Nonarbitrability and Mandatory Rules: Brothers, Not Twins

Notwithstanding the lack of clear legislative intent, Belgian judges have unilaterally prohibited the arbitration of exclusive distribution disputes, unless a specific Belgian pro-distributor statute was applied or unless similar substantive foreign rules were applied. However, in 2023, the Court of Cassation finally reversed its jurisprudence. Yet, the syllogism underlying this longawaited reversal remains unsatisfactory. It mistakenly equates a conflict-of-laws issue concerning mandatory rules with questions of nonarbitrability under international arbitration law. Such an overly simplistic assimilation is inappropriate in many respects. It dilutes the tailored legal standard applicable to international arbitration into a lesser question of applicable rules. It unduly prevents a subject matter from entering ratione materiae into the arbitration field. Upon closer examination, it conflates two substantively different gateways to arbitration: the nonarbitrability doctrine (Article V(2)(a) of the New York Convention) and the public policy exception (Article V(2)(b) thereof). In so doing, it needlessly erodes confidence in the arbitral process, which is based on parties’ autonomy, and violates the principles of judicial non-interference in international arbitral proceedings and of competence-competence. In essence, regardless of the pro-arbitration outcome in the case at hand, this flawed syllogism violates the New York Convention’s straightforward language and pro-arbitration ethos by potentially generating unnecessary, unforeseeable, and improper exceptions to arbitration.