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New international arbitration rules – UNCITRAL, SIAC, LCIA India

22 September 2010

Over the past few months, there have been important revisions to two important sets of arbitration rules – the UNCITRAL Arbitration Rules, which are very commonly used for ad hoc (or non-institutional) arbitration; and the Singapore International Arbitration Centre (SIAC) Arbitration Rules, which are the leading rules used for institutional arbitration in Singapore.  In addition, anticipating an increase in arbitrations in the sub-continent, the London Court of International Arbitration (LCIA) has recently issued a set of LCIA India Arbitration Rules

UNCITRAL Arbitration Rules

On 25 June 2010, UNCITRAL adopted a revised version of UNCITRAL Arbitration Rules.  The original Rules were adopted on 28 April 1976 and have worked well over the past 34 years.  Nevertheless, in 2006 the UNCITRAL decided to revise the 1976 Rules in order to better align them with current international arbitration practice and the updated provisions of the UNCITRAL Model Law. 

Article 2 states that the revised Rules apply to any arbitration agreements referring to the UNCITRAL Arbitration Rules concluded after 15 August 2010.  In general, the revised Rules contain more detailed provisions dealing with multiple parties and joinder, the replacement of arbitrators, interim measures, tribunal-appointed experts and the costs of arbitration.  Some important innovations include the following:

  • Articles 2 and 4 clarify the procedure for commencing an arbitration (including by email where authorised or designated) and expressly provide that a respondent must file an initial notice of response
  • Article 10 contains a new default procedure (similar to Article 10 of the ICC Arbitration Rules) for arbitrator appointment in multi-party arbitrations 
  • Article 17(1) requires the tribunal to “conduct the proceedings so as to avoid unnecessary delay and expense and to provide a fair and efficient process for resolving the parties’ dispute”; it also replaces the previous right to a “full opportunity” to present one’s case with a “reasonable opportunity
  • Article 17(5) provides that the arbitral tribunal may, at the request of any party, allow one or more third persons to be joined to the arbitration.  The third party must, however, also be a party to the same arbitration agreement
  • Article 26 contains detailed provisions – based on the 2006 amendments to the Model Law – on interim measures from an arbitral tribunal.  A party requesting an interim measure has to satisfy the arbitral tribunal, amongst other matters, that harm is likely to result if the measure is not ordered and that there is a reasonable possibility the requesting party will succeed on the merits of the claim
  • Article 28(4) authorises the use of technology, such as videoconferencing, for examining witnesses
  • the Rules no longer use the language of final, partial, interim and interlocutory awards.  Instead, tribunals are empowered to make separate awards on different issues at different times, all of which shall be final and binding (see Articles 33 and 34), and
  • tribunal remuneration and the allocation of the reasonable costs of legal representation are now addressed in more detail, which will hopefully encourage greater accountability and predictability (see Articles 40 to 42).

SIAC Arbitration Rules

Almost simultaneously, the SIAC released its fourth edition of the SIAC Arbitration Rules.  The SIAC Rules 2010 came into effect on 1 July 2010 and apply to SIAC arbitrations commenced on or after this date.  The amendments primarily aim to improve the efficiency and speed of arbitration proceedings.  Some important innovations include:

  • Schedule 1 provides a mechanism for emergency interim relief prior to the formation of an arbitral tribunal through appointment by the SIAC Chairman of an Emergency Arbitrator with the power to order or award any interim relief deemed necessary.  Unless agreed otherwise, the Emergency Arbitrator may not act as an arbitrator in any future arbitration relating to the dispute.  Any order or award issued by the Emergency Arbitrator ceases to be binding if the tribunal is not constituted within 90 days, when the tribunal makes a final award, or if the claim is withdrawn
  • Article 5 provides a framework for an expedited arbitration procedure.  This is only applicable if the amount in dispute does not exceed S$5 million, if all parties agree, or in cases of exceptional urgency.  Under the expedited procedure, the dispute is resolved by a sole arbitrator, the Registrar is empowered to shorten any applicable time limits, an award must be issued within six months, and reasons may be given in summary form, and
  • technical amendments, such as the shortened time period from 21 to 14 days to nominate an arbitrator and the removal of the requirement for a Memorandum of Issues, which aim to speed up and de-clutter the conduct of proceedings.

LCIA India Arbitration Rules

LCIA India, the first independent subsidiary of the LCIA, has also adopted new arbitration rules which have effect for arbitration proceedings commenced on or after 17 April 2010.  The LCIA India Rules are intended to adapt the general LCIA Arbitration Rules for Indian conditions.  These rules should be of interest to New Zealand exporters and investors considering doing business in India (either in connection with a future NZ-India FTA or otherwise).  Two key features include:

  • a provision addressing Indian case law: Article 32(6) expressly excludes certain provisions of Part I of the Indian Arbitration and Conciliation Act 1996 – which is directed at domestic arbitration and contains extensive court supervisory powers – when the place of arbitration is outside India.  This provision is in response to the Indian Supreme Court decision in Bhatia International v Bulk Trading SA (2002) 4 SCC 105, which held that, unless excluded by the parties, Part I would apply even to arbitrations taking place outside India, and
  • tailored costs provisions: the Rules include a costs regime which provides for a capped hourly rate for arbitrators (rather than the Indian practice in some ad hoc arbitrations of arbitrators charging expensive daily sitting fees, plus additional costs for drafting the award and other duties).  This is likely to reduce the costs of arbitrating hearings in India.