(MENAFN- KNN India)
New Delhi, Jun 19 (KNN) The Centre for Regulation of Disputes in the Micro, Small and Medium Enterprise Facilitation Council (MSME-RADIC) has notified new regulations to streamline the arbitration process for disputes referred by the Facilitation Council under the MSME Development Act, 2006.
The key highlight of the MSME Arbitration Rules, 2024 is the introduction of a fast-track procedure aimed at delivering arbitration awards within 6 months through a written submissions process, with oral hearings only if required.
"The new fast-track arbitration is a game-changer for resolving MSME disputes expeditiously," said Vinod Sharma, President of the MSME Manufacturers' Association. "Quicker resolutions will ease cash flow issues for small businesses locked in payment disputes with larger buyers."
The Rules detail the procedure from initiation to award, including submission of claim and defence statements, appointment of sole arbitrators, interim relief provisions, confidentiality requirements, and a schedule of fees based on dispute amounts.
Some of the other key aspects include: 30 days for parties to file their initial pleadings, with allowance for amendments; mandatory disclosures by arbitrators on any conflicts of interest; flexibility to hold proceedings physically, electronically or in hybrid mode; provisions for partial, consent and reasoned awards.
"We have front-loaded the processes to ensure any delays are minimised," said retired Judge A.K. Srivastava, Chairperson of MSME-RADIC. "The sole arbitrator model and written submissions default will also ensure cost-effectiveness", he added.
However, some experts raised concerns about the Rules circumventing courts' supervisory role over arbitrations.
"While the intention to expedite MSME dispute resolution is laudable, the Rules appear to go overboard in minimising court oversight, which could be problematic," said Prof. Viju Mohan, an arbitration law expert.
The Rules will apply to any new MSME cases referred by the Facilitation Council from June 1st, 2024 onwards. Their actual impact on reducing delays and costs for India's vital MSME sector remains to be seen.
(KNN Bureau)
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