Conduct of Arbitrations at the ICC International Court of Arbitration
Chau Huy Quang / Logan Leung (Rajah & Tann LCT Lawyers)
The ICC Rules of Arbitration (2012 being the latest version) (“ICC Rules”) regulates the procedures and conduct of arbitrations brought to the ICC International Court of Arbitration (the “Court”) – from commencement to completion.
Established in 1923, the Court’s has a maintained its position as the arbitral institution with the greatest global reach. According to its website, 791 cases were filed to the Court in 2014. This global reach and popularity is shown through the fact that these 791 cases involved parties from 140 countries and independent territories and the seat of arbitration was located in 57 countries throughout the world.
In view of a globalised economy, an increasing number of states have looked to international arbitration as a dispute resolution mechanism. Vietnam is no exception, as Vietnamese enterprises have becoming increasingly interested in exploring the conduct of ICC arbitrations. This article intends to provide a concise overview of the procedures of such arbitrations.
Behind the Scenes
It is first helpful to briefly describe the administration of ICC arbitrations.
ICC arbitrations are administered by the Court, whose powers are set out under the ICC Rules. Some of the functions of the Court include fixing the place of arbitration, appointing and deciding on challenges against arbitrators, monitoring the arbitral process to ensure it is in accordance with the ICC Rules, and scrutinising awards. While the Court does not resolve the dispute, which is the role of the tribunal, it is there to assist the parties and arbitrators overcome procedural obstacles that may arise. It also assists to ensure that awards are enforceable through, among others, its award scrutiny function.
The Court’s performance of these functions is assisted by the Secretariat, which comprises over 80 lawyers and support staff, and which can communicate in approximately 25 languages. The Secretariat is divided into eight “case management teams”, and each case brought before the ICC will be assigned an appropriate team with expertise to facilitate the above functions for the parties.
Request for Arbitration
Arbitration is commenced through the claimant serving its Request for Arbitration to the ICC Secretariat under Article 4 of the ICC Rules. Upon the Secretariat’s receipt of the Request, the arbitration will be deemed to have commenced.
Payment of the arbitration filing fee, which is US$3,000 as of the date of this article, is to be accompanied with the Request.
The Request must set out certain particulars, including but not limited to the details of the parties and representatives, description of the dispute, a statement of relief sought, the arbitration agreement, arbitrator appointment, and all relevant particulars relating to the place, applicable law and language of the arbitration.
Answer to the Request
Within 30 days from the Secretariat’s receipt of the Request, the respondent is required to submit its Answer in response to the claimant’s Request (and also containing any counterclaims) in accordance with Article 5 of the ICC Rules. However, the Secretariat may grant an extension to the respondent.
Appointment of Arbitrators
The number of arbitrators is to be determined by the parties’ agreement (i.e., sole arbitrator or tribunal of three arbitrators). Under Article 12 of the ICC Rules, where both parties have not agreed upon the number of arbitrators, the Court will appoint a sole arbitrator by default, unless there is reason to warrant the appointment of three.
In the event an arbitrator(s) is unable to be appointed, the Court will appoint the arbitrator(s). This includes the appointment of the President of an arbitral tribunal in the event both parties have no mechanism for his/her appointment.
While the Court has a considerable pool of arbitrators from which to choose for appointment in the event of the above, Article 13(1) of the ICC Rules requires the Court to consider the arbitrator’s nationality, residence, relationships with the parties’ countries in which they are nationals, availability and ability prior to appointment.
For appointments of the sole arbitrator or president of an arbitral tribunal, the appointed arbitrator would not bear the same nationality as those of the parties, unless the circumstances give rise otherwise.
Terms of Reference (TOR)
Under Article 23 of the ICC Rules, after receiving the file from the Secretariat, the tribunal will draw up a document called the “Terms of Reference” (TOR) in light of the parties’ submissions within two months (unless otherwise extended by the tribunal).
The TOR is a unique creature to arbitrations adjudicated under the ICC Rules. It comprises an agreement to be signed between the parties and the arbitrator on matters including party and notice details, summary of the parties’ claims and relief sought, a list of issues to be determined (where appropriate), the seat of the arbitration and other procedural matters (where appropriate).
The TOR operates contractually for the purpose of the arbitral proceedings. Therefore, upon the signing of the TOR by the parties, no party may make any new claims that fall beyond the limits of the TOR unless the tribunal authorises otherwise upon consideration of the nature of the new claims, the stage of the arbitration and other relevant circumstances.
Conduct of the Arbitration and Case Management
For the purpose of case management and ensuring the procedures of the arbitration are set out, Article 24 of the ICC rules requires the tribunal to, after the TOR is signed, convene a “case management conference” to consult the parties on the procedure for the conduct of the arbitration. This may include discussions on matters such as (but in no way limited to) bifurcation of proceedings, length of submissions, means of communications, pre-evidentiary hearings and disclosure/discovery processes.
Regarding submissions, the ICC Rules require only the Request and the Answer from the claim and respondent respectively. However, it is common for tribunals to request for further submissions (Statement of Claim, Statement of Defence, Reply, Rejoinder, etc.), which will be raised during the case management conference.
Matters in respect of rules of evidence are also commonly agreed upon in these procedural discussions – particularly, whether rules of evidence apply or not. Parties to international disputes will commonly reach an agreement to adopt (or not adopt) standardised rules of evidence (e.g., IBA Rules of the Taking of Evidence in International Arbitration) to arrive at procedures on documentary, witness and expert evidence.
During or after the case management conference, the tribunal shall establish a procedural timetable that it intends to follow for the conduct of the arbitration. This timetable is communicated to the Court.
Further case management conferences or procedural measures may be adopted by the tribunal (after consulting the parties) to ensure effective case management.
Closing of the Proceedings and Delivery of the Award
Upon the conduct of the last hearing concerning matters to be decided in an award or the filing of the last authorised submission on such matters, the tribunal will, as soon as possible, declare the proceedings closed under Article 27 of the ICC Rules. After this declaration, no further submissions/arguments may be made and no evidence may be produced.
Under Article 30 of the ICC Rules, the final award is to be delivered within 6 months from the date the parties sign the TOR, the time to delivery of which may be extended. While the ICC Rules impose such time limit, flexibility is afforded and it is common for the tribunal to make applications for such extensions to accommodate the circumstances of the case. Accordingly, a different time may be fixed by the parties depending on the procedural timetable established (see above).
After the declaration to close the proceedings, the tribunal will inform the Secretariat of the date it expects to submit its draft award for the Court’s approval. Under ICC arbitrations, all awards are scrutinised by the Court and must be approved as to its form. In doing so, the ICC Court may suggest modifications on form, as well as draw attention to the tribunal on matters of substance. The scrutiny stage is a mechanism of ensuring that the awards delivered comply in terms of form, thereby mitigating the potential risk of them being set aside or not being recognised and enforced under New York Convention (1958).