The Judiciarys Law Journal

The Judiciarys Law Journal

Feasibility study of recognition of the "principle of privity of arbitration agreement" in the legal system of Iran and the United States (by examining the judicial procedure)

Document Type : Research/Original/Regular Article

Authors
1 Ph.D student, Department of Law, Shahr-e-Qods Branch, Islamic Azad Uniwersity, Tehran, Iran
2 Professor of Private Law Department, Faculty of Law, Mofid University, Qom, Iran
3 Department of Law, Shahr-e-Qods Branch, Islamic Azad University, Tehran, Iran
10.22106/jlj.2025.2049424.6158
Abstract
The doctrine of privity of contract at first glance includes all types of contracts, including the arbitration agreement, and does not face any exceptions except according to the law. But based on the requirements of today's societies, in the arbitration process, dealing with disputes related to third parties in the context of modern international business transactions, which usually include complex networks of intertwined agreements and multi-layered legal obligations with the presence of numerous and often related legal entities, it's inevitable.
Extension of the arbitration agreement to a third party and the possibility of the third party to rely on it, has always been a subject of debate in various legal systems and has been accepted in many systems based certain grounds. This has made the acceptance of the privity of arbitration agreement as a principle doubtful.
In this research, with the descriptive-analytical method and by studying in library sources, by examining the legal system and judicial procedure of Iran and the United States, we have come to the conclusion that in the legal system of Iran, if Extension of the arbitration agreement to a third party and the possibility of the third party to rely on it can be justified based on the general rules of contracts is acceptable, otherwise, our legal system still does not have an answer to this issue, and the principle of privity of the arbitration agreement and the non-acceptance of the extension of the arbitration agreement to third parties should be ruled on; An approach that has also been adopted in the draft of "Comprehensive Arbitration Plan" of Iranan Parliment.
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Volume 88, Issue 128
Spring 2025
Pages 119-150

  • Receive Date 30 December 2024
  • Accept Date 09 May 2025
  • First Publish Date 09 May 2025
  • Publish Date 19 February 2025