MARITIME LABOR MEDIATION AND ARBITRATION CENTRE ARBITRATION RULES

• Purpose

MAC (Maritime Labor Mediation and Arbitration Centre) is an institution that aims to resolve disputes between the parties by ad hoc arbitration method.

"Ad hoc" arbitration, which is one of the alternative dispute resolution methods, aims to resolve disputes fairly and reliably within a reasonable period of time, at more affordable costs, by the arbitrators chosen by the parties with their free will.

In this way, MAC aims to resolve disputes by taking into account the unique rules, realities and maritime traditions of the maritime sector.

Within the scope of the MAC rules, it is possible for the parties to determine the procedural rules, to choose the applicable law, the place of arbitration, the language of arbitration and to determine the Arbitration Tribunal. Awards made in the arbitration process are final and easy to enforce. These reasons listed above ensure that arbitration is effective in meeting the needs of the maritime sector.

• Scope and Field of Application

This set of rules shall apply in the event of a dispute between the company and the marine employee who has signed any of the Collective Agreements approved by the International Transport Workers’ Federation (ITF) and has accepted the arbitration clause. The arbitral awards to be taken in accordance with these rules shall be suitable for execution and enforcement and shall be binding on all parties.

• Initial Provisions Article 1 – Definitions
• In these Rules:
  • “MAC”; is the MARITIME LABOR MEDIATION and ARBITRATION CENTER headquartered in 9 Level 4 TRIQ IL-PAPA URBANU VIII BIRKIRKARA BKR 1425 Malta.
  • “MLAC”; is the Maritime Labor Arbitration Council, which is the independent arbitration body of the MAC.
  • “ITF” is an INTERNATIONAL TRANSPORT WORKERS’ FEDERATION headquartered in ITF House, 49-60 Borough Road, London, SE1 1DR, UK.
  • “ILO” is the International Labour Organization operating before the United Nations (UN) in order to develop and advance standards in labour laws and practices in this field in countries.
  • “Convention” is the Maritime Labour Convention (MLC), adopted by ILO at the Geneva Conference in February 2006, regulating maritime labour life. MLC is a “force major” international convention that sets minimum standards for the working and living conditions and social rights of marine workers all over the world.
  • “Company” means the company or companies defined in Article II(j) of the Convention.
  • "Employer"; refers to the shipowner, operator, agent who is the party to the dispute subject to arbitration.
  • "Marine Employee" refers to marine employees who are parties to the dispute subject to arbitration, work on ships and comply with the definition made in Article II(f) of the Convention.
  • "Vessel" means "Vessels" that comply with the definition in Article II(f) of the Convention.
  • "Award" means an interim decision, partial decision or final decision made within the scope of the arbitration process.

• “Arbitration Tribunal” is the board of arbitrators authorized to resolve disputes arising from the seafarer service contract between the parties.
• “Applicant” means the party or parties claiming that their rights have been violated in an arbitrable dispute and requesting the dispute to be resolved.
• “Counterparty” means the party or parties to which the applicant claims that his or her rights have been infringed.

Article 2 – Maritime Labor Arbitration Council

• The Maritime Labor Arbitration Council (hereinafter referred to as the “Council”) is the independent arbitration body of the MAC. The Council is a body established in accordance with these Rules before the MAC in order to resolve the disputes arising from the contract concluded between the parties by arbitration.
• The Council shall administer the procedure for the settlement of disputes by the Arbitration Tribunal in accordance with the Rules of Arbitration of the MAC (hereinafter referred to as the “Rules”). The Council is the only body empowered to administer arbitration, including the examination of arbitral awards rendered under the Rules.
• The Presiding Judge of the Council may appoint a sufficient number of personnel to assist the Council Board in the works and works subject to the Rules.

Article 3 – Written Notices and Correspondence; Terms

• All notifications, correspondence and notifications regarding the parties shall be carried out by the Council. Such notices, correspondence and notices may be delivered by hand upon receipt, registered mail, courier service, e-mail or via convenient portals acceptable to MAC.
• A notice or correspondence shall be deemed to have been served on the date of its receipt by the party concerned or his representative.
• The periods specified or determined in these Rules shall begin to run as of the day following the day of notification. If the day following the notification day is an official holiday or not a working day, the period starts to run on the first following working day. Public holidays and non-working days are also taken into account in the calculation of the periods. If the last day of the recognized period coincides with an official holiday or a day that is not a working day, the period expires at the end of the first following working day.
• In determining the public holidays, the Council also takes into account the public holidays in the country where the parties to the application are located.
• Initiation of Arbitration Article Article 4 – Request for Arbitration
• The party seeking arbitration under these Rules shall submit the Request for Arbitration (hereinafter referred to as the “Request”) to the Council.
• The Presiding Judge of the Council submits the request petition to the Council. The Council shall supervise the application in terms of admissibility. The date on which the request is received by the Presiding Judge of the Council shall be deemed to be the date of commencement of the arbitration if the Council accepts the application.
• The Presiding Judge of the Council notifies the applicant and the other party of the receipt of the Request, the date of receipt and the decision of acceptance of the Council.
• The request should include the following information:
  • Full name, capacity, addresses and other contact details of the parties;
  • The full name, address and other contact details of the person(s) representing the applicant in the arbitration;
  • Description of the nature and characteristics of the dispute that led to the claim(s) in the case and the matters, information and documents, evidence on which these claims are based;
  • The amounts of the claims whose amount is determined together with the results of the claims, what they are in case of claims that can be measured with the money in question and/or the monetary value corresponding to them;
  • All relevant contracts, and in particular the arbitration agreement; (if applicable)
  • Arbitrator selection
• The applicant may make partial or complete changes to the request, the amount of the request and the requests such as the other party. This amendment may be made before the Arbitration Tribunal makes its final award. 

Article 5 – Response Petition

• The petition submitted by the applicant and its annexes are notified to the other party by the Council. Within 1 month of receiving the petition and its annexes from the Council, the other party submits a Response Petition (hereinafter referred to as the “Response”) containing the following information:
  • Full name, capacity, address and other contact details of the other party;
  • Full name, address and other contact details of the person(s) representing the other party in the arbitration
  • Statements regarding the nature, characteristics and grounds of the dispute that led to the lawsuit;
  • Response to the results of the request;
  • Election of arbitrators;
  • All available information, documents and evidence on which it bases its claims.
• The response petition is submitted to the Council.
• The Council shall transmit the Answer and its annexes to all other parties.
• Upon submission of the response petition to the Council, the exchange of petitions shall be deemed to be completed.
• The other party may change partially or completely once in relation to each of its answers and defences. This amendment may be made before the Arbitration Tribunal makes its final award.

Article 6 – Provisions of the Arbitration Agreement

• The parties agreed to submit to arbitration shall be deemed to be bound by the Rules in force at the date of commencement of the arbitration.
• If the other party does not provide its answer, the arbitration proceeds.
• The Arbitration Tribunal shall decide whether the objections will be accepted and/or whether the objections or claims related to the authority will be decided in this arbitration in the following cases:
  • If the other party objects to the existence, validity or scope of the arbitration agreement,
  • If it requests that all claims raised in the arbitration be seen in a single arbitration file (merging).
• The Arbitration Tribunal may decide that the arbitration agreement is valid even if the employment contract between the parties bearing the arbitration clause is null and void. This award is without prejudice to the admissibility or merits of the claims or defences of the parties to the arbitration. In this context, the relevant rights of the parties and the decision-making powers of the Arbitration Tribunal regarding their claims and defences shall continue.
• Even if either party does not participate or refuses to participate in the arbitration or at any stage of the arbitration, the arbitration proceeds.
• Multiple Parties, Multiple Agreements and Merging Article 7 – Merging Arbitration Applications

1. The Council may merge two or more applications for arbitration if it deems it necessary and appropriate.

• Arbitration Tribunal

Article 8 – General Provisions

• Each arbitrator shall be and remain impartial and independent of the parties to the arbitration.
• The arbitrator shall notify the Council in writing of any events and circumstances that may affect the independence of the arbitrator in the eyes of the parties, as well as any situation that may raise reasonable doubts about the impartiality of the arbitrator. If this situation arises, the Council shall have a new arbitrator elected by the relevant party upon the decision of the Council.
• The decisions of the Council regarding the appointment, approval, rejection and replacement of arbitrators are final.
• By agreeing to take office, the arbitrators undertake to fulfill their responsibilities in accordance with the Rules.
• The Arbitration Tribunal shall be established in accordance with the following provisions.

Article 9 – Number and Selection of Arbitrators

• The Arbitration Tribunal authorized to decide on disputes determined by these Rules must consist of at least 3 (three) and at most 7 (seven) natural persons, provided that it is an odd number.
• Each party may select at least 1 (one) and at most 3 (three) arbitrators. The number of arbitrators chosen by the parties must be equal.
• During the exchange of petitions, the parties notify the arbitrator (s) they have selected to the Council. The arbitrator who will preside over the Arbitration Tribunal shall be elected by the Council. Thus, the Arbitration Tribunal is completed.
• If one of the parties refrains from selecting an arbitrator, the arbitrator shall be appointed by the Council.
• In cases where the other party consists of more than one party, the other parties shall appoint a joint arbitrator within themselves. In the event that a joint arbitrator is not determined, the Council is authorized to appoint arbitrators on behalf of the party that cannot determine the joint arbitrator.

Article 10 – Appointment, Approval and Rejection of Arbitrators

• When approving or appointing arbitrators, the Council shall take into account the independence and impartiality of the proposed arbitrator and the appropriateness and adequacy in terms of time for the proposed arbitrator to conduct such arbitration in accordance with the Rules.
• The request for rejection of the arbitrator on the ground that he/she is not impartial or independent or for any other reason shall be made to the Council with a written statement explaining the circumstances and reasons on which the rejection is based.
• In order for the refusal request to be heard, the notification of appointment or approval of the arbitrator must be submitted within 30 days from the receipt of the relevant party or, if the party requesting the refusal has learned the situations and events on which the refusal is based after the above-mentioned notification date, within 30 days from the date of its discovery.
• After the Council has been allowed to give its opinion in writing within a reasonable period of time for the arbitrator whose rejection is requested, the relevant arbitrator, the other party or parties and the members of the other Arbitration Tribunal shall examine and decide on the rejection request duly and, if necessary, on the merits. These opinions about the arbitrator are communicated to the parties and the arbitrators.

Article 11 – Change of Arbitrators

• In the event of the death of an arbitrator, the acceptance of his/her resignation by the Council, the acceptance of the request for rejection of the arbitrator by the Council or the request of all parties, the arbitrator may be changed.
• In addition, if the Council decides that an arbitrator is prevented or does not fulfill his or her arbitration duties, in law or in fact, in accordance with the Rules or within the specified periods, it may automatically replace the arbitrator concerned. The Council shall give its decision on this matter after the relevant arbitrator, the parties and the members of the other Arbitration Tribunal have been given the opportunity to express their views in writing within an appropriate period of time.
• After the Arbitration Tribunal is re-established and the parties are invited to submit their opinions, the Arbitration Tribunal shall decide whether and to what extent the arbitration process will be renewed.
• Arbitration Process

Article 12 – Transfer of the File to the Arbitration Tribunal

• In order for the arbitration process to start, at the application stage, the applicant must deposit the advance of expenses requested by the Council and the share of the arbitral fee in cash and in lump sum to the bank account notified to him.
• The cost advance and the arbitrator's fee are determined by the Council every year and published on the website.
• If the cost advance and the arbitral fee requested at this stage have been paid, the Council shall refer the file to the Arbitration Tribunal as soon as the Arbitration Tribunal is established.

Article 13 – Certificate of Authorization

1. At any time after the commencement of the arbitration process, the Arbitration Tribunal or the Council may request a certificate of authorization from any of the parties' representatives.

Article 14 – Place of Arbitration

• The Arbitration Tribunal shall determine the place, time and manner of convening of the arbitration.
• Unless the parties agree otherwise, the Arbitration Tribunal may, after consulting the parties, conduct hearings and meetings at any place and manner it deems appropriate.
• The Arbitration Tribunal may negotiate the award at any place it deems appropriate.
• The Arbitration Tribunal is free to settle the dispute by examining the file or, if necessary, by holding a hearing.

Article 15 – Rules of Procedure

1. The arbitration proceedings before the Arbitration Tribunal shall be governed by these Rules. If there is no regulation specified in the Rules, the rules determined by the Arbitration Tribunal in accordance with the maritime customs and customs shall be applied.

Article 16 – Language of Arbitration

1. Unless agreed by the parties, the Arbitration Tribunal shall determine the language or languages of the arbitration taking into account all relevant considerations, including the language of the articles of association. If the members of the Arbitration Tribunal are foreign nationals, the relevant translation service shall be provided by the Council.

Article 17 – Applicable Material Law

• In the arbitration process to be held within the scope of the MAC, the legal rules agreed by the parties shall be applied, provided that the maritime customs and customs are taken into account.
• The Arbitration Tribunal shall first take into account the following regulations regarding the norms to be applied for the settlement of the dispute:
  • The contract between the parties,
  • Law of the country to which the marine worker is subject
  • ITF Collective Agreement provisions
  • Provisions of MLC 2006,
  • STCW provisions,
  • SOLAS,
  • MARPOL,
  • ILO Conventions,
  • Maritime customs.
• As known to all parties operating in the maritime sector, the ITF is a parent organization representing 18 million transport workers in 150 countries, operating within organizations such as ILO, IMO and the International Civil Aviation Organization (ICAO), which take decisions on employment, working conditions and safety issues related to the transport sector. It has been accepted by defining its powers and responsibilities in the judicial system of the Republic of Turkey, including the Council of Cassation. For this reason, the provisions of the ITF Collective Agreement will first be taken into account in terms of the norms to be taken as a basis in addition to maritime customs.
• Again, MLC 2006 is one of the rules to be considered primarily together with the ITF Rules as it deals with a wide range of issues including seafarers' working contracts and the obligations of maritime companies on these contracts, working hours, health and safety, living spaces, food standards and the welfare of seafarers.

Article 18 – Arbitration Management

• The Arbitration Tribunal and the parties shall make every effort to conduct the arbitration process expeditiously and at low cost.
• After consulting the parties, the Arbitration Tribunal may adopt the necessary procedural decisions in order to carry out the arbitration process effectively, provided that it is not contrary to any agreement of the parties.
• As a rule, the arbitration process is public. However, upon the request of either party and/or in the presence of justified reasons, the Arbitration Tribunal may ex officio issue confidentiality instructions regarding the arbitration process.
• In all cases, the Arbitration Tribunal shall act in a fair and impartial manner and shall afford each party sufficient opportunity to present its claims, defence and grounds.
• The parties undertake to comply with any instructions given to them by the Arbitration Tribunal regarding the subject matter of the arbitration.

Article 19 – Determination of the Cases Subject to Arbitration

• The Arbitration Tribunal shall attempt to determine the cases subject to arbitration using all methods it deems appropriate as soon as possible.
• After the written submissions of the parties and the examination of all the documents relied upon, at the request of either party, the Arbitration Tribunal shall hear the parties in person and/or together, if there is no such request, it may decide to hear them ex officio.
• The Arbitration Tribunal may also hear witnesses, experts appointed by the parties or any other person in their absence, in the presence of the parties or if duly invited.

• The Arbitration Tribunal may appoint one or more experts or experts, determine their duties and receive their reports. The parties may object to the expert and the expert report. The Arbitration Tribunal shall consider the objections. It may decide to obtain a new expert report in the file or to appoint a new expert. The parties are obliged to give all kinds of permission and support to the work of experts or experts.
• At each stage of the arbitration process, the Arbitration Tribunal may require the parties to provide additional evidence.
• Unless the parties agree otherwise, the Arbitration Tribunal may decide on the file without a hearing.

Article 20 – Trials

• When the hearing is to be held, the Arbitration Tribunal shall notify the parties at least 1 week in advance and invite the parties to its presence on the day and place it determines. Although the hearings are subject to the decision of the Arbitration Tribunal, it is possible to conduct them face-to-face, electronically or by participating in other opportunities provided by technology.
• If one of the parties does not come to the hearing without a valid excuse despite having been duly summoned, the Arbitration Tribunal shall have the authority to continue the hearing.
• In all hearings where the parties have the right to be present, the Arbitration Tribunal shall have all the powers to conduct such hearings. Persons unrelated to the arbitration process shall not be admitted to hearings unless the approval of the Arbitration Tribunal and the parties is obtained.
• If the parties are real persons, they may attend the hearings in person and/or through their authorized representative (lawyer or mediator); if they are legal persons, they may attend the hearings through their duly authorized representatives and/or through a lawyer or mediator.

Article 21 – End of the Arbitration Process and Delivery Date of the Award

• As soon as possible after the final hearing on the matters to be adjudicated in the award or the submission of the final petition (whichever is later), the Arbitration Tribunal shall:
  • declares the end of the arbitration process regarding the matters to be determined in the award. Unless requested or authorized by the Arbitration Tribunal, after the end of the arbitration process, no submissions may be made or claims made or evidence submitted regarding the matters that should be adjudicated in the award.
  • informs the Council and the parties of the approximate date on which the award on the dispute will be submitted.

Article 22 – Protective and Provisional Measures

1.   Unless the parties agree otherwise, the Arbitration Tribunal may, at the request of one of the parties, decide on any protective or provisional measures it deems appropriate as soon as the case is referred to it. The Arbitration Tribunal may make the award of such an injunction conditional upon the requesting party showing the requisite security. Any such injunction may, at the discretion of the Arbitration Tribunal, be given in the form of an order or a final award, giving its reasons.

Article 23 – Time for Final Award

• The time allowed for the final award of the Arbitration Tribunal shall be six months. This period starts with formation of the Arbitration Tribunal.
• The Council may extend this period on the reasoned written request of the Arbitration Tribunal or ex officio if it decides that it is necessary.

Article 24 – Making the Award

• The award in the Arbitration Tribunal shall be taken by a majority of votes. If the Arbitration Tribunal cannot decide by a majority of votes, the duty of the Arbitration Tribunal shall be discharged and the arbitration fee shall not be paid.
• In the Award, the grounds on which it is based are shown.
• The award shall be deemed to have been rendered at the place and date of the specified arbitration.

Article 25 – Conciliation of the Award

1. If the parties reach a settlement after the transfer of the file to the Arbitration Tribunal, upon the request of the parties and the approval of the Arbitration Tribunal, the settlement shall be recorded as an arbitral award given by agreement of the parties.

Article 26- Notification, Waiver and Enforceability of the Award

• Each award given by the Arbitration Tribunal shall be delivered to the Council in one more form than the number of parties and signed by all members of the Arbitration Tribunal. The Council shall notify the parties of the text of the award signed by the Arbitration Tribunal, provided that all the costs of the arbitration have been paid.
• Additional copies approved by the Council as true copies shall be given to the parties upon request. The Council is obliged to keep additional copies for 5 (five) years.
• Each award made by the Arbitration Tribunal shall be binding on the parties. The parties have accepted the enforceability of the awards made.

Article 27 – Correction and Interpretation of the Award; Return of the Award

• The Arbitration Tribunal may correct a recording, calculation or typographical error or other errors of a similar nature in the award upon the application of the parties or ex officio and submit it to the approval of the Council within 30 days.
• The award to correct or interpret the award is issued as an annex to the award and forms part of the award.

Article 28 – Advance for Arbitration Costs

• The Council may ask the applicant for advances of costs in an amount sufficient to cover the costs of the arbitration.
• The Council may determine a separate advance of costs for the main claim and counterclaim. In the event that the Council determines a separate advance of costs, each party shall pay the advance of costs corresponding to its own claims. The amount of the advance of costs determined by the Council may be re-determined during the arbitration process. In all cases, the parties are free to pay the share of the party who does not pay its share of the expense advance.
• When a claim concerning the advance of costs is not met, the Council may instruct the Arbitration Tribunal to suspend its work. In the event that the advance payment is not completed, the Council may fix a period within which such requests shall be deemed to have been withdrawn.
• If either party asserts that it has a right to an exchange in respect of any claim, such claim shall, like a separate claim, be taken into account in determining the advance to cover the costs of the arbitration to the extent that the Arbitration Tribunal requires it to consider additional considerations.

Article 29 – Award on Arbitration Costs

• The costs of the arbitration shall include the fees and expenses of the arbitrators, the administrative expenses of MAC determined by the Council, the fees of the experts appointed by the Arbitration Tribunal and the legal expenses incurred by the parties for the arbitration.
• There are additional statutes and schedules to these Rules regarding the costs and fees listed above. They shall constitute an integral part of these Rules and may be updated and amended by the Council. In addition, if the application requires exceptional circumstances, the Council may fix the fees of the arbitrators to be more or less than the amount determined.
• At any time during the arbitration process, the Arbitration Tribunal may claim expenses other than those determined by the Council. According to the decision of the Council, it may issue a payment order regarding the costs of the arbitration.
• The Final Award stipulates the costs of arbitration and which of the parties shall bear the costs in question or at what rates the costs shall be shared by the parties.
• In the event that all claims are withdrawn or arbitration is terminated before the final award is made, the Council shall determine the fees, expenses and administrative costs of the arbitrators. In the event that the parties disagree on the distribution of the arbitration costs, the decision on this shall be made by the Council.

Article 30 – Waiver

1. A party that proceeds to arbitration without objection to any instruction given by the Arbitration Tribunal or to any requirement contained in the arbitration agreement for the formation of an Arbitration Tribunal or to the administration of the arbitration proceedings shall be deemed to have waived its right to object.

Article 31 – Limitation of Liability

1.   The arbitrators, the persons appointed by the Arbitration Tribunal, the Council and its members, the MAC and its employees shall not be liable to any person for any act or omission related to the arbitration.

Article 32 – General Rule

• The parties, the Council and the Arbitration Tribunal shall act in accordance with the spirit of the rules determined by these Rules, maritime customs and customs, ITF Collective Agreement Provisions, MLC 2006 and the standards determined by various international maritime legislation in the arbitration process to be applied in order to resolve the dispute.

Article 33 – Enforcement

• These Rules are effective from the date …/…/...