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Islamic Law And Its Impact On Arbitration Of Ip Cases

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Islamic Law And Its Impact On Arbitration Of Ip Cases In Middle East With Special Reference To Jordan


The law of intellectual property is one of the areas of law that has emerged in Jordan relatively recently. The reasons for such late emergence of intellectual property law in Jordan are that there were no sufficient conditions for development of this area of law in this jurisdiction.

Due to this fact, courts in Jordan were hardly able to decide such cases because of their complexity and lack of necessary skills and knowledge of judges in respected area of law. It is for this reason it seems that Jordanian legal practitioners saw the necessity of establishing courts which would adjudicate such cases.

The law of intellectual property is one of the areas that pose several challenges to trade area, where sellers of unauthorized products or products which breach intellectual property rights are widespread. It is inevitable truth of most Arab countries and in this respect it seems that position of intellectual property legislation saw its goal.

Some would ask: Why would Jordan need intellectual property law at all? It does not have such potential in order to enforce such complicated legislation and procedures. The answer lies in increasing importance of Jordan as a financial and trade center of Middle East, which would compete and challenge such centers as U.A.E. and Qatar.

In order to ensure such position in market, Jordan, first, has to ensure that legislation is in harmony with international trade and financial legislation. Amidst them, intellectual property law, if not most important, but occupies significant place to such an extent that it has to increase awareness and skills in this area.

Simultaneously, one of the important and flexible methods of alternative dispute resolution as arbitration has to play here crucial role. Arbitration is one of the areas of alternative dispute resolution, necessity of which has increased along with globalization of international trade. It has been seen as one of the areas which can significantly simplify international trade procedure without bringing unsolvable complexities into the business which has already gone into complexities.

The arbitration of cases related to intellectual property is different and complicated matter, which cannot be explained with reference to arbitration of normal and common cases that emerge in the course of international or local trade. It requires lawyers which are not only fluent but also skilled in matters of IP law and practice. Such lawyers, the amount of which is few in Jordan, can be and should be trained in this area in order to ensure the integrity of arbitration procedures in IP cases.

As a rule, majority of companies and lawyers cannot trust to state courts, which would consider intellectual property cases along with ordinary cases and are subject to inevitable error by doing incorrect analogies in decision of such cases. Usually parties which address their cases to state courts are usually unsatisfied not only with level of knowledge of judges in intellectual property cases but also with complexity of procedure.

In this sense, one should realize the importance of arbitration methods for adjudication of intellectual property cases. Jordan, it seems, have realized the serious threat posed by this problem and have taken number of measures in order to respond to this challenges.

One of the notable measures is certainly sending law students abroad in order to prepare future judges specialized on intellectual property disputes. This has been done effectively and majority of students are in prominent institutions which are really strong in this area of law. Second is creation of respective legislation in this area, yet there are some gaps which are inevitable and these gaps should be filled in order to harmonize Jordanian legislation in the field of arbitration and IP law.

Jordan has examples to learn from and it is its closest neighbors such as U.A.E., Qatar and Bahrain. These countries have foremost skills and experience in these fields of law. It is not only explained by abundance of their experts but also rapid expansion of their economies and integration into the world economy.

In this respect, Jordan is in more convenient position than other countries since even the culture of its neighbors is identical to Jordan. The similarity in culture and tradition is one of the factors that make harmonization of Jordanian IP legislation much easier and painless.

Besides, the lack of experience and knowledge not only in IP law, but also in arbitration process in IP case makes Jordan vulnerable to the challenge posed by the legal world of these neighbors. It is for this reason; the necessity of this dissertation is realized.

There is also Islamic factor that raises issue. Since Jordanian constitution recognizes Islam as a religion of state and due to historical circumstances when Islamic law dominated Jordan for centuries, it raises question: Has Islamic law influenced emergence and development of arbitration in Jordan as well as of intellectual property law?

In this respect, Akhtar remarked: “there exist considerable variations in the Middle East on the incorporation and application of arbitration laws and the practice and procedure in enforcing arbitral awards, which are complicated further by the differing interaction between Shari'a law and Western systems of law in each country”.

Therefore, the major goal of this dissertation is to examine whether Islamic legal principles in fact had an impact on development of arbitration and intellectual property law in Jordan. It will be tested on the basis of case related to IP law decided in arbitration courts of Jordan. The importance of this topic is realized in the context of rising importance of Jordan as emerging economic and financial leader in Middle East. It is also realized due to the fact that Islamic law is a dominant system in contemporary Middle East.

This dissertation consists of four parts: (i) first chapter briefly examines the basic tenets of Islamic law; (ii) second chapter briefly examines arbitration system in Jordan; (iii) third chapter briefly analyses intellectual property law in Jordan; and (iv) final chapter, an important one scrutinizes Jordanian intellectual property disputes arbitration for compliance with Islamic law.

Overview Of Jordanian And Islamic Law

Jordan is one of the countries in the world that inherited several features of different legislations at a time. One of the major influences was Ottoman legislation, since Jordan was under their dominancy for almost 700 years. In this respect, it can be said that it has been influence not only by Islamic law, which was the law of Ottoman empire but also by features of unique Ottoman law, which coexisted in one line with Islamic law.

Legislation And Judicial System In Jordan

Once Jordan became a subject of European colonization in 19 century, it inevitably embraced some features of European legislation. Yet, at present time, Jordanian legislation is surprising mixture of European and Islamic elements.

The system of government in Jordan is parliamentary monarchy. Yet, it should be noted that monarchy in Jordan is almost absolute since all powers are vested in the King of Jordan who is considered to be direct descendant of Prophet Muhammad (S.A.V.)

As in other countries of the world, the power in Jordan is divided into three branches, namely, legislative, executive and judicial. However, unlike other countries King may interfere within functioning of legislative power or other in order to ensure his absolute status.

The constitution of Jordan openly declares Islam as the religion of state. However, upon the close examination of Jordanian legislation, one cannot call it Islamic state since it contains elements which are contrary to Islamic legal principles.

Unlike Saudi constitution which declares Islam as a source of law, Jordan constitution declares Islam only as a religion of state. It is, however, not clear what it implies. Nonetheless, one can see the consequences of Islam being declared as a religion of state, in the legal system, where there is duality of courts.

Jordanian courts are divided into secular and religious courts. While religious courts are not only Islamic but also ecclesial or Christian courts, which are free to decide family matters of their respective religious communities. The competence of religious courts, including Islamic, are not extended to the matters of commercial and administrative law.

Therefore, matters pertaining to commercial or administrative law are decided in secular courts. Officially, Jordanian constitution declares that there are three types of courts: (i) civil courts; (ii) religious courts; and (iii) special courts. Yet, civil courts also hear criminal cases along with civil cases and cases of administrative field.

Religious courts are divided into Islamic and courts of other non-Muslim communities. Both of them hear cases within scope of their competence. It is interesting that Sharia courts also hear cases which are related to the compensation of blood money where one of the parties are not Muslims. Compensation of blood-money, otherwise called diya, is one of the old features of Islamic criminal law and it is surprising that it is not in competence of secular courts but religious.

The constitution does not define how special courts function, leaving this matter to the law. Yet, there are tribunals which are designed to interpret law and one of them is High Tribunal, the purpose of which to interpret constitution when required by government.

It is also necessary to provide brief overview about Shari ‘a, which occupies significant position in Jordanian legislation. Shari'a, otherwise called Islamic law, is one of the ancient systems of law that has been preserved since 7 century A.D. with some modifications.

The sources of Shari'a, according to Muslim belief, are Qur'an and Sunna. First being Holy Book of Islamic religion and second are traditions or precedents of Prophet of Islam. Besides, official Islamic dogma declares that Islamic jurisprudence functions according to four sources of law, Qur'an, Sunna, ijma and qiyas. Ijma, otherwise called consensus is being interpreted differently by four schools of Islamic law and same goes with qiyas, which is otherwise called analogy. Four schools of Islamic law that has emerged at different periods of time during first century of Islam, mainly diverge upon interpretation of major or secondary sources of Islamic law.

Islamic law does not recognize freedom of contract and prohibits such elements of trade and economy as charging interest, fortuity and gambling. In order to comply with these principles, Islamic lawyers has developed certain methods and forms which would allow Muslim to operate in one or another way in business world.

One of the remarkable features of new Islamic jurisprudence is creation of Islamic banking, which replaces interest with profit-and-loss sharing concept, Islamic insurance that operates in almost similar fashion and other new concepts as Islamic bonds, otherwise called sukkuk.

As far as intellectual property concerned, Islamic law protects inviolability of property as well as its manifestations in different forms. The same applies to any form of intellectual property, be it trademark or invention.

Arbitration in Islamic law is unique, since arbitration has been inherent to Arab culture and was called hakama. Hakams were arbitrators in ancient Arabia and judged according to Arab customs and traditions. Therefore, there is nothing new in arbitration which is not familiar to Islamic lawyers.

In last century, the position of Islamic law in disputes that were decided in arbitration courts was widely ignored. It is evident from several cases. In Petroleum Development (Trucial Coasts) Ltd. V. Shaikh of Abu Dhabi, Lord Asquith, the arbitrator ironically observed: “…it would be fanciful to suggest that in this very primitive region there is any settled body of legal principles applicable to the construction of modern commercial instruments”.

Another remark, done by arbitrator in Ruler of Qatar v. International Marine Oil Company Ltd., was bitterer and arrogant: “…I am satisfied that the [Islamic] law does not contain any principles which would be sufficient to interpret this particular contract”.

Such excesses and bitter remarks were summed up and characterized in the following terms: “In general, the legal community throughout the Arab world is still manifesting its hostility to transnational arbitration mainly as a result of the great publicity devoted to the criticism of certain unfortunate arbitral awards rendered as of 1951 by western arbitrators who excluded, with terms of a humiliating nature, the application of the national applicable legal systems of countries like Abu Dhabi or Qatar”.

It should be also noted that Jordanian legislation does not fully implement precepts of Islamic law such as prohibition of interest or insurance. There are banks and insurance companies in Jordan which operate according to Western principles of banking and insurance. The companies and banks in Jordan are free to operate in the mode they choose to be most efficient for them. There is no hindrance on the part of Jordanian government in this sense.

Defining Islamic Law

There is no single or unified definition of Islamic law. Various scholars offer various definitions. I shall not go into each definition offered but shall arbitrarily explicate some of them. One of the famous scholars of Islamic law, Joseph Schacht offered an interesting definition for Islamic law: “Islamic law is the epitome of the Islamic spirit, the most typical manifestation of the Islamic way of life, the kernel of Islam itself”. Goitein, it seems, offered more precise and comprehensive definition: “Islamic religion is characterised by the prominence of legal conceptions in its systems: The Shari'a, or holy law, is its very essence and Fiqh, or religious jurisprudence, is its science (‘ilm) par excellence. The minute observation of many commandments is its most conspicuous practical aspect; the free fellowship of religious scholars, who do not need authorisation by any government to interpret, develop and apply its law, is its most representative body, and even purely legal sections of the Fiqh are studied as an act of worship”. These two definitions are not exhaustive but reflect true essence of Islamic law. Schacht's ‘way of life' and Goitein's ‘religious jurisprudence' constitute what is called Shari'ah in Arabic.

Moreover, Islamic law cannot be compared with common or continental legal systems. It is because latter do deal and embrace all areas of law, whereas Islamic law mostly deal with private law, leaving aside public law. Therefore, the claim of some countries that since their legislation is based on Shari'ah, their law is being regulated by divine law is not correct. The Shari'ah only applies to matters of private law in these countries and the public law has been imported from Western models.

The majority of scholars have long been recognizing Qur'an as a major source of Islamic law, sometimes without examining what it stands for. It was Schacht who first suggested that Shafii, prominent Islamic jurist, paid merely lip-service to Qur'an as a source of law in his jurisprudential theory. Certainly, major principles of Islamic law has been deducted from Qur'an but it is only a major and in a number of cases, we discover that Muslim jurists are dependant or totally reliant on other sources rather than Qur'an without hesitation.

The holy book of Islam or Muslims all over the world, Qur'an is believed by Muslims to have been revealed via Archangel Gabriel to Muhammad, who is regarded by Muslims as both Prophet and Messenger of God. Qur'an is law but law in a spiritual sense. If you ask a Muslim: What is your law (Shari'a)? He or she would respond: “Qur'an” without realizing whether it is spiritual or actual law.

For the purposes of present study, Qur'an is a source of law but to a limited extent since a major proportion of rules and judgments is being extracted from other sources of law and via different methods of legal reasoning. It is not however realized by ordinary Muslim as such, and even by Muslim jurist, who would suggest that sources for such rulings is Shari'a and all rules, embodied in Shari'a are immutable and should not be a subject of any challenge by anyone. Before turning to critical points, it is crucial to explore basics of Qur'an.

Qur'an is the holy book of Islamic religion. It is said to have been revealed during 23 years, once Prophet Muhammed started his mission among Arab people. The Qur'an derives from the word ‘qara' which denotes in Arabic, reciting or reading. It is also asserted that with a same meaning it is cited in Old Testament in Hebrew language. There are other names which are designed for Qur'an, such as ‘Qur'an al-Majid' or ‘al-Qur'an ash-Sharif' or ‘Furqan', etc. For the purpose of present study, it shall be called Qur'an, which is rather easy to refer and this way we shall avoid confusion.

The divine legislation is said to have been established through revelation of Qur'an in stages as I have mentioned earlier. The modern scholars as well as classic jurists were still unsure about precise role of Qur'an as a source of legislation. It is not clear whether the role of Qur'an corresponds to the hierarchy where it has been hoisted to the primary position. In fact, Qur'an has never been a primary source as we understand a primacy in modern jurisprudence. Muslim jurists would often rule according to verse of Qur'an but not a principle or spirit that it implies. They would pay a lip-service to Qur'an as a source of all legislation, but in fact they would disregard those rules of Qur'an that should have been regarded in specific occasion.

The precise role of Qur'an is difficult to define; it is because the primacy of Qur'an has been overshadowed by other sources and methods of law. Qur'an has always been mentioned along with Sunna, second sources of Islamic law which we shall have occasion to discuss in the next paragraph. In order to demonstrate the position of Qur'an as a source of law, let us look at some examples of utilization of Qur'an in classic Islamic jurisprudence.

The Prophetic Traditions or hadith as called in Arabic form a second source of law in hierarchy of sources of Islamic law and jurisprudence. It does not only occupy this position indeed but sometimes shares dominancy with Qur'an. The difference that emerged between Muslim jurists and later led to establishment of schools of law was caused by diverging interpretation of Prophetic Tradition. From liberal approach of Hanafis to strict compliance of Zahiris, they all dispute on nature of Prophetic Traditions as a source of law. Sometimes their conflict went as far as one realise that it is rather absurdity than logical argument.

The word ‘ijma', which is basically translated as ‘collecting' or ‘assembling', in a legal sense has caused a lot of debates over its validity. It is sometimes viewed as a consensus of either jurists or Muslims in general. Some assert that it is consensus of early Muslims - Companions over common postulates of faith and religion.

The consensus might be reached if it is unanimously adopted in practice or ‘custom' as in the case of international law. Second, consensus might be uttered in respect of certain ruling by majority of either scholars or jurists. Finally, it can be ‘e silentio' support for certain opinion by majority of jurists that have the right to adjudicate their independent opinion.

It is not clear from Islamic jurisprudential theory when ijma should be employed and what certain conditions are. Some jurists, Hanafi, for instance, usually in their judgments, say ‘there has been consensus on this issue' or ‘question' but they never clarified how and why such consensus has been reached among them.

We also do not know whether we may employ ijma concept in modern context and whether it shall be binding on all Muslims or adopted by them as a constituent part of Islamic law. In Sunni jurisprudence, we know that by way of ijma, certain jurists united into groups affiliated with dominating opinion of single jurist, which later became known as ‘schools of law' or ‘madhahib'. It has also been asserted that ijma on common legal issues has been reached in eighth century by respective founders of ‘madhahib'; there is no way to re-visit these concepts or judgments.

When speaking of analogy principle in Islamic law, it is not clear whether it is absolute or not or whether it is logically applicable to all cases. The word ‘qiyas' itself means ‘to compare' and it is regarded as one of the major sources of Islamic law.

Islamic jurists themselves stipulate four predominant conditions of analogy:

  1. The precept or practice upon which it is founded must be of common (amm) and not of special (khass) application;

  2. The cause (‘illa) of the injunction must be known and understood;

  3. The decision must be based upon either the Qur'an, the Sunna, or the Ijma;

  4. The decision arrived at must not be contrary to anything declared elsewhere in the Qur'an and Sunna.

The fourth stipulation raises some concerns. As we have discussed earlier, there are a lot of contradictions between Qur'an and Sunna, and even within Qur'an and within Sunna. The jurists attempted to decide such contradictions by asserting that there cannot be hypothetically any conflicts between these sources and even within these sources; they exist and it is reality. This factor also serves as a great hindrance in deriving rules or judgments from primary sources of Islamic law.

Even though these rules has been developed and elaborated by jurists; there are still a lot of controversies with application of this principle. It is caused by a different degree of application in schools of law and conflict between jurists whether such analogy might be applied when the necessity in such application is clear. Thus, for instance, it is not clear why principle of justice embodied in Qur'an might not be equally applied to all subjects of Islamic state, be it Muslim or non-Muslim. Normally, Islamic jurist would object saying that since Qur'an is only for Muslims, its injunctions are only applicable to Muslims. There is no logic which might be applied but incoherence in reasoning, sometimes leading to absurd conclusions.

Concluding Remarks

In present chapter, we have discussed general legal conceptions that exist in Jordanian and Islamic law. There is a big difference between them because of the nature of legislation. Islamic law is mainly religious, whereas Jordanian is secular; even though Constitution claims that Islamic is a state religion.

In majority of Islamic countries, a fact that Islamic is a religion of state is merely lip-service to Islamic as a religion of people. It does not go further than that, except some countries as Iran, Pakistan and Saudi Arabia. But even legislation of these countries demonstrates how secular they are in their nature.

It does not however mean that Jordan lack of Islamic legal taste; there are some aspects of Islamic law in Jordanian legislation, as we have seen previously. The matters of marriage, divorce, inheritance and religious endowment are mainly under realms of Islamic law. Yet, on the other hands, similar matters that arise with other religious communities are decided based on their respective religious law.

However, the matters which are related to arbitration and intellectual property are mainly based on secular, precisely on European model based laws. Therefore, purpose of forthcoming chapters will be to examine whether they comply with Islamic law in general.

Arbitration System In Jordan And Compliance With Islamic Law And Its Implications For Intellectual Property Law

This chapter summarizes the current state of arbitration system in Jordan and issue of its compliance with Islamic law. It is done with purpose to acquaint readers with main aspects of these systems and legislation, so he or she has full understanding when looking through forthcoming chapters.

Arbitration In Jordan

The arbitration process in Jordan is being regulated by special law - Law No. 31 of 2001 otherwise called Jordan Arbitration Law. It is not unique; neither has it been adopted from international law, but from Egyptian Arbitration Act No. 27 of 1994, which in turn has been adopted from UNCITRAL Model Law 1985.

The law consists of 7 parts and 56 articles. It can be structured thus: (1) General provisions (Articles 1-8); (2) Arbitration agreement (Articles 9-13); (3) Arbitration tribunal (Articles 14-23); (4) Arbitration proceedings (Articles 24-35); (5) Arbitral award and termination proceedings (Articles 36-47); (6) Nullity of arbitral award (Articles 48-51); (7) Enforcement of awards (Articles 52-56).

The Art. 3 makes the scope of law absolute; it extends to any arbitration proceedings in Jordan and to any cases whether they derive from contractual dispute or not. Neither does it differentiate between commercial or civil disputes; both of them are within scope of this law.

The Art. 5 allows not only contracting parties to choose the arbitration procedure but also a third party which shall be able to choose such procedure.

The Art. 8 explicitly prohibits the intervention by state courts; yet, it stipulates that the arbitration tribunal may ask the intervention of state courts where former needs the participation of experts, witnesses, etc.

As far as arbitration agreement is concerned, Art. 9 allows only those persons, be it physical or legal, which has legal capacity, to conclude such agreement. It does not allow arbitration on matters which are on “amiable compositeaur” basis.

The arbitration agreement is valid only if in writing, according to Art. 10a, yet, the form of written agreement is flexible. It can be contained in exchange of letters, faxes, etc. It has been also reaffirmed by Jordanian Court of Cassation which stated: “the arbitration clause as established should be written, clear and explicit as well, by virtue of Article 10/A of the Arbitration Law No. 31of 2001”.

The law also allows parties to render their dispute to arbitration whilst in state court, in which case state court has the right to refer to arbitration tribunal and its reference shall be viewed as arbitration agreement in writing.

As far as arbitration tribunal concerned, Art. 14a and b, establishes that number of arbitrators shall be odd, otherwise it is void. If there is a disagreement between parties then number of arbitrators is three.

Noteworthy, the law reaffirms the independence of arbitration clause, which is according to Art. 22, is not dependent on other clause of underlying contract.

The language of arbitration proceedings is Arabic but law allows the use of another language or other languages upon consent of parties, according to Art. 28a.

Most importantly, Art. 17 upheld the principle of impartiality and independence of arbitrators and in elaboration of this provision Court of Cassation further held: “all arbitral procedures, in which the challenged arbitrator has participated, including the arbitral award, shall be deemed void”.

These are the major aspects of arbitration law in Jordan. Besides, Jordan has also ratified the New York Convention on Recognition and Enforcement of Foreign Arbitral Awards by the virtue of Jordanian Court of Cassation, where it was remarked: “It is understood from the Article (2) of Enforcement of Foreign Judgments Law No. 8 of 1952 that the foreign arbitral award which has been enforced and ratified by the forum court , shall be enforceable in Jordan in accordance with all the clauses and requirements, and does not conflict with any of the stipulated provisions of Article (7) of the said law”.

The ratification of New York Convention by Jordan should be viewed as positive development and attractive for the foreign companies who wish to deal with Jordanian companies or invest in Jordan. The same applies to IP disputes; any company which would challenge Jordanian company with the claim of breach of copyright or violation of other forms of intellectual property, are in convenience in the view of ratification of New York Convention.

However, in his study of issues pertaining enforcement, Haddad critically commented: “Turning again to Jordanian Law which provides, as has just been seen, that a foreign award must be enforceable in the place in which it was issued, which means that the award should have been reduced to a judgment in the foreign country”.

It implies that Jordanian legislation does not recognise validity of foreign judgement as enforceable in Jordan. But he noted that “this approach may be criticized since it may be difficult in practice or even impossible to achieve this goal in certain circumstances, particularly in institutional arbitration. In this type of arbitration, it may happen that the parties involved in the proceedings including the arbitrators, and all other relevant factors have no relation whatsoever with the place of arbitration except that the proceedings were conducted there. In such a case, the foreign court may reasonably reject to enforce the award rendered in its country, and that means that the award may not be enforced in Jordan either”.

In such dubious situation, it is unclear how Jordanian legislation on arbitration would cope with this kind of problem. It seems to be paradoxical situation because award cannot be enforced either domestically or locally.

It will also have some implication for enforcement of foreign arbitral awards on intellectual property rights since majority of arbitral awards may not be enforced in foreign country since its enforcement should be accomplished in Jordan because of object of dispute. In such case, it is difficult to predict how arbitration courts and moreover state courts would deal with it.

Enforcement Of Foreign Arbitration Awards In Jordan

One of the problems that foreign company may encounter in Jordan is the problem of enforcement of award related to IP cases in Jordan. It is clear that certain IP cases may intervene with public policy and in this regard it is nearly impossible to assert such possibility may not arise.

IP legislation in Jordan being in immature position sometimes may not offer effective solutions for parties which are from different countries. In this regard, one should closely take a look at public policy issues in Jordan.

According to IP legislation, certain names cannot be registered as trademarks in Jordan. However: what if the name of foreign company or brand coincides with the name trademark registration of which is illegal in Jordan? The company in this case would face difficulties in carrying out business and moreover it would face difficulties in enforcing award that has been rendered in foreign or international arbitration court.

The case of Mitsubishi in U.S. showed how difficult it is to determine whether one case is subject to public policy or not. It has changed the contours of arbitrability in U.S. but the question arises: can such case have implication for Jordanian arbitration system? One can answer positively, but one would be confused when it comes to IP arbitration.

IP arbitration, as it has been seen, is a difficult and complex matter. It cannot be simply adjusted as in the case of ordinary commercial arbitration. The IP legislation is diverse and this diversity may imply negative consequences for arbitration, since arbitrators should be expertise in all areas which derive from IP legislation.

In such case, it is necessary to produce efficient theoretical base for arbitration of IP cases which can respond to challenges of Jordanian business realities.

Another important factor is Shari'a; we all know that Shari'a represents an important tool of behavior in consciences of Jordanian people. Most of them are influenced by its precepts and by the virtue of their moral law they cannot trespass certain principles of Shari'a. It is also true when IP registration is concerned the trademark which is contrary to Islam. In such case, it is hardly possible to enforce any foreign judgment, outcome of which at any cost is likely to offend principles of Islam.

Unlike European countries, where religion has been separated from the state, Jordan is still considered an Islamic state at least on constitutional level. Given this fact, it is hardly possible to change this pattern since religion occupies dominant position in the lives of Jordanian people. They are compelled to respect its foundations and principles.

Even ruling dynasty of Jordan - Hashemite dynasty is considered to be descendants of family of Holy Prophet of Islam. Therefore any inappropriate formulation of trademark is likely to summon immediate reaction on the part of government.

Further, one of the other factors is a Palestinian factor; 45% of Jordanian population is of Palestinian origins. It implies that this part of population is unlikely to accept any dealings or awards which involve any company which somehow related to Israel or Hebrew nation. It is even despite the fact that Jordan has normalized its relations with Israel; Palestinian diasporas are still influential in Jordan and this fact cannot be simply overlooked.

These, what we would call, are Jordanian realities, with which, foreign companies are likely to encounter when enforcing arbitration awards, especially on IP legislation. They cannot be avoided, neither can they be suspended; they have to be dealt effectively and beforehand.

On the other hand, the picture of Jordanian arbitration opportunities on IP legislation is not as grey as it seems at the first glance. Jordanian government is committed to create all possible conditions for normal business within the country. All laws which were adopted in the field of arbitration and intellectual property are clear evidences of such commitment.

Those obstacles which are apparent in the course of recognition and enforcement of foreign arbitration awards should be regarded as temporary and it is hoped that they would be either harmonized or changed in the course of integration into international legislation.

Issue Of Compliance Of Islamic Law With International Standards Of Arbitration

The compliance of Islamic law with international standards of arbitration is longstanding issue. It has been debated that Shari'a is not only incompatible with international standards of commercial law but with human rights standards as well. It is however incorrect to assert that international arbitration standards is totally incompatible with Shari'a since there are certain rules of arbitration which are inherent to Islamic law.

Arbitration or tahkim, as it is termed in Arabic, has been one of the traditional methods of dispute resolution on the territory of contemporary Saudi Arabia, long before Islam has emerged. Along with war, tahkim has been a method, to which all pre-Islamic Arab tribes often resorted in order to resolve their inter-tribal disputes.

The Arab society, then, was based on, as Goldziher put, “the relationship of the tribes to one another”. “Membership of a tribe”, he elucidated, “was the bond which united people who felt that they had something in common; but at the same time it also separated them from other groups”. El-Ehdab, then, described how arbitration worked in that society: “The Arabs of Jahiliya (pre-Islamic period) knew arbitration because adversaries (be they individuals or tribes) usually resorted to arbitration in order to settle their disputes… Arbitration was optional and was left to the free choice of the parties. Arbitral awards were not legally binding - their enforcement depended solely on the moral authority of the arbitrator”.

After emergence of Islam and as Islamic law further developed and elaborated, the influence of arbitration dramatically declined. It is then judiciary that came to replace arbitration for long period; yet, mediation has been recognized as a method of dispute resolution for a long period.

In the wake of twentieth century, arbitration came as one of the important tools of dispute resolution. It has been effective tool for dispute resolution in oil concession disputes.

It is however an interesting case that has been made nowadays in respects of applicability of arbitration in Islamic law. They have been arguing that it is not only inherent but also a part of Islamic law. Yet, several countries, including Saudi Arabia, do not fulfill their obligations under international conventions on arbitration. They would seek different reasons to refuse recognition and enforcement of foreign arbitral awards and assert that it is contrary to public policy.

In this sense, it should be said that Islamic law is not compliant with provisions of international standards of arbitration. It is because certain types of contract, which seem to be normal in modern contract law, are prohibited in Islamic law.

Implications Of Arbitration Systems Of Some Arab Countries For Jordan

Case Of Saudi Arabia

At the present time, for instance, arbitration is important tool for resolution of disputes in Saudi Arabia. It is interesting however, how much weight Saudis place on Islamic law when stipulating rules of arbitration. It should also be noted that Saudis are much opposed to arbitration than other countries of Middle East. Arbitration is not as welcome here as it is in Jordan, UAE, and Lebanon etc. It has been generally observed in following terms: “In general, the legal community throughout the Arab world is still manifesting its hostility to transnational arbitration mainly as a result of the great publicity devoted to the criticism of certain unfortunate arbitral awards rendered as of 1951 by western arbitrators who excluded, with terms of a humiliating nature, the application of the national applicable legal systems of countries like Abu Dhabi or Qatar.”

Such alienation and opposition is realised due to decision which has been adopted in arbitration trial between Saudi Arabia and Arab Am. Oil Co. (ARAMCO). The outcome of this case limited significantly participation of Saudi companies in international disputes. The reason for that is offensiveness of decision itself for Saudis. It read: “Saudi laws had to be interpreted or supplemented by the general principles of law, by the custom and practice in the oil business and by notions of pure jurisprudence, because ARAMCO's rights could not be secured in an unquestionable manner by the law in force in Saudi Arabia”. Such exposition of Saudi law persuaded Saudis to adopt special regulation that prohibited Saudi government agencies from participation in international disputes.

In Saudi Arabia, arbitration is only applicable in the matters of property, finances and trade and such rule derives from basic consensus of all schools of law. In other matters, Saudi law makes clear: “Arbitration in matters wherein conciliation is not permitted, such as crimes, unlawful accusation in adultery between spouses, and all matters relating to the public order, shall not be accepted”. The matters of public policy should be understood in terms of religious precepts and moral rules.

Besides, Saudi legislation significantly expands the scope of matters which are not arbitrable. Particularly, it “prohibits the Services of the Commercial Register (the “Registrar”) from registering (without special authorization) any company which refers any dispute between the company and the Registrar to arbitration outside of Saudi Arabia”. Further, it “requires that all disputes dealing with commercial agency contracts must be brought before the Diwan Al-Mazalem and not be resolved through arbitration”. Finally it “stipulates that the Diwan Al-Mazalem shall have exclusive jurisdiction over disputes among foreign contractors or companies and their Saudi sponsor”.

Case Of U.A.E.

The question is however: how U.A.E. legists would deal when it comes to duality of Islamic laws and secularist laws pertaining intellectual property when adjudicating cases in arbitration courts? Unlike Saudi Arabia, U.A.E. does not impose restrictions on gender and religion of arbitrators therefore it is possible that arbitrators appointed would not be aware of current development in Islamic law, if it is applied in the case. On the other hand, there is a danger that a case which had civil sanctions in the beginning can turn out to be criminal case in the end. Therefore courts are faced with the problem of such uncertainty. Yet, in U.A.E. it seems such cases are being decided with reference to secularist laws in order to exclude any difficulties and misunderstanding for parties which come from foreign non-Islamic jurisdictions.

When it comes to rules of arbitration, the rule pertaining scope of arbitration encapsulated in Civil Procedure Code reads: “Arbitration shall not be permissible in matters, which are not capable of being reconciled. An arbitration agreement may be made only by the parties who are legally entitled to dispose of the disputed right”. It is realised from the first part of present provision that it is related to public policy exception but illuminated in simple terms.

It is however not clear what is meant by legally entitle to dispose of the disputed right. Does it speak about legal capacity of person, be it physical or legal? Or does legislation restrict the scope of persons who can resort their disputes to legal adjudication? It can be however either ways, legal capacity and limited scope of companies which are not able to resort their cases to legal adjudication.

Another difficulty which has already been discussed in connection to public policy is jurisdiction of arbitration courts. In this regard, Art. 2 of U.A.E. Civil Code declares that: ““one shall resort to the rules and principles of the Islamic law in the construction of the laws.”. It implies that law-making industry as well as issues of application of proper law during adjudication process wholly dependant on principles of Islamic law. It, as it has been evident before, represents certain difficulties related to duality of laws.

Such problems, as it has been seen, does not exist in Jordan, where Islamic legal principles prevail mostly in matters of family law and other related areas but not commercial law. In this sense, the arbitration in Jordan can be more convenient in Jordan than U.A.E.

Another issue which arises almost in all Islamic jurisdictions is an issue of charging interest. In majority of Islamic jurisdictions, such as Saudi Arabia, interest in business transactions has been prohibited unanimously, yet in U.A.E. by the virtue of court decision, it has been allowed only in case of delayed payment. The same goes with uncertainty or gambling, which is unanimously prohibited by Islamic law and in no way can be applied in business dealings.

Another important which is more beneficial and positive rather than negative in the context of IP arbitration is sanctity of contract. Contract, according to Islamic law, is sacred and should be fulfilled by both parties in good faith. It somehow echoes principles of utmost good faith laid in Carter v. Boehm by Lord Mansfield. Nevertheless, two concepts should not be mixed altogether, since in Islamic law, principle of good faith derives from notion of sanctity of contract, whereas in law of marine insurance, it derives from practical necessity and places larger burden on insured rather than insurer.

As far as liability of arbitrators is concerned, Art. 207(2) states: “If an arbitrator, after having accepted his appointment, withdraws without a good reason, he may be held liable for compensation”. This provision sets aside any provision of Islamic law and prevails in cases where arbitrator withdrew without excuse.

The choice of law does not represent a problem as it represents in Western countries, in matters of conflict of law, the law of UAE automatically applies. It is rather Islamic than secular perspective. The law which has been encapsulated in Qur'an prescribes to resort all disputes to the law of God, therefore, U.A.E. arbitrators should without any doubt resort their disputes to the law of U.A.E. which declares, as one may recall, Islam as a source of law.

Such automatic redirection in the case of conflict of law can create some problems. First of all, parties from certain foreign jurisdictions may not agree with such state of affairs as they may view their law to be dominating. It is especially felt in IP dispute cases; should it happen arbitrators would be compelled U.A.E. law, even though it is contrary to expectations of foreign party. It does not happen however in Jordanian jurisdiction which offers more space for parties once conflict of laws arises.

The major problem and one that occupies almost all arbitration courts in the world is a problem of enforcement of foreign award. UAE is not an exception of the list. The importance of enforceability has been underlined by Jane L. Volz and Roger S. Haydock in following terms: “without the guarantee of enforceability, the arbitration becomes meaningless, a mere prelude to frustrating litigation”. In UAE, this problem is solved in relatively simple way. The foreign arbitral award can only be enforced in UAE, if it meets the requirements of legislation that stipulates certain conditions to the contents of foreign arbitral award.

Case Of Lebanon

Like majority of European countries, all disputes are arbitrable in Lebanon with exception of some. They mainly include public order offences, personal capacity, bankruptcy, criminal offences and - to some extent - employee compensation and social security issues.

Unlike Saudi Arabia, where government agencies cannot participate in arbitration proceedings, Lebanese law provides freedom for parties to arbitrate against. Thus, parties are free to initiate arbitration proceedings against government bodies and agencies.

In this regard, it is convenient for even foreign parties to initiate arbitration proceedings in the field of IP disputes against government bodies.

In a lot of regards, Lebanese legislation is favourable towards international arbitration and this factor distinguishes it from other Arab countries. It is also evident when it comes to notion of public policy. Public policy in Lebanon is not dominated by religious principles at all, not to mention Islamic ones.

There is also freedom as to arbitration agreement; arbitration agreement can take any forms, clause in contract, addendum or separate agreement. As far as other features of arbitration concerned, they remain all essentially same in par with Western standards.

It also concerns rules of choice of law and enforcement procedure. There is much freedom in choice of law that it is in Saudi and UAE jurisdictions.

Interestingly, when enforcing foreign arbitral awards, Lebanese law enforces only those which are not contrary to international public policy. The distinctive feature of Lebanese law should be emphasised here. It does not oppose foreign arbitral awards to the notion of domestic public policy and this factor make it more favourable among other countries of Arab world and Middle East.

The distinctive interpretation of public policy, as it has been seen above, particularly in countries where Islamic law is predominant makes it considerably difficult for foreign countries with partners from these countries. In this light, Lebanon can become model country where such restrictions have been lifted in favour of international commercial convenience.

What important is implications of Lebanese system of arbitration? Lebanese system of arbitration can serve as a good model for Jordan both in regards of IP disputes and arbitration as whole. However, its importance should not be overestimated; Lebanese arbitration system in the way of development not in the height of its development. Jordan is likely to be associated with Lebanese trend of development than Saudis and UAE because of strong ties and close links between governments

Concluding Remarks

Arbitration system, as we have seen, is largely based on international standards. It does not however mean that it is incompatible with Islamic law. There are some similarities but adequate comparison can be made only when Muslim jurists will produce adequate set of Islamic arbitration rules.

Such work can only be done in collaboration of Muslim jurists in other Arab countries. The experience of other countries such as Lebanon, Saudi Arabia and U.A.E. demonstrated that such set of rules is possible but secular factor should be largely taken into account in order to cope with realities of modern legislation.

The experience of abovementioned countries, as we have shown, is invaluable for Jordan. It is because Jordan has take into account an experience of countries that has same mentality as theirs, Arab and it has undergone same process of economic transformation, even though at the moment the level of their development is bit different.

Compliance Of Intellectual Property Legislation In Jordan With Norms Of Islamic Law

IP legislation in Jordan is vast. It comprises of several acts and encompasses almost all areas of intellectual property. Generally it consists of 15 acts, which are the following: (1) Act of Protecting New Varieties of Plants (2000); (2) Copyright Law , 1992 (1999), No. 22 (No. 29); (3) Geographical Indications Law No. (8) for the year 2000; (4) Industrial Designs and Models Law; (5) Integrated Circuits Law No. (9) for the year 2000; (6) Law Amending the Copyright Protection Law, No. (29) of 1999; (7) Law Amending the Trademarks Law No. (34) of 1999; (8) Models and Industrial Designs Law No. (14) for the year 2000; (9) National Production Protection Law No. (4) for the year 1998; (10) Patent Regulations No. 4522 dated 13.12.2001; (11) Patents Law No. (32) for the year 1999; (12) Plant Variety Protection Law No. (24) for the year 2000; (13) Regulation No. (97) of the Year 2001 Patent Regulation; (14) Trade Marks Rules No. 1 of 1952; (15) Trademarks Law No 34 of 1999.

The major act among these are Copyright Law 1992, which has been amended by Copyright Protection Law 1999, Trademarks Rules No. 1 1952, which has been amended by Trademarks Law No 34 1999 and Patents Law No. 32 1999, which has been supplemented by Patents Regulations No. 4522 2001.

Such variety of legal norms in the field of intellectual property law implies that Jordan pays considerable attention to the question of regulation of these issues on legislative level. It also shows that Jordan attempted its commitment and willingness to international standards of intellectual property law, hence such a bulk of norms extending to all areas of intellectual property law.

Implications Of Islamic Contract Law For Compliance Of Intellectual Property Law With Islamic Law

One of the perplexed issues that occupy lawyers in contemporary Islamic world is whether intellectual property rights are compliant with Islamic law. It has been seen in study of Aryani, that intellectual property rights are in fact protected by Islamic law. Yet, it is not clear to what extent does Islamic law protects intellectual property rights and can such protection be extended to arbitration courts.

In Jordan, the intellectual property legislation is largely based on European models. Why is it so? Why did Jordanian legists fail to incorporate Islamic legal devices into contemporary Jordanian legislation?

It seems that it was much convenient and better to incorporate European models rather than Islamic models, simply because there was no ready Islamic model. But are European models compliant with Islamic principles, which are mainly ethical?

To this question, we may answer, largely looking at Islamic contract law, which distinguishes four major stipulations, one of which is considered to be void and illegal. They are to be tested whether they appear in contemporary intellectual property rights legislation in Jordan.

Muslim jurists, particularly members of Hanafi schools, distinguish the following categories of stipulations to contract: (i) al-shart al-ladhi yaqtadih al-aqd (the stipulation inherent in the nature of the contract); (ii) al-shart al-mula'im li'l-‘aqd (the stipulation appropriate to the contract); (iii) al-shart al-ladhi fih ta'amul (the stipulation that is customary practice); and (iv) al-shart al-fasid.

It is necessary to scrutinise stipulations one by one and test for compliance with modern intellectual property rights in Jordan. For the purposes of present study, it is appropriate to pick Jordanian Trademark Law, provisions of which are usually been invoked by parties who seek resolution of their disputes in arbitration courts in Jordan.

The stipulation inherent in the nature of the contract is such a stipulation where buyer purchases goods on that condition that he or she acquires its ownership or on the condition that he is paid a price, in other words it is ordinary condition, which has to be satisfied, otherwise such transaction is void.

There is nothing that seems to contradict Trademark Law, but one aspect is worth of discussing here. If a company that grants another company a right to use its trademark, it is unlikely that a condition which restricts another party can be considered as a stipulation which is inherent to contract. Yet, the restriction in licence or franchise contract is a condition which is inherent to the contract, where by merits of Islamic law, it is not so.

The stipulation which is appropriate to the contract is a stipulation where a seller sells goods on the condition that “the buyer pledges a security as a countervalue of price, or one the condition that the buyer has a guarantor who stands security for the price”.

Either in license or franchise agreement, there is a condition that one party, especially licensee or franchisee pledges a security or has a guarantor as such, but it is possible that licensor or franchisor inserts such condition in order to assure that licensee or franchisee pays a commission or fee for use of trademark. In this respect, courts ought to consider a possibility that arises when party argues that another party fails to present security or guarantee as a countervalue of price. In this case, licensor or franchisor may assert that it violated al-shart al-mula'im li'l-‘aqd.

Parties should wary however of possibility of this stipulation to be void because some schools of law do not consider this stipulation as legitimate by virtue of consensus (qiyas) but it has been rendered as legal by virtue of juristic preference (istihsan). It implies that some schools of law can still consider this stipulation as invalid.

The stipulation that is customary practice can be interpreted broadly because it can equally include both local and international customary practices. It is however whether Trademark Law can be considered a custom or customary practice but it can be considered as legislation adopted by State in compliance with Islamic law.

The stipulation that is customary practice in the words of Kasani, “a transaction comprising a stipulation which is neither implied in the primary contract nor appropriate to it, but which is common practice…” In this respect, international conventions or treaties, incorporating customs or common practice can also be considered as a part of Islamic law.

The invalid stipulation is “a stipulation which includes uncertainty” or when someone buys an object on a condition that it generates something else in future. It also extends to cases of conventional insurance and contract of futures, where they generate same effect. The invalid stipulation is also a stipulation that involves ritually forbidden behaviour. For instance, Playboy may grant its license or franchise to a company in Jordan, but it would be contrary to Islamic law. Therefore such contract would be void, if arbitration court is to apply principles of Islamic law. It also applies to contracts where sale of pork or wine is intended, contract is equally void.

There are also stipulations which are considered void if they suggest benefit only to on of the parties. The permissibility of such contracts are only considered under Hanbali school of law, whereas Hanafi school of law explicitly prohibits it as well as Malikis and Shafiis. It is particularly this category of contracts that raise issues in licence or franchise agreements because franchise or licence agreements are viewed as onerous contracts. Therefore, arbitration courts, where parties resort their disputes to and which also choose Islamic law as lex arbitri. In this case, arbitration court may refuse adjudication of such disputes because of their incapability with precepts of Islamic law.

Yet, if parties choose Islamic law in Hanbali interpretation, then contract may be legal and court may adjudicate it. Ibn Qudama, Hanbali jurist ruled in the following way: “The contract is valid if the vendor stipulates a definite benefit in the object, such as inhabiting the house for month before its delivery to the buyer. Also the sale is valid if the buyer stipulates an additional condition to his benefit in the object, such as the transport of the firewood or the tailoring of the cloth”.

`In such a case, parties are free to resort their disputes related to arbitration court, provided that parties choose Islamic law in interpretation of Hanbali school of law. It is then a jurisdiction of school of law that becomes an issue in resolution of such disputes. It should also be noted that Hanbali school of law takes more liberal approach in consideration of contracts. But question arises: Will Jordanian courts or companies prefer Hanbali law as a law of dispute? It is because, Jordan has been under influence of Hanafi and Shafii schools for centuries and it is unlikely that they would prefer to shift towards this school. However, on the other hand, in the view of rising importance of international trade and necessity to harmonise with rules of international arbitration and intellectual property law, some Jordanian companies in order not to predate Islamic law, may prefer to apply Hanbali law.

Compliance Of General Intellectual Property Law With Islamic Law

After we have discussed implications of Islamic contract law for intellectual property law, the necessity arises to discuss the compliance of general intellectual property law with Islamic law as it is understood in practice.

One of the benchmark for such understanding is intellectual property law in Jordan. Jordan is a clear example of adequate balance between European and Islamic law, notwithstanding the fact that it has promulgated Islam as the source of legislation, not as a source of legislation.

Case Of Trademark law

The trademark legislation is regulated on the different basis and almost all elements of this legislation are dependent on the fact of registration of the trademark. Yet, it is not that surprising since almost all legislations of the world in the field of trademark operates on that basis.

According to Article 7, the trademark is subject to registration, if it contains distinctive words, letters, numbers, figures, colors, or other signs or any combination thereof and visually perceptible. In this respect, it seems to be in compliance with majority of international standards.

In Islamic law, trademark can be viewed as one of the forms of properties and therefore does not required registration. But problem arises when there are multiple cases of having same trademark, and then there arise necessity to register a person or company who sustains trademark first. It is for the same reasons; registration requirement exists in Jordanian trademark law.

There are however distinctive features of Jordanian trademark legislation. Particularly, it does not recognize as trademarks any elements that resemble any sign of Royal Hashemite Family or anything related to them. It extends to royal crests or the word royal or any other words, characters or insignia or decorations of the government.

Such provision particularly fits within provision of public policy in Islamic law, since it prevents royal family which is mainly associated with Prophet Muhammad's family.

The most interesting feature is prohibition of the use as trademark of elements that are contrary to morality. In this respect, it should be noted that since Islam is the religion of the state, any mark or sign that contradicts with Islamic principles can be deemed as void.

It is however arguable whether trademarks which reflect signs or insignia of alcoholic drinks or pork products, because, for instance, alcohol is not prohibited in Jordan. It is also arguable whether some signs of Christian faith can fall within this prohibition.

The persons with claim of trademark can register it with registrar, yet registrar can refuse on registration. However his actions can be appealed to the High court of justice. It is surprising that person cannot sue to the court of the first instance but high court of justice.

The important disclaimer, which is relevant to the court proceedings as well, is made in Act: “If a trademark incorporates matters in common use in the trade or otherwise is neither in such common use nor has an obvious feature, the registrar or the high court of justice may require, in deciding whether such trademark shall be entered or shall remain entered in the register, as a condition for maintaining it entered in the register, that the proprietor shall disclaim any right to the exclusive use of any part or parts of such trademark…” It is important that the role of the court in such a dispute shall be prevailing otherwise there will be assurance that arbitration court can effectively participate in adjudication of such case.

Such disclaimer is important in the sense that it clearly provides the competence of the court and registrar but in the case of arbitration of the IP, it is really important that such disclaimer is present.

From the point of Islamic law, it is not important whether such disclaimer exists. Important is whether person, whose rights have been violated, can claim for damage or a person, who violated trademark legislation should be persecuted for such breach and court should apply criminal penalty.

Case Of Patent Law

Patent law in Jordan is based on almost similar grounds as trademark law but there are some notable differences between them.

The inventions in order to be patented should not be disclosed before to anyone or displayed in public. Yet, the law makes stipulation that the disclosure would not count if it has been done within twelve months from the date of filling application.

This provision does partially comply with Islamic law of privacy, which does prohibit anyone from interfering into someone's property or house. In this context, property subject to protection irrespective of its being an object of patent law or any other law.

As in the case of copyright and trademark law, the law states that any invention which is contrary to public policy and morality will not be registered. Again, the question of definition of morality arises in connection to Islam; it is no

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