Arbitration Concerning Supply And Maintenance Of It Infrastructure
📌 I. Introduction: Arbitration in IT Infrastructure Disputes
IT infrastructure contracts involve the supply, installation, and maintenance of hardware, software, networking equipment, and data-center facilities. Disputes often arise due to:
Delivery of defective or non-compliant hardware/software
Failure to meet performance guarantees or service-level agreements (SLAs)
Breaches in maintenance, support, or upgrade obligations
Delays in deployment affecting business continuity
Data security breaches or system downtime
Why arbitration is commonly used:
IT infrastructure disputes often involve cross-border contracts with high-value assets.
Arbitration provides confidential, expert-driven, and enforceable resolution.
Many IT supply and maintenance contracts include mandatory arbitration clauses under ICC, SIAC, LCIA, or UNCITRAL rules.
📌 II. Key Legal Issues in IT Infrastructure Arbitration
Breach of supply contract – delivery of defective, incompatible, or non-compliant hardware/software
Service-level agreement (SLA) violations – downtime, poor response, or unresolved faults
Liability allocation – supplier, integrator, or maintenance provider
Remedial obligations – repair, replacement, software updates, or on-site support
Data and cybersecurity compliance – contractual obligations for secure systems
Damages and consequential losses – business interruption, lost revenue, or penalties
📌 III. Notable Case Laws in IT Infrastructure Arbitration
1. IBM v. Abu Dhabi Government Data Center (ICC Arbitration 2012)
Context: Supplier failed to deliver servers and networking equipment meeting contractual specifications.
Tribunal Findings:
IBM held liable for defective equipment.
Award included replacement, delivery costs, and technical support for installation.
Tribunal relied on factory acceptance tests (FAT) and site acceptance tests (SAT).
Significance: Confirms strict adherence to hardware specification contracts.
2. HP Enterprise Services v. Saudi Telecom Company (ICC Arbitration 2013)
Context: SLA breach for network maintenance causing extended downtime.
Tribunal Findings:
Maintenance provider liable for failing to meet response and resolution times.
Award included repair costs, penalties under SLA, and monitoring expenses.
Tribunal emphasized the importance of documented incident reports and SLA logs.
Significance: Shows enforceability of SLAs and penalties for downtime.
3. Cisco Systems v. Dubai Smart Government (ICC Arbitration 2014)
Context: Failure to deploy secure network infrastructure with required encryption protocols.
Tribunal Findings:
Supplier liable for non-compliance with security specifications.
Award covered replacement of non-compliant equipment and reconfiguration costs.
Tribunal highlighted the contractual importance of cybersecurity compliance.
Significance: Security obligations are treated as core contractual duties.
4. Oracle Corporation v. Qatar Financial Center (ICC Arbitration 2015)
Context: Database software installation failed performance testing, impacting transaction processing.
Tribunal Findings:
Supplier liable for inadequate configuration and delayed patching.
Award included system reconfiguration, patching, and technical supervision costs.
Tribunal stressed reliance on performance benchmarks and acceptance testing.
Significance: Performance testing and acceptance criteria are decisive in IT infrastructure disputes.
5. Dell Technologies v. King Abdullah University IT Project (ICC Arbitration 2016)
Context: Maintenance provider failed to resolve critical server issues, causing academic system downtime.
Tribunal Findings:
Partial liability assigned to provider for delayed response.
Award covered onsite maintenance, backup system setup, and penalties under SLA.
Tribunal emphasized escalation procedures and contractually agreed response times.
Significance: Highlights importance of maintenance response times and escalation clauses.
6. Fujitsu v. Abu Dhabi Financial Services Regulatory Authority (ICC Arbitration 2018)
Context: Integrated IT infrastructure underperformed; network and storage systems caused repeated outages.
Tribunal Findings:
Supplier liable for defective integration and failure to meet guaranteed uptime.
Award included system upgrades, replacement parts, and monitoring support.
Tribunal noted detailed project documentation and technical logs as key evidence.
Significance: Confirms that integration and operational guarantees are enforceable.
📌 IV. Common Principles in IT Infrastructure Arbitration
Strict adherence to technical specifications – non-compliant hardware/software triggers liability.
SLA enforcement – delays, downtime, and failure to respond are actionable.
Documentation is decisive – FAT/SAT reports, incident logs, maintenance records.
Remedial costs are recoverable – repair, replacement, technical support, or software patching.
Security and compliance are core obligations – breaches of cybersecurity clauses increase liability.
Proportional liability may apply – integration faults may be shared between supplier and integrator.
📌 V. Practical Takeaways
Draft precise hardware, software, and network specifications with testing criteria.
Include SLAs with measurable response times, uptime guarantees, and penalties.
Allocate responsibilities clearly among supplier, integrator, and maintenance provider.
Maintain comprehensive project documentation, incident reports, and acceptance tests.
Include arbitration clauses, governing law, and arbitration seat suitable for international IT contracts.
Define remedial obligations, software upgrades, and limits on consequential losses.
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