DISCLOSURE OF THIRD PARTY FUNDING IN ARBITRATION: AN INDIAN PERSPECTIVE
—Tariq Khan and Shruti V. Khanijow
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This paper focuses on the interaction of Third Party Funding (TPF) and disclosure requirements in arbitration, specifically in Indian context. Impartiality and independence of arbitrators are key elements of effectiveness and due process in non-state actors resolving disputes between parties. With TPF emerging as a potent tool for pursuit of claims by Indian parties, it becomes essential to understand and explore this key element of arbitration - privity of contract between parties to Arbitral reference and the impact of TPF by an undisclosed party. The paper contends, that amongst the various stages at which such disclosure requirement can be imposed at, it is best to impose such disclosure requirement as early as possible. The paper then discusses the potential threat to confidentiality posed by TPF to the arbitration itself and the threat the disclosure requirement poses to the confidentiality of the funder. The paper posits robust Non-disclosure agreements between the funder and the funded party as a way to protect the confidentiality of the process. The paper concludes, by noting the need of amending Section 42A and Section 12 of the Arbitration and Conciliation Act, 1996, along with having a wellbalanced and holistic code with regard to disclosures in TPF in India.