1E9Ct5D

In accordance with the guidelines of the New York Convention and the Model Law,the Commerce Code establishes that in order for the validity of the arbitration agreementto be recognized it must be recorded in writing and set forth in a document signed bythe parties or in an exchange of letters, telexes, telegrams, faxes or other means oftelecommunication that provide a record of the agreement, or in an exchange of statementsof claim and defense in which the existence of an agreement is alleged by oneparty and not denied by another.Due to the fact that the arbitration agreement is considered an independent contract,as such the basic requirements for existence and validity applicable to contracts underMexican law must be complied with. The elements of existence are the following:a) The purpose of the contract, which should make reference to the fact that the partieswish to submit present or future disputes to arbitration;b) Consent: the parties must state their desire to submit present or future disputes toarbitration;c) Formality, consisting of the requirement that the arbitration agreement be recordedin writing, and therefore a verbal agreement between the parties is not sufficientto submit to arbitration.The following are the elements of validity:a) The purpose of the contract must be legal and the matter must be arbitrable;b) The consent may not be vitiated, which is to say granted in error, bad faith, underduress, or as the result of an unconscionable bargain;c) The parties must have full legal capacity to sign the arbitration agreement.349Dispute ResolutionMoreover, the arbitration agreement is considered an independent agreement evenwhen found in a clause of a contract. In the event that the contract is declared null andvoid or nonexistent, such a declaration does not necessarily imply that the arbitrationagreement is also null and void or nonexistent.The Commerce Code has established as a general rule that Mexican judges are obligatedto refer the parties to arbitration when a dispute that is submitted to their jurisdictioninvolves a matter that has been submitted to an arbitration agreement by theparties in conflict.5.4. The Arbitral TribunalArbitrators must have the capacity to exercise the functions entrusted to them in the specificcase by the parties. They must also reveal, at the time of their appointment and duringthe entire arbitral proceedings, any circumstances that could create doubt about theirimpartiality or independence.