Review On Zhejiang Yisheng Petrochemical Co. Ltd. Case

With the development of economic globalization and economic transactions among countries, varieties of disputes will inevitably arise. Owing to the unique advantage of international commercial arbitration in solving disputes, many parties will choose to submit the dispute to arbitration mechanism to resolve. However, because of both parties in agreement not familiar with the arbitration mechanism, it is very possible for them to cause a lot of blemish arbitration agreements, therefore, how to use “in favor validities” to remedy the pathological arbitration agreement displays a particular importance. By Zhejiang Yisheng Petrochemical Co. Ltd. case, the paper points out the application of “in favor validities ” in that case, then it further defines the meaning and application scope of this principle, and makes a systematic analysis of the pathological agreement. Finally, it summarizes and emphasizes the importance of “in favor validities” to remedy the defect arbitration agreement.This thesis is divided into four parts, including:The first part introduces the basic facts of the case and the relevant court's different recognition of the case, and then based on various grounds for the court to find this case, this paper probes to extract “in favor validities ”principle, meanwhile it attempts to analyze how to understand and apply “in favor validities ”for the court in the present case.The second part clarifies the theoretical foundation of “in favor validities ”. It mainly includes three aspects: based on autonomy of will, refer to teleological interpretation, and combined with a analysis on this case. First of all, it discusses the relative theory of autonomy of will, the relativity of arbitration agreement and the intensive role of “in favor validities ” in remedying the pathological arbitration agreement. Secondly, it clarifies the necessity of teleological interpretation and points out to sustain “in favor validities” by teleological interpretation. Thirdly, it focuses its attention on analyzing the application of “based on autonomy of will, refer to teleological interpretation” in this case.The third part discusses the application of “in favor validities” when arbitration agreement is defective. In practice, Although it often occurs that the arbitration agreement turns out invalid due to one of two parties suffering fraud or coercion or matters in agreement beyond the scope of arbitration agency, the invalidity of arbitration agreement due to not to be clearly agreed in arbitration agency is especially common, thus in theory causing a heated discussion between scholars, and the principle-“in favor validities ”is enshrined in the judicial interpretation. So here I elaborate the issue from different perspective by classification, meanwhile, some immature understanding and solutions to specific issues are gradually proposed, and combined with the context, the importance of “in favor validities ”principle are to be discussed in remedying pathological arbitration agreement. The defect arbitration agreement in this section mainly includes three types: arbitration institution not agreed; not to be explicitly agreed in arbitration institution; two or more of the agreed arbitration institution.The last part returns to the core case of this paper “Zhejiang Yisheng Petrochemical Co. Ltd case”. By analyzing the different issues arising from this case before and further thinking about, the author is enlightened in two aspects. So as to pay more respect to the autonomy of will of the concerned party, Firstly, it is necessary to gradually improve the arbitrary institution and eliminate its loophole, and admit the validity of temporary arbitration; Secondly, it is urgent for us to understand the meaning of “a clear arbitration institute shall be included in arbitration agreement” in broad sense in article 16 of arbitration law.