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Arbitration
An arbitration clause makes four decisions. Most people read it as one.
The written companion to the webinar of 21 October 2026 on the Arbitration Court at the German Chamber of Commerce and Industry (SGH), hosted by the German-Australian Chamber of Industry and Commerce with the German Chamber of Commerce and Industry (DIHK). Dr Christian Gross of the DIHK presents the institution. This page sets out our part: what the clause decides, what the SGH and SIAC Rules do when it says nothing, and where the SGH fits for a German company dealing with Australia and the region.
The Arbitration Court at the German Chamber of Commerce and Industry (SGH) Explained
Wednesday 21 October 2026, 6.00 pm AEDT (9.00 am CEST). Free, online, in English.
Why arbitrate
An award travels. A judgment mostly does not
01
A German judgment can be registered here
Germany is listed in the Foreign Judgments Regulations 1992 (Cth), so a money judgment of a German superior court can be registered in Australia and enforced.
02
That arrangement is country by country
Registration works here because Australia has listed Germany. What a German judgment is worth anywhere else depends on the law of the country where the assets are, and a counterparty with assets in several countries raises that question in each of them.
03
An award is enforced on a short list of grounds
A foreign arbitral award is binding on the parties and can be enforced in an Australian court as if it were a judgment of that court. Enforcement may be refused only on the grounds the Act lists.
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A German judgment can be registered here
Item 10 of the Schedule to the Foreign Judgments Regulations 1992 (Cth) names the German courts that count as superior courts for this purpose, being the Federal Court of Justice and the courts below it down to the regional courts. Registration is under Part 2 of the Foreign Judgments Act 1991 (Cth).
Related expertise
Close
An award is enforced on a short list of grounds
Sections 8(1) and 8(2) of the International Arbitration Act 1974 (Cth), with the grounds for refusal in s 8(5). The Act is how Australia gives effect to the New York Convention, and the Convention is what makes an award enforceable across the region as well.
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One clause, four decisions
What an arbitration clause actually decides
01
The seat
The legal home of the arbitration, not the place anyone meets. It decides which country’s arbitration law governs the procedure, which courts support the arbitration, and which courts alone can set the award aside. The hearing can be held somewhere else, and under the SGH Rules proceedings are generally conducted online (Arts 2(3), 16(2)).
02
The rules
The institution and its procedure, chosen separately from the seat. Both sets of rules let the parties choose the seat (SGH Rules Art 16(1); SIAC Rules r 36.1). The institution has to be named as it names itself, which is why its own model clause is the place to start.
03
The law of the contract
The law that decides who is right. Arbitration does not supply it: the contract does, or the tribunal does when the contract is silent, and the tribunal’s answer cannot be predicted at signature.
04
The law of the clause
The arbitration clause is a separate agreement that survives the contract around it, so a party arguing that the contract is void is not, by that argument, outside the arbitration (SGH Rules Art 27(1); SIAC Rules r 31.1). Because it is separate it can have its own governing law, which decides whether the clause is valid and what it covers. Almost no clause says what that law is.
When the clause is silent
What the SGH and SIAC Rules decide when the clause says nothing
01
The seat
SGH Rules: the tribunal decides, and the place will then generally be in Germany (Art 16(1)). SIAC Rules: the tribunal decides (r 36.1).
02
The law of the contract
SGH Rules: the law with the closest connection to the subject matter (Art 28(2)). SIAC Rules: the law the tribunal determines to be appropriate (r 35.1).
03
The law of the clause
SGH Rules: the law applicable in the State in which the award is made (Art 27(2)). SIAC Rules: no rule, but SIAC’s own model clause carries a line for the parties to fill in.
04
The language
SGH Rules: German or English, and the SGH decides if the parties have not (Art 16(3)). SIAC Rules: any language, decided by the tribunal if not agreed (r 37.1).
05
The number of arbitrators
SGH Rules: one arbitrator up to EUR 250,000 in dispute and three above it, unless the parties agree otherwise (Art 2(1)). SIAC Rules: one, unless the Registrar decides the dispute warrants three (r 19.1).
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The seat
A clause naming the SGH and no seat therefore points towards Germany, which favours the German party. A clause naming SIAC and no seat leaves the question open until a tribunal answers it.
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The law of the contract
Under the SGH Rules a choice of law is read, in case of doubt, as a choice of a national system’s substantive law rather than its conflict of laws rules (Art 28(2)). Neither default can be predicted with confidence when the contract is signed.
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The law of the clause
The two institutions close the same gap in different places. The SGH closes it in its rules; SIAC closes it in its model clause. The SGH model clause does not mention it, so a party using that clause unchanged gets the rules’ answer.
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The number of arbitrators
On the SGH’s own scale, at EUR 1 million in dispute a three-member tribunal’s fees are EUR 62,000 against EUR 24,800 for a sole arbitrator, net of VAT (Appendix 2). The number belongs in the clause.
A worked example
One contract, worked through the four decisions
01
The contract
A German supplier and an Australian distributor sign a distribution agreement governed by German law. Its arbitration clause names the SGH Rules, a seat in Singapore and English, and the hearing is held by video.
02
Who does what
The tribunal decides the dispute under the SGH Rules and German law. The Singapore courts supervise the arbitration and are the only courts that can set the award aside. The Australian courts enforce the award against the distributor’s assets.
03
The law of the clause, here
The clause does not name it, so under the SGH Rules it is the law applicable in Singapore, where the award is made (Art 27(2)), while the contract is under German law. One sentence in the clause would have settled it.
04
What the example is for
It shows the four decisions coming apart: each is made separately and each has its own consequence. It illustrates how the pieces fit together. It is not a recommended combination.
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Who does what
Enforcement in Australia runs under s 8 of the International Arbitration Act 1974 (Cth), on the grounds described above.
Australia and the region
Australia as a seat, and what is actually used
01
The Model Law is the law here
The UNCITRAL Model Law has the force of law in Australia under s 16(1) of the International Arbitration Act 1974 (Cth), and the courts support arbitration. ACICA is the Australian institution.
02
A court shall stay proceedings
Where a party sues in breach of an arbitration agreement, the court shall, on the application of a party, stay the proceedings and refer the parties to arbitration (s 7(2)). It is not a discretion.
03
Singapore is a Model Law seat as well
Singapore, the seat an Asian counterparty most often proposes, works on the same UNCITRAL Model Law, so the framework is familiar from either end.
04
What is used in practice
In our experience, where the Australian or Asian counterparty is the stronger party, or the two are of equal weight, the clause usually ends up at SIAC in Singapore, and sometimes at another institution or with the courts. That is not a verdict on any seat. It is what counterparties and their lawyers know and will sign.
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The Model Law is the law here
Article 16(1) of the Model Law treats an arbitration clause that forms part of a contract as “an agreement independent of the other terms of the contract”. That is the separability point from the four decisions, with the force of law in Australia.
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Singapore is a Model Law seat as well
Our writing on how the Singapore courts treat a defective clause and on the emergency arbitrator’s powers is linked at the foot of this page.
Related expertise
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What is used in practice
An observation from our own practice, not a statistic. It is why the comparison that matters for the SGH in this region is with SIAC rather than with the German courts, and that is the comparison the next band makes.
The SGH next to SIAC
What is the same, what differs, and who each difference favours
Much is the same. Under both sets of rules the clause survives the contract (SGH Rules Art 27(1); SIAC Rules r 31.1), the parties choose the seat and the law, the proceedings are confidential (Art 15; r 59.1), the tribunal can order interim measures while the courts remain available (Art 36; r 45), and a decision on fairness alone needs the parties’ authority (Art 28(4); r 35.3). Six differences matter more, and each is a design choice rather than a defect.
01
Under the SGH Rules, German or English, and the choice also decides which language version of the Rules applies (Art 16(3)). Under the SIAC Rules, any language the parties agree, or that the tribunal decides (r 37.1). Between a German and an Australian party the difference rarely matters.
02
An SGH tribunal can order documents to be submitted, but the Rules require it to reject requests for discovery (Art 18(2), (4)). A SIAC tribunal can order a party to produce documents it considers relevant to the case and material to its outcome (r 50.2(f)). For a counterparty from a common law system this is usually the first difference it notices.
03
The SGH Rules fix it by value: one arbitrator up to EUR 250,000 in dispute and three above it (Art 2(1)). The SIAC Rules appoint one unless the Registrar decides the dispute warrants three (r 19.1). Above EUR 250,000 the SGH default therefore puts three arbitrators on the case.
04
An SGH tribunal should give the parties preliminary legal guidance before the oral hearing, and strives towards an amicable settlement, for which it may give a preliminary view (Arts 19(4), 22(1)). The SIAC Rules contain no equivalent duty.
05
The SGH Rules require the proceedings to be concluded within 12 months of the tribunal’s appointment, or six months on the fast track where the parties agree to it (Arts 2(2), 20(1)), and the fees follow fixed scales. The SIAC Rules have a streamlined and an expedited procedure (rr 13, 14), and SIAC’s fees are subject to maximum limits set by its schedule (r 57.4).
06
SIAC offers an emergency arbitrator before the tribunal is constituted (r 12.1) and scrutinises every draft award before it is issued (r 53). The SGH Rules provide no emergency arbitrator, leave the parties free to seek interim measures from a court (Art 36(3)), and provide review of the draft award where a party or the SGH asks for it (Art 25(2)).
01 / 06
What language can the arbitration run in?
Under the SGH Rules, German or English, and the choice also decides which language version of the Rules applies (Art 16(3)). Under the SIAC Rules, any language the parties agree, or that the tribunal decides (r 37.1). Between a German and an Australian party the difference rarely matters.
Who it favours: nobody in a German and Australian contract. It matters only where a third language is in play.
02 / 06
Can a party be made to hand over documents?
An SGH tribunal can order documents to be submitted, but the Rules require it to reject requests for discovery (Art 18(2), (4)). A SIAC tribunal can order a party to produce documents it considers relevant to the case and material to its outcome (r 50.2(f)). For a counterparty from a common law system this is usually the first difference it notices.
Who it favours: the SGH approach suits the party that already holds the documents. A party that needs the other side’s documents to prove its case is better served by the SIAC approach.
03 / 06
How many arbitrators, if the clause does not say?
The SGH Rules fix it by value: one arbitrator up to EUR 250,000 in dispute and three above it (Art 2(1)). The SIAC Rules appoint one unless the Registrar decides the dispute warrants three (r 19.1). Above EUR 250,000 the SGH default therefore puts three arbitrators on the case.
Who it favours: neither side as such. Three arbitrators cost more, most noticeably at the lower end of the range, and writing the number into the clause removes the question.
04 / 06
How active is the tribunal?
An SGH tribunal should give the parties preliminary legal guidance before the oral hearing, and strives towards an amicable settlement, for which it may give a preliminary view (Arts 19(4), 22(1)). The SIAC Rules contain no equivalent duty.
Who it favours: it can save cost and time for both sides. A party that expects the tribunal to stay silent until the award may read an early view as an early commitment.
05 / 06
How long does it take, and what does it cost?
The SGH Rules require the proceedings to be concluded within 12 months of the tribunal’s appointment, or six months on the fast track where the parties agree to it (Arts 2(2), 20(1)), and the fees follow fixed scales. The SIAC Rules have a streamlined and an expedited procedure (rr 13, 14), and SIAC’s fees are subject to maximum limits set by its schedule (r 57.4).
From the SGH’s own scales, net of VAT and before the parties’ own costs: at EUR 250,000 in dispute, a processing fee of EUR 3,500 and a sole arbitrator’s fee of EUR 8,800; at EUR 1 million, EUR 11,000 and EUR 62,000 for the default three-member tribunal, or EUR 24,800 for a sole arbitrator; at EUR 5 million, EUR 31,000 and EUR 118,000 (Appendices 1 and 2). The scales allow an increase for unusual effort.
Who it favours: a fixed timetable and price suit the party that wants a decision quickly, usually the claimant. Extensions of deadlines are capped at 21 days, with 7 more only in exceptional cases (Art 17(3)), which is strict for a party with a document-heavy case.
06 / 06
What happens before the tribunal exists, and after it decides?
SIAC offers an emergency arbitrator before the tribunal is constituted (r 12.1) and scrutinises every draft award before it is issued (r 53). The SGH Rules provide no emergency arbitrator, leave the parties free to seek interim measures from a court (Art 36(3)), and provide review of the draft award where a party or the SGH asks for it (Art 25(2)).
Who it favours: where assets may move before a tribunal is in place, the SIAC route is the more direct one. Under the SGH Rules the urgent route is a state court.
Related expertise
Where the SGH fits
Neither set of rules is better in the abstract
01
Where the SGH fits
Where the German party has the negotiating weight, being a supplier, licensor, principal or parent dealing with its own distributor or subsidiary; where the contract is under German law; and where the likely disputes are mid-sized, so that a fixed price and a 12-month timetable matter more than familiarity.
02
Where SIAC fits
Where the counterparty is of equal or greater weight; where several parties or contracts are involved, which the SIAC Rules provide for (rr 15 to 18); where assets may move before a tribunal is formed; or where the case turns on the other side’s documents.
03
When to decide
At signature, when nobody is thinking about disputes and the clause is cheapest to negotiate. Whichever institution is chosen, start from its model clause unchanged and fill in each supplement rather than leaving the decision to the defaults.
How to write it in
The SGH model arbitration clause, with its supplements
The SGH publishes a model clause and a set of optional supplements, and recommends against changing the clause otherwise. The clause reads:
The SGH model arbitration clause, as of October 2024
“All disputes arising out of or in connection with the present contract or in regard to its validity shall be finally settled under the Rules of Arbitration of the Arbitration Court at the German Chamber of Commerce and Industry while excluding ordinary legal proceedings.”
The SGH’s optional supplements that settle the decisions on this page
“The place of arbitration is … [please specify desired location].”
“The number of arbitrators is … [please state 1 or 3].”
“The language of the arbitration proceedings shall be … [please select German or English as language of proceedings].”
“The substantive law applicable in the matter is the law of the country … [please specify desired legal system].”
“The rules of the “fast-track arbitration proceeding” pursuant to Article 20 of the Rules of the Arbitration of Arbitration Court at the German Chamber of Commerce and Industry shall apply.”
Our addition, which is not part of the SGH’s published text
“The law governing this arbitration clause shall be the law of … [please specify].”
None of the supplements names the law of the clause itself, so without a sentence of that kind the SGH Rules supply the answer (Art 27(2)). Ours is worded on the line SIAC’s model clause carries for the same purpose.
Checklist
Four questions for every contract already signed
01
Is the seat named?
A city and a country, as the legal place of the arbitration rather than the place of a hearing. If it is not, the rules decide: generally Germany under the SGH Rules, and the tribunal under the SIAC Rules.
02
Are the rules named exactly?
The institution’s name as the institution uses it, ideally in its own model clause wording. Check the number of arbitrators and the language while you are there.
03
Is the law of the contract chosen?
A governing law clause, so that the tribunal does not have to find the law with the closest connection or the law it considers appropriate.
04
Is the law of the clause chosen?
Usually it is not. One sentence fixes it. Where any of the four is missing the defaults decide, and the next variation, renewal or extension is the time to fix it.
Further reading
Our writing on arbitration and the corridors it serves
The boundary
What we advise on, and what we leave to others
We are admitted in Australia and advise on Australian law, from offices in Sydney, Canberra and Frankfurt am Main. On the subject of this page that covers the arbitration clause itself, the enforcement of awards in Australia, and acting in an arbitration.
A question of German law is answered by German lawyers. The SGH’s procedure and administration are for the SGH, and Dr Christian Gross’s presentation on 21 October covers the institution itself.
Questions people ask
The short ones
Does an SGH hearing have to take place in Germany?
No. The seat and the place of a hearing are different things. Under the SGH Rules a hearing can be held elsewhere where the tribunal considers it appropriate, and proceedings are generally conducted online (Arts 16(2), 2(3)).
Can an SGH arbitration be run in English?
Yes. The parties can choose German or English, and the choice also decides which language version of the Rules applies (Art 16(3)).
Can the Australian party ignore the clause and sue?
It can start proceedings, but on the application of a party the Australian court shall stay them and refer the parties to arbitration (International Arbitration Act 1974 (Cth) s 7(2)).
Can an award be published?
The SGH may publish an anonymised award for scientific purposes unless a party objects before it is issued (Art 39(1)). SIAC may publish only with the written agreement of all parties (r 60.1).
Can you advise us in German?
Yes, in writing and in conference. The advice is on Australian law, and the contracts themselves are usually in English.
Is anything on this page advice?
No. It is general information for a business audience and not advice on any particular contract. The rules are stated as at October 2026: the SGH Rules as of November 2024 and the SIAC Rules 2025.
Send us the clause
The quickest useful thing is the dispute clause as it stands, with a line on who the counterparty is and where its assets are. We will tell you which of the four decisions it makes, which it leaves to the defaults, and what we would change.
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