ICC Rules of Arbitration: some welcome revisions
The International Chamber of Commerce has launched its revised Rules of Arbitration, which will come into force on 1 January 2012. The new rules are the product of over two years of review and the revisions are mainly "evolutionary" in that they reflect developments in arbitration practice and procedure since 1998, when the rules were last updated.
The International Chamber of Commerce (ICC) launched its revised Rules of Arbitration in Paris on 12 September 2011 (the new rules). The new rules will come into force on 1 January 2012.
The new rules are the product of over two years of review by a 200-member Task Force on the Revision of the ICC Rules of Arbitration set up by the ICC Commission on Arbitration, a think tank of 620 arbitration experts from 90 countries.
The revisions are mainly "evolutionary" in that they reflect developments in arbitration practice and procedure since 1998, when the rules were last updated (1998 rules).
A significant feature of the new rules is the appointment of an emergency arbitrator at the request of a party to decide on urgent interim or conservatory measures before an arbitration tribunal is constituted under the ICC rules (the tribunal). The emergency arbitrator will normally be appointed within two days of a party's application. Any order made by the emergency arbitrator may, however, be subsequently modified, terminated or annulled by the tribunal.
Key provisions of the new rules relate to complex arbitrations; for example, those involving more than two parties or based on more than one contract. While these revisions mostly reflect practices already applied in ICC arbitrations, codification is to be welcomed.
Specific revisions include:
In claims involving multiple parties, any party may make claims against another party.
Claims arising out of more than one contract may be made in a single arbitration.
Any party may seek joinder of an additional party before any of the arbitrators have been appointed.
The ICC Court of Arbitration may consolidate two or more arbitrations in certain circumstances (including on the agreement of the parties), when the claims are made under the same arbitration agreement or made under different arbitration agreements but the ICC Court finds that the arbitration agreements are compatible (see box "ICC Court").
Time and costs
The new rules introduce an express duty on the tribunal and the parties to conduct the arbitration "… in an expeditious and cost-effective manner, having regard to the complexity and value of the dispute". Arbitrators may also take into account the parties' conduct when deciding on the costs of the arbitration.
This general duty is supported by a number of specific rules, including a mandatory case management conference and permitting the tribunal to adopt procedural measures to ensure effective case management, which incorporate techniques found in Appendix IV to the new rules.
The tribunal will also be required to inform the ICC Secretariat and the parties of the precise date by which it expects to submit its draft award to the ICC Court for approval.
Impartiality and independence
Arbitrators are now required to be both impartial and independent, as opposed to just independent (as was the case under the 1998 rules). Before their appointment, prospective arbitrators will have to sign a statement of acceptance setting out not just their independence, but also their availability and impartiality. The requirement to disclose availability is aimed at limiting the extent to which parties suffer delays due to the unavailability of the arbitrators.
Under the 1998 rules, when a jurisdictional challenge was raised, the ICC Court would make a prima facie decision as to whether the arbitration would proceed. By contrast, the new rules limit the ICC Court's role in jurisdictional matters to cases specifically referred to the ICC Court by the ICC's Secretary General.
The new rules empower the tribunal to make orders concerning the confidentiality of the arbitration proceedings or any other matters in connection with the arbitration, including taking measures to protect trade secrets and confidential information.
Modes of communication
The revisions bring the rules up to date with modern communication technology and reflect the ICC Secretariat's current practice of using email as a means of communication.
Administration of arbitration
The new rules provide that the ICC Court will be the only body authorised to administer arbitrations under the ICC rules. This should go some way to avoiding situations such as that seen in the Singapore Court of Appeal decision Insigma Technology Co Ltd v Alstom Technology Ltd, where the court upheld a hybrid arbitration clause providing for the administration of arbitration by the Singapore International Arbitration Centre under the ICC rules ( SGCA 24).
The changes are also aimed at making the ICC arbitral process more amenable for investment arbitration in line with the work of the Task Force on Arbitration Involving States or State Entities created by the ICC Commission in March 2009. An important change arising from the Task Force's work is a provision that the ICC Court may appoint directly as an arbitrator any person whom it considers suitable where one or more parties is a state or state entity.
Julianne Hughes-Jennett is Of Counsel, and Michael Davison is a partner, in the litigation and arbitration team at Hogan Lovells International LLP.
Arbitration and ADR Rules, http://www.iccwbo.org/uploadedFiles/Court/Arbitration/other/2012_Arbitration%20and%20ADR%20Rules%20ENGLISH.pdf.
The International Chamber of Commerce (ICC) is a global business organisation based in Paris. Its activities cover a broad spectrum, from arbitration and alternative dispute resolution, to making the case for open trade and the market economy system, business self-regulation, fighting corruption and combating commercial crime.
The ICC Court of Arbitration is arguably the leading international arbitral institution, both in terms of the volume of cases and the significance of the disputes heard. The ICC Court is, in fact, an administrative body that organises and supervises arbitrations. It may assist in the appointment of arbitrators and confirms the appointment of the tribunal. It also scrutinises any draft awards before they are finalised and released to the parties. (For more information on arbitration generally, see feature article "International arbitration: streamlining, while competition heats up", www.practicallaw.com/3-504-9617.)