sectors and increased reliance on private actors to perform public functions
in virtually every industrialised state.4In the UK, the transfer of government
powers to the private sector gathered pace during the 1980s.5Such outsourcing
arrangements can take various forms including entrusting pr ivate partners with
the legal responsibility to provide such services (‘contracting out’) and collabo-
rating with private parties for the purpose of achieving a public function, albeit
that ultimate legal responsibility to the public remains with the public body.6
Legislative developments have lent impetus to this movement by, for exam-
ple, requiring local authorities to engage in competitive tendering processes7
and by facilitating the exercise of certain public powers by private entities.8
These developments, in turn, have led to a marked increase in the number of
public-private contracts (ie contracts entered into by public bodies with private
The connection between these two developments - the expansion of arbi-
tration’s domain and the rise of the ‘contracting state’ - is the fact that many
public-private contracts favour arbitration and other private forms of dispute
resolution over resolution of disputes in the national courts.10 For example,
the Model Terms and Conditions of Contracts for Goods issued by the UK
Ofﬁce of Government Commerce provide for a multi-tiered dispute resolu-
tion process which ends in arbitration in the event that informal negotiation
and mediation are unsuccessful11 and similar dispute resolution provisions are
common in standard forms of international construction contracts, typically
adopted for procurement of public works.12 Recent years have therefore seen
both the general expansion of arbitration’s domain as well as an increase in the
number of public-private contracts providing for arbitration.
The expansion of arbitrations arising under public-private contracts has been
accompanied by an increase in other forms of arbitration between public and
private entities. In particular, since the registration of the ﬁrst dispute under
4 J. Freeman, ‘The Private Role in Public Governance’ (2000) 75 NYU L Rev 543; J. B. Auby,
‘Contracting Out and ‘Public Values’: A Theoretical and Comparative Approach’ in S. Rose-
Ackerman and P. L. Lindseth (eds), Comparative Administrative Law (Cheltenham: Edward Elgar
Publishing, 2013) 512.
5 A.C.L.Davies,Accountability: A Public Law Analysis of Government by Contract (Oxford: OUP,
6 See M. Freedland, ‘Public law and private ﬁnance – placing the Private Finance Initiative in a
public frame’  PL 288; C. Harlow and R. Rawlings, Law and Administration (Cambridge:
CUP, 3rd ed, 2009) ch 9.
7 SeeDirective 2014/24/EU of the European Parliament and of the Council of 26 February 2014
on public procurement and repealing Directive 2004/18/EC, OJ L 94, 28.3.2014, 65–242.
8 See Deregulation and Contracting Out Act 1994.
9 J. B. Auby, ‘Comparative Approaches to the Rise of Contract in the Public Sphere’  PL
40, 41. See also A. Davies, The Public Law of Government Contracts (Oxford: OUP, 2008) 61.
10 G. S. Tawil, ‘On the Internationalisation of Administrative Contracts, Arbitration and the Calvo
Doctrine’inA.vandenBerg(ed),Arbitration Advocacy in Changing Times, ICCA Congress Series
No 15 (Alphen aan den Rijn: Kluwer, 2011) 325.
11 Ofﬁce of Government Commerce, ‘OGC Model Terms and Conditions of Contracts for Ser-
vices’ (OGC, 2009) clause I2. See also HM Treasury, Standardisation of PFI Contracts (London:
TSO, 4th ed, 2007) ch 28.
12 See, for example, FIDIC,‘Conditions of Contract for Constr uction, which arerecommended for
building or engineering works designed by the Employer or by his representative, the Engineer’
(FIDIC, 1999) clause 20.6.
24 C2017 The Author. The Modern Law Review C2017 The Modern Law Review Limited.
(2017) 80(1) MLR 22–56