Feasibility of Third-Party Intervention in Dispute Resolution through Arbitration under Iranian Law: With Reference to International Instruments and Practices

Abstract

Arbitration, as one of the most significant alternatives to judicial litigation, is fundamentally grounded in the principle of party autonomy and the mutual consent of the disputing parties. This defining feature raises critical questions and challenges regarding the intervention of third parties in arbitral proceedings. Unlike judicial litigation systems, which generally recognize third-party intervention, arbitration—owing to its private and independent character—faces notable limitations in this respect. The participation of third parties in arbitration lies at the intersection of two fundamental principles: the relativity of the arbitration agreement and the obligation to observe fair trial standards. Since arbitral jurisdiction derives from the consent of the original parties, the inclusion of any third party requires verification of their consent, along with that of the existing parties, as well as the existence of a close legal nexus to the subject matter of the arbitration. This article analyzes the theoretical underpinnings of third-party intervention and evaluates its legal feasibility through mechanisms such as the extension of the arbitration clause. Despite the presence of a specific provision addressing third-party intervention in Iran’s Law on International Commercial Arbitration, a legislative gap persists in this domain. Accordingly, the enactment of comprehensive regulations governing third-party participation in arbitration, with explicit clarification of its conditions and legal consequences, constitutes an essential step toward enhancing the effectiveness and inclusiveness of arbitration in the Iranian legal system.