Our interview series on the Practical Law Arbitration blog continues with part 3 of my interview with Meg Kinnear, who since 2008, has been the Secretary General of the International Centre for Settlement of Investment Disputes (ICSID) at the World Bank.
In part 1 of the interview, Meg talked about her background and role at ICSID. In part 2, she focused on elements of ICSID procedure and in part 3 she considers changes to ICSID arbitration procedure. Finally, in part 4 Meg considers current topical issues in ICSID arbitration, such as the EU proposal for reformed ISDS provisions, transparency rules and third party funding.
Changes to ICSID arbitration procedure
What changes to ICSID procedure have you seen since you took office?
There have been numerous practice changes at ICSID since I began this job. We have spent a lot of time upgrading our internal systems, including case management, document management, and financial management systems. We have examined each step of the process and developed internal best practices and templates so that our staff use the best approach to each step of the process. We have adopted service standards and track ourselves, and this has substantially expedited the process. We have also adopted a ballot procedure before selecting arbitrators from the Panel of Arbitrators; this has been welcomed by parties and has resulted in greater diversity in the arbitrators at ICSID.
Which ones have been the most/least effective? For example, what gave rise to Rule (6)(1) of the Institution Rules which provides that the Secretary-General may refuse to register a request for arbitration only if he finds, based on information contained in the request, that the dispute is manifestly outside the jurisdiction of the Centre. Can you tell us what proportion of cases are rejected based on this provision? Has the provision been effective? That is, do you find that the inclusion of the provision adds to the overall costs and time of proceedings or has it effectively eliminated cases?
The registration provisions have long been a feature of ICSID. Article 36 (which regulates the Secretary-General’s power to register a request for arbitration) is one of the key provisions of the ICSID Convention. These provisions are intended to screen out cases that are manifestly outside the jurisdiction of the Centre so that no party is put to the cost or time of litigating a case that exceeds the jurisdiction of the Centre. Because the threshold is so high (and it was intended to be so by the drafters of the ICSID Convention), few cases are rejected as manifestly outside the jurisdiction of the Centre. However, about one or two cases a year are rejected on this basis. In addition, the Centre can ask the party filing a request to provide missing information before it decides on registration, and this ensures the necessary components of the claim are clear before the matter proceeds. The registration process takes little time (about 16 days on average in the past year), and it is a useful feature of ICSID arbitration.
Do you publish information as to average duration of an ICSID arbitration?
We do, and have done so for several years. ICSID publishes detailed information about every case on its website, including the dates on which every step is taken. As a result, all information about the average duration of a case or of a particular stage in a case is readily and publicly available. It can also be considered from the perspective of who is the counsel, who is the arbitrator, or any other number of variables. We also track cases internally by a number of factors so that we can ensure no undue delay.
What improvements do you think could be made to the arbitration process? For example, do you think there should be time limits on the production of the award?
There is no single answer to improving the process, especially from a time perspective. We have done a number of analyses in-house and the cause of delay is varied; sometimes parties take a long time to select a panel, want a long time to file a memorial, or want a stay to engage in discussions. Other times a tribunal takes a long time because the issues are difficult, the documents are numerous or the members of the tribunal are trying to reach consensus. However, there are some steps that can help, and having the tribunal and parties address these at the first opportunity is vital. For example, increasingly we are seeing parties express their expectations as to timeliness in the first procedural order, and this is a good initiative. Similarly, we see some efforts by parties or tribunals to reduce the number of documents submitted. I know from my days as counsel that it is hard to predict what documents will become material, but I also see boxes of documents that never get referred to in a case yet they are part of the record that arbitrators must consider. Addressing this would go a long way to expediting the process. Some arbitrators have had success with getting parties to create chronologies or agreed statements of fact. These kinds of initiatives are useful. Finally, a tribunal chairman who actively manages the case timetable can help ensure the matter proceeds as quickly as possible but also offers a fair process.
Should ICSID arbitrators file a statement of availability before accepting a position?
They do. Before proposing an arbitrator, ICSID asks them to advise whether they have reasonable availability in the next 18-24 months so that they can ensure an expeditious process and this is in the arbitrator’s declaration. We reaffirm the importance of expedition once the tribunal is constituted, and we speak to arbitrators as the process continues if there appears to be any undue delay. I personally speak to arbitrators where we are concerned about the time taken for a matter to proceed, and we will put extra staff on a matter if that can assist. We also have a number of practices we encourage, for example scheduling as far out as possible so dates are protected, arbitrators meeting the day before a hearing to plan the hearing, arbitrators staying the day after the hearing to deliberate and plan the award writing, and sending parties regular updates on the progress of an award during the writing phase.
Do you think there is any scope for changing the rules so that not all remaining members of the tribunal have to decide arbitrator challenges?
This rule is based on public international law practice and is enshrined in the ICSID Convention. Changing it requires unanimous approval by the member states to amend. However, it is certainly something that could be amended by the member states, and it may be an appropriate provision for them to consider in the future.
Are there any further changes in the pipeline?
We are currently translating our website to French and Spanish and further upgrading the technology behind that. We have just published a book celebrating our 50th anniversary, and we are issuing three special issues of the ICSID Review this year focussing on the role of state owned enterprises in investment, the intersection of investment law and public international law, and procedural developments in recent investment cases. We also have a number of substantive projects in the works, for example the recently published guidelines for respondents, an update of our annulment paper, and similar practice studies.