– Aishwaryah M
An increasingly globalized world necessitates strengthening the versatility of institutions and legal frameworks across the world in order to ensure that inter country transactions, relationships and conflicts are provided certainty with respect to their legal status. This article explores the significance of transnational law and the hurdles encountered in this process of expanding Indian jurisprudence on the subject. Primarily, this article is concerned with three pillars: economy, society and dispute resolution; each of these aspects are explored with reference to requisite case laws to establish the current position in the eyes of the law.
- Relationships
Due to inter country migration rates being at an all time high, the realm of family law has undergone massive change with respect to its application to matters with an element of cross border relationships. The Parliament of India has the power to legislate on matters with an extra territorial effect under Article 245. To this effect, several pieces of legislation; both personal and secular family law, have such application. The most important of these happens to be the dilemma around cross border adoption;
In this case before the Karnataka High Court, an Indian couple residing in Uganda adopted a child as per the law in Uganda and wished to regularize it according to Indian law by way of an application to the Central Adoption Resource Authority. But such an application went unattended due to the lack of a framework for cross border adoption with respect to countries that are non signatories to the Hague Convention (such as Uganda). The High Court then ruled that in such cases, there is a gap in existing law as neither the Juvenile Justice Act nor the Adoption Regulations are equipped with an answer to this question. However, in light of equity and good conscience, the rights of a child that has been validly adopted abroad, irrespective of such country’s allegiance to the Hague Convention, much be respected. Accordingly, a writ of mandamus was passed that directed the grant of a no objections certificate to the petitioner thus regularizing the adoption of the child.
- Transactions
Cross border transactions often lead to a plethora of ambiguities. In order to avoid the same and streamline these processes, courts across the world attempt to establish a clear legal framework as to the law governing these transactions to ensure greater certainty and ease of doing business. An important concern under this is that of cross border insolvency. The jurisprudence regarding cross border insolvency has remained stagnant due to the lack of any legislative support for the same in the Insolvency and Bankruptcy Code of 2016 except for a standalone section 234 that permits Central Government to enter bilateral agreements with foreign jurisdictions regarding the question of insolvency and resolution. The proposal for a Draft Z that comprehensively deals with the topic on the lines of the directive of the UNCITRAL Model framework is yet to see fruition. Nevertheless, the following cases shed some much needed light on the position of cross border insolvency in the country;
Jet Airways, a leading airline operating in India, faced acute financial distress in the year of 2018. Following their inability to pay employees their salaries and multiple defaults on debt repayments, they were forced to file for insolvency under IBC before the National Company Law Tribunal at Mumbai. A few months prior to this, the company had already commenced bankruptcy in Netherlands. In this case before the NCLT, it was held that the Netherlands proceedings were null and void in the eyes of Indian law due to the non-existence of a cross border insolvency framework in India. Instead, a bilateral agreement was signed between the countries through a resolution professional from India and an appointed trustee representing the Netherlands to ensure cooperation through the insolvency proceedings.
- Dispute Resolution
Law is primarily concerned with the exercise of dispute resolution. But when sensitive issues of a transnational character arise, traditional form of adversarial litigation is the least preferred mode for its resolution. This has led to the rise of several alternate dispute resolution mechanisms such as Arbitration, Mediation and Conciliation but their integration with Indian laws is still an ongoing process. The following authorities lead the way in clarifying the Indian position on international arbitration;
In this case, the principal issue surrounded interpretation of s. 29A of the Arbitration and Conciliation Act of 1996. The applicant and respondent had entered into an inter se agreement to notarise their mutual understanding of certain sale and purchase of primary and secondary shares by the parties. However, disagreement arose as to the fruition of the agreement and the same led the applicant to invoke the arbitration clause. Such an arbitration, by virtue of the parties being Indian and Japanese respectively, assumed the nature of an international commercial arbitration. The applicant contended that such arbitration falls within the scope of the Arbitration and Conciliation Act, therefore making its interim application for automatic extension of the mandate of the arbitrator valid in law. But the Court rejected such interpretation by calling attention to the amendment of the Act in 2019 that specifically precludes the application of this section to international commercial arbitration.