Spain

• Courts' willingness and ability to intervene in the arbitration process
• Appeals and setting aside awards
• Consolidation
• Injunctions
• Mandatory provisions
• Further details

Courts' willingness and ability to intervene in the arbitration process

Arbitration covenants have an “adverse effect” in that they prevent the Courts from intervening in disputes submitted to arbitration. If the parties have submitted a dispute to arbitration, but one of them opens a judicial proceeding in relation to the same dispute, the other may oppose such proceeding by submitting a jurisdictional plea (declinatoria), requesting the Judge to withdraw from hearing the case. This does not prevent the commencement or continuation of arbitration proceedings.

Judicial involvement in issues submitted to arbitration are restricted to those support and control proceedings expressly provided for in the law:

• to appoint arbitrators if (i) they cannot be appointed under the procedure agreed by the parties; and (ii) any party applies to the competent court (Articles 8 and 15)
• to remove arbitrators (if the arbitrator is de facto or de jure unable to perform his/her functions, or acts with undue delay): when there is a disagreement about the removal of the arbitrator and the parties have not provided for a procedure to resolve this, or when the designated arbitrators are not able to reach an agreement (Articles 8 and 19)
• to give assistance in the taking of evidence (Articles 8 and 33)
• to award interim relief/injunctions (Articles 8 and 11)
• to enforce the awards granted by the arbitral tribunal (Articles 8 and 44)
• to set aside the arbitral award (Articles 8 and 40-43)
• to recognise foreign arbitral awards (Articles 8 and 46).

Appeals and setting aside awards

An arbitral award may be set aside by a Court of Appeal (Tribunal Superior de Justicia) only if the party making the application alleges and proves (Articles 40 to 43):

• that the arbitration agreement does not exist or is not valid
• that he was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case
• that the arbitrators have decided questions not submitted to their decision that the arbitrators have been appointed or the arbitral procedure has not been conducted in a manner complying with the parties’ agreement, unless such agreement was in violation of a provision of the Spanish Arbitration Act (from which the parties cannot derogate) or, in the absence of such agreement, was not in accordance with the Spanish Arbitration Act
• that the arbitrators have decided on issues which cannot be settled by arbitration
• that the award is in conflict with public policy.

The possibility of an award being set aside is therefore very restricted under Spanish law. Furthermore, recent judgments issued on 15 June 2020, 15 February and 15 March 2021 by the Spanish Constitutional Court have emphasised the limited nature of such proceedings. In the face of a tendency of certain Spanish High Courts of Justice to extensively apply the public policy concept to review the merits of arbitration cases, the Spanish Constitutional Court clarified that the standards of ordinary and extraordinary appeals cannot be applied in set aside proceedings. The Spanish Arbitration Act, based on the freedom of choice exercised by the parties, limits the terms and circumstances under which a party may set aside an arbitration decision. In particular, the Spanish Constitutional Court clarified that due process and procedural guarantees are only breached in this context when the arbitral award is either “arbitrary, illogical, absurd or irrational”.

An application for setting aside shall be made within two months from the date on which the party making that application had received the award or, if a request for correction, clarification or to supplement the award had been made, from the date on which the party making that application received the decision on such request, or from the date on which the term for rendering such decision expired. The judgment rendered in respect of an application to set aside is not subject to appeal.

The arbitral award has res judicata effects. There is no general right of appeal. However, extraordinary revision is possible in accordance with the procedure established in the Civil Procedure Act for final judgments (Article 399) in very limited cases (Article 510 of the Spanish Civil Procedure Act) where:

• decisive documents are uncovered or obtained which had not been available before due to force majeure or wilful action by the party benefited from the award
• an award is made on the basis of evidence of documents found to be forgeries in criminal proceedings
• an award is made on the basis of testimony given by witnesses or experts which has subsequently been found by the court to be false; or
• an award is unduly obtained by bribery, violence or fraud.

Consolidation

The arbitral court does not have the authority to order the consolidation of related arbitrations without the consent of all parties.

Injunctions

The arbitrators may award interim relief and the parties are presumed to accept the arbitrator’s authority to do so unless such authority is expressly excluded by the parties or the arbitration rules governing the arbitration. Arbitrators do not have executive powers, therefore the judicial courts are needed to enforce interim relief granted by arbitral decision, which the courts will do as if it were a final award.

The arbitrators’ authority to grant interim relief does not affect the parties’ right to request the adoption of interim relief by the judicial courts.

Mandatory provisions

Most provisions of Spanish arbitration law may be excluded by agreement between the parties. However, relevant mandatory rules include, inter alia, the following:

• The arbitration agreement shall be verifiable in writing, in a document signed by the parties or in an exchange of letters, telegrams, telex, facsimile or any other means of communication that provides a record of the agreement. For the purposes of international arbitration, the arbitration agreement is valid and the dispute is capable of arbitration if it complies with the requirements established by the legal rules chosen by the parties to govern the arbitration agreement, or the legal rules applicable to the merits of the dispute, or Spanish law.
• The parties can only enter into arbitration disputes relating to matters within the free disposition of the parties according to law. Where the arbitration is international and one of the parties is a State or a company, organisation or enterprise controlled by a State, that party shall not be able to invoke the prerogatives of its own law in order to avoid the obligations arising from the arbitration agreement.
• The parties are free to agree on the procedure to appoint arbitrators as long as the principle of equal treatment is respected. Likewise, the only limit to the parties’ free will to choose the procedure to be followed is also the equal treatment principle and the parties’ right to fully present their case. Furthermore, the Spanish Arbitration Act also requires that arbitrators, parties and arbitral institutions, as appropriate, honour the confidentiality of the information received during the proceedings.
• Arbitrators are obliged to take out liability insurance or an equivalent guarantee. The amount of said insurance shall be fixed by regulation.

Further Details

For further details see Law 60/2003 of 23 December 2003 on Arbitration as amended by Law 11/2011 of 20 May 2011.

Arbitrators' attitude to procedure

The Spanish Arbitration Act is based on the principle of the parties’ free will (principio de autonomía de la voluntad). The rules on the arbitration procedure are generally not mandatory (dispositivas) and are only applicable if the parties have not agreed other provisions or have accepted institutional arbitration or arbitration rules. 

The parties are free to agree on the procedure to be followed by the arbitrators. In the absence of such an agreement, the arbitrators may, subject to the provisions of the Spanish Arbitration Act, conduct the arbitration in the manner they consider appropriate. The arbitrators are given various powers which include determining the admissibility, relevance and usefulness of any evidence; the manner in which evidence is taken, and its weight. Spanish arbitrators come from a civil law background in which discovery of documents is not common.

Unless otherwise agreed by the parties, the arbitrators decide whether to hold oral hearings to present oral arguments, evidence and submit conclusions, or whether the proceedings are to be conducted solely in writing. However, unless the parties have agreed that there will be no oral hearings, the arbitrators may hold such hearings as appropriate if so requested by one of the parties.

All statements, documents, expert reports and evidence provided to the arbitrators by one party must be communicated to the other party.

The arbitrators decide in equity only if the parties have expressly authorised them to do so.

In international arbitration, the arbitrators decide on the dispute in accordance with the rules of law selected by the parties. The designated legal system must be construed, unless otherwise stated, as referring to the substantive law of that State and not to its conflict of law rules. Failing any designation by the parties, the arbitrators apply the law that they consider appropriate. In all cases, the arbitrators’ decision is made in accordance with the terms of the contract taking into account applicable common practice.

Where there is more than one arbitrator, any decision must be made by a majority, unless otherwise agreed by the parties. If there is no majority, the decision is made by the presiding arbitrator who may make decisions himself as to the order, formalities, and progress of the proceedings, unless otherwise agreed by the parties or by the arbitrators. At least one of the members of the arbitral tribunal shall have the status of lawyer.

Arbitrators' role in settlement

Spanish arbitrators do not usually involve themselves in promoting the settlement of the dispute. If, during arbitral proceedings, the parties wholly or partially settle the dispute, the arbitrators will terminate the proceedings in respect of the points agreed and, if requested by both parties and not objected to by the arbitrators, record the settlement in the form of an arbitral award on agreed terms.  

Costs of arbitrations

It is common practice for the cost of arbitration to be paid by the losing party.

Availability of arbitrators

In Spain, there is a large pool of capable arbitrators of all disciplines, many of who have extensive experience in international arbitrations.