arbitral award with the courts (rule 19.7, Special ADR Rules). However, an arbitral award can be vacated, modified,
corrected, or set aside under very limited specified grounds by court action (sections 24 and 25, Republic Act 9876
otherwise known as the Arbitration Law , rule 11.1, Special ADR Rules) (see Question 3).

The exception to the general rule is an arbitral award rendered by the Construction Industry Arbitration
Commission (CIAC), which can be appealed to the Court of Appeals (rule 43, Revised Rules of Court of the Philippines).
Furthermore, a party to an arbitration can petition the Regional Trial Court to confirm, correct or vacate an arbitral award
(rule 11.1, Special ADR Rules). The decision and orders of the Regional Trial Court relating to the arbitral award can be
reviewed by the Court of Appeals and subsequently by the Supreme Court (rules 19.8, 19.12 and 19.36, Special ADR
Rules).

Grounds and procedure

An appeal to the Court of Appeals can be made on at least one of the following final orders of the Regional Trial Court
(rule 19.12, Special ADR Rules):
 Granting or denying an interim measure of protection.
 Denying a petition for appointment of an arbitrator.
 Denying a petition for assistance in taking evidence.
 Enjoining or refusing to enjoin a person from divulging confidential information.
 Confirming, vacating or correcting/modifying a domestic arbitral award.
 Setting aside an international commercial arbitration award.
 Dismissing the petition to set aside an international commercial arbitration award even if the court does not decide to
recognise or enforce such award.
 Recognising and/or enforcing an international commercial arbitration award.
 Dismissing a petition to enforce an international commercial arbitration award.
 Recognising and/or enforcing a foreign arbitral award.
 Refusing recognition and/or enforcement of a foreign arbitral award.
 Granting or dismissing a petition to enforce a deposited mediated settlement agreement.
 Reversing the ruling of the arbitral tribunal upholding its jurisdiction.

When the Regional Trial Court, has acted without or in excess of its jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction, and there is no appeal or any plain, speedy, and adequate remedy in the
ordinary course of law, a party can file a special civil action for certiorari to annul or set aside the order on one of the
following grounds] (rule 19.26, Special ADR Rules):
 The arbitration agreement is inexistent, invalid or unenforceable.
 Reversing the arbitral tribunal's preliminary determination upholding its jurisdiction.
 Denying the request to refer the dispute to arbitration.
 Granting or refusing an interim relief.
  Denying a petition for the appointment of an arbitrator.
 Confirming, vacating or correcting a domestic arbitral award.
 Suspending the proceedings to set aside an international commercial arbitral award and referring the case back to the
arbitral tribunal.
 Allowing a party to enforce an international commercial arbitral award pending appeal.
 Adjourning or deferring a ruling on whether to set aside, recognise and or enforce an international commercial
arbitral award.
 Allowing a party to enforce a foreign arbitral award pending appeal.
 Denying a petition for assistance in taking evidence.

A party, who is not satisfied with the decision of the Court of Appeals, can appeal to the Supreme Court. However,
review by the Supreme Court is not a matter of right, but of sound judicial discretion, which will be granted only for
serious and compelling reasons resulting in grave prejudice to the aggrieved party (rule 19.36, Special ADR Rules).
Arbitral awards made by the CIAC can be appealed through the standard procedure for appeal for quasi-judicial bodies to
the Court of Appeals under Rule 43 of the Revised Rules of Court of the Philippines.

Excluding rights of appeal

Arbitration is a consensual agreement between the parties. As such, parties may include a stipulation regarding
the waiver of rights to challenge an award. However, such waiver may be questioned in court as being contrary to
''...morals, good customs, public order, or public policy'' (Article 1306, Civil Code of the Philippines).

34. What legal fee structure can be used in arbitration? Is it fix?

Like in court litigation, the legal fees are subject to agreement between the lawyer and his client such as:
 Hourly rates.
 Contingency basis.
 Based on tasks accomplished.
 Success fees.
 A combination of the enumerated fee structures.
Fees may be reduced if found to be unconscionable or unreasonable (section 24, rule 138, Revised Rules of Court ).

35. Is it necessary for the unsuccessful party to pay the successful party? How does the arbitrators calculate the
amount to be paid – what are the factors?

Cost allocation
The arbitral tribunal has discretion as to how the costs of the arbitration process are awarded (section 20, Republic
Act 9876 otherwise known as the Arbitration Law).

Cost calculation
Awarded costs usually include the expenses (or a portion of them) of any party against another party. Whether a
successful party’s costs (in full or partially), can be recovered is at the tribunal's discretion.
Following the general rule in evidence, the party who asserts that he is entitled to costs has the burden of proving the
same. The tribunal is prohibited from awarding costs that cannot be proved.

Factors considered
The tribunal can takes into consideration all the circumstances of the case. An example is whether the arbitration
case presented difficult questions of law and therefore, that the losing party acted sincerely in pursuing or resisting the
claims.

Enforcement of an award
36. To what extent does local arbitration award enforceable in the local courts?

The petition for enforcement and recognition of an arbitral award can be filed anytime after the award is made.
Once the court is satisfied that the petition filed meets the requirements of rule 12 of the Special Rules of Court on
Alternative Dispute Resolution (Special ADR Rules), the court must serve a copy of it on the respondent, directing him to
file an opposition within 15 days of receipt. The respondent can file a petition to set aside the award in opposition to the
applicant's petition to recognise and enforce, or a petition to recognise and enforce the award in opposition to the
applicant's petition to set aside (rule 12.8, Special ADR Rules).

A petition to recognise and enforce or set aside an arbitral award can be filed with the regional trial court (rule 12.3,
Special ADR Rules):
 Where arbitration proceedings were conducted.
 Where any of the assets to be attached or levied on are located.
 Where the act ordered in the award will be or is being performed.
 Where any of the parties to the arbitration resides or has its place of business.
 In the National Capital Judicial Region.

If the court finds that the issue between the parties is mainly one of law, the parties may be required to submit briefs
of legal arguments, not more than 15 days of receipt of the order, which sufficiently discuss the legal issues and the legal
basis for the relief prayed (rule 12.9, Special ADR Rules).
Unless a ground to set aside an arbitral award has been fully established, the court must dismiss the petition. If, in the
same proceedings, there is a petition to recognise and enforce the arbitral award filed in opposition to the petition to set
aside, the court must recognise and enforce it (rule 12.13, Special ADR Rules).

37. What is the proper attitude of courts towards arbitration?

The Philippines has adopted a stance in favor of arbitration such that even arbitration clauses drafted in
permissive language, on which still resort to courts in alternatives, are deemed to mandate referral of disputes to
arbitration. Philippine courts also promote arbitration through interim measures of protection such as injunctive relief, and
confidentiality and protective orders. In matters of enforcement of domestic and foreign arbitral awards, the Philippine
courts further construed an apparent ambiguity in the rules of procedure in a manner that made court reliefs existing
pending arbitration also available in the execution of a confined arbitral award.

38. Do arbitral awards have the effect of res judicata?

Arbitral tribunal are not considered quasi-judicial bodies and are therefore not courts that can decide with the
effect of res judicata. Nonetheless, confirmed arbitral awards are enforceable as final and executory decision of Philippine
courts and final court rulings on incidents arising from arbitration have the effect of res judicata.