The Doctrine of Separability under Swedish Arbitration Law, IncludingComments on the Position of American and Soviet Law
By jur. kand. KAJ HOBÉR
I. Introduction
The jurisdiction of an arbitral tribunal depends on the existence of a valid arbitration agreement. When parties enter into a business agreement they often include an arbitration clause in it. When a subsequent dispute is referred to arbitration the question frequently arises what effect alleged invalidity of the agreement containing the arbitration clause will have on the arbitration clause itself. If the main agreement is invalid, does that ipso facto entail the invalidity of the arbitration clause? Such a jurisdictional plea is not seldom made by the respondent in arbitral proceedings.
This issue has acquired increasing importance under Swedish law as a result of the recent tendency to locate international arbitral tribunals in Sweden and particularly in Stockholm. Many important East-West contracts contain arbitration clauses providing for arbitration in Stockholm.1 In 1977 this practice was manifested in the so called US/USSR Optional Clause Agreement, which constitutes a recommendation by the American Arbitration Association and the USSR Chamber of Commerce and Industry to their respective members to insert the Clause into their contracts. In March 1982 the agreement was reviewed by both parties in Stockholm in cooperation with the Stockholm Chamber of Commerce.
The text of the Clause may either be reproduced in full in the contract or in an abbreviated form which was also prepared by the two institutions. The Clause stipulates that arbitration shall take place in Stockholm applying the UNCITRAL Arbitration Rules. It further provides that the Stockholm Chamber of Commerce shall act
as the appointing authority.2 It should be emphasised that the use of the Clause and its insertion into contracts depend entirely on the agreement of the parties to the contract.
Locating the arbitration proceedings in Sweden will often entail the application of Swedish arbitration law.3 Sweden, the USA and theUSSR are all parties to the 1958 New York Convention on Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention).4 An award rendered in Sweden will consequently been forceable both in the USSR and the USA, subject to the provisions of the New York Convention. Article V (1) a of the New York Convention stipulates that if the arbitration agreement is invalid —e. g. because of the alleged invalidity of the main agreement — the party against whom enforcement is sought may invoke the invalidity as a defence. Courts in the USA and the USSR may thus be confronted with the doctrine of separability when enforcement is sought of an arbitral award rendered in Sweden. A brief account will be provided of the arbitration law in this respect in these two countries.5
II. The Doctrine of Separability
When the alleged invalidity of the agreement in which the arbitration clause is embodied is pleaded in bar of the jurisdiction of an arbitral tribunal, the argument is usually that since the main agreement is invalid so is the arbitration agreement since the latter is an integral part of the former.
At first hand it might seem obvious that the arbitration agreement is invalid in the situation described; an arbitration clause relating to disputes arising out of or in connection with a contract could not really be applied unless a contract actually existed. If there is no
contract, there is no arbitration clause. On the other hand it is by no means clear why an agreement (arbitration agreement) should lose its character of an independent agreement only because it is embodied in another agreement and become legally dependent on this other agreement. Does the invalidity of the main agreement necessarily mean that the parties do not wish to refer the dispute between them to arbitration?
The doctrine of separability means that the agreements are regarded as two separate ones;6 the arbitration agreement is separable from the rest of the main contract. The fact that the latter is allegedly invalid — implying lack of jurisdiction of the arbitrators — does not prevent the arbitrators from deciding the validity issue. The issue of the validity of an agreement containing an arbitration clause may thus be submittedto arbitration if the separability doctrine is accepted. If it is not accepted, allegations as to the invalidity of the main agreement will at the same time affect the competence of the arbitrators. The separability issue is thus of significant practical importance.
In discussing the question of validity of arbitration agreements one has already implied a distinction between an agreement as a whole and an arbitration clause embodied in it. Thus, the concept of arbitration agreements has been employed e. g. in the Swedish Arbitration Act of 1929, the Swedish Act of 1929 concerning Foreign Arbitration Agreements and Awards, the New York Convention and the Swedish legislation implementing the New York Convention. The very concept of arbitration agreements implies that when two parties enter into an agreement containing an arbitration clause they enter into not one but two agreements: the main agreement and the arbitration agreement.7
The origins of the doctrine of separability are partly traceable to the notion of the necessity for a clearly identifiable agreement to refer a dispute to arbitration and thereby oust the jurisdiction of courts.8 Some legal systems used to require that the arbitration agreement was to be set forth in a separate document. The doctrine also seems to have been adopted for practical reasons, namely in order to overcome the problem of allowing arbitrators to decide disputes in which one of the parties asserts that the agreement containing the arbitration clause is invalid because of fraud in the inducement of the agreement
or for some other reason. From a logical point of view it seems difficult to explain how an arbitral tribunal can judge on its own competence when the jurisdiction of the tribunal is based on a document allegedly invalid. The basis of these difficulties is the argument that when the arbitrators embark upon the process of deciding whether they have jurisdiction or not, they may theoretically no longer have any jurisdiction because the arbitration agreement may have become invalid. The opposite view — it is argued — would mean that the arbitrators would be "pulling themselves up by their own bootstraps", which is logically impossible. The logical inconsistency from which the doctrine of separability thus seems to suffer must however be characterised as illusory since the alleged inconsistency obviously presupposes that the main agreement and the arbitration clause embodied in it constituteone and the same agreement.
III. The Present State of Swedish Arbitration Law
It should be stressed at the outset that there are no statutory provisions governing the question of the separability of the arbitration agreement from the rest of the agreement. The issue has however been addressed by the Supreme Court in two cases.
In the case of AB Norrköpings Trikåfabrik v. AB Per Persson (NJA 1936 p. 521) the facts were as follows: A knitwear factory (AB Norrköpings Trikåfabrik) had bought four powered knitting machines. The contract of sale, by reference to general conditions of the trade, contained an arbitration clause. The machines did not prove satisfactory and the buyer wanted to rescind the sale. When the buyer brought an action, the seller (AB Per Persson) pleaded the arbitration clause in bar of the jurisdiction of the Court and moved for a dismissal of the case. The buyer pleaded, inter alia, that the contract of sale was invalid because of fraud in the inducement of it and because of unconscionable behaviour and that the buyer was not bound by the arbitration clause since it formed a part of the contract of sale. The court of first instance dismissed the case for lack of jurisdiction. This decision was affirmed by the court of appeal and by a unanimous Supreme Court. The Supreme Court found the arbitration clause embodied in the contractof sale valid and binding "regardless of whether the latter could otherwise be enforced or not".
The two different opinions as to the relation between the arbitration agreement and the main agreement could hardly have been expressed more clearly than in this case. The Supreme Court based its decisionon the fact that no circumstances had been evidenced which would make the arbitration agreement invalid. The assertion that the main
agreement was invalid did not affect this finding. The decision was clearly based on the assumption that the arbitration agreement is "separable" from the rest of the agreement in the sense that an allegation of invalidity of the main agreement does not affect the jurisdiction of the arbitral tribunal; it is for the arbitrators to rule on such an allegation. The separability doctrine was thus accepted by the Supreme Court.9
In the second case — Hermansson v. AB Asfaltbeläggningar (NJA 1976 p. 125) — the majority of the Supreme Court came to the same conclusion as in the case of AB Norrköpings Trikåfabrik v. AB Per Persson. AB Asfaltbeläggningar and Hermansson entered into a lease contract. The contract contained an arbitration clause according to which disputes concerning the application and interpretation of it were to be settled by arbitration. Hermansson brought an action and moved for a declaratory judgment to the effect that the contract was invalid since there had been no meeting of the minds of the parties. It was thus alleged that the contract had never existed. Furthermore, Hermansson contended that the arbitration clause was invalid, inter alia, on the ground that the contract containing the arbitration clause was invalidin its entirety. AB Asfaltbeläggningar pleaded the arbitration clause in bar of the court proceeding and moved for a dismissal of the case, arguing that the arbitration clause was valid and binding irrespective of the fact that the contract was allegedly invalid. The court of first instance found the arbitration clause inapplicable to the dispute and accepted jurisdiction over the case. Reversing that decision, the court of appeal dismissed the case for lack of jurisdiction. The decision of the court of appeal was affirmed by the majority of the Supreme Court. In doing so, the Court employed the same language as in the case of AB Norrköpings Trikåfabrik v. AB Per Persson. It thus found the arbitration clause — included in the document referred to as the lease contract — valid and binding "regardless of whether the document could otherwise be enforced or not". The minority of the Supreme Court (two out of five Supreme Court Justices) stated, inter alia, that the question whether parties have entered into an arbitration agreement at all and whether future administration of a dispute between them should be handled by an arbitral tribunal is for the courts to decide. The minority seems to have considered the allegation of invalidity of the lease contract as referring to the arbitration agreement as well, i. e. no distinction was made by the minority between the lease contract and the arbitration clause.
The case of Hermansson v. AB Asfaltbeläggningar represents the most recent support for the doctrine of separability in Swedish case law.
The doctrine of separability has also found support among most commentators in the field of arbitration law in Sweden.10 Under Swedish arbitration law it is consequently well established that the arbitration agreement and the main agreement constitute two separate agreements; the separability doctrine is thus firmly settled in Swedish law. In this connection it may be pointed out that Swedish courts would probably accept the doctrine of separability also in relation to choice of forum clauses contained in agreements entered into by the parties.11
The doctrine will be applied not only in situations in which questions of recognising and enforcing an arbitration agreement arise but in all probability also in proceedings concerning the enforcement of foreign arbitral awards, viz. when the invalidity of the arbitration agreement—as a result of an allegedly invalid main agreement—is raised as a defence against enforcement of the award in Sweden. According to Article V (1) a of the New York Convention recognition and enforcement ofan award may be refused if the arbitration agreement is invalid. The argument is that there should be no enforcement of an award against a party who never agreed to arbitrate. The article allows the parties to choose the law to be applied to their agreement. Failing a choice of law by the parties the arbitration agreement is governed by the law of the country where the award was made. However, if the question of validity of the arbitration agreement turns on the legal capacity of the parties "the law applicable to them" should govern. This seems to make it possible for the courts of the enforcing state to use its conflict of laws rules to decide which law should govern this question.12
Article V (1) a governs the recognition and enforcement of awards but does not refer to arbitration agreements in other contexts. In Article II of the New York Convention, which deals with the recognition of arbitration agreements and their effects, there are no provisions defining the law which governs the question of the validity of the arbitration agreement. During the diplomatic conference preceding the New York Convention it was not possible to reach an agreement
on this issue. Could this omission be construed as to mean that different conflict rules apply to the enforcement of arbitration agreements and to arbitral awards? A positive answer to this question could have the effect that the same arbitration agreement would be governed by two different laws; one when the agreement is being enforced and another when enforcement is sought of a subsequent award and the invalidity of the arbitration agreement is raised as a defence against enforcement of the award. The committee preparing the Swedish implementing legislation in 1971 stated, however, that under Swedish law the same principles concerning applicable law should apply to arbitration agreements in both situations.13 The Minister of Justice agreed with this conclusion of the committee.14 It would thus seem that under Swedish law the same rules apply to arbitration agreements in both situations and that the doctrine of the separability of the arbitration agreement from the main agreement will be accepted both in proceedings in which enforcement of an award is sought and in other contexts when the question of the validity of the arbitration agreement arises.
The rationale for adopting the separability doctrine is twofold. Firstly, the acceptance of the doctrine is based on an interpretation of the will of the parties and of their contractual intent. This is the general principle in Swedish law applied to the construction of all agreements, including arbitration agreements. The mere fact that the agreement to submit disputes to arbitration is included in the main agreement between the parties should not be decisive in this respect. One should rather try to ascertain the intention of the parties, as to settlement of disputes, at the time when they included the arbitration clause in their agreement. Normally the parties are presumed to have intended that all aspects of their legal relationship should be settled by arbitration, including the question of the validity of the main agreement containing the arbitration clause.15 (If for instance the circumstances alleged in support of the invalidity claim, e. g. fraud or duress, affect only part of the agreement, it is likely that neither party would have any objection to the arbitration clause.) This presumption will prevail in the absence of circumstances indicating otherwise. Thus, the will of the parties is paramount. Secondly, the doctrine has been accepted in order to make the arbitral process effective. Owing to its advantages over litigation in courts commercial arbitration has long been relied on by businessmen to settle both international and domes-
tic disputes. The advantages of arbitration include, inter alia, a speedy and flexible settlement of disputes, possibilities to take into account special experience and knowledge of arbitrators and confidentiality; the process also may be cheaper than court proceedings, at least in acountry like Sweden in which appeal courts often function as trial courts. All these advantages—in particular perhaps those pertaining to the speed and flexibility of arbitration—are of course susceptible of being undermined. Failing the doctrine of separability, a recalcitrant party (usually the respondent) could easily delay the arbitration proceedings simply by alleging the invalidity of the main agreement.
The doctrine of separability has in fact become one of the main elements of what is conceived of as a modern and liberal law of arbitration.16 It has received wide recognition in a majority of countries including, e. g., — in addition to the USA and the USSR17 — France and Switzerland and to a certain extent also in Austria, England and the Federal Republic of Germany.18 The UNCITRAL Rules have also accepted the separability of the arbitration clause from the rest of the contract. Article 21, paragraph 2, of the said Rules stipulates that "for the purposes of Article 21, an arbitration clause which forms part of a contract and which provides for arbitration under these Rules shall be treated as an agreement independent of the other terms of the contract". (Article 21 deals with the jurisdiction of the arbitral tribunal.)19
IV. Can the Doctrine of Separability be Distinguished?
It should be emphasised that the doctrine of separability relates to allegations to the effect that a main agreement which contains anarbitration clause is invalid. Questions concerning the validity of the arbitration agreement itself may be tried in court proceedings, even after arbitral proceedings have been instituted. This follows from Section 18, second paragraph, of the Swedish Arbitration Act. The pertinent part of the section reads in translation: "...but if proceedings concerning the validity or applicability of the arbitration agreement are commenced in any court of law within such time ...". The expression "such time" refers to a six month period from the date
when the application of the arbitration agreement was called for in accordance with the rules laid down in the Arbitration Act. It thus seems possible for a party to an arbitration agreement to resort to dilatory tactics by instituting court proceedings, concurrently with the arbitral proceedings, concerning the validity of the arbitration agreement as such. All that must be alleged in the complaint is invalidity relating specifically to the arbitration agreement rather than to the main agreement. However, Swedish courts will not issue injunctions against arbitration proceedings,20 and there is no provision in the Arbitration Act which obliges the arbitrators to stay their proceedings. They may thus—if they find fit to do so—continue the arbitration proceedings. On the other hand a judgment declaring the arbitration agreement invalid is binding on the arbitrators and also in future court proceedings concerning, e.g., the challengeability of an arbitrala ward.21
In international arbitrations conducted in Sweden where none ofthe parties is Swedish, the situation is further complicated by the question of the extent to which Swedish courts are available to foreign parties wishing to bring concurrent court proceedings. Foreign parties often cannot find a forum in Sweden under ordinary jurisdictional rules and the Arbitration Act does not provide a forum for concurrentactions. Section 26 of the Arbitration Act provides, however, a forum, inter alia, for actions where an award is challenged under Section 21 of the Act. It has been suggested that the arbitration agreement stipulating arbitration in Sweden should be construed as to constitute aprorogation to Swedish courts.22 The opposite view could mean that concurrent actions would never be possible in Sweden and could also result in a somewhat peculiar situation where Swedish courts would have jurisdiction to try cases where the award is allegedly challengeable but not to try cases where a declaratory judgment is sought to the effect that the award is void.23 No court of law has yet been called upon to rule on this issue. The position of Swedish law as to the jurisdiction of Swedish courts in this respect is thus unclear.
It could perhaps be argued that application of the doctrine of separability should depend on the alleged ground of invalidity of the main agreement or that a distinction should be made between initial invalidity or non-existence of the main agreement and its subsequent
invalidity. Non-existence of the main agreement is sometimes described as an exception to the doctrine of separability.24 The argument is that if the main agreement never existed, i. e. was void ab initio, there could never have been any agreement between the parties to arbitrate, as opposed to the situation where the main agreement was initially valid but has subsequently become invalid, in which latter situation the parties have actually at one time reached an agreement to settle disputes by arbitration.
The language used by the minority of the Supreme Court in the case of Hermansson v. AB Asfaltbeläggningar could be construed as to indicate that distinctions in this respect were made. It was argued among other things that no contract had ever been concluded since there had been no meeting of the minds of the parties. The minority stated, inter alia, that the question whether parties have entered into an arbitration agreement at all—arguably implying a distinction as to other grounds of alleged invalidity—is for the courts to decide. The reasoning of the majority of the Supreme Court, however, and of the unanimous Supreme Court in AB Norrköpings Trikåfabrik v. AB Per Persson (in the latter case the contract was allegedly invalid on account of fraud and unconscionable behaviour) contains no support for the view that such distinctions were made. Moreover, to distinguish between different grounds of invalidity would seem to deny any weight to the parties' contractual intent as to the settlement of disputes when entering into an agreement containing an arbitration clause. Distinctions as to the nature of relief sought, e. g. rescission, damages or declaratory judgment, would by the same reasoning probably not be accepted by Swedish courts.
As regards the suggested distinction between initial and subsequent invalidity of the main agreement referred to above, it seems to presuppose identity of the main agreement and the arbitration clause embodied in it. Having accepted the notion of the doctrine of separability, a distinction between initial and subsequent invalidity of the maina greement cannot as a matter of principle affect the validity of the arbitration agreement. If, however, the same factual and legal circumstances pertain to both the arbitration agreement and the rest of the
agreement, the arbitration agreement would also be void ab initio, assuming that identical requirements apply to the validity of both agreements. Strictly, in order to have the arbitration agreement declared invalid in such situations, claims to this effect should relate specifically to it rather than to the main agreement. In the described situation the question of the separability of the arbitration clause from the rest of the contract is obviously reduced to a terminological problem. However, as a matter of principle, the fact that the main agreement is void ab initio does not ipso facto entail the invalidity of the arbitration agreement. Neither the AB Norrköpings Trikåfabrik v. AB Per Persson case nor the Hermansson v. AB Asfaltbeläggningar case, apart from the minority opinion in the latter case, contains statements justifying adistinction between initial and subsequent invalidity of the main agreement.
The two Supreme Court cases discussed above both deal with arbitral proceedings conducted in Sweden between two Swedish parties. There is no language in either of the two cases nor in Swedish jurisprudence indicating that the doctrine of separability would not be accepted in international cases or that a different separability concept would be applied in such cases. It is thus to be expected that Swedish courts would apply the same concept of separability both in a domestic and in an international setting.
In conclusion, we note that it is well established in Swedish arbitration law that a main agreement and an arbitration agreement embodied in it constitute two separate agreements and that no distinctions have yet been made in applying the doctrine of separability.
V. The Doctrine of Separability in the USA and the USSR
1. The USA
In the USA the doctrine of separability was introduced on the federal level by Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967).25 In that case Prima Paint purchased Flood & Conklin's paint business. A few weeks later the parties entered into a consulting agreement, according to which Flood & Conklin was to furnish advice
and consultation to Prima Paint. The agreement contained an arbitration clause. One week after the agreement was signed Flood & Conklin filed a petition for bankruptcy. Prima Paint then brought an actionin court—thus ignoring the arbitration clause—to rescind the consulting agreement on the ground that Flood & Conklin had fraudulently represented that it was solvent, whereas in fact it was insolvent. Flood & Conklin moved to stay Prima Paint's lawsuit pending arbitration. The district court and the Court of Appeals for the Second Circuit granted the stay of the lawsuit. In affirming the decisions of the lower courts the Supreme Court held that the issue of fraud in the inducement of a contract containing an arbitration clause should be left to the arbitrators. This holding meant that—as a matter of federal substantive law—an arbitration clause was deemed to be separable from the rest of a contract into which it had been included so that allegations toward the validity of the main contract were to be decided by the arbitrators rather than by the courts.26
The Supreme Court based its decision on Section 4 of the Federal Arbitration Act, which stipulates that a federal court must order arbitration to proceed if it is "satisfied that the making of the agreement for arbitration or the failure to comply there with is not inissue".27 In Prima Paint the validity of the main contract was in issue. The Supreme Court also stated that if the arbitration agreement itself is alleged to be invalid, then the federal court may proceed to a trial of this issue.28
The separability concept adopted in Prima Paint has been widely accepted both on the federal and state levels including the State of New York.29
The Prima Paint doctrine of separability has also been applied in international cases. In Island Territory of Curaçao v. Solitron Devices Inc., 356 F. Supp. 1 (S.D.N.Y.), Curaçao,30 which is a part of the Netherlands, obtained an award against Solitron Devices Inc., a New York corporation. In the enforcement proceedings under the New York Convention the American defendant claimed among other things that the agreement, which contained an arbitration clause, was made on representations of the Government of Curaçao that the wage structure would remain stable and that the agreement was terminated by reason of impossibility when the minimum wage was increased by a
new law. Relying on Prima Paint the court rejected this argument and said: "It has been determined by highest authority that 'claims of fraud in the inducement of the contract generally' are exclusively for the arbitrators."31
2. The USSR
In the USSR there are no express statutory provisions governing the separability issue. In Soviet law, however, an international treaty prevails over domestic legislation. This follows from Article 129 of the Basic Principles of Civil Legislation and Article 64 of the Basic Principles of Civil Procedure Legislation;32 these articles correspond to Article 569 of the Civil Code of the RSFSR and to Article 438 of the Civil Procedure Code of the RSFSR. In 1964 the USSR acceded to the 1961 European Convention on International Commercial Arbitration.33 Article V 3 of the said convention contains provisions concerning the competence of the arbitrators which provide for the separability of the arbitration agreement from the rest of the agreement.34 In this sense, the doctrine of separability thus enjoys statutory support in the USSR.35 Moreover, the doctrine of separability seems to have been adopted in the decisions of the Foreign Trade Arbitration Commission and also by the Maritime Arbitration Commission,36 both attached to the Chamber of Commerce and Industry in Moscow. In the area of foreign trade practice and international commercial arbitration the decisions of these two permanent arbitral tribunals constitute, in fact if not in law, the most important source of law. The following account is based on the practice developed by the Foreign
Trade Arbitration Commission (the Commission).
In proceedings before the Commission it is not unusual that the respondent pleads invalidity of the main agreement which contains an arbitration clause in bar of the jurisdiction of the Commission. The question of the separability of the arbitration agreement from the rest of the agreement has been touched upon by the Commission in several cases, three of which will be very briefly discussed below.37
In the cases of V/O Soyuznefteeksport v. Moroni & Keller (Italy),38decided in 1960, it was asserted that the contracts which contained the arbitration clauses had never been concluded, since the persons having signed the contracts on behalf of the Italian company did not have the authority to do so. The Commission did not rule directly on the question of the autonomy of the arbitration agreement but did obviously find that the allegation of invalidity of the main agreement presented no bar to its competence to try the cases.
In the case of Mayer (Switzerland) v. Cogis (Italy),39 decided in 1964, the Commission seems to have taken another position. The Italian defendant alleged that the agreement between the parties to arbitrate was invalid since the requirements of the Italian Code of Civil Procedure with respect to arbitration agreements had not been met. The Commission stated that Italian law should be applied to the contractin which the arbitration clause was embodied, since the contract had been concluded in Italy. The Commission then found that the parties had failed to observe the provisions set forth in Italian law and that the arbitration clause was therefore invalid. Consequently, the case was dismissed. In its decision the Commission does not deal directly with the separability issue but it seems to have regarded the arbitration clause as an integral part of the main contract when it applied the law governing the main contract to the question of the validity of the arbitration clause.
The most recent case dealing with the separability of the arbitration clause from the rest of the contract — No. 102/196740 decided in 1974—concerned a dispute between a Soviet foreign trade organisation and an Indian company. In this case the Commission addressed the issue more squarely. The Indian firm was of the opinion that since the main agreement was invalid, the arbitration agreement embodied in it must
ipso facto also be invalid. At the outset the Commission characterised the question of the validity of the arbitration agreement as one of procedure and went on to say that it did as a general rule deal with questions of procedure on the basis of Soviet law irrespective of what substantive law governs the contract. The Commission then stated, as to the separability issue, that if the parties to a contract have agreed that all disputes arising out of or relating to the contract should be referred to arbitration this means that they have also agreed to submit the question of the validity of the contract itself to arbitration. The decision of the Commission is obviously based on the assumption that the contract and the arbitration clause constitute two separate agreements.
Particularly in view of the 1974 decision it would seem that the Commission has now accepted the doctrine of separability. The acceptance of the doctrine of separability by the Commission has also been pointed out by a number of both Soviet and Western commentators in the field of arbitration law.41 No attempts seem to have been made to modify or distinguish the doctrine of separability.
In this context mention should be made of Article 1, paragraph 3, of the Rules of Procedure of the Commission. It provides: "The question of the competence of the Foreign Trade Arbitration Commission in a particular case shall be decided by the tribunal considering the case. "This provision expressly empowers the tribunal to try questions concerning its own jurisdiction without having to stay the arbitration proceedings. Thus, if one of the parties objects to the jurisdiction of the tribunal, e.g. on the ground that the arbitration agreement is invalid, the objection does not automatically lead to a stay or termination of the arbitral proceedings. This rule was laid down by a number of previous cases and has been confirmed and codified by the introduction of the above-mentioned article in the rules of procedure in 1975, in which year the rules were amended.