Ensuring Continuity of Contracts: Enforcing Self-Cleaning as a Tool to Combat Corruption Through Arbitration

Abstract

The arbitration law scholarship includes a great number of corruption-related writings. However, what is an uncovered area is the application of arbitration for enforcing self-cleaning. Self-cleaning is a term used especially in public procurement law but may be applied for other corporate compliance purposes relating to restoring reliability. This article introduces a novel approach to apply the principle of self-cleaning in an arbitration context by examining whether contracts and the business relationship can be saved by the parties’ action in cases where corruption is evident by analyzing the applicability of arbitration as a method of self-cleaning for rehabilitation. Based on our findings, we demonstrate how this is possible.
          In the last ten years, contractual approaches to fight corruption have emerged and these apply the principle of proportionality to the need to call a contract terminated in case corruption is discovered. We are using the landmark International Chamber of Commerce (ICC) Anti-Corruption Clause 2012 (“the ICC Anti-Corruption Clause”) as an example. The ICC Clause purports to preserve the validity and continuity of the contract by providing remedies to the violations of the ICC Rules on Combatting Corruption 2011 (“ICC Anti-Corruption Rules”). The parties of a contract adhere to these Rules explicitly with a view to create an impact on their relationship. The key idea is that a party to a contract could, in many, although not all, cases remedy its breach of contract constituted by not adhering to the Rules.