## Facts

- Two French construction companies and two Egyptian companies formed a joint venture to perform civil works in Egypt.
- The joint-venture contract selected “the laws in force in Egypt” as governing law and provided for arbitration under the ICC Rules.
- The arbitration clause did not specify a seat of arbitration.
- After a dispute arose, the French companies initiated ICC arbitration.
- Under the ICC Rules, the ICC Court fixed the Netherlands as the place (seat) of arbitration; the Egyptian companies had indicated The Hague as an acceptable place.
- A preliminary dispute arose over the law governing arbitral procedure:
  - The Egyptian companies argued the contract’s Egyptian choice-of-law clause made Egyptian civil procedure law applicable to the arbitration.
  - The French companies argued Egyptian law governed the merits, but Dutch law (as the seat’s law) governed procedure, together with the ICC Rules.
- The tribunal issued an interim award deciding the applicable procedural law and whether the arbitration was local or international.

## Issues

1. Whether the proceedings should be treated as a local Egyptian arbitration subject to Egyptian civil procedure law.
2. Whether a contract clause selecting “the laws in force in Egypt” governs arbitral procedure, or whether procedure is governed by the law of the seat (Netherlands) supplemented by the ICC Rules.
3. Whether, absent an express seat or express procedural-law choice, the parties can be taken to have chosen a particular national procedural regime through the combination of a substantive choice-of-law clause and ICC arbitration clause.

## Decision

- The tribunal classified the arbitration as international rather than a purely local Egyptian arbitration.
- The tribunal held that the Egyptian choice-of-law clause governed the substantive contractual relationship, not the arbitral procedure.
- Because the Netherlands was the seat fixed under the ICC Rules, Dutch arbitration law governed procedural matters, alongside the ICC Rules.
- The tribunal rejected the argument that Egyptian civil procedure law applied to the arbitration merely because the project was in Egypt and Egyptian law governed the contract.

## Legal Principles

- The law governing the contract (lex causae) is distinct from the law governing the arbitration procedure (lex arbitri).
- A general contractual choice-of-law clause does not, without clear and specific language, incorporate that state’s civil procedure law as the procedural law of the arbitration.
- When the parties do not choose a seat, an institutional mechanism (here, the ICC Court under the ICC Rules) may fix the seat; the seat’s law then supplies the arbitral procedural framework and identifies the supervisory courts.
- An arbitration may be international even where performance is closely connected to a single state and that state’s law governs the merits.

## Conclusion

The interim award treated the arbitration as international and held that procedural questions were governed by Dutch arbitration law as the law of the ICC-designated seat, supplemented by the ICC Rules, while Egyptian law governed the substantive contract; a generic Egyptian choice-of-law clause did not make Egyptian civil procedure law the arbitral procedure.


Interim Award in ICC Case No. 5029, XII Y.B. Comm. Arb. 113 (1987)