On August 11, 2020, the London Court of International Arbitration (LCIA) published an updated version of its Arbitration Rules (the “2020 Rules”). The 2020 Rules enter into effect on October 1, 2020. As the LCIA itself has noted, the revisions reflect a “light touch.” They introduce some features already existing in the rules of other leading institutions and have the potential to increase the efficiency of LCIA arbitrations.
Expedition of proceedings and preparation of the award
The LCIA has introduced further requirements on, and granted further powers to, tribunals to promote the expeditious conduct of proceedings.
The 2020 Rules now require the tribunal to contact the parties within 21 days of written notification of its formation (Article 14.3). They also expressly confirm the tribunal’s discretion to make any procedural orders it considers appropriate (Article 14.5) and provide a list of efficiency measures the tribunal may wish to consider (Article 14.6). Those measures include limiting the length and/or number of submissions, dispensing with a hearing, or making an early determination on a claim or defence (see following section). These changes will encourage tribunals to take a more active role in case management.
Further, tribunals must now “endeavour to [make their award] no later than three months” following the parties’ final submissions (Article 15.10). According to the LCIA’s figures, three months is currently the median amount of time LCIA tribunals take to render their awards. While it may not be realistic in more complex cases, the default deadline does send a strong message about what parties can reasonably expect of their tribunals. Parties and counsel will watch with interest the steps the LCIA takes to encourage compliance with this new rule.
Early determination and summary disposal
The 2020 Rules expressly enable tribunals to make an “early determination” (whether in an award or an order) that any claim or defence thereto “is manifestly outside the jurisdiction of the Arbitral Tribunal, or is inadmissible or is manifestly without merit” (Article 22.1(viii)). This brings the LCIA in line with the SIAC, SCC and HKIAC Rules, which contain similarly worded clauses (while the ICC has recently updated its practice note to confirm ICC tribunals have this power). In conferring this discretionary power, the LCIA Rules do not provide any guidance for tribunals in devising appropriate procedures for making early determinations. The SIAC Rules, by comparison, set out numerous requirements for both the applicant party and the tribunal, including a 60-day deadline to render a reasoned determination (Rule 29).
LCIA Tribunals have arguably always had the ability to make such early determinations; However, in practice such robust case management steps are generally rarely applied, not least due to the risk of subsequent challenge and the potential to lengthen proceedings where the early determination does not actually bring about an earlier final award. The LCIA’s express recognition of this power is expected to reassure and embolden tribunals to dispose promptly of clearly frivolous claims or defences. Whether tribunals actually do so will depend in large part on parties actively pressing for such measures and selecting arbitrators who will manage cases closely and might therefore be more inclined to use these processes where appropriate.
Multiparty and multicontract arbitrations
The 2020 Rules’ changes will further facilitate multiparty/multi-contract arbitrations. Parties will now have the opportunity to commence multiple proceedings, whether against the same or different respondents, by filing a single, composite Request for Arbitration (Article 1.2).
More fundamentally, the 2020 Rules have expanded the circumstances in which consolidation is possible. Previously, the tribunal or the LCIA Court could consolidate arbitrations absent the consent of all parties where the arbitrations (i) shared a single arbitration agreement or (ii) the parties in each arbitration were identical and the relevant arbitration agreements were compatible. The 2020 Rules now allow for consolidation in a third category where the arbitrations have compatible arbitration agreements and “aris[e] out of the same transaction or series of related transactions” (Articles 22.7(ii), 22.8(ii)). Alongside the SCC and SIAC Rules, the LCIA Rules now offer one of the more liberal approaches to consolidation in the market. It remains to be seen how in practice LCIA tribunals might consider and apply the tests of “same transaction” and “series of related transactions.”
Remote hearings and electronic communications
Resulting in part from the COVID-19 pandemic, the 2020 Rules now confirm that hearings may take place “virtually by conference call, videoconference[,]” or some other technology (Article 19.2). Further, the LCIA has imposed the use of email or other forms of electronic communication on parties and tribunals (Article 4.2). The Rules now even require parties to make Requests for Arbitration and Responses in electronic form (Article 4.1). Another new feature is that the LCIA Registrar can transmit awards to parties by electronic means alone if the parties do not expressly request the award in paper form (Article 26.7).
Acknowledging industry concerns about cybersecurity, the LCIA has also introduced new provisions on data protection that (i) require the tribunal to consider specific measures to protect the parties’ data (Article 30.5) and (ii) authorise both the LCIA and the tribunal to issue binding directions addressing data protection (Article 30.6).
The 2020 Rules include a new set of provisions on tribunal secretaries that reflect guidance previously provided in the LCIA’s 2017 Guidance Note to Arbitrators (Article 14A). In particular, the provisions confirm that the tribunal may not delegate its decision-making function (Article 14.8) and must seek the parties’ approval for all tasks it wishes the secretary to perform (Article 14.10), thereby ensuring that parties benefit from the experience and skillset of their arbitrators.
The 2020 Rules represent moderate but welcome additions to an already reliable set of provisions. They have the potential to promote less expensive, shorter, and more efficient arbitrations. Nonetheless, it will remain essential for parties to select suitable arbitrators who know how to make appropriate use of the powers offered to them under the Rules, as well as choosing experienced arbitration counsel who can navigate the Rules to the best effect for clients.
Sidley Austin LLPはクライアントおよびその他関係者へのサービスの一環として本情報を教育上の目的に限定して提供します。本情報をリーガルアドバイスとして解釈または依拠したり、弁護士・顧客間の関係を結ぶために使用することはできません。
弁護士広告 - ニューヨーク州弁護士会規則の遵守のための当法律事務所の本店所在地は、Sidley Austin LLP ニューヨーク：787 Seventh Avenue, New York, NY 10019 (+212 839 5300)、シカゴ：One South Dearborn, Chicago, IL 60603、(+312 853 7000)、ワシントン：1501 K Street, N.W., Washington, D.C. 20005 (+202 736 8000)です。