Common use of Settlement of Disputes between the Parties Clause in Contracts

Settlement of Disputes between the Parties. 1. The two Contracting Parties shall endeavour, in good faith and in a spirit of cooperation to achieve prompt and fair settlement of any dispute between them regarding the interpretation, application or termination of this Agreement. In this regard, the Contracting Parties agree to enter in direct and meaningful negotiations to arrive to a settlement. If the parties did not reach an agreement within a period of six months from the date on which the question was raised by one of the Contracting Parties, it may be submitted at the request of either Party, to an arbitral tribunal composed of three members. 2. Within a period of two months from the date of receipt of the said request, each Contracting Party shall in turn designate a third-country national as President of the Court. If one of the Contracting Parties has not designated its arbitrator within the period indicated, the other Contracting Party may request the President of the International Court of Justice to designate an arbitrator. If the two arbitrators fail to agree on the choice of the President within two months of their appointment, the President shall be designated, upon request of either Contracting Party, by the President of the International Court of Justice (ICJ). 3. If, moreover, the President of the International Court of Justice (CIJ) is unable to exercise his functions in accordance with the preceding paragraphs 2 and 3 of this article, or if the President of the International Court of Justice is a national of one of the Contracting Parties, the Vice-President of the International Court of Justice will take the decision to proceed with the appointment. However, if the Vice-President cannot exercise this function or if he is a national of one of the Contracting Parties, then the senior member after the Vice-President will take the decision to appoint, provided that he does not is not a national of a country of one of the Contracting Parties. 4. The arbitral tribunal shall take its decisions by majority vote, and those decisions are final and enforceable by the Contracting Parties. 5. Regarding its procedures, the tribunal apply the principles of UNCITRAL, and regarding the substance of the dispute, apply the rules of this Agreement, the applicable provisions of international law. The place of arbitration will be The Hague (Netherlands), or Stockholm (Sweden). 6. All complaints must be submitted and all debates closed within eight months of the date of appointment of the third member unless otherwise stipulated. The court submits its decision within two months from the date of filing of the final claims or the date of the end of ordinary sessions regardless of the order of succession. 7. The two Parties contribute equally to the expenses of the President, the two arbitrators and to the costs of the other proceedings. However, the court may decide to charge the Parties a higher sum. 8. It is not permitted to submit a dispute to arbitration by the court in accordance with the provisions of this article, if this dispute has already been submitted to arbitration by another court in accordance with the provisions of article 9 and if he is still under investigation at the level of this court. However, this situation does not prevent the two Parties from consulting each other for direct and constructive negotiations.