The Validity of the Third Party Funding in Arbitration Contract in the Legal System of Iran

Document Type : Original Article

Authors

1 PhD in International Trade and Investment Law, Shahid Beheshti University, Tehran. Iran: (Corresponding Author).

2 Assistant Professor of Private Law, Semnan Branch, Islamic Azad University, Semnan, Iran.

Abstract

The third party funding in international arbitration (TPF), is a new and emerging phenomenon. TPF is a new way in which a third-party funder, if his client wins, deserves an agreed amount with his client, but failing, He has no right to refer to the client for the costs incurred.
The purpose of this article is to describe and analyze the validity of the Third Party Funding in Arbitration contract in The Legal System of Iran. Accepting the validity of this concept in Iranian law can be disputed due to the lack of regulations and the impact of some concepts such as non-alea rule and aleatory contract. On the other hand, the increasing number of court cases requires more attention to arbitration and its expansion. On the other hand, this requires paying attention to the provision of arbitration costs. It seems that the validity of the Third Party Funding in Arbitration contract in The Legal System of Iran was accepted in the framework of Article 10 of the Civil Law by accepting the custom to recognize the transaction as "Alea". An issue that, in addition to creating a new field of investment, can lead to the development of arbitration and help the judicial system and reduce the increasing number of cases in judicial authorities; And it can strengthens the position of country as the seat of international arbitration.

Keywords

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Journal of Studies in Islamic Law & Jurisprudence
Volume 16, Issue 36
November 2024
Pages 61-78

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