Arbitrate Where?

In Baker Hughes Saudi Arabia Co. Ltd. v. Dynamic Indus., Inc., the Fifth Circuit addressed the issue of arbitrability under a subcontract for an oil-and-gas project in Saudi Arabia. It reversed the district court’s decision that denied a motion to compel arbitration, holding that the dissolution of the “DIFC-LCIA” (the arbitral authority specified in the agremeent) did not make the arbitration agreement unenforceable.

The Court emphasized that the parties’ dominant purpose was to arbitrate disputes generally, rather than to arbitrate exclusively before the DIFC-LCIA, so “the forum-selection clause (if it is one) is not integral to the subcontract ….” The Court further clarified that even if the DIFC-LCIA was unavailable as a forum, the district court should have considered whether the DIFC-LCIA rules could be applied by another available forum. No. 23-30827 (Jan. 27, 2025).