ARBITRABILITY OF STATUTORY DISPUTES IN MEXICO

The legal nature of arbitration refers to a legal relationship through which the parties in a legal conflict voluntarily seek to resolve their problems extrajudicially, this extending to different areas of law, including corporate law.

Specifically in mexican statutory arbitration, when the arbitration clause is incorporated in the founding bylaws of a company, it does not only oblige and bind founding shareholders who voted in favor of such incorporation, but also to those that didn’t attended to vote and even to those others who, having attended, voted against the act. It is for the foregoing that as a principle and in a general way, when an arbitration clause is not provided in the bylaws, it is not possible to arbitrate matters arising from merely corporate acts.

As another matter, if an arbitration clause is effectively established in the bylaws, it would include the rights and obligations of all partners, as well as the rules that govern the company in its internal life, operation and regulation, therefore that the will of the partners, which is the supreme law of commercial law and arbitration, would be clear when deciding the arbitrability of disputes related to corporate matters.

However, it is a common practice that the shareholders of a commercial company make agreements to determine, among other issues, the structure of the capital stock, the exercise of voting rights, and the organization and operation of the company, that is to say, specific content regarding rights and obligations of the shareholders towards the shareholders, that is to say, the regulation of private relationships between them. In these contracts it is also possible to establish arbitration clauses, which could not, even if they contemplated all of the shareholders of a company, attend to statutory disputes if it is not explicitly established or there is a verbatim incorporation of the arbitration clause in the company’s bylaws.

Following this line of ideas, the Hong Kong Court established in Dickson Holdings v. Moravia, that even if in the generality of arbitration clauses it is established that arbitration extends to resolve disputes that originate from the contract or that have a relation with it, and these terms are usually interpreted in a quite broad way, it should not be considered that an arbitration clause established in a contract between shareholders to regulate their interpersonal relationships is extensible to disputes related with the company.

Therefore, it is stated that for statutory disputes to be settled through arbitration, the arbitration clause must be incorporated into the bylaws, or else, have an explicit scope to settle issues related to them.

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