The Previous Mongolia Arbitration Law consisted of 43 clauses while the newly revised Arbitration law consists of 52 clauses. The new Mongolia Arbitration Law is drafted to be mostly based on the previous Arbitration Law with a few key changes.
Under the new Mongolia Arbitration Law the following “Temporary Actions” may be taken to secure the implementation of an Arbitration decision:
- Force the continuance or restoration of the status quo until dispute is resolved;
- Parties may be compelled to not take actions which may affect arbitration proceedings and may take preventive actions to prevent further damages;
- Take actions to protect property aa may be necessary for ensuring the enforcement of of a final arbitration award;
- Take action to preserve evidence which is significant for the resolution of the dispute or otherwise related to the dispute.
The following conditions must be met in order to take such protective measures
- The request for the temporary action should be clear and enforceable;
- if no actions are taken, it will be impossible to compensate, in full, the damage enforceable under the principle award;
- The amount of the potential damage should be greater than amount of potential damage which may incur as a results of the temporary actions if taken;
- there is a reasonable possibility that the dispute may be resolved positively for the Party requesting the temporary action.
If the arbitration panel considers that informing one party of the request for Temporary Action submitted by the other party, the panel may do so. The party so notified will have the opportunity to provide arguments relating to the request for Temporary Action.
The arbitration panel may request the Party requested the temporary actions, to provide appropriate financial guarantee in relation to the said actions.
This is a positive change to the Arbitration Law which will give Arbitration more “teeth” and better ways to be effective at both resolving disputes and securing an appropriate compensation for a grieved party seeking redress. Our experienced Mongolia lawyers are excited at the new options provided by this change the Arbitration Law and we are looking forward to see these Temporary Actions take effect in our own cases.