A number of years ago, in the middle of a small loch, the kayak I was manning capsized, plunging me into the murky depths of muddy weeds and foul water. Ever since, because of the unique way in which my craft crashed down upon me, I have had to put up with a left shoulder that crunches when I move my arm. Suffice it to say, had I known what to expect when I set off, I would have at least hesitated. Admittedly, this lesson in preparedness came quite late in my life, but at least I do now appreciate the advisability of thinking ahead. As such, and in a similar vein, Practical Law Arbitration has been looking ahead and anticipating what arbitration-related developments are expected in 2016 and beyond.
Certain buzzwords seem to forever swarm around legal, political and business bodies. The one that has perhaps gained most traction in recent years is “transparency”. This has been just as true in the world of international arbitration. A developing theme in 2015 was the drive for more institutional transparency. To mix metaphors further, the London Court of International Arbitration (LCIA) and the International Chamber of Commerce (ICC) have taken up the gauntlet.
The LCIA published information on the cost and duration of LCIA arbitrations and the ICC announced that it will provide reasons for decisions on arbitrator challenges, if requested by the parties. The ICC also announced recently that it will publish on its website details of arbitrators sitting in ICC arbitrations from January 2016 onwards. It is safe to assume that the trend towards greater transparency will continue. Expect other institutions to follow suit.
Impact of free trade agreements on ISDS
Practical Law Arbitration will be paying close attention to the emerging details of free trade agreements being negotiated between the EU and countries such as Canada, China, Singapore, Vietnam and the USA, especially to those provisions regarding investor-state dispute settlement (ISDS).
Of particular interest, the EU-US Transatlantic Trade and Investment Partnership Agreement (TTIP) negotiations are on-going. One of the issues being debated is the form and scope of the ISDS provisions that should be included. In November last year, the European Commission formally presented its final proposal on investment protection and dispute resolution to the US for inclusion in the TTIP. Its text was based on the proposal published in September 2015, which envisaged the creation of an Investment Court System. Negotiations will continue this year, and we will keep subscribers updated.
Third party funding
Third-party funding continues to be a controversial and evolving practice in international arbitration. In 2014, the International Council for Commercial Arbitration (ICCA) and Queen Mary, University of London set up a Task Force on Third-Party Funding in International Arbitration. It established sub-committees to focus on costs and security for costs, best practices, investment arbitration and conflicts of arbitration.
In October 2015, a sub-committee of the Law Reform Commission of Hong Kong issued a consultation paper recommending the amendment of Hong Kong’s Arbitration Ordinance to provide for third party funding to be permissible in arbitrations conducted under Hong Kong law. It is anticipated that the amendments will be effected in 2016 or 2017, if approved.
In anticipation of these pending developments, Practical Law Arbitration looks forward to hosting a breakfast seminar on third party funding at Mischon de Reya on 9 March (stay tuned for a future blog update).
What else is in store?
The above are only three of the main areas to excite arbitration lawyers. You can also look forward to further institutional rule changes, issuing in a seamless transition from 2015. New arbitration rules by the Singapore International Arbitration Centre (SIAC) are expected to launch, and the process of revision of the rules of the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) continues.
We are also paying attention to upcoming changes in arbitration legislation, any clarification of the extent of the arbitration exception to the Recast Brussels Regulation, and the potential creation of a global arbitration ethics council.
Several important cases are pending before national courts. To cite one example, Russia has requested the District Court in The Hague to set aside three parallel awards granted by an arbitral tribunal at the Permanent Court of Arbitration, in which the tribunal awarded the former majority shareholders in Yukos over US$50 billion in damages. Arbitration lawyers are keeping an eye on progress.
To round things off, we will also keep you updated on the many arbitration events that are planned for 2016.
While we wait
So, a year sure to be full of developments, all of which Practical Law Arbitration will continue to monitor. Be sure to watch out for further news in our e-mail updates and maintained What to expect tracker. In the meantime, I really should make an appointment with a chiropractor.