REUTERS | Issei Kato

2017 facts and figures: ICC, LCIA, SIAC

In July 2018, the International Chamber of Commerce (ICC) published a full report of its dispute resolution statistics for 2017. This blog compares the trends identified in the ICC figures with those released by the London Court of International Arbitration (LCIA) and Singapore International Arbitration Centre (SIAC) earlier in 2018.

The tribunal:

Nationality

The six most frequent nationalities for appointed arbitrators remained unchanged for the ICC and SIAC, albeit there was some rearrangement within that pool. In 2017, France became the second most appointed nationality in the ICC, overtaking Switzerland and the USA (the remaining countries being the UK in first and Brazil in sixth).

In SIAC arbitrations, the most notable change was that there were fewer appointments to tribunals of Australian nationals in 2017, which fell from the third to the sixth most appointed nationality, and a rise in the appointment of United States nationals, who became the third most appointed (from fifth). Around 42% of appointments in SIAC arbitrations were Singaporean (an increase of around 10% from 2016), with the UK (second), India (fourth) and Malaysia (fifth) making up the remainder of the top six.

By contrast, the LCIA has seen more change in the nationality of arbitrators appointed. While British arbitrators still make up 60-65% of those appointed, 2017 saw a rise in the appointment of arbitrators from other western European countries. Germany, Spain and Switzerland all entered the top six in 2017, replacing Australia, Canada and France. Spain’s rise to third most appointed is notable, as it had not featured at all in the LCIA’s nationality statistics for the previous year.

Gender diversity

All of the arbitral institutions reported an increase in the number of women appointed as arbitrators. In the ICC, 16.7% of arbitrators nominated or appointed for 2017 were women; an increase of approximately 2% since 2016. Of those appointed, 45% were appointed by the court, 41% by the parties and around 14% by co-arbitrators.

Whilst the LCIA reported a higher total percentage of female arbitrator appointments, it experienced a bigger discrepancy on the origin of those appointments. One in three (33%) arbitrator appointments by the LCIA in 2017 was a woman, compared to one in six (17%) for the parties and the co-arbitrators. In total, 24% of arbitrator appointments were women, a 3% increase from 2016.

Approximately 30% of SIAC’s arbitrator appointments were women, an increase of 7% from 2016. SIAC has not, however, published the statistics as to the number of female appointments by the parties or the co-arbitrators, or the total proportion of cases which feature at least one woman on the tribunal.

Challenges

Challenges to arbitrators continue to be rare, and even more rarely upheld. In the ICC, 48 challenges were made in 2017, a decrease in 4% from 2016. The proportion of those accepted (12.5%) was the highest for at least five years.

In February 2018, the LCIA launched an arbitrator challenge database, setting out the background to challenges and a summary of relevant decisions since 2010. According to that database only three challenges were brought in 2017, all of which were rejected. Successful challenges have been made in only 0.4% of LCIA cases since 2010.

There were only two challenges to arbitrators heard by the SIAC Court of Arbitration in 2017, one of which was upheld.

The parties:

Each of the arbitral institutions publishes a list of their top users, by nationality. The courts’ most loyal users remain unchanged from 2016: 8% of all parties in the ICC were from the USA; 19% of all parties in the LCIA were from the United Kingdom, and 40% of all parties in SIAC were from Singapore.

SIAC’s figures remain fairly unchanged from 2016, although significant increases were observed in the number of parties from Switzerland and the UAE.

In two areas, the ICC and the LCIA have seen opposite trends in the nationalities of parties engaged in arbitration:

Central and South America

In the ICC, the number of cases involving a party from Latin America grew by almost 8% as Brazil became the seventh most popular nationality of parties. This was no doubt due at least in part to the ICC’s new case management team in Sao Paulo, which opened in 2017. Meanwhile, the proportion of parties in the LCIA in 2017 from central and South America almost halved.

Central and Eastern Europe

The share of parties using the LCIA and hailing from central and eastern Europe more than trebled in 2017. On the other hand, in the ICC, the overall number of parties from central and eastern Europe decreased by 14% in the same period.

The disputes:

Subject matter

For the ICC, the construction industry continues to be the industry which produces the highest proportion of referred disputes. Approximately 23% of the new cases in 2017 related to the construction industry (up from 20% in 2016), followed by the energy sector (19% of new cases, up from 13% in 2016). No other sector had a share of more than approximately 6%, which included telecoms and specialised technology, health, pharmaceuticals and cosmetics, and general trade. The most significant shift was the reduction in finance and insurance disputes, which accounted for approximately 20% of new cases in 2016, but only 6% in 2017.

Almost half of new cases in the LCIA in 2017 came from disputes arising from either the banking and finance or the energy and resources sectors (24% each, up from 21% and 23% in 2016 respectively). Around 11% of disputes concerned transportation and commodities (down from 15% in 2016). The sectors with significant change included professional services (doubled from 5 to 10% in 2017) and construction and infrastructure (halved from 15% to 7%).

SIAC also saw a fall in the proportion of its arbitrations relating to the construction and engineering sector (9% in 2017, down from 16% in 2016). Arbitrations relating to general trade overtook commercial and maritime shipping to emerge as the most popular sector for SIAC (31%) in 2017.

Amounts in dispute

Both the ICC and the LCIA have published the breakdown of pecuniary relief sought by parties in 2017. The proportion of cases in which unquantified sums were sought were more than double in the LCIA than in the ICC. Around 15% of cases in both institutions have a value of over US $50 million. The full breakdown is in the table below.

Value (US$) ICC LCIA
< 1 million 23.1% 19.9%
1 million – 5 million 23.3% 24.1%
5 million – 10 million 10.7% 6.5%
10 million – 50 million 19.9% 15.8%
50 million – 100 million 7.2% 2.5%
100 million + 8.2% 13.3%
Not Quantified 7.5% 17%

SIAC has not published a full breakdown, but has confirmed that the average value for new case filings in 2017 was US $14.47 million (the highest sum in dispute for a single administered case at US $601.03 million).

It remains to be seen whether the observable changes to arbitration in 2017 are simple annual fluctuations, or are indicative of long term trends in each or as between the three institutions.

King & Spalding Charity R. Kirby

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