The new Rules of the Court of Arbitration of Madrid, which came into force on 1 January 2009, have now been in force for almost six months. Although it is too soon to make a final judgment, practitioners have generally welcomed these Rules, as they represent a decisive step towards modernity and internationalisation and an attempt to become a natural venue for disputes between Latin-American and European parties.

The new rules draw primarily on the rules of UNCITRAL, the ICC and the LCIA and are based on the principle that flexibility and freedom of action of the parties must govern arbitration proceedings. In their drafting, the Court of Arbitration of Madrid received input from the Club Español del Arbitraje (Spanish Arbitration Club), which brings together leading personalities from the Ibero-American arbitration world. This effort was also assisted by the participation of arbitrators from the Court and lawyers specialising in arbitration, who were consulted on the reforms they regarded as most significant and necessary.

The rules also address certain procedural questions that had arisen as a result of the increasing complexity and internationalisation of business which had not previously been resolved by law or by other arbitration rules.

For instance, the new rules allow a claimant who disagrees with a prima facie decision of the Court rejecting jurisdiction due to the inexistence of an arbitral agreement, to ask for an arbitral tribunal to be established for the sole purpose of reviewing the decision of the Court and issue an award. If the tribunal ratifies the Court’s decision, the claimant is liable for costs.

On costs, the criterion applied by the new rules is that the decision on costs should proportionally reflect each party’s relative success or failure on the merits of the arbitration.

The rules also address the circumstances in which a third party may join, or appear at, an arbitration, provide for scrutiny of awards by the Court prior to signing by the arbitrators, and also provide for a fast track proceeding for smaller claims (under EUR 100,000).

The new rules also emphasise modern technology. They provide for communication by electronic means; and in the future the Court intends to launch an electronic platform for the integral managing of proceedings.

Since 1 January 2009, the Court of Arbitration of Madrid has received 50 new arbitration cases, to which the new rules apply. Approximately, 30% of these cases are international. Most parties have chosen to appoint arbitrators: only a small percentage have left the appointment to the Court. Similarly, parties have predominantly opted for electronic means as the normal method of communication. The Court has also received some requests for fast track arbitration, even in cases exceeding the automatic fast track limit.