In order to make its arbitration rules more efficient, flexible, and transparent, the International Court of Arbitration of the International Chamber of Commerce (ICC) has revised to its arbitration rules, which entered into force on January 1, 2021 (the "Arbitration Rules").

The ICC has been acting as an arbitral institution since 1923 and today it is considered to be the chamber with the largest international projection in the world.[1] Its rules are updated periodically, and the last modifications had been made in 2017. The new Arbitration Rules contain minor changes that have been proposed in order to adapt them to new trends in arbitration and to make the procedures more efficient and flexible.[2]

The revised rules will apply to all disputes submitted to the ICC as of January 1 of this year, unless the arbitration agreement that gives rise to the dispute expressly provides otherwise.

Inclusion of additional parties

With the inclusion of item "5", Article 7 of the Arbitration Rules now expressly provides for the possibility of submitting a request for inclusion of additional parties, even after the arbitral tribunal has been constituted. In such a case, the inclusion of new parties is subject to the new party(ies) acceptance of the arbitral tribunal and to the terms of reference already agreed upon between the original parties. The provision also establishes that it will be incumbent on the arbitral tribunal to decide on its jurisdiction over the additional party or parties and whether to include such new party or parties.

The 2017 version of the Rules (in item "1" of the same Article 7) prohibited the inclusion of additional parties after the appointment of an arbitrator, unless there was the consent of all parties. As a result, it was practically impossible to include additional parties after the arbitrator(s) had been appointed, even though, in many cases, the participation of additional party(ies) could make the process more efficient.

Consolidation of arbitral proceedings

Items "b" and "c" of Article 10 of the Arbitration Rules, which previously provided that the Court could consolidate two or more arbitrations governed by the Arbitration Rules and arising from the same arbitration agreement, have undergone minor adjustments and now provide for the possibility of consolidating arbitrations arising from separate contracts.

Disclosure of third-party funding

In view of the increasingly frequent use of third-party funding in international arbitration and the debates surrounding the duty to disclose the existence of such funding agreements, the ICC added item “7” to Article 11 of the Arbitration Rules, which establishes the obligation to disclose third parties with whom the party(ies) have entered into funding agreements.

The disclosure of the existence of a third party with an economic interest in the case is fundamental for the arbitrators to be able to evaluate potential conflicts of interest.

Appointment of the arbitral tribunal by the Court

With the inclusion of item "9" in Article 12, the Arbitration Rules now grant the Court express powers to appoint all members of the arbitral tribunal in exceptional situations, namely, whenever it is necessary “to avoid a significant risk of unequal treatment and unfairness”, without prejudice to any agreement entered into between the parties regarding the appointment of the arbitral tribunal.

This will most likely help to avoid possible challenges to arbitrators and requests for annulment of awards on the grounds of unequal treatment of the parties during the constitution of the arbitral tribunal.

Party representation

Among the measures adopted to mitigate the risks of conflicts of interest, Article 17 was also amended and the Arbitration Rules now provide that (i) the parties must report any change in their representation immediately (item "1"); and (ii) the arbitral tribunal may take any measures it deems necessary to avoid conflicts of interest arising from changes in the parties' representation and to preserve their independence and impartiality, and may even order the exclusion of new representatives retained by the parties after the constitution of the arbitral tribunal (item "2").

Virtual hearings

Item “1” of Article 26 of the Arbitration Rules, which previously only established that the arbitral tribunal had to notify the parties within a reasonable period of time of the scheduling of hearings, now expressly provides that both the parties and the arbitral tribunal may request hearings to be scheduled and that the arbitral tribunal may determine whether a designated hearing will be held in person or remotely, via videoconference, telephone, or such other means of communication as they deem appropriate.

 

Emergency arbitrator provisions

The new Arbitration Rules excluded a previously existing rule that the emergency arbitrator provisions (Appendix V of the Arbitration Rules) would not apply whenever the parties had agreed to some other pre-arbitral procedure for the granting of conservatory, interim or similar measures (former item "6", "c" of Article 29 of the 2017 Rules), thereby expanding the range of situations in which parties may resort to emergency arbitration.

Law applicable to disputes related to the Court's administration of arbitrations

Article 43 was included in the Arbitration Rules, which provides that any disputes related to the administration of arbitration proceedings by the Court under the Arbitration Rules shall be submitted to the Paris Judicial Tribunal and governed by French law.

Other relevant changes

In addition to the changes detailed above, the following changes to the Arbitration Rules are worth noting:

Arbitrations arising from treaties:

  • No arbitrator shall be of the same nationality as any of the parties to arbitrations arising from treaties (Article 13(6)); and
  • The emergency arbitrator provisions shall not apply to arbitrations arising from treaties (Article 29 (6)(c)).
  • Article 36 of the Arbitration Rules has been amended to provide that, in addition to being able to request the correction of any errors in arbitral awards, the parties may request the issuance of an additional award on any claims that the arbitral tribunal failed to address in its original award.
  • Article 5 has been included in Appendix II of the Arbitration Rules to provide that parties may request that the Court disclose the reasons behind its decisions on (i) the existence of the arbitration agreement (pursuant to Article 6, item "4”, of the Arbitration Rules); (ii) consolidation of proceedings (pursuant to Article 10); (iii) the appointment of the president of the arbitral tribunal or all arbitrators (pursuant to Article 12, items "8" and "9"); (iv) challenges against arbitrators (pursuant to Article 14); and (v) the replacement of an arbitrator at the Court's own initiative (pursuant to Article 15, item "2"). Although the new general rule is that of transparency, pursuant to item "2" of Article 5, in “exceptional circumstances”, the Court may choose not to communicate the reasons for the decisions above.
  • Article 2 of Appendix VI to the Arbitration Rules has been amended to broaden the scope of cases that are governed by the expedited procedure provisions. Now, arbitrations involving amounts of up to US$ 3 million will, as a rule, be governed by the expedited procedure provisions set out in Appendix VI, which were implemented with the intention of expediting the settlement of such disputes. Until now, the limit had been US$2 million.

Access the new ICC arbitration rules here. The comparative version of the 2017 and 2021 rules is available here.

[1]According to the ICC International Arbitration Statistics report released in July of 2020 (for the year 2019), the Court recorded 869 new cases in 2019 involving parties from 147 countries and independent territories. In December of 2019, the Court recorded its 25,000th case.

A summary of the 2020 statistics is available at: https://iccwbo.org/media-wall/news-speeches/icc-releases-2019-dispute-resolution-statistics/ [Accessed on February 1, 2021]

[2] As announced by the ICC itself in its note disclosing the new arbitration rules: https://iccwbo.org/media-wall/news-speeches/icc-unveils-revised-rules-of-arbitration/ [Accessed on February 1, 2021]